The cell and gene therapy market: why it matters
Since the start of the decade we have seen a number of advanced therapies come to market around the globe, bringing with them new hope for patients who suffer from rare and resistant conditions. These Advanced Therapy Medicinal Products (ATMPs) comprise ground-breaking Cell and Gene Therapies (CGT) and Tissue Engineered (TE) products which are the result of decades of research and development. In the last four years there has been a noticeable push from investors, companies and regulators to bring ever more complicated products, like the CAR-T (Chimeric Antigen Receptor – T cell) therapies, to market. In this blog post we focus on how the market has evolved and what the global ATMP ecosystem looks like today.
The development of an ATMP is a complicated process involving multiple stakeholders, which is summarised in Figure 1. From the initial technology being published by an academic institution to a product being manufactured and regulated for patients, each of the players is likely to interact with every other player at some point. When trying to understand what this ecosystem looks like every perspective has to be considered: here we’re going to start with the funding.
Since the start of 2015 there has been over $36 billion of funding in the ATMP space with many biotech companies giving an IPO (Initial Public Offering) and then continuing to raise significant sums in follow-on funding. For instance, Bluebird Bio, whose ZYNTEGLO (formerly LentiGlobin) gene therapy is expected to receive European approval later this year, has raised over $3 billion since its Series B round in 2010 - with 90% of this post-IPO.
The market’s appetite for IPOs dramatically increased in 2018 with 7 ATMP companies raising an average of $200 million each (Autolus Therapeutics, AVROBIO, Magenta Therapeutics, Homology Medicines, Rubius Therapeutics, Allogene Therapeutics and Orchard Therapeutics). What’s also striking is how young these companies are: Allogene, for example, was created by a $300 million Series A in April 2018, has a single candidate in phase I trials and was just 6 months old when its IPO raised a staggering $324 million in October 2018 - the largest biotech IPO in almost a decade. The stellar valuation of Allogene is, at least in part, due to its experienced leadership team: including Arie Belldegrun and David Chang - two previous executives of Kite pharma whose Yescarta was the 2nd CAR-T to gain FDA approval after Novartis’s Kymriah.
As seen in Figure 1, the FDA’s approval of Novartis’s CAR-T therapy, Kymriah, in August 2017 sparked a flurry of M&A activity including Gilead’s acquisition of another CAR-T developer, Kite pharmaceuticals, for $12 billion, Celgene’s acquisition of Juno Therapeutics for $9 billion and Novartis’s acquisition of AveXis for $8.7 billion. Celgene has since been acquired by Bristol-Myers Squibb for a massive $74 billion and the proposed takeovers of Luxturna’s manufacturer, Spark Therapeutics, by Roche for a reported $4.3 billion and Nightstar by Biogen for $800 million indicates the desire of large players to have a presence in the CGT market.
This consistent supply of funding has enabled an explosion in the number of ATMP clinical
trials with the total number more than doubling from 486 in 2015 to 1,028 at the end of 2018 (Figure 3). Whilst the majority of these trials had been in cell therapies (CT), in Q3 2018 they were overtaken by gene therapies and gene-modified cell therapies (GT&GCT) for the first time (Figure 4). This gap seems set to widen with the CAGR (Compound Annual Growth Rate) of GT&GCT’s at 34% compared with CT’s 8%. CAR-T therapies are a particularly fast growing market with a recent report predicting a CAGR of 64% until 2022. Figure 4 also highlights the much smaller size of tissue engineering when compared with the cell and gene therapies.
The clinical trials for ATMPs also look very different from those for small molecule drugs or biologics - most notably in their size. The typical size of a small drug molecule phase II trial is in the order of 200-300 participants whilst Kymriah and Yescarta had less than 100 each. This is in part due to the small size of the target patient populations, with only around 650 treatable patients (under the age of 25) annually for r/r ALL (relapsed/refractory Acute Lymphoblastic Leukaemia), with these numbers shrinking further for rare diseases.
