and mainly treated by primary care physicians using widely available generics. Healthcare systems have not been accustomed to restructuring drug administration for these patients with biologics, let alone paying for them.16
However, it is important to consider that biologics entering nontraditional biologic disease areas may take longer to optimally position within the patient pathway. This is because primary care physicians and patients are not accustomed to prescribing and using biologics, respectively, so it may take longer to benefit from such innovation. Historic examples of slow initial uptake for drugs in this category can be seen in the case of Xolair® and Prolia®; however, both drugs have now surpassed US$1 billion in sales (DRG Company & Drugs, April 2016).17
2.6 Technology and Science Innovation in the Long Term?
2.6.1 The Potential of Innovative Technologies
Currently, mAbs hold the lion's share of the biologic market sales and remain the largest protein technology class within the biologic pipeline. However, the mAb dominance we see today could be outperformed by novel biologic technologies currently in the pipeline. In the next 10 years, therapies using nonestablished technologies will have been launched into the market. Although only a handful of launches will occur before 2020, these first few will show us the potential of these therapeutic strategies to change the way we treat disease in the long term. There are four technology classes with significant pipeline scale that will be entering a pivotal stage during their first few launches by 2020.
1 Antibody–drug conjugates: A drug (e.g. a cytotoxin) is coupled to an antibody that specifically targets a specific biological marker (e.g. cell surface tumor antigen). The function of the antibody is to act as a vector, enabling targeted delivery of the toxic drug to the antibody target. When compared with standard drug treatment, it allows orders‐of‐magnitude lower dosage, reducing the undesirable systemic side effects caused by the toxic drug. This means that a drug or certain high drug dosages that may have previously been too toxic for use in treatment can be utilized safely. There are currently two antibody–drug conjugates (ADCs) on the market, Kadcyla® marketed by Roche/Genentech and Adcetris® marketed by Seattle Genetics/Takeda. There are an additional 17 ADCs from Phase II through registration looking to enter the market in the near future. Depending on clinical success and market acceptance, we may see ADCs becoming a more popular pipeline choice.
2 Antisense/RNAi: These are two similar naturally occurring biological processes in which RNA molecules modulate the level of gene expression. They have been manipulated for therapeutic benefit in order to prevent the expression of disease‐causing proteins with great specificity. These are relatively new technologies, RNAi was only utilized as a scientific technique in 1998, but they are showing great promise in a range of therapy areas from oncology to hyperlipidemia. Improvements in delivery systems have been key to enabling the use of these unstable RNA treatments. Two pioneering antisense RNA treatments were approved by the FDA in 2016, Spinraza® and Exondys®. Spinraza® is the only available treatment for spinal muscular atrophy, an orphan disease with a low life expectancy. Market analysis consensus revenue for Spinraza® is over US$1 billion by 2021 (IMS MIDAS 2016), very substantial considering it is a novel technology. With 44 antisense/RNAi candidates in Phase II and later phases, this could be an important segment for biologic market growth.
3 Gene therapy: Gene therapies are treatments in which genetic material is incorporated into the cells of a patient with an intended therapeutic benefit. Much of the gene therapy pipeline candidates function by attempting to correct or replace a genetic defect that underlines the root cause of the disease. The only examples of approved gene therapies are Glybera®, used to treat lipoprotein lipase deficiency, and Strimvelis®, for treating adenosine deaminase deficiency (ADA)‐severe combined immuno deficiency, ADA‐SCID. The potential for gene therapies is that they aim to be curative. There are also gene therapies going beyond genetic correction and toward non‐corrective, with more sophisticated mechanisms of action. Examples are pipeline candidates aiming to stimulate nerve cell growth in patients with Parkinson's disease and stimulating blood vessel growth for heart disease.
4 Cell therapy: Cell therapies are treatments in which intact, living, human cells are injected into a patient for therapeutic benefit. Sixty percent of the cell therapies in development are autologous (fully personalized treatments where the cells themselves originate from the patient), the rest are allogeneic (off the shelf). In 2010, the FDA approved the first ever autologous cell therapy vaccine, Provenge®. Although this product was not a commercial success, this area remains very dynamic particularly due to the high‐profile CAR T‐cell, and T‐cell treatments that have been valued so highly during recent company acquisitions.
Collectively these drug technologies make up 18% of the Phase II+ biologic drug pipeline. The performance of each technology class is somewhat dependent on the first few launches. The challenges associated with the cost of groundbreaking curative treatments in the pipeline must be tackled proactively. Innovative approaches to funding will be a necessary prerequisite of success when commercializing such valuable treatments.18
2.6.2 Drug Delivery: Calls for Change
There are currently two biologic delivery methods that are used for the great majority of biologic products, intravenous (IV) and subcutaneous (SC). Today, many biologics have subcutaneous formulations available. This has the advantage of enabling patient self‐administration and often cutting down on the delivery time. This solves many of the challenges of IV delivery; however, there is still room for improvement and innovation. Much of the work for innovative biologic delivery has been in the diabetes space. This is because diabetes is a primary care area with an extremely large and growing patient population that could see significant benefit and increased compliance with insulin treatment should administration be made easier and less onerous. Once established, these technologies could spread to other disease areas. This will be particularly important in diseases with large patient populations like asthma, chronic obstructive pulmonary disease (COPD), and hypercholesterolemia.
Collectively these drug technologies make up 18% of the Phase II+ biologic drug pipeline. It is still not clear which of these platforms will enter the mainstream market. The performance of each particular technology class is somewhat dependent on the first few launches. If they fail to deliver clinically and commercially, these launches serve as warnings to investors for the platform as a whole. Existing marketed examples of cell and gene therapies have faced multiple challenges in commercialization, particularly in the funding of treatment. The western world's first gene therapy, Glybera®, was priced at €1.1 million in Germany. Glybera® is used to treat an ultra‐orphan indication, lipoprotein lipase deficiency, but much of the pipeline similarly aims to cure disease and will likely be priced highly. The challenges associated with the cost of groundbreaking curative treatments in the pipeline must be tackled proactively. Innovative approaches to funding will be a necessary prerequisite to success when commercializing such valuable treatments. Instilling payer confidence in a technology's curative promise is challenging given the inability for clinical trials to model a lifelong cure. Schemes such as the UK's Early Access to Medicines and the Accelerated Access Review can enable early collection of real‐world data before approval and enable longer periods of evaluation.19
2.6.3 Biologic Asset Deal Frenzy
As biologic pathway targets are validated, competition for the mode of action intensifies. In the 2012–2016 period, the upfront value of a biologic product deal rose from ~US$20 to 60 million (IMS MIDAS, 2016), tripling in four years. These valuations increased due to three factors:
Innovation output from biotechs has increased in scale and quality. This is possible due to greater scientific understanding of disease, advancement in scientific techniques, and their wider availability.
Investment
