Mehta Analysis: The Promise Of 2021

Executive Summary

Next year promises a wide range of opportunities for biopharma, triggered by an all-in commitment by every company with something to combat – COVID-19.

Between January and early April 2020, over 80 COVID-19-focused programs entered the clinic, seven of which are vaccines. Such advances would normally take 5-10 times longer. Here we focus on two exciting and complementary opportunities. The first is the chance to help society gain a realistic understanding of how an R&D-anchored drug reaches their medicine cabinet, and the second is the chance to ensure that every patient has access to these products, thanks to the maturation of the tools of R&D.

The potential recalibration of the biopharma operating model is helping society to see the value proposition of biopharma innovations. These are early days, and biopharma managers and investors are still searching for a happy middle ground, as evidenced by share prices rises even as companies indicate a shift to a non-profit model for their COVID-19 programs.

Shining A Light On R&D

Perhaps most transformative is the opportunity for biopharma to help society gain a realistic understanding of how a drug is developed and marketed. COVID-19 has squarely put patients in charge of their health care, not least because their health care needs must be met remotely while they remain in isolation. It is to be hoped that this shift will be permanent. Every citizen should now recognize that any path back to normalcy travels through new drug discovery and development.

All stakeholders are united in the urgency to get useful therapies to COVID-19 patients and health care providers. This unanimity includes a willingness for prudent compromise to balance timeliness on the one hand and safety and efficacy on the other.

The mushrooming of the COVID-19 pipeline has engaged every one of us at a visceral level. Every new product initiative is played out from infancy in real-time. Therein lies the opportunity. The collective story of the innovation journey will become a gripping documentary of how a product reaches the patient, providing an archive that will serve the society and biopharma interests alike.

RisksManagers at companies doing the R&D need to sponsor such accessible sharing. Johnson & Johnson has just announced a weekly video blog with such an objective. It may well prove effective, but imagine the impact of the wider story unfolding across a consortium of innovative companies. All that this consortium would need is a respected academician supported by a skilled story teller to bring such life-saving work alive for the audience held captive by varying degrees of lock-down.

Governments and regulators are streamlining and mostly loosening the requirements for repurposing products approved for viral and inflammatory illnesses, as well as facilitating speedier initiation of clinical studies for new molecules. At the same time, 20 major regulatory bodies have reassuringly affirmed that controlled, multi-arm safety and efficacy studies will be required in the final stages of development so as not to compromise public health.

Risks

Therein lies a risk that leaders of biopharma companies need to manage. Most experts project that a new vaccine and/or therapy will take at least 18 months to be approved, although successfully repurposed drugs may take less time. Several hundred products could compete for patients to test on, and we know the delays that immuno-oncology companies have suffered under such competitive circumstances. Gilead Sciences has already had to delay its study recruitment after launching and subsequently expanding COVID-19 studies.

The public is likely to ignore the ‘at least’ part of the ‘at least 18 months’ projection, and remember the 18 months benchmark, bringing an expectation that in the middle of 2021 we will be able to fully return to our ‘normal’ lives. Therefore, those telling the story must actively manage expectations around timelines.

Highlighting Why Innovation Matters

The opportunity to have society appreciate biopharma’s R&D work is not to be missed. However, this much-needed global educational blitz should center on the fruitfulness of life science innovation, especially when combined with the power of IT. And adding to that is the exploding number of digital tools that are already changing the nature of health care systems globally as we adapt to social distancing.

Most countries have been caught flat-footed with few effective tests while the spread of virus escalates. Nevertheless, diagnostics technology was already evolving at a fundamental level and a number of innovative diagnostic solutions for the current crisis are being developed. CRISPR-based non-thermocycling probes promise to deliver rapid point-of-care virus detection, improving upon RT-PCR testing. Many such initiatives are being tested, and three have been granted emergency use authorization by the FDA as of mid-April. For those already infected, antibody testing often yields variable results. A new generation of serologic testing include bioelectronic nano-sensors that detect viral protein presence with voltage change, and miniaturized flow cytometers, to cite just two promising initiatives.

