CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

2CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

It is an exciting time to be involved in the cell and gene therapy industries. There are both opportunities and challenges around analytical testing, manufacturing, process automation, supply chain, regulations and business deals to name but a few, often still with more questions than answers.

KNect365 Life Sciences conducted one of the biggest surveys of its kind across cell and gene therapy professionals from pharma, biotechs, academia, CDMOs, service providers and regulators around the world. This final report based on 165 responses reveals unique insights into the state of the cell and gene therapy industries in 2018; the hottest potential opportunities; the biggest challenges and how industry insiders are tackling them.

To introduce the report, Dan Stanton, editor of BioProcess Insider, explores what some of the key takeaways mean for the industry.

Region

48%

39%

13%

Europe North America Other

Organization Type

Biotech & pharma

Other

32%

37%

31%

CAR-T CrazeWhen Novartis’s Kymriah (tisagenlecleucel) received the regulatory thumbs up in August 2017, US Food and Drug Administration (FDA) Commissioner Scott Gottlieb described regenerative medicines as being “no longer the stuff of science fiction.” The approval of Gilead/Kite’s Yescarta (axicabtagene ciloleucel) weeks later helped cement the safety and commercial potential of CAR-T therapies.Over 60% of respondents to the survey said chimeric antigen receptor (CAR) T cell therapies are a key pipeline focus. Such firms are likely to be buoyed by the recent spate of approvals in the CAR-T space and will be closely watching the uptake and progress of the two approved therapies as they continue developing their own products.

Autologous vs AllogeneicBut like Dendreon’s cellular immunotherapy product Provenge (sipuleucel-T) – approved to treat prostate cancer in 2010 – Kymriah and Yescarta are autologous products, made from a patient’s own cells. The cells are extracted and then engineered before being administered back into the individual. The process is costly and the end-product expensive, with added risks coming from the complex and time-critical supply chain.Therefore, it is no surprise 61% of respondents believe allogeneic – or ‘off-the-shelf’ – therapies have the bigger potential for commercial success, compared to the 39% who said autologous products will be more lucrative.With allogeneic cells, the potential patient population will be naturally larger than with personalized therapies. At the same time the ability to manufacture large batches is more in keeping with standard biotherapeutic processes. Therefore, the cost of goods will be lower and profits theoretically higher. This sits in line with the survey, where 87% of respondents said monitoring the cost of goods is either ‘very important’ or ‘extremely important.’For now Takeda – through its acquisition of Tigenix –

is alone in commercializing an allogeneic cell therapy with Alofisel (darvadstrocel) being approved to treat complex perianal fistulas in Crohn’s disease in Europe earlier this year.

Outsourcing IssuesAlmost half our respondents (48%) said they manufacture solely in-house, with another 32% saying they make their products both internally and using contract manufacturers.As with other complex biotherapeutics, firms, where possible, prefer to manufacture in-house to ensure control and compliance of their bioprocesses. Kymriah is made by Novartis from its facility in Morris Plains, New Jersey acquired from Dendreon in 2012, while Yescarta is made at a custom-built plant in El Segundo, California.But another key factor could be the relative lack of outsourcing facilities with the expertise to make these newer and often unproven products.“Manufacturing capabilities needed for autologous cell therapies are not yet common, and most CMOs are not yet competent,” according to Fiona Barry, associate editor of PharmSource.She added her firm’s research found there are only around 30 companies involved in contract manufacturing autologous cell and tissue therapies.Demand for cell and gene therapy services has, however, driven several major investments by contract manufacturing organizations (CMOs) over the past year, with Lonza, Brammer Bio, VGXI, Fujifilm, and Paragon Bioservices all announcing new capabilities in the space.Dan Stanton is editor of BioProcess Insider, a new digital news platform from the biopharmaceutical industry’s leading B2B information platform BioProcess International (BPI) launching in June 2018. The site brings you the latest financial and business news impacting the research, development, and manufacturing of biologics directly to your inbox.To learn more, visit www.BioProcessInsider.com or contact: dan.stanton@KNect365.com

CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

CRO, CDMO, ServiceProvider, Consultant

3CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

THERAPY FOCUS AREAS

Company cell and gene therapies focus areas

What phase(s) are your cell or gene therapy clinical trials currently in?

