Who will win the race of high pharmaceutical technologies

Cancer under control

Matthew Herper, ForbesThe pharmaceutical company Novartis has thrown all its efforts into the development of drugs against cancer.

And not just her

At the age of five, Emily Whitehead was diagnosed with acute lymphoblastic leukemia. 85% of children with this diagnosis are cured thanks to chemotherapy. Emily's first year didn't help – she suffered an infection during it and almost lost both legs. Then the cancer returned, and she was scheduled for a bone marrow transplant. While the girl was waiting for her turn, the disease worsened. Is there no way out?

The parents decided to try an experimental method that had never been used to treat children before: Emily's blood was withdrawn, passed through a device that removed all white blood cells. Then scientists at the University of Pennsylvania used a genetically modified strain of HIV to reprogram these white corpuscles so that they attacked cancer cells and then injected them back.

Priority direction"Money doesn't matter.

The main thing is speed," says 54-year-old Joseph Jimenez, CEO of Novartis. – I want to hear what is needed to launch the third phase of testing and release the product to the market. We are talking about patients who are about to die."

Combined with the growing capabilities of DNA sequencers capable of reading the genetic code, new drugs are bringing amazing results in the treatment of lung cancer, melanoma and other deadly tumors, sometimes causing them to disappear completely. Last year alone, the U.S. Food and Drug Administration approved nine drugs aimed at fighting certain types of cancer. And it's a big business. According to IMS Health, the cost of cancer drugs last year amounted to $91 billion, which is three times more than in 2003.

Research by the University of Pennsylvania says that the new method will allow achieving a complete cure. Out of 25 children and 5 adults with acute lymphoblastic leukemia, 27 people went into complete remission, in which cancer is not diagnosed. "This is a breakthrough," says Sally Church of the pharmacology consulting company Icarus Consultants.

There are still many obstacles ahead: Novartis must conduct clinical trials on children and adults in hospitals around the world and figure out how to minimize the side effects that almost killed Emily. According to Novartis forecasts, all this work will be completed by 2016, by the time the application is submitted to the Food and Drug Administration.

Such progress explains why Jimenez focused on one task: to cure cancer. Cancer drugs already account for $11.2 billion of the company's $58 billion in annual revenue. But Jimenez says he is "doubling down" on this direction. In April, he signed a deal under which he actually gives GlaxoSmithKline unprofitable areas for the production of vaccines and Novartis consumer products, as well as up to $9 billion in cash in exchange for GlaxoSmithKline cancer drugs, which currently bring in $1.6 billion in revenue. According to Jimenez, among GlaxoSmithKline's drugs there are three, sales of which he can bring up to $ 1 billion a year. On the same day, he sold the veterinary drugs business to Eli Lilly. Jimenez's policy, which he calls "the opposite of mega-mergers," will reduce Novartis' revenue by 5% for 2016, but will increase net earnings per share to 10%, according to Jefferies investment bank.

Jimenez has competitors, including one of the most generously funded startups Juno Therapeutics (Seattle), whose patrons include Jeff Bezos, CEO of Amazon. But this is inevitable with such a potential.

"Anyone who is connected with this technology and sees what it is really capable of, begins to believe that he is making history," says Jimenez. "Over the next 20-30 years, it will be possible to see how cancer treatment will change."

Jimenez's biography does not betray him as the patron of one of the most revolutionary breakthroughs in medicine. By profession, he is a marketer and before joining Novartis in 2007, he promoted household chemicals Clorox, peanut butter Peter Pan, headed the North American business of ketchup manufacturer Heinz. But after getting a seat on the AstraZeneca board, he immediately became interested in selling products that save people's lives. Jimenez was invited to head the Novartis consumer products division with a turnover of $4 billion, known for the Triaminic cold remedy and the TeraFlu flu medicine, and soon became drug sales director, and then, to everyone's surprise, CEO.

