Next-Generation CAR-T : The Race to Win the Future of Immuno-Oncology
Novel gene editing technologies and lean manufacturing processes could unleash the potential of CAR-T in both blood and solid tumors, but with hundreds of potential drugs in development, who wins?
Fundamentally, the advent of CAR-T signaled a paradigm shift in drug development from molecules and biologics to living cells.
While biochemists have spent thousands of hours optimizing small molecule chemotherapies over the last century, today’s molecular biologists are meticulously tweaking the genetic code of living immune cells to maximize their therapeutic potential and miminize their toxicity in the fight against cancer.
In this analysis, I cover:
- A brief overview on the history of CAR-T.
- The current FDA-approved therapies on the market and the drug candidates not far behind.
- The technologies that both biotech startups and big pharma are using to build next-generation adoptive cell therapies.
- Predictions for which assets will be valuable in the next couple years.
- Distinct market strategies that companies are betting on based on their pipelines, capex spend, and clinical trial results.
Note: This is not meant to serve as investment advice or an all-inclusive list of CAR-T players, but rather a helpful guide to get up to speed with many of the companies and technology strategies in the CAR-T space.
TABLE OF CONTENTS:
- CAR-T Overview
- CAR-T Market Landscape
- CAR-T 2.0: Synthetic Biology
- CAR-T 3.0: Allogenic CAR-T
- CAR-T 4.0: In-situ Reprogramming
- CAR-T 5.0: CAR-T-on-a-Chip
- Brief Reading List
We all have cancer cells.
For most of us, our immune system, in particular T cells, identify individual tumor cells in our bodies early and destroy them before the cancer has the chance to grow, spread, and escape our body’s natural defenses. People fall sick when those cancer cells evade the immune system or grow too fast for our body’s defenses to bear.
Imagine finely tuning the body’s immune system to target exactly those cancer cells that escaped and supercharge T cells to destroy tumors on contact.
In 2011, Dr. Carl June and his research team at the University of Pennsylvania engineered and showed results of T cells that did just that–called chimeric antigen receptor T cells (CAR-T). High response rates and durable remissions since that initial study have excited scientists about the potential of CAR-T and similar cell-based therapies for treating cancer.
How does it work?
The treatment process begins by removing a patient’s T cells in a process similar to blood donation, separating the immune cells from blood plasma, and then reprogramming their DNA in a lab using a harmless lentivirus vector, a virus that transfers a new gene of interest into each T cell. In this case, the gene of interest is a protein called a chimeric antigen receptor (CAR), which is expressed on the surface of each T cell and targets the protein CD19, found on the surface of tumor cells associated with chronic lymphocytic leukemia (CLL) and acute lymphocytic leukemia (ALL), two blood cancers. The cells are then grown up to a count of hundreds of millions to be infused back into the patient.
Once these reprogrammed T cells are in the body, they multiply and attack tumor cells. In addition to identifying tumors, the CAR also supercharges T cells. It includes a signaling domain that promotes rapid self-growth without the need for complementary immune cells or extracellular signals.
- Cytokine release syndrome (CRS): It’s no surprise that infusing supercharged T cells to the body can cause the body’s immune response to go into overdrive. CAR-T patients often develop cytokine release syndrome, a condition that occurs as T cells secrete enormous levels of cytokines. This can cause severe fever, nausea, fatigue, difficulty breathing, low blood pressure, and organ swelling. Current treatments to tamp down cytokine storms are relatively rudimentary, including steroids and other anti-inflammatory drugs
- Neurotoxicity: CAR-T patients often experience hallucinations, memory loss, and cerebral edema, which has proven deadly in clinical trials. The cause of swelling in relation to the treatment is still unknown.
Since Penn’s study in 2011, two CAR-T treatments have been approved by the Food and Drug Administration (as of 4/23/18):
- Yescarta (Kite Pharma, acquired by Gilead): used to treat adult patients with diffuse large B-cell lymphoma (DLBCL), the most common type of non-Hodgkin lymphoma, primary mediastinal large B-cell lymphoma (PMBCL), high-grade B-cell lymphoma, and transformed follicular lymphoma (TFL). Price tag: $373,000 per patient.
