Cell & Gene Therapy: High stakes and high hopes for healthcare
Now that CGT is proving its worth, the next task for pharma is working out the best ways to commercialise it
Revolutionary cell and gene therapies (CGT) delivering breakthrough treatments have begun to disrupt healthcare. The companies building these next-generation pharma technologies are introducing radically new operating models, influencing industry development and attracting large-scale media and investor attention.
However, while growing rapidly, CGT is expected to see around just $34 billion of sales in 2030, up from $4.4 billion in 2020 compared to the global industry figure of £1.27 trillion in 2020. Although there are hundreds of CGT treatments in the pipeline, the challenges have so far kept the approved treatments on the market to just a couple of dozen.
But the attention, the deal making and the high valuations in the sector underscore the unmistakable interest in their potential to treat or cure a vast range of medical conditions and to offer a better alternative to annual treatments taken over the course of a lifetime. In addition, the growing geriatric population, rising prevalence of cancer and chronic diseases, and increasing focus on using cell and gene therapy are also favouring the sector’s dynamics.
Yet while hopes are high indeed, there are multiple challenges to the commercialization of CGT.
Manufacturing, supply chain and logistics
CGTs’ high manufacturing complexity and capacity constraints compare starkly to the highly centralized bulk manufacture of traditional pharmaceuticals.
“CGTs require a manufacturing process that's very bespoke and their shelf life can be short from manufacturing to administration. This can lead to challenging supply chain logistics. Significant logistics coordination is paramount,” says Christine Strobele, Senior Director, US Launch Lead for Cx601 (darvadstrocel), Takeda. Darvadstrocel is an allogeneic stem cell therapy under investigation in the US for the treatment of complex perianal fistulas in adult patients with Crohn’s disease.
Unlike autologous treatments where cells are collected from the patient, allogeneic cells come from donors. In both cases, however, these treatments are living cells. “The supply chain process is similar to an organ transplant,” says Strobele, “because there are a lot of checks and balances that need to be in place in the supply chain to ensure smooth delivery.”
Advice from PWC is for companies to “re-evaluate their operating models and scale out rather than scale up. Decentralised manufacturing across several sites and co-location with specialised clinics to reach patients more efficiently and reduce transport-related risks are key attributes of on-demand and just-in-time supply chain networks.”
At Novartis, Kinshuk Saxena, Associate Director, Commercialization Strategy and Operations at Novartis, acknowledges that while the manufacture of CGTs has always been a challenge, things are “better” now because many CDMOs have entered the space”.
The entry of CDMOs may be a boon in particular for the innovative but cash-strapped earlier stage players in CGT. However, as consultants Deloitte warn, “this often means relinquishing full control of the manufacturing process to the CDMO with little oversight, which ties them to a third party regardless of performance”.
And as French management consultants Strammer warn, outsourcing part of the process “challenges quality control”. This has led to calls for CGT manufacturing systems “to be portable, small, and implantable in hospitals”, able to “record batch data and maintain standards, and manage patient variables”. However, even then, new safety requirements are needed such as “high aseptic handling procedures during transportation and consistent, standardized testing”.
Such challenges are spurring innovation. Swiss biotech company Lonza, for example, has automated the manufacture of cell therapies in a “cocoon” that can be used at hospital sites. This lowers costs by eliminating transportation and reducing the facilities and personnel required, while at the same time improving patient care.”
Meanwhile, some biopharma companies now building in-house facilities but, as Deloitte warns, the upfront costs are high and “there is a risk of being stuck with expensive, unused infrastructure in the event of product failure”
Pricing, reimbursement and sharing
The limitations of treating conditions with only small populations, reimbursements on high-upfront costs, the need for long-term safety and efficacy data, and difficulties finding trial patients are among the economic constraints to CGTs.
“As this space becomes more crowded, the traditional challenge of pricing and reimbursement remains,” says Novartis’ Saxena. “Insurers will increasingly require manufacturers to demonstrate curative potential and a willingness to enter risk-sharing agreements that rebalance the risk in case the therapy does not work as expected.”
Smaller size patient populations means higher costs per patient. Last summer, the average U.S. price list for five approved cell therapies, which aim to treat diseases by restoring or altering certain sets of cells, was $440,000.
