By Linda Nguyen, PhD MBA
photography by Kyle Carreon
I recently had the privilege of attending the US Biotech and Pharma Summit hosted by the Financial Times and Endpoint News. Industry leaders like Ken Keller, Dr. James Sabry and Dr. Simeon George discussed pivotal topics and trends, especially in light of the upcoming election. Here are insights from their Funding Pharma and Biotech Innovation panel, along with additional thoughts and research of my own included.
The Health of Innovation in Biopharma
Ken Keller, Chairman, President, and CEO of Daiichi Sankyo, emphasized the vibrancy of innovation in the biopharma industry, particularly in oncology. At every major oncology meeting, including the upcoming ASCO from May 31-June 4, new standards of care are introduced, showcasing the rapid advancements in the field. Keller highlighted that companies like Daiichi Sankyo face more decisions about where to invest their efforts than ever before due to the sheer volume of promising research and emerging therapeutic modalities. This abundance of options necessitates careful selection and strategic prioritization to maximize impact and return on investment.
The future belongs to the innovators because the innovators are going to unlock value for patients. – Dr. James Sabry
The Essential Role of Capital in Innovation
James Sabry, PhD, the newly retired Global Head of Pharma Partnering at Roche, underscored the importance of innovation, noting that the future belongs to those who can unlock new levels of efficacy, safety, and convenience for patients. While capital is available, it is increasingly directed towards truly innovative projects rather than “me-too” drugs. This shift ensures that only differentiated and groundbreaking therapies receive funding, driving the industry towards genuine innovation. Notably, “me-too” drugs were particularly prevalent during the 1990s and early 2000s, when pharmaceutical companies often developed drugs that were similar to existing blockbusters, offering slight variations, but competing within the same therapeutic class. This strategy has since diminished in favor of pioneering unique and transformative therapies.
Investing in High-Risk, High-Reward Projects
Simeon George, MD MBA, CEO and Managing Partner of SR One Capital Management, discussed the critical nature of investing in projects that address unmet clinical needs, whether in rare diseases, genetically driven conditions, or major therapeutic areas like oncology, autoimmune disease and neurology. Dr. George emphasized that the process of developing a successful drug involves serendipity, leadership, and courage so, “we are looking for drug hunters, entrepreneurs, founders that have a vision for how they can solve a meaningful, clinical, unmet need.” Despite the high failure rates, the potential to create impactful therapies justifies the risks involved, a sentiment Chris Viehbacher, CEO of Biogen, agrees with.
The Journey of Drug Development
Dr. George provided insight into the challenging path of drug development, noting that every successful drug has faced significant hurdles. He illustrated this with the example of Tepezza, now a treatment for thyroid eye disease, which was initially developed for cancer, but repurposed based on a new biological insight to become a blockbuster drug. This insight came from recognizing that the drug could target and inhibit the activity of the insulin-like growth factor I receptor (IGF-IR), which is implicated in the pathogenesis of thyroid eye disease. Encouraged by this potential, SR One collaborated with the original developers to found River Vision and conducted a successful Phase II study. This demonstrated the drug’s efficacy in reducing proptosis, or bulging of the eyes, in thyroid eye disease patients. Horizon Therapeutics then took on the Phase III development for $145M plus biobucks and successfully brought Tepezza to market. Horizon Therapeutics was acquired by Amgen last year for $27.8B in cash.
Strategic Partnerships and Collaborations
Ken Keller shared Daiichi Sankyo’s experience with their DXd ADC technology, which faced initial skepticism but ultimately proved transformative. The development of their DXd antibody-drug conjugate (ADC) technology began as a somewhat obscure project, initially overlooked by the company’s broader management. The DXd ADC technology combines a monoclonal antibody with a potent topoisomerase I inhibitor via a linker that releases the drug once inside cancer cells. This targeted approach aims to deliver the drug directly to the cancer cells while minimizing off target damage to healthy cells.
Recognizing the potential of their ADC technology, Daiichi Sankyo formed major partnerships with AstraZeneca (global development and commercialization deal of one ADC with multiple therapeutic areas, $1B upfront and $5B in biobucks) and Merck (codevelopment-cocommercialization of 3 drugs, $4B upfront, $1.5B in continution and up to $22B in biobucks) to accelerate clinical development and commercialization. These collaborations have been instrumental in advancing the DXd ADCs to market, allowing Daiichi Sankyo to leverage the resources and expertise of their partners to bring these innovative treatments to patients more rapidly. For example, Daiichi Sankyo and AstraZeneca’s DXd ADC, Enhertu (trastuzumab deruxtecan), has shown statistically significant and clinically meaningful efficacy in treating HER2-positive cancers and is a testament to the successful execution of their strategy. However, another of their DXd ADCs did not meet its pivotal trial’s primary endpoints in non small cell lung cancer recently.
Exploring Gene Therapy: Challenges and Opportunities
The panel also delved into the rapidly evolving field of gene therapy, which holds immense potential but also presents significant challenges (discussed earlier with Biogen CEO Chris Viehbacher). Dr. Sabry highlighted that while gene therapy offers the promise of curing genetic diseases by addressing the root cause at the DNA level, it requires a paradigm shift in how treatments are developed, regulated, and monitored. Unlike traditional drugs that are taken continuously, gene therapies are often one-time treatments that can have long-lasting effects.
Dr. George emphasized the groundbreaking potential of gene editing technologies like CRISPR. He noted that the first approval of a gene-editing therapy, Casgevy for beta thalassemia and sickle cell disease, represents just the tip of the iceberg. The success of these therapies hinges on precise delivery mechanisms and long-term monitoring to ensure safety and efficacy. Companies like CRISPR Therapeutics are leading the way by developing a pipeline of programs that extend beyond rare genetic disorders to more common diseases, including cancer and cardiovascular conditions.
However, the regulatory landscape for gene therapies is still evolving. Dr. Sabry pointed out that current regulations require extensive long-term monitoring, sometimes for decades, to track the efficacy and safety of these therapies. This is because gene therapy is akin to genetic surgery, where changes to the genome are permanent. Regulators, healthcare systems, and payers must innovate alongside the science to develop appropriate frameworks for approval, reimbursement, and patient monitoring.
Interestingly, there is increasing evidence that the durability of the effect of gene therapies is not always one and done. The patient may need more than one dose of the adeno-associated virus (AAV) containing gene therapy and they could be part of the 30-70% of the population with AAV neutralizing antibodies. Further, patients’ immune systems may mount a response to subsequent doses of gene therapy with the same AAV. Therefore, further research on both suppressing the B-cell and T-cell response and using other immune evading viral vectors like anelloviruses will be important.
Looking Ahead: Opportunities and Growth for Academia, Biotech and Pharma
Despite the challenges, the panelists expressed optimism about the future of biopharma innovation. Government funding for basic research in universities and research institutes is crucial for generating the scientific insights that fuel the biotech and pharma industries. Supporting academic research ensures a continuous pipeline of new ideas and breakthroughs. Biotech companies excel at pioneering innovative therapies, while pharma companies provide the scale and resources necessary for late-stage development and commercialization. Supporting biotech and pharma in their roles as they make advances in machine learning, digital pathology, and regenerative medicine, etc. promise to revolutionize treatment paradigms. As the industry continues to evolve, raising capital and committing to scientific innovation and strategic collaboration will be key to unlocking new therapies and improving patient outcomes.
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