The low number of available patients for clinical trials coupled with the desperate need for these therapies has prompted a response from regulators. In 2016 the FDA (Food and Drug Administration) created a new designation called the RMAT (Regenerative Medicine Advanced Therapies) which is essentially an enhanced version of the Breakthrough designation but specifically for ATMPs. 25 RMAT designations have been awarded to date and they ensure more interactions with regulators (especially for discussing manufacturing), surrogate endpoints for accelerated approval and eligibility for rolling review and priority review.
Similarly, in 2016 the EMA (European Medicines Agency) introduced the PRIME (Priority Medicines) designation for therapies which treat an unmet medical need. This also grants enhanced interactions with regulators and accelerates the approval process. So far 18 ATMPs have been granted PRIME designation, including the trailblazers Kymriah, Yescarta and Luxturna - all of which are now marketed across Europe.
Whilst progress in the market and clinical trials is impressive, the critical question for ATMPs is the same as for any therapy: are they making a difference?
The short answer is yes.
Novartis’s follow-up data for the ELIANA (r/r ALL) and JULIET (r/r DLBCL (Diffuse Large B-Cell Lymphoma)) trials have shown 62% and 65% relapse-free survival after 2 years and 18 months respectively. This is not only impressive from an efficacy standpoint but more pertinently because the patients treated are those who have gone through multiple previous rounds of treatment and have otherwise very limited options. For the case of r/r ALL, Kymriah is approved for the treatment of children and young adults up to the age of 25, giving these young people hope for a future that otherwise would have been deeply uncertain.
However, the longer answer (at least for now) is that it’s complicated.
Whilst follow-up data for Yescarta has shown similarly impressive results, for both of these treatments, as with others in development, there are other factors to consider. Foremost are the non-trivial side effects, including Cytokine Release Syndrome (CRS) and Cerebral Edema (CE). There have also been several treatment-related deaths, notably 2 in the ZUMA-1 trial for Yescarta and 5 in the ROCKET trial for Juno Therapeutics’s JCAR015 CAR-T product, which led to the trial being closed.
There are also substantial challenges in the manufacturing of the products and the logistics of getting them to the patients. This is exemplified by autologous CAR-T products, which require the extraction, genetic modification, expansion and re-administration of each individual patient’s cells. This process requires transporting the cells from a hospital to a manufacturing facility and then back again, all under time pressure and with strict quality control. The complexity of these processes also generates vast quantities of data in clinical trials, with the CEO of Spark Therapeutics noting that their Biologics License Application (BLA) for Luxturna was almost 60,000 pages long with the vast majority concerning CMC (chemistry, manufacturing and control).
Last but not least are the price-tags: namely $475,000 and $373,000 for Kymriah (r/r ALL and r/r DLBCL respectively), $373,000 for Yescarta and $425,000 for Luxturna (per eye).
Yet the transformative potential of these therapeutics has motivated the industry to find solutions to these problems. Side-effects are now more effectively managed, such as by treatment with Tocilizumab for CRS. Prices are being formulated through new payment structures, with the cost of Kymriah being refunded if it doesn’t work and Bluebird Bio suggesting spreading the cost of its upcoming LentiGlobin product (which it says has an intrinsic value of $2.1 million) over 5 annual instalments contingent on the continued efficacy of the therapy.
Manufacturing still remains a significant challenge for CGTs and an area that Synthace is passionate about tackling. By working together with the developers of these therapies we are delivering greater reproducibility and higher efficiencies in manufacturing - the former minimising potential health risks and the latter lowering costs.
The power of these therapies has been demonstrated as nothing short of transformative: the challenge for the industry now is to make them safer and more affordable. Just as the ATMP ecosystem has arisen from collaboration, its success is likely dependent on it as well. Through our partnerships, we believe that we are bringing value not only to the companies that develop the products but also to the patients who lives can be changed by them.