Even before one is infected, a vaccine can protect, and the initiatives here are wide-ranging. Few have been clinically tested, let alone marketed. mRNA and DNA based vaccines are likely to take at least 18 months to demonstrate their approvability, but safety could be established more quickly if the size of the mRNA needed to bind to the selected target could be relatively small.  Their promise for COVID-19 and other future infectious diseases is such that enormous investments are justified to advance these potential breakthroughs as soon as possible. Moderna’s mRNA-1273 in collaboration with NIH-NIAID for COVID-19 got a $483m BARDA award to accelerate clinical studies as well as manufacturing scale-up. J&J and BARDA have committed at least $1bn to COVID-19 vaccine and drug discovery efforts in a wide range of collaborations. NIH has entered into collaborations with 15 other companies to hasten the progress of the vaccine and therapeutic pipeline.

The therapeutics pipeline is simply exploding with nearly 300 programs at various stages – and over 80 already in the clinic. The range of new approaches is dizzying, including the following innovations with potential to speed up our treatment options for this and future such challenges. Vir Biotechnology is deploying a multi-pronged approach, anchored around its platform that has mapped all the conserved strains of flu since the 1918 pandemic, yielding only a few cross-reactive antigens that lead to both a seasonal vaccine, as well as off-the-shelf products for a future pandemic. Integrating its partner Alnylam’s RNAi offers long duration of action. Adaptive Bio deploys a platform to find a handful of best neutralizing antibodies from among many thousands in a patient that can be engineered for optimal yield in manufacturing. And these are just two of several dozen innovations being studied. In addition, some of the more common pathways are also being pursued, with both novel molecules and well-established drugs working on ACE-inhibition, DPP-4 activation, RNA-polymerase, anti GM-CSF, BTK inhibition, protease inhibition, and many others.

Repurposing approved therapies removes the safety concerns, and hence these are likely to be among the first to reach COVID-19 patients and healthcare providers. Rochehas accepted a $25m backing from BARDA to accelerate Actemra (tocilizumab) studies for COVID-19. This may set the stage for Roche to follow J&J’s lead to create a not-for-profit model to ensure rapid access should it prove effective. Moderna’s mRNA vaccine is also likely to follow such a model with its NIH-NIAID collaboration and nearly half a billion dollars of BARDA support.

Ensuring Patient Access

We know that the cost of actual manufacture of most of the marketed molecules under investigation for repurposing is tiny compared to their list price. The resulting dilemma will require some give and take from all stakeholders, but biopharma companies leading these development plans have committed to getting these products to the market at the earliest, without profits as the key driver. Developed countries have applauded the non-profit model being embraced by biopharma, as that will ensure eligible patients in those countries would be treated. The developing countries, conversely, would find a J&J vaccine prohibitively expensive even at $10 if they are to treat every eligible citizen. Enter the government agencies and NGOs, such as the Bill & Melinda Gates Foundation, which will need to help fill this gap.

In contrast to the full decade that was required to turn HIV into a chronic disease, the relative maturity of life sciences today offers a running start to conquer COVID-19. The resulting vaccines and therapies over the next several years promise to lay a foundation for society to be better prepared with respect to sensitive diagnostics, vaccines and therapies for future pandemics – and biopharma is providing the tools to reopen society with confidence.

Imagine the transformation of the biopharma image in the wake of such a fundamental contribution to helping every citizen regain their lives, especially if this journey has been persuasively shared in real time. This opportunity is greatly enhanced as most biopharma leaders explicitly note how profits are the last factor, and many are joining the non-profit commitment so as to make it possible for the governments and other agencies to get these lifesaving products around the globe.

These pronouncements point to a different model from business as usual to win over COVID-19, but it leaves biopharma vulnerable: its investors are expecting mega sales from these products and this expectation has already driven many companies’ share prices to new highs. This conundrum will need to be sorted out over the coming months if this transformative opportunity to recast biopharma in a totally different, far more positive light in the eyes of the society is to be successfully achieved.

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