Chimeric antigen receptor T-cell therapy (CAR-T) could change how doctors treat cancer patients; however, creating these drugs is complicated and a flurry of research and commercialization activity could create a manufacturing bottleneck for some companies. CAR-Ts rely on inactivated viruses to reengineer T-cells to find and ultimately destroy cancer cells and, unfortunately, there's a limited number of companies that can supply them. Will tight supply derail drugmakers' plans?
A flurry of activity
Gilead Sciences (GILD 2.18%) agreed to pay nearly $12 billion to acquire CAR-T drugmaker Kite Pharma in August after Kite's Yescarta demonstrated impressive efficacy and manageable safety in advanced non-Hodgkin lymphoma patients. The FDA approved Yescarta in October, but it wasn't the only CAR-T to secure an FDA green light recently. Novartis (NVS 0.65%) got the go-ahead to begin marketing Kymriah for use in pediatric acute lymphoblastic leukemia patients this year, too.
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Other researchers are advancing their own CAR-T programs through clinical trials, as well. For example, Juno Therapeutics (JUNO +0.00%), bluebird bio (BLUE +0.00%), Ziopharm Oncology (ZIOP +2.12%), Bellicum Pharmaceuticals (BLCM +0.00%), and Cellectis S.A. (CLLS +3.43%) represent only a handful of the fast-moving biotech companies working on this approach.
CAR-Ts in development at these companies are similar to each other in that each uses an inactivated virus to penetrate cells in order to deliver the genetic material necessary to supercharge a T-cell's ability to detect cancer. Gilead Sciences' Yescarta, for instance, relies on an inactivated retrovirus, while Novartis' Kymriah, Juno Therapeutics' JCAR017, and bluebird bio's bb2121 rely on inactivated lentiviral vectors to get the job done.
It's already difficult meeting demand for the inactivated viral vectors necessary for gene therapy research, but it's only going to become more difficult following the FDA's approval of Yescarta and Kymriah. The typical CAR-T clinical trial is only enrolling dozens of patients, but the addressable market for commercial-stage CAR-Ts totals in the thousands of people in the U.S. alone.
And therein lies a problem for drugmakers. To guarantee the quantities necessary for commercializing CAR-Ts, they need to either outbid one another to secure supply from third parties or build their own in-house production.
For example, Novartis locked in all the supply it needs for Kymriah back in 2014, but Novartis had to agree to pay Oxford BioMedica royalties on Kymriah's commercial sales to get the deal done.
At bluebird bio, management's nervous enough about viral vector supply that it's investing in a two-pronged approach. It's acquiring a 125,000 square foot manufacturing facility to make some of the viral vectors it needs. Additionally, it recently agreed to multi-year deals with three viral-vector manufacturing partners: Brammer Bio, Novasep, and MilliporeSigma, a division of Merck KGaA. These investments aren't going to be cheap, but they should be able to provide the viral vectors necessary for bb2121 (its multiple myeloma CAR-T), Lenti-D (its cerebral adrenoleukodystrophy gene therapy), and LentiGlobin (its beta-thalassemia and sickle cell disease gene therapy).
What's next
At the moment, CAR-Ts are being used for limited patient populations, but eventually, they could be used in tens of thousands of patients per year. Suppliers are attempting to get out in front of increasing demand by bulking up capacity, but there's no guarantee capacity will increase quickly enough. If it doesn't, companies that rely mostly on third parties for their viral vectors, including Juno Therapeutics, could face some manufacturing challenges.
Nevertheless, it might not be the right investment move to extrapolate the capacity constraints out too far. Usually, supply issues get resolved, and oftentimes companies overshoot and end up creating too much capacity. For this reason, I think it's best to focus less on manufacturing obstacles and more on efficacy and safety -- those two factors remain more important to the long-term success of these drugmakers than manufacturing worries.