Joseph Jimenez on the cover of the American Forbes

Daniel Vasella, his predecessor, saw in Jimenez a man capable of managing Novartis during a difficult period. Under Jimenez, consumer and veterinary drug factories were temporarily shut down. But thanks to the generics business and Alcon's ophthalmology division, Jimenez was able to maintain revenue and profit. Novartis also profited from its 33% stake in rival Roche with $31 billion in oncology sales. When production was re–established, Novartis shares were able to show a big increase - 176%.

Marketing caseThe former director was proud of how he once decided to ignore the opinion of his own marketing specialists and listen to an oncologist from Oregon, who asked very much to develop a drug against cancer "Glivek".

Vasella even wrote a book about it. A drug that helps patients with chronic myelogenous leukemia has proved successful. It is so effective that Novartis has increased the cost of the annual course fourfold since 2001 – from $24,000 to more than $90,000 dollars. Even the stingiest insurance companies pay for it.

Jimenez notes that the drug, which, according to marketers, was supposed to bring in $400 million, now brings in $4.6 billion and is one of Novartis' best-selling drugs.

Lesson: it is harmful for business to prioritize marketing considerations, neglecting the effectiveness of the drug.

"Our commercial services are excluded from the decision–making process at an early stage of research," Jimenez says. "Other companies attract marketers at this stage to assess the commercial potential or the size of the market, but we refused to do that."

Glivek has changed the very architecture of the company's headquarters, located in Basel on the banks of the Rhine, where Switzerland borders France and Germany. The dreary industrial complex has become like a university campus with summer cafes, benches for socializing and a glass building designed by Frank Gehry. Vasella has set up his research headquarters in Cambridge, Massachusetts, in a converted confectionery factory building with a magnificent glass roof and a six-story atrium one block from the Massachusetts Institute of Technology.

Unfortunately for Novartis, the patent for Glivec expires in July 2015. And recently, Novartis scientific research has been ineffective. In the ten years prior to Jimenez's arrival, the company launched 16 drugs, more than any of its competitors. And for four years under his leadership – only one drug per year. Worse than that, according to Jimenez, was that Novartis did not investigate the advanced drugs discovered by Bristol-Myers Squibb, which use the immune system as a weapon against tumors. "We were lagging behind here," Jimenez admits. He fears that his scientists have taken another lesson of Glivek too close to heart: understanding the biochemical mechanisms at the heart of the drug is a priority. He says that instead, sometimes you just need to say, "This is working, and we'd better get involved in the process."

The race for InnovationFor Novartis, everything changed with the appearance of a 64-year-old patient named Douglas Olson, who was diagnosed with chronic lymphocytic leukemia 14 years ago.

His body was no longer responding to chemotherapy, and he had two years to live without a risky bone marrow transplant operation. Then he underwent cell therapy using a technology that Novartis soon acquired. His temperature rose sharply, and he had to be urgently hospitalized due to the fact that his kidneys were failing. But the kidneys survived, but the cancer cells did not. Two kilograms of cancer cells disappeared from the blood and bone marrow.

"My whole life has changed. Suddenly, out of the blue, this something is no longer sitting inside your body waiting for the moment to kill you," says Douglas.

He gives an interview to Forbes, taking a break from cutting trees on his property in Pennsylvania. In addition to land, he also got a boat – his lifestyle has completely changed.

In August 2011, the results of Olson's therapy were published without his name in a scientific journal. At the same time, data on two other patients were published in another journal. "The phone was hot, startups and venture investors were calling," says Carl Jun, a researcher at the University of Pennsylvania, the head of the team that developed a new method of therapy and who three years earlier could not find funding for the project. – Then three large pharmaceutical companies approached us. It was incredible."

All three companies offered the same financial terms: $20 million in advance, a percentage of sales and interim payments to the University of Pennsylvania. June will get crumbs compared to what he could get if he started his own company, but he says he doesn't care. The path of starting his own company is too slow; and Jun had too many patients asking to experience therapy on them than he could cure.