- Kymriah (Novartis): used to treat relapsed acute lymphoblastic leukemia (ALL) in children and young adults treat children and young adults. Price tag: $475,000 per patient.
Gilead has hit a snag with CMS reimbursement. The company will have to come to terms with how to sell Yescarta with a price that could reach as much as $1M per patient for total inpatient costs, limiting the total number of patients that can afford treatment. Every day it takes for CMS to make Yescarta more affordable for patients is another day that Gilead can’t capitalize on its current first-mover monopoly in DLBCL.
Similarly, Novartis has put up weak sales numbers with Kymriah this quarter, racking up just $12M of an expected $159M they were expected to bring in this year. Both the scarcity of ALL patients that are eligible for their therapy and the complexity of immune cell harvesting has limited their market reach.
Novartis is currently seeking FDA approval to expand it’s CAR-T label to include treatment of DLBCL patients — 10x the prevalence of ALL — and is expected to get it, which would pit Novartis and Gilead in direct competition for patients. That being said, both the science behind CAR-T and the drawbacks of current treatments make it clear that we have a long way to go, opening up the door for competitors like Juno Therapeutics and Bluebird Biosciences, each with their own CAR-T therapies knocking on the door.
The size and speed of investment in engineered T cell therapy R&D both underscores the potential of the treatment modality and highlights problems companies will face in clinical trial recruitment and design, generalizability, and post-approval pricing. As of December 2017, the Cancer Research Institute reported 99 T cell targeted immunomodulators in clinical development and 199 in preclinical development.
The biggest challenges for next-generation CAR-T development will be:
- Safety: decreasing cytokine release syndrome and neurotoxicity in patients.
- Proving efficacy in solid tumors: If CAR-T is limited to a few targets and blood cancers alone, there isn’t much room for biotech startups to compete against the pipelines of big pharma.
Bonus points will go to companies that can lower production costs and improve turnaround time from blood draw to infusion without sacrificing quality.
In the aftermath of AACR 2018, below is an overview of opportunities for next-generation CAR-T development and the work of notable companies and scientists in each space:
First-Gen Companies Hot on the Heels of Novartis and Gilead
Juno Therapeutics ($CELG): Acquired by Celgene in January, Juno’s results at ASH 2017 (below) could give their lead asset JCAR017 a case for best-in-class therapy for Non Hodgkin Lymphoma given the much lower CRS numbers relative to Novartis and Gilead. Two caveats to this are 1) the smaller sample size for Juno’s trial relative to their competitors and 2) the drop in Compete Response from 3 months to 6 months in Juno’s trials, raising questions about the durability of treatment. Juno is betting that their extraordinarily low CRS rates will allow for outpatient administration and monitoring of CAR-T, increasing their attractiveness to patients and total addressable market. Juno also has a broad portfolio of Phase 1/2 assets across both blood and solid tumors, many of which will have results later this year.
Bluebird Biosciences ($BLUE): Bluebird’s make or break play in 2018 will depend on the market’s response to CAR-T efficacy vs. side effect profile for their bb-2121 and bb-21217 multiple myeloma trials — they’re taking the opposite bet of Juno. Results reported at ASH 2017 for their CRB-401 trial showed a 56% complete response rate and a 94% overall response rate in multiple myeloma patients. However, safety in the n=21 trial was a big problem. 71% of patients had CRS and 24% showed signs of neurotoxicity. Assuming no change in product toxicity, if Bluebird can prove that there’s a strong enough market for their therapeutics to be exclusively administered in major cancer and transplant centers that can manage CRS and neurotoxicity for inpatients, they’ll do well (32 capable sites in the U.S. as of the end of 2017). Given the company’s diverse assets in gene therapy, CAR-T partnership with Celgene, and strong cash position, I wouldn’t be surprised to see Bluebird end up as a hot acquisition target this year.
