American Phramaceutical Review, September/October 2015
As the biologics industry continues to grow exponentially, marked by an increase in Biologic License Applications (BLAs) submitted for approval, the focus of big pharma has begun to shift towards the need for cell therapeutic specific drug development.
The expansion of pharmacogenetics is shaping the current industry trajectory into the world of personalized medicine. Pharmacogenetics holds much promise because it not only removes the uncertainty from the drug selection process, which is the main challenge when prescribing, but also potentially offers expedited recovery time and reduces the likelihood of adverse reactions. Additionally, information regarding individual disease susceptibility, coupled with close observation relating to the condition, can allow for drugs to be introduced at a more appropriate phase–ultimately resulting in increased efficiency rates.
Big pharma companies are at the forefront of the biologics trend. To maintain relevance, they have been aggressively pushing the development of large molecule drugs by investing heavily in biotechnology. Through acquisitions, mergers, partnerships, and inlicensing–often with significantly smaller, emerging firms–pharma giants are vying for the top position within the biotherapeutics space. For instance, the recent acquisition of NPS Pharmaceuticals Inc. by Shire Plc for $5.2 bilion, provided Shire with two market approved biologics and strengthened it’s position in the lucrative rare diseases space1.
In early 2015, another noteworthy acquisition occurred between Valeant and Salix, a manufacturer of stomach disorder drugs. Instead of purchasing drugs still in the research phase, Valeant actively seeks those with a proven track record2. Also in 2015, LabCorp acquired Covance. The merging of these two entities created a ‘super diagnostic’ company, which provides capabilities as varied as clinical lab services, through to drug development. As these examples illustrate, as biologics demand increases, so do mergers and acquisitions.
Of the top 25 best-selling drugs for 2014, ten were biologics; as were seven of the top eight selling drugs3. Throughout this same year the FDA approved 20 BLAs4 and 41 Novel New Drugs, which were approved as New Molecular Entities (NMEs) under New Drug Applications (NDAs), or as new therapeutic biologics under BLAs 5. Cytotoxics and other oncology drugs constitute the bulk of these approvals. In a study by the Pharmaceutical Research and Manufacturers of America (PhRMA), biopharmaceutical companies are currently working on 836 oncology focused medicines and vaccines, all of which are either in clinical trials or under review by FDA. The total includes 123 developed for lung cancer, 82 for breast cancer, 106 for leukemia, 92 for lymphoma, 58 for brain tumors and 53 for skin cancer6.
Vaccine development is also experiencing strong growth, replacing monoclonal antibodies (MAbs), which were the norm until 2007. For example, in 2012 there were nearly 300 vaccine clinical trials in progress or being reviewed by the FDA, with 170 of these vaccines targeted at infectious diseases7. In addition to these, the number of investigational new drug applications continues to rise, with over 336 being submitted through 20148.
“Survey Says...Increased Demand for Biologics”
Integrating biologics into their pipelines is necessary for pharmaceutical companies to remain competitive. The Nice Insight Annual Pharmaceutical and Biotechnology Outsourcing Survey clearly supports this with the percentage of respondents whose business is engaged in the development of biologic-based therapeutics continuing to increase–up nine percentage points from 73% in 2014 to 82% in 2015. This is also reflected in annual R & D expenditure, with spend on biologic development slightly increasing from 57% in 20149 to 58% in 201510. This trend holds promise for CMOs who often provide biologics production and manufacturing services.
After noting the increased demand for biologics, Nice Insight specifically polled respondents on their preference for mammalian and microbial manufacturing, including their top choice of supplier. According to the 2015 study, 53% of respondents planning to outsource biomanufacturing, would engage a CMO for mammalian cell culture work. The companies most cited for mammalian cell culture contract manufacturing were: GSK Contract Manufacturing, Boehringer Ingelheim, CMC Biologics, Lonza and KBI Biopharma.
Managing Capacity Internally and Externally
Contract development and manufacturing organizations (CDMOs) and CMOs have played an increasingly crucial role in the biologics production process, as they provide the means through which the pharmaceutical companies stand to profit. However, predicting outsourcing capacity opportunities for biomanufacturing is not easy, especially since big pharma and biotech companies continue to increase their capacity based on their own product portfolios. Both CDMOs and the larger CMOs have recognized the need for investment in microbial and mammalian cell-culture capabilities. This split has created differentiated specialization, with one group focused on early phase clinical supply and the other with large-scale capacity.