Novartis has launched a massive offensive. The head of the research department, Mark Fishman, arrived himself – he knew June's boss, the dean of the University of Pennsylvania Medical School, Larry Jameson, since the days when both were doctors. Personal connections helped. June also knew Barbara Weber, head of the Novartis Interdisciplinary Research department, and Novartis scientist Seth Ettenberg studied with June and shared his sense of responsibility (Ettenberg took up cancer research after his brother died of leukemia). June, like Fishman, talks about curing cancer as her goal. The history of the drug "Glivek" is what really bribed June. Novartis already had experience with blood cancers and knew about breakthroughs in this area, so June accepted her offer.

However, the launch into mass production of cancer-infecting cells cannot be compared with any previously known drug development program. Scientists call them T-cells with chimeric antigenic receptors. T cells are the most active hunters of the immune system. They use their receptors to recognize cells with certain proteins on the surface throughout the body, and destroy them by acting on infected cells. When modifying T cells, scientists add an artificial receptor – a chimeric antigenic receptor assembled from mouse antibodies and receptor fragments. The genetic code of the artificial receptor is inserted into the DNA of the T-cell along with a virus, usually modified by HIV. If the receptor sees a cancer cell, it not only kills it, but also begins to divide, forming an army of cancer-infecting cells inside the body.

There are disadvantages. "So far, this is only applicable for blood cancer; high technologies are required; this is individual therapy; development will require significant investments," warns Clifford Huedis, president of the American Society of Clinical Oncology, who, nevertheless, is very enthusiastic about the discovery. Today, modified T-cells affect not only cancer cells, but also any B-cells – a type of white blood cells in which leukemia fails. Patients will probably have to spend the rest of their lives injecting a protein called gamma globulin, which is produced by B cells. If this method of treatment becomes popular, a deficiency of gamma globulin may occur.

One of the first tasks is to figure out how to conduct individual therapy. It will be necessary to purify their blood in the hospital, then send it to Novartis, and then back to the hospital. How to cope with this task? By a happy coincidence, the biotech company Dendreon solved this problem for its method of treating prostate cancer, but it turned out to be not so effective and the company decided to curtail the project. Novartis paid Dendreon $43 million and left 100 of the company's 300 employees. Bruce Levine, a researcher at the University of Pennsylvania, is pleased with the appearance of production facilities. "There are results, there is knowledge," he says. – The question is in the technique."

Will the modified T cells act on all types of cancer? Targeted drugs such as Glivec are more effective against blood cancers than against solid tumors such as lung or breast cancer (which literally build walls of tissue to protect themselves); this is likely to be the case with modified T cells. Even if you switch from Emily's disease – acute lymphoblastic leukemia to chronic leukemia, which Doug Olson suffered from, the probability of complete remission decreases from 90% to 50%.

"While these cells are impressive," says Charles Sawyers, former president of the American Association for Cancer Research and a member of the board of directors of Novartis, "we don't yet know how widely they can be used." The University of Pennsylvania and Novartis will soon begin research on mesothelioma, a type of lung cancer, to begin answering this question.

In addition, there is the problem of competition. June, with whom Novartis collaborates, was not the only one who thought about using modified T-cells to fight cancer, he was just the first to publish evidence of their effectiveness. But other scientists also followed this path, and many of them joined forces within the framework of the biotech company Juno Therapeutics, headquartered in Seattle.
Cancer Hunters

Juno is the brainchild of Larry Corey, director of the Cancer Research Center. Fred Hutchinson in Seattle, who is probably a leader in the study of the mechanisms by which the immune system usually keeps cancer under control. Richard Klausner, former director of the US National Cancer Institute, helped to find investors such as ARCH Venture Partners and the Alaska Permanent Fund, and then others, including Jeff Bezos, who together invested $175 million in perhaps the largest volume of the first round of attracting investments in the field of biotechnology.

While Novartis was buying one of Dendreon's businesses, Juno hired the man who built them, 50-year-old Hans Bishop, the former CEO of Dendreon. "I have never seen such clinical data in the early stages," he says. "I've been working in this industry for a long time, and I've been doing clinical research for a long time, but what we see now is so different from everything else, like day and night."