What type of products are your company currently focusing on/are in your pipeline?

Oncology 62%

Rare diseases 29%

Autoimmune disorders 24%

Cardiovascular 24%

Musculoskeletal 19%

Diabetes 19%

Ocular disease 18%

Parkinson’s disease 8%

Alzheimer’s 8%

ALS 7%

Other 27%

Phase IV

Phase III

Phase II

Phase I

Not currently in trials/ Not applicable

0% 10% 20% 30% 40% 50% 60%

8%

19%

29%

36%

55%

Other VST TIL NK cells Dendritic TCRs CAR-T

60%

50%

40%

30%

20%

10%

0% 33% 5% 12% 16% 17% 18% 50%

4CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

ALLOGENEIC VS AUTOLOGOUS: WHICH HAS THE BIGGER POTENTIAL FOR COMMERCIAL SUCCESS?

Which has the bigger potential for commercial success?

61%39%

Autologous therapies Allogeneic therapies

Autologous therapies Allogeneic therapies

67%55%

45%33%

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%Europe North America

5CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

ANALYTICAL TESTING AND MONITORING

On a scale of 1-10 how important a role do analytics currently play in your company’s cell therapy manufacturing?

1%1% 1% 1% 9% 4% 15% 19% 12% 35%1 - not at all important

2 3 4 5 6 7 8 9 10 - critical

Average

8.05

50%

45%

40%

35%

30%

25%

20%

15%

10%

5%

0%

On a scale of 1-10 how highly do you think companies should prioritize analytics in their processes?

0% 0%1% 1% 2% 2% 15% 28% 12% 39%1 - not at all important

2 3 4 5 6 7 8 9 10 - critical

Average

8.57

50%

45%

40%

35%

30%

25%

20%

15%

10%

5%

0%

6CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

ANALYTICAL TESTING AND MONITORING

In which ways do you currently monitor your processes? (multi-pick)

8%Other

29%Single-use

sensors

34%QbD

37%PAT tools

(Process Analytical Technologies)

52%Molecular methods

74%Product profile/characteristic

testing

80%

70%

60%

50%

40%

30%

20%

10%

0%

Other• Our Innovative System for ATMP

production with continuous data recording of all parameters with detail QA/QC at the end for release

• Cytometry

• Cell based assays

• Validation and Qualification

• Information gained from users

• Functional testing

• Internal Process Controls

• Biological activity

• Flow analysis

7CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

MANUFACTURING

How important is it that your company monitors Cost of Goods?

Does your company manufacture internally or externally (through a CDMO partner)?

Replied “Very Important”

or “Extremely Important”

87%48%

32%

20%

Internally Externally Both

What considerations are most important when considering your CDMO? (multi-pick)

2%Other

7%Centralised

manufacturing

10%Local

manufacturing

13%Regional

manufacturing

25%Limitations of building

your ccapabilities

in house

37%Ability for

customization to your process by the CDMO vs enterprise

solutions

49%Considerations for autologous, allogeneic and gene therapy

products

58%Tech transfer

of processes to new facilities

68%Capabilities

80%

70%

60%

50%

40%

30%

20%

10%

0%

8CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

MANUFACTURING

What considerations are most important when choosing raw materials?(Ranked 1 - 7, where 1 is most important)

At what stage in the process should the decision be made to outsource or manufacture internally?

Average phase decision by organization type

Biotech and Pharma

CRO, CDMO, Service Provider, Consultancy

2.04

1.66

Average Postion Biotech and Pharma CRO, CDMO, Service Provider, Consultancy

Regulatory requirements 2.4 2.6 2.4

Elimination of variations 3.4 3.4 3.5

Assessment of origin and impurity profiles 3.5 3.6 3.4

Analytical testing 3.8 4.0 3.7

Insuring supply chain for large-scale commercial manufacturing 4.2 3.5 3.7

Supplier agreements 4.9 4.9 4.9

Customised raw materials 5.8 5.9 5.8

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Phase IV

Phase III

Phase II

Phase I

8%

13%

36%

43%

9CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

REGULATIONS

If you could ask your regulatory authority one question anonymously, what would it be? Most popular words

What impact have regulatory agencies had on your company’s success in the field?