Globally, there exists a shortage of companies that can provide the necessary support for the development and manufacture of biologic drugs. However, CDMO/CMO capacity for biologics has continued to increase in order to meet an increased demand. According to HighTech analyst William Downey, Big Biopharma is expected to be the key driver of contract manufacturer growth, with current outsourcing levels more than doubling from 16% to 34% over the next 5 years. In terms of revenue, this increase translates to over $4.0 billion worth of outsourced biomanufacturing by 2019. Again, the fervent demand for new, more expensive biologic drugs will be the driving force behind this significant push11.
Cell Therapy Takes Off
The global cell therapy industry continues to undergo rapid growth, with annual turnover in the billions of dollars. New product development is being driven by significant R&D expenditure from large pharma/biotechs, and cell therapy-focused biotechs. The pipeline is already well developed with over several hundred cell and gene therapy products in clinical trials. Ultimately, this will drive significant capacity needs as the pipeline matures and progresses toward commercialization.
In April 2013, when citing the work of University of California San Francisco (UCSF) researchers who had then outlined a vision of cell- based therapeutics as a ‘third pillar of medicine’, Jeff Norris of UCSF wrote: “Treating patients with cells may one day become as common as it is now to treat the sick with drugs made from engineered proteins, antibodies or smaller chemicals.” Similarly, Wendell Lim, Ph.D., director of the UCSF Center for Systems and Synthetic Biology stated: “Today, biomedical science sits on the cusp of a revolution: the use of human and microbial cells as therapeutic entities12.”
Concurrent with these statements, the California Institute for Regenerative Medicine was funding a research team developing a cell therapy to treat insulin-dependent diabetes in conjunction with ViaCyte, (a company in San Diego that focuses on improving treatment for patients with diabetes). By August 2014, an IND was accepted by the FDA to initiate Phase I-II clinical trials in patients with Type 1 diabetes13. These first-in-human (FIH) trials were to evaluate ViaCyte’s VC-01 candidate: a stem cell-derived, encapsulated cell replacement therapy. A year later, the study protocol had been approved and additional clinical protocols were under development. Investigational sites were being selected and patient enrollment was well underway.
Being Subject Matter Experts and ‘Equipment Ready’
According to the Nice Insight Annual Pharmaceutical and Biotechnology Outsourcing Survey, the percentage of respondents from traditional pharmaceutical companies whose businesses are engaged in developing biologic-based therapeutic drugs has risen significantly over the past three years from 65% in 2013 to 82% in 2015. The 2015 survey of 2,300 pharmaceutical and biotechnology executives involved with outsourcing shows that 30% of sponsors in North America and 25% in Europe outsource biomanufacturing. Of those that outsource biomanufacturing, 53% in North America and 56% in Europe will outsource mammalian cell line-based biomanufacturing; while 74% in North America and 83% in Europe will outsource microbial based manufacturing14.
To compete in the biologic therapy market, CMOs and contract research organizations (CROs) need to invest in new equipment and technology. For example, one of the key challenges associated with cell therapy is the mode in which cells are stored. Potential options, from freezing (cryopreservation), to drying (anhydrobiosis) and freeze drying (lyophilization), are complex and resource intensive. To be at the forefront of cell therapy production, CMOs have to deliver and demonstrate an effective, long-term storage method and instill confidence in their clients15.
Similarly, disposable, single-use bioprocessing technologies have also established themselves as a widely acceptable choice at the preclinical and clinical production stage, and are gaining rapid acceptance by biopharmaceutical companies worldwide as a reliable alternative at the commercial manufacturing stage. According to a BioPlan Associates 2015 report on biomanufacturing, 69% of biomanufacturers and suppliers report improvements in biomanufacturing performance at their facility over the past 12 months due to the use of disposable devices. The report also shows that more than 90% of facilities are using single-use/disposable technologies, and manufacturers and suppliers are comparing them with stainless-steel options when planning their manufacturing strategies. Single-use devices benefit CMOs in particular, with 86% reporting improvements to their productivity, compared to 66 percent of biotherapeutic developers who report improvement. Their greater advantage for CMOs is attributed to the ease-of-use and the efficiency of these systems and devices when dealing with multiple products and bioprocesses that require fast turn-around times16.