In February, one of the founders of the company, Michel Sadlen, from the Memorial Cancer Center named after Sloan-Kettering published data on acute leukemia that are comparable to those cited by Novartis: its modified T-cells caused complete remission in 18 out of 21 adult patients.

The method of treatment with modified T-cells of a new generation, developed at the Hutchinson cancer center by Juno, does not seem to cause such a strong fever. So far, the patients who underwent the procedure have been treated with paracetamol. In addition, Juno has developed another option: T cells that use natural, rather than artificial, receptors to detect cancer. The company will continue testing different combinations to create even more effective modified T-cells.

Other competitors include the independent research program of modified T-cells of the M. D. Anderson Cancer Center, the program of Kite Pharma in partnership with pioneer Steven Rosenberg from the US National Institute of Oncology and the program of the biotech giant Celgene, which cooperates with the tiny Bluebird Bio.

"When you look at a company like Celgene, you realize that they will find their solution," Jimenez says. – And they have to find him. This is for the benefit of patients. We want to beat the competition, but we actually use competition as an incentive to get to the patient."

The economy as an obstacleDespite all the promise of the method, the biggest obstacle to new cancer treatments, according to Jimenez, may be economics, not science.

"What should definitely not happen is that patients are prescribed one therapy after another at their current price in the expectation that people will pay for it," he says. "All prices in oncology require rethinking, as they have reached a level where further development may become impossible in the long term."

That's what Jimenez is guided by when he expands his oncology unit so that it can compete with other centers. He expects that medical companies will find themselves in a difficult situation, as countries around the world will be forced to double the cost of medical care due to the aging of the population and the spread of diseases in the next ten years. Paradoxically, the rapid increase in costs will lead to governments trying to cut costs, exacerbating competition between hospitals, doctors and pharmaceutical companies.

"You will see that many companies will not survive in this new environment, despite the fact that the cost of medical services will almost double," says Jimenez.

He has a team that is actively working to explore new ways of pricing anti-cancer drugs, for example, by selling several drugs for the price of one or introducing rules according to which health systems and insurance companies will pay for treatment depending on the number of cured.

When researchers talk about the use of modified T-cells, they often cite for comparison the cost of bone marrow transplantation surgery, which is $350,000 for one course of treatment. Why not? There are biotechnological drugs against rare diseases, annual courses of which cost $ 400,000 or more. But Jimenez says that it is too expensive, and that the costs even for such a revolutionary method of treatment should be lower.

Earlier this year, Novartis made its way into the field of immunostimulating anticancer drugs by purchasing the biotech company CoStim, because such drugs need to be combined with Novartis targeted drugs and modified T cells. A similar desire drove the company when concluding a deal with Glaxo, which allowed it to get rid of non-profitable divisions and gave the company the volumes necessary to negotiate with future buyers of medicines, such as governments and insurance companies.

Jimenez met Glaxo CEO Andrew Witty at a meeting of the European Industry group in the field of pharmacology. They started talking about vaccines and quickly realized that each of them had a business that the other needed. They had to push a complicated deal through their companies, negotiate several times a week, including at Easter, to close it. One of the most difficult points in the negotiations is the condition that Novartis will withdraw from the joint venture they created in the field of consumer medicines, which will control Glaxo if things go badly.

Can Novartis succeed? The company, which ten years ago was the leader in the number of new drugs, now ranks 18th out of 22, according to a new analytical report by Sector & Sovereign Research, where pharmaceutical companies are ranked by the economic impact of research and development. But new breakthroughs are being planned, and not only in the field of anti-cancer drugs: several cardiac medicines can also become sales leaders. The example with Glivek showed that one drug is sometimes enough to change the fate of a company.

One thing is clear – as long as pharmaceutical companies compete with each other on the effectiveness of drugs and the speed of their introduction into production, patients benefit.

Doug Olson, the first person saved by modified T-cell therapy, believes in the future. "Personally, I think I'm cured," he says. – I never think about relapse. I don't think. That's right."

Portal "Eternal youth" http://vechnayamolodost.ru23.06.2014