CAR-T 2.0: Synthetic Biology
Bellicum Pharmaceuticals ($BLCM): Bellicum is designing two switches in their Phase 1 GoCAR-T products for pancreatic cancer (BPX-601) to help control patient responses to T cell deployment in situ. The first is a suicide switch that activates caspases in the T cell, causing it to die. The second is an inducible MyD88/CD40 activation switch, which controls how fast the cells proliferate in the body and attack solid tumors. Pancreatic cancer is a relatively open market, giving the company a lot of room to bring value to a potential Big Pharma partner. That being said, they’ve had trouble with cash flow and just proposed another public offering on April 17th to keep the lights on.
Ziopharm Oncology (partnered with Intrexon ($XON)): Ziopharm is building cellular switches similar to Bellicum, but with a critical distinction. The engineered cells are activated via the drug veledimex, and need continued dosing of the drug to remain active. Halting administration of veledimex shuts off the T cells, but doesn’t cause them to die, meaning they can be reactivated later and, in theory, controlled like a traditionally titrated therapeutic.
Autolos: London-based Autolos is building a fast-acting and permanent off switch in their CAR-T products for both hematological and solid tumors. Their AUTO2 and AUTO4 assets incorporate RQR8, a permanent off switch activated by rituximab. Their next step is replacing rituximab, an antibody, with a small molecule to improve tissue penetration and response time. The small molecule mechanism functions via the addition of Caspase 9 (rapaCasp9) into the engineered T cells, which are them shut off by rapamycin. Autolus filed for a Nasdaq IPO in March after launching three Phase 1/2 trials of its CAR-T products.
F1 Oncology (partnered with BioAtla): F1 is employing BioAtla’s Conditionally Active Biologics (CAB) technology,initially designed for BioAtla’s biologics, for its CAR-T assets. The CAB technology activates or inactivate drugs under specific physiological conditions defined by cellular metabolites, in this case being the tumor microenvironment (TME). The two companies received approval for a clinical trial in China for two CAB-CAR-T product candidates targeting Axl and Ror2 for the treatment of recurrent/refractory metastatic renal cell carcinoma, a solid tumor, in January.
Tmunity: founded by Carl June, pioneer of CAR-T, and Usman Azam, former head of the Cell & Gene Therapies unit at Novartis, Tmunity is working on a CAR-T product for prostate cancer and the first CRISPR-edited TCR cell therapy in the U.S. Like those before it, Tmunity is building cellular switches to control T cell activation and direction in vivo.Tmunity is following in Kite’s footsteps and investing a good chunk of its $135M in Series A funding into building a lean, bottom-up manufacturing operation. Along with public statements by executives, research the company has funded tells us that they’re betting that a highly capital efficient CAR-T production process will give them a long-term edge.
Synthetic Gene Circuits
Cell Design Labs (Acquired by Gilead): This acquisition is one I’m very excited about, and a potential reason why Gilead could develop long-term market leadership in the CAR-T space. Cell Design Labs, founded by UCSF scientist and synthetic immunology pioneer Wendell Lim, applied synthetic biology principles to next-generation CAR-T development. In a nutshell, the company was building a toolkit of modular genetic ‘parts’ to fine-tune CAR-T behavior in different tumor microenvironments, two of which are worth noting here:
- The synthetic Notch (SynNotch) receptor: gave scientists the ability to engineer cells with finely tunable sensing and response behaviors to user-specified cell-cell and extracellular signals. In the context of oncology, SynNotch receptors can sense tumor antigens, deliver custom therapeutic payloads, drive T cell cytokine profiles, and determine T cell fate in varying physiological environments.
2. Combinatorial Antigen Sensing Circuits: Requiring CAR-T cells to recognize multiple antigens on a tumor prior to activation reduces the risk of toxicity to healthy tissue and increases the scope of targetable tumor types. Combinatorially-activated circuits utilize a SynNotch receptor for one tumor antigen that induces the expression of a CAR for a second tumor antigen via an AND-gate (diagram below).