Outsourcing practices today have evolved into more of a partnership arrangement, where CMOs are engaged, in part, for their technical expertise and subject matter knowledge. When Nice Insight asked survey respondents to rank a dozen different quantifiable traits for choosing a CMO, 74% of respondents, (whose business was developing biologics), said technical expertise was very important, second only to “having a track record of success”, selected by 75%. Both qualities drive CMO engagement when it comes to biologics17.
Possessing appropriate technology is also paramount, as CMOs must demonstrate that they have every device for cell therapy manufacturing on hand, as well as analytical capabilities including flow cytometry, a purity/identity method, and all available controls.
This is in addition to facilities set up for controlled production, an exemplary regulatory track record and extremely knowledgeable staff with Ph.D.-level experience in cell therapy18. The CMOs that can position themselves with high quality products, trusted production pipeline and clear technical and subject matter expertise, will emerge as clear leaders in the cell therapy market.
References
- http://www.investopedia.com/articles/investing/022615/ranbaxy-and-sun-pharma-mega-indian-merger.asp
- http://www.wsj.com/articles/valeant-raises-salix-offer-price-1426507294
- http://cellculturedish.com/2015/03/10-biologics-on-best-selling-drugs-list-for-2014/
5.http://www.fda.gov/downloads/Drugs/DevelopmentApprovalProcess/DrugInnovation/UCM430299.pdf
- http://phrma.org/sites/default/files/pdf/oncology-report-2015.pdf
- http://www.immunizeforgood.com/vaccines/new-vaccines-on-the-horizon
- http://www.accessdata.fda.gov/scripts/fdatrack/view/track.cfm?program=cber&status=public&id=CBER-All-IND-and-IDEs-recieved-and-actions&fy=2014
- 2014 Nice Insight Pharmaceutical and Biotechnology Outsourcing Annual Survey, January 2014
- 2015 Nice Insight Pharmaceutical and Biotechnology Outsourcing Annual Survey, January 2015
- http://www.biopharma-reporter.com/Upstream-Processing/Bio-CMO-sector-to-grow-40-on-Big-Biopharma-s-burgeoning-pipelines
- Norris, J. Will Cell Therapy Become a ‘Third Pillar’ of Medicine? April 2013 https://www.ucsf.ed/news/2013/04/104816/will-cell-therapy-become-“third-pillar”-medicine
- ViaCyte company website http://viacyte.com/products/vc-01-diabetes-therapy/
- Manufacturers and CMOs Streamline Bioprocessing With Single-Use Devices: A Nice Insights Biomanufacturing Outsourcing Report, Nice Insight 2013
- http://www.ncbi.nlm.nih.gov/pubmed/21082416
- Lupis JC and Langer ES. Critical Trends Driving BioManufacturing Production Strategies. Pharma Manufacturing. June 3, 2015. Accessed at:http://www.pharmamanufacturing.com/articles/2015/trends-driving-biomanufacturing-production-strategies/
- Hammeke K. As Biologics Development Rise at Pharma Companies -- What Does it Mean for Outsourcing? BioProcess Online. February 3, 2014.http://www.bioprocessonline.com/doc/as-biologics-development-rise-at-pharma-companies-what-does-it-mean-for-outsourcing-0001
- http://worldstemcellsummit.com/files/2009_report/4-5_2009.pdf
Survey Methodology
The Nice Insight Pharmaceutical and Biotechnology Survey is deployed to outsourcing-facing pharmaceutical and biotechnology executives on an annual basis. The 2014-2015 report includes responses from 2,303 participants. The survey is comprised of 240+ questions and randomly presents ~35 questions to each respondent in order to collect baseline information with respect to customer awareness and customer perceptions of the top ~125 CMOs and ~75 CROs servicing the drug development cycle. Five levels of awareness, from “I’ve never heard of them” to “I’ve worked with them,” factor into the overall customer awareness score. The customer perception score is based on six drivers in outsourcing: Quality, Innovation, Regulatory Track Record, Affordability, Productivity, and Reliability. In addition to measuring customer awareness and perception information on specific companies, the survey collects data on general outsourcing practices and preferences as well as barriers to strategic partnerships among buyers of outsourced services.