For gene therapies (which aim to treat diseases by replacing, inactivating or introducing genes into cells) the stakes are even higher. The price of the Novartis spinal muscular atrophy treatment Zolgensma was $2.1 million, while its treatment for inherited retinal dystrophy Luxturna was $825,000.
As a result, Saxena says: “Individual pricing and contracting negotiations often need to be inked with specific insurers, based on a representation of the relevant patient population, which can make approvals longer and more complex.”
Commercialization, in the US at least, can be further complicated if existing codes do not describe the procedure to administer the treatment. As an example, an investigational stem cell therapy such as darvadstrocel must be administered surgically and may not be covered by existing drug administration codes.
“Therapies have unique ways in which they are administered. It is extremely important for patient care and access to have specific codes in place that reflect accurately and precisely what is happening clinically,” Strobele says.
As McKinsey points out, cash-strapped healthcare systems will find it hard to bear the high costs concentrated over a short period of time. “Moreover, because this model entails making a fixed up-front payment, the payer bears all the risk of a new therapy not working in the longer term, or of it being harmful.
“Payers and biopharmaceutical companies—in Europe and other markets—will therefore need to consider collaborating to find new, more affordable pricing mechanisms, although there is arguably greater urgency to do so in Europe given its principle of equal access.”
Options include: annuity payments contingent on the therapy’s continued efficacy; annuity payment amortized over five or ten years; part payments upfront with additional payments when certain outcomes are met; or full payment upfront with rebates if outcomes are not met.
Education and the skills gap
CGT launches being narrower in scope than conventional launches owing to small patient populations means they need to be handled with greater care, Saxena stresses.
Education of all stakeholders is vital. For one, public misconceptions around stem cell therapies need to be addressed.
When multidisciplinary teams are involved, often each with their own approaches and vested interests, education is particularly important, and more so when a rare disease is being treated within a more common disease. For physical complications, where surgery is the only option, showing the benefits of CGTs is even harder, as surgical procedures typically don't have clinical trials.
Ways to address these challenges include developing videos, more MSL (medical science liaison) education, and peer-to-peer training with surgeons involved in clinical trials. Spreading the message through respected advocacy groups is another key strategy.
“When a therapy is new or could be perceived as complex, we have to find alternate ways to reach our customers,” says Strobele. “One example is through digital means.”
A skills gap is also hindering the delivery of therapies to patients. At US life science consultants Project Farma director Phil Massey told Pharmaceutical-Technology that “demand is outstripping supply in every sort of functional area” in the CGT field, which has seen a “paradigm shift” in recent years.
Training is another factor. Following a survey of CGT leaders, Deloitte said: “Serious adverse events such as cytokine release syndrome (CRS) and neurotoxicity are possible with CGTs. This requires advanced administration protocols, additional training, and specialized clinical resources to manage patients and for short- and long-term monitoring.”
The skillsets commercial launch teams will need, Saxena says, include: very high skill levels in manufacturing/supply chain; the ability to enter complex and innovative contracting negotiations’ and source capital at short notice if required.
Lessons for and from CGT launch teams
According to Saxena, the biggest lessons come from working with targeted patient populations and customizing therapies at a patient level. “Blockbuster products which served millions of patients are becoming rarer,” he says adding that “the next generation of products will need to address smaller populations, with more difficult to treat diseases”.
Inevitably, therefore, healthcare will need to move from traditional linear systems to patient-focused, decentralised hub-and-spoke models, supported by emerging new businesses.
Looking to the future, Saxena says organizations will need teams that are “more specialized and less generic in terms of skillsets”. Crucially, across organizations, everybody will need “a market access lens” at every stage of development. “Instead of thinking of access as something commercial teams work on towards the end, it will need to be embedded in the way a product is developed and commercialized right from the outset,” Saxena says.
Conventional launches, planned at best 24 months from approval, won’t work for CGTs, say Takeda’s Strobele. Given the complexities with manufacturing and logistics, “you need to be thinking three years before launch.”
At Novartis, Saxena believes that “smaller, more targeted launches may be the norm going forward. In addition, by engaging with commercial stakeholders early in development will make it more possible “to bring to a treatment to market”.
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