Global regenerative medicine sector on a roll, report finds

Print 16 May 2016
Peter Winter / BioWorld

The Alliance for Regenerative Medicine (ARM) has released its first quarter industry report that describes a regenerative medicine sector, which includes gene and cellular therapies, in healthy shape. Growth is evident on a number of fronts, even in the wake of the uncertain financial environment that has prevailed and depressed the capital market since the beginning of the year.

"Despite the downturn in the global financial markets, the gene and cellular therapies and regenerative medicine sector had several noteworthy financings, along with numerous positive data and regulatory developments," commented Morrie Ruffin, ARM's managing director.

According to the report, there are currently 685 regenerative medicine companies now in operation around the world. That represents a 32.5 percent increase over the 517 companies identified in ARM's 2014 annual report. (See BioWorld Insight, Jan. 20, 2015.)

In terms of regional distribution, approximately 52 percent, or 356 companies, are located in U.S. and Canada, with 191 (28 percent) in Europe and 127 (18.5 percent) in Australia and Asia.

In the U.S., 32 of the companies are publicly listed, which collectively have a market cap of approximately $12.6 billion as determined by BioWorld Snapshots. The number of public companies was reduced in February when Marlborough, Mass.-based Ocata Therapeutics Inc., previously known as Advanced Cell Technology Inc., was acquired by Astellas Pharma Inc. for $8.50 per share in cash, valuing the company at about $379 million.

BUSY PERIOD FOR DEALS

The report noted that it was a busy period for business development. Juno Therapeutics Inc., of Seattle, acquired Boston-based Abvitro Inc., giving Juno access to a single-cell sequencing platform that will augment the company's capabilities to create best-in-class engineered T cells against a broad array of cancer targets.

Abvitro's technology allows for the identification of fully human, natively paired T-cell receptors (TCRs) and chimeric antigen receptor (CAR) T binders directly from cancer patients.

Juno paid $78 million in cash and about 1.3 million in shares of its stock to acquire Abvitro.

In another acquisition, Spark Therapeutics Inc. reported it was acquiring Dublin-based Rhonova, a company with which it has collaborated for manufacturing services and clinical development. Spark paid $6 million in cash and 265,000 in shares valued at $9.15 million. (See BioWorld Today, March 8, 2016.)

Among the notable partnership deals, Durham, N.C.-based Precision Bioscience Inc., a genome-editing firm, signed a strategic alliance with Baxalta Inc., of Bannockburn, Ill. (See BioWorld Today, Feb. 26, 2016.)

Precision will deploy its Arcus technology, the backbone of which is what the firm calls the ARC Nuclease: a fully synthetic enzyme similar to a homing endonuclease, modified so that it's a better starting point for reagents. It received $105 million up front from Baxalta, with the potential for milestone payments of up to $1.6 billion, plus royalties on worldwide sales if projects pan out. Precision will be responsible for research through to phase II trials, after which Baxalta bears the exclusive rights to opt in for later-stage development and commercialization. The first program is expected to enter the clinic late next year.

Immuno-oncology technology continues to be a hot ticket item and during the period Glaxosmithkline plc (GSK) expanded the terms of its strategic collaboration and licensing agreement with Adaptimmune Therapeutics plc for a TCR engineered cancer immunotherapy program, initially targeting NY-ESO-1 and moving toward pivotal trials in synovial sarcoma. (See BioWorld Today, Feb. 3, 2016.)

The companies signed their original deal in 2014 for up to five programs, including the lead NY-ESO TCR candidate (GSK3377794), allowing GSK to opt in and take control of the NY-ESO-1 program following clinical proof of concept. (See BioWorld Today, June 2, 2014.)

Under the terms of the expanded agreement, the companies will work on accelerating the development of Adaptimmune's NY-ESO therapy into pivotal studies in synovial sarcoma and plan to conduct research in myxoid round cell liposarcoma. Additionally, the companies said they may initiate up to eight proof-of-principle studies exploring combinations with other therapies, including checkpoint inhibitors.

FUNDS FLOWING

Although the first quarter saw a slowdown in financing deals across the biopharma spectrum, a total of $1.28 billion was raised by regenerative medicines companies, including more than $200 million from three IPOs. In the first quarter of 2015, $2.8 billion was raised by companies in the sector.

Cambridge, Mass.-based genome-editing company Editas Medicine Inc. saw investor enthusiasm for its technology trump poor market conditions to raise more than $108 million from an IPO.

The company has indicated it will deploy those funds to support preclinical and clinical studies of its lead program targeting Leber congenital amaurosis type 10, or LCA10, a genetic form of progressive blindness. Editas has demonstrated that combinations of Cas9 and guide RNA pairs could restore normal messenger RNA and protein expression in cells taken from patients with a specific mutation that causes LCA10. A clinical program is expected to launch next year. (See BioWorld Today, Feb. 4, 2016.)

Following closely on the heels of the Editas IPO, gene therapy-focused Avexis Inc. successfully completed its IPO, pricing 4.75 million common shares at $20 apiece – the midpoint of its intended range – to raise $95 million. Its lead gene therapy candidate, AVXS-101, is in clinical trials for the treatment of spinal muscular atrophy type 1.

VALUE CREATION

The sector has a full product pipeline with the ARM report identifying 669 ongoing clinical trials; 70 percent of those are at the phase II and phase III stages. In terms of indication, about 40 percent of candidate products in clinical development are targeting oncology and 12 percent are targeting cardiovascular conditions.

Stephen Ward, chief operating officer at the Cell & Gene Therapy Catapult (CGTC) in London, noted in the report that "one of the key barriers to the growth of the cell and gene therapy industry is the ability to grow cells reliably and cost effectively at scale."

There has been encouraging developments in the industrialization and manufacturing components of the sector. The CGTC has, in fact, released the third annual survey of GMP cell and gene therapy manufacturing facilities in the U.K. It finds that there are 22 facilities in operation, up from 18 in 2015 and 13 in 2014. Of that increase, three are gene therapy manufacturing facilities and an additional facility is involved in cell therapy.

Among the regulatory issues with which ARM is involved, one includes work with the National Academy of Sciences, and it has provided a detailed industry perspective on the state of commercialization of somatic cell gene-editing technologies. That information, ARM noted, will be included in an upcoming consensus report to be released by the end of this year.

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