CAR-T 3.0: Allogenic CAR-T
The process of removing T cells from a patient and then isolating and reprogramming them in a highly controlled laboratory is time-consuming, costly, and prone to any number of potential manufacturing errors.
For that reason, some biotech companies are designing ‘off-the-shelf’, or allogeneic CAR-T cells. This involves harvesting and genetically reprogramming immune cells from a healthy donor; the cells could then be used to treat any corresponding cancer patient.
Allogene Therapeutics: Two of Kite Pharma’s former executives unveiled that they had left Gilead to found Allogene earlier this month. The company has raised $300 million as part of a strategy to acquire and develop a portfolio of 16 preclinical cell therapy assets from Pfizer and just one that’s been tested clinically, UCART19, originally developed by Cellectis. Early UCART19 data in both children and adults hasn’t been great, but the executive’s track record of building meticulous manufacturing processes could improve the fidelity of UCART19 and advance the company’s newly ascertained preclinical assets quickly. This marks Pfizer’s exit from adoptive cell therapy, but they’ll keep a 25 percent ownership stake in Allogene.
Cellectis ($CLLS): Cellectis pioneered allogeneic T cell therapy by using TALENs to directly edit the genome of donor immune cells, but has had troubling results in Phase I clinical trials to date for it’s UCART123 for acute myeloid leukemia (AML) and blastic plasmacytoid dendritic cell neoplasm (BPDCN). The FDA halted both trials last September following patient deaths resulting from therapeutic toxicity. The trials were resumed two months later. That being said, Cellectis has plenty of time to prove that UCART123 works — the company reported cash flow of $297M and an annual cash burn of $52M at the end of 2017, and just closed a $164 million U.S. public offering.
Celyad ($CYAD): Celyad’s single allogeneic asset CYAD-101 (CAR-T NKG2D) is still in preclinical development, but relies on the same mechanism of action as their current lead asset (CYAD-01) in Phase I trials–engineered T cells that express NKG2D. NKG2D binds to any of its eight naturally occurring ligands, which are known to be overexpressed on more than 80% of tumors. This is distinct from most CAR-T therapies, which bind to a single tumor-associated antigen. Celyad is betting that the theoretically improved efficacy from a multi-pronged approach to tumor eradication will overweigh possible off-target effects relative to more precise CAR-T therapies.
Kite Pharma/Gilead ($GILD): While Cellectis is using — and owns most of the IP for — TALENs as a gene editing technology, Kite (acquired by Gilead) is using Sangamo Therapeutics’ zinc-finger nuclease (ZFN) technology to develop allogeneic CAR-T therapies.
Despite the difficulty of ZFN protein engineering, there are three reasons I believe zinc finger nucleases might be more likely to play a role in CAR-T R&D this decade relative to CRISPR/Cas9, an otherwise more popular gene editing tool for research labs.
- Accuracy: CRISPR/Cas9, a ribonucleoprotein complex, is more susceptible to off-target modifications both as per the nature of Cas9 and because it has to be delivered in a persisting DNA vector. In contrast, ZFNs are more precise proteins and can be delivered as a one-shot gene editing tool in RNA form.
- Clinical Track Record: An incredibly crowded market has biotech companies scrambling for the most clinically-ready gene editing tools. While CRISPR offers a clear cost advantage long-term, its first trial in humans didn’t start until the end of 2016. ZFNs have been around for twenty years and have a proven track record of clinical safety and efficacy.
- Target Flexibility: CRISPR/Cas9 requires the target gene sequence to be immediately upstream of a protospacer adjacent motif (PAM). ZFNs have no such restriction, allowing scientists free reign to modify any genetic sequence they’d like.
For better or worse, a bullish investment environment for immuno-oncology won’t have Big Pharma second-guess chasing first-mover advantage over capital efficiency, and Kite/Gilead has a diverse second-generation portfolio to build on.