By region

2%

7%

26%

39%

27%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Major Negative ModeratelyNegative

Neutral ModeratelyPositive

Major Positive

Average

3.83

3.72Europe

3.92N America

10CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

PROCESS AUTOMATION AND CLOSED SYSTEMS

To what extent is your company currently automating its processes? What are the limitations of your current automation strategies?

13%Not at all

30%Slightly

29%50/50

20%Mostly

9%Completely

Average

2.80

40%

35%

30%

25%

20%

15%

10%

5%

0%

On a scale of 1-10 please rate the importance of closed systems and scalability?

Average

8.53

0% 0%1% 1% 3% 5% 13% 24% 16% 38%1 - not at all important

2 3 4 5 6 7 8 9 10 - critical

45%

40%

35%

30%

25%

20%

15%

10%

5%

0%

11CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

LOGISTICS, SUPPLY CHAIN, AND CRYOPRESERVATION TECHNIQUES

Where are the biggest gaps in logistics, supply chain, and cryopreservation techniques? (Multi-pick)

3%Other

19%Injection

technologies/Administration technologies

22%Product

distribution

28%Thawing

technologies

46%Global

supply chain strategies

(including raw materials)

58%Forward

thinking and preparations for

commercialisation

70%

60%

50%

40%

30%

20%

10%

0%

Where do you think the biggest gaps in logistics, supply chain, and cryopreservation techniques lie? (multi-pick) (By Organization Type)

Other Injection technologies/Administration technologies

Product distribution

Thawing technologies

Global supply chain

strategies (including raw

materials)

Forward thinking and

preparations for commercialisation

80%

70%

60%

50%

40%

30%

20%

10%

0% Biotech and Pharma CRO, CDMO, Service Provider, Consultancy

12CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

LOGISTICS, SUPPLY CHAIN, AND CRYOPRESERVATION TECHNIQUES

What is the most important consideration in vein-to-vein supply chain and transportation?

Other• Control of, standardisation

of, processes at clinical site

• Prohibitive COGS

• Logistics and timing in the characterization and release as well as manufacture.

• Control of starting materials, ie. from the vein

• Chain of custody

• How to manage patient variability of starting material

• Training of local personnel in thawing/infusing

Other

5%System used to

track shipments

10%Current systems

used for transport/cryogenically

freezing

17%Preparing samples for use

17%Alleviating

bottlenecks

18%Logistics of the

transfer from manufacture to

patient

33%

35%

30%

25%

20%

15%

10%

5%

0%

13CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

LOOKING TO THE FUTURE

Where do you think the next major technological advance will be in cell and gene therapies?

1%

3%

8%9%

25%

27%27%

0%

5%

10%

15%

20%

25%

30%

Other

Supply

chain

/cryop

reservatio

n

Delivery

to the pati

ent

Analytic

s

Manufa

cturin

g techn

ologies

Cell/ge

ne en

gineeri

ng

Automation/cl

osed syste

ms

Manufacturing technologies to be next major advance

22%Europe

29%N America

Cell/gene engineering to be

next major advance

30% 23%Europe N America

Manufacturing technologies to be next major advance

17%Biotech and

Pharma

25%CRO, CDMO,

Service Provider, Consultancy

Analytics to be next major advance

13%Biotech and

Pharma

4%CRO, CDMO,

Service Provider, Consultancy

14CELL AND GENE THERAPIES 2018: STATE OF THE INDUSTRY REPORT

LOOKING TO THE FUTURE

In the next two years how likely is it that your company will submit a marketing application for a product currently in your pipeline?

In the next two years how likely is it that your company will submit a marketing application for a product currently in your pipeline?

13%

17%

26%27%

18%

0%

5%

10%

15%

20%

25%

30%

Very unlikely Unlikely Neutral Likely Very likely

Average

3.19

3.22Europe

3.09N America

By Region

3.22 3.09