CAR-T 4.0: In-situ Reprogramming
In-vitro production of CAR-T cells is highly laborious, expensive, and elaborate. While still very much experimental, in-situ reprogramming of a patient’s own T cells to express CARs would be the most capital efficient therapeutic possible and allow ‘on-demand’ administration at the point of care. Last April, researchers at the University of Washington published a method to quickly reprogram circulating T cells in situ by using DNA-carrying polymer nanoparticles (NPs) to introduce CD19-targeting CAR genes into T cell nuclei. Given the bull market for AAV-based gene therapies lately, I’d be on the lookout for companies working on commercializing in-situ technologies like this for adoptive cell therapy within the next decade.
This process, however, relies heavily on 1) more basic science research diving into the causes of CRS and neurotoxicity from CAR-T and 2) applied science research into better delivery vectors with the capacity to deliver both the CAR genes and the genetic circuits needed to tweak the tumor response in real time.
Why? Any in-situ gene editing of T cells will produce a heterogenous population that will select for reprogrammed cells with the strongest tumor response, which could exacerbate CRS and neurotoxicity in turn. This is based on the hypothesis that differing CRS responses is due to variations in the original monoclonal cytokine profile of CAR-T cells, which thus predict toxicity.
CAR-T 5.0: CAR-T-on-a-Chip
The landscape for next-generation CAR-T therapeutics up to this point can be divided into two production workflows, in vitro and in vivo:
In vitro (CAR-T 1.0–3.0)
A patient’s cells are sent to a centralized company lab that handles gene editing and propagation. The CAR-T products are sent back to an oncology clinic that administers the transfusion. This model favors Big Pharma with large budgets for scaling production like Novartis, Gilead, Celgene, and biotech startups investing significant capex in bottom-up manufacturing processes like Kite and Tmunity.
The turnaround process for personalized in vitro CAR-T production doesn’t lend itself to economies of scale very well. Allogenic CAR-T therapies offer an advantage in that regard, but, relative to personalized treatments, might be less likely to produce an optimal immune response in heterogenous populations. Yet, simply from a market standpoint, I imagine most biotech companies are more concerned with being first-to-market and worrying about pricing to recoup production costs afterwards.
In vivo (CAR-T 4.0)
A company sends a pre-made serum to a transfusion clinic specific to a patient’s cancer profile that transforms some endogenous T cells into CAR-T cells. Given the heterogenous T cell population, however, the clinicians lose control over which CAR-T variants are selected for, risking unknown toxicity.
A thought experiment:
Imagine loading a patient’s blood sample and reagent mix for specific tumor antigen(s) into a closed machine and picking up clonal CAR-T cells from the same machine a few days later.
Companies like 10x Genomics and Genalyte have already sold desktop “black box” machines directly to labs and clinics to provide on-demand single-cell sequencing and protein/metabolite detection respectively. With continual advances in autonomous ‘cloud’ labs, why couldn’t this workflow, someday in the far future, be applied for the production of personalized therapeutics?
Distributed CAR-T production could democratize cell therapy, minimize reagent use, and allow better tracking of individual cell profiles. While this idea is far into the future and has a lot left to discover, hypotheses that the side effects of CAR-T treatment originate from the specific subtype of CAR-T may mean that subsequent single-cell analysis on those subtypes may allow scientists and clinicians to selectively choose cell variants and thus optimize treatments.
FDA approval of two CAR-T treatments in the last year, continual advances in the precision of gene editing, rapidly declining costs for gene synthesis, the success of potentially complementary immuno-oncology treatments, big money M&A, and a massive influx of capital has pushed CAR-T research and development to the forefront of the oncology world.
That being said, while it’s worth paying attention to the new approaches that biotech companies employ to make cellular therapy faster, cheaper, and better, one of the hardest challenges that cell therapies will face over the next decade is how to make them affordable and accessible to patients — a bottleneck that neither biotech nor big pharma seems close to cracking quite yet.
Brief Reading List
For a deeper dive into the science behind next-generation CAR-T, I’ve linked a few of my favorite scientific reviews of CAR-T below:
Thanks to Asmay Gharia for reading drafts of this and coining the idea behind ‘CAR-T-on-a-Chip’.
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