Shares of Bluebird bio fell more than 20% Monday morning as the biotech company, already in the midst of a major reorganization and just getting past a serious challenge to one of its leading programs, disclosed two more significant setbacks.
The first is that another of Bluebird's more advanced programs has been placed on clinical hold because of safety concerns. According to the company, a patient treated with its eli-cel gene therapy has developed a kind of bone marrow cancer known as myelodysplastic syndrome. Bluebird said the disease was likely "mediated" by eli-cel's design, which uses a so-called Lenti-D lentiviral vector, or LVV, to deliver helpful genetic material into stem cells extracted from patients.
Though they're considered safer than what was used in the earlier days of gene therapy research, lentiviruses like the ones Bluebird uses are still thought to pose potential risks. These viruses integrate with the genetic code of cells, but if they do so incorrectly, it may trigger unwanted mutations that could, at least in theory, lead to cancer.
Bluebird knows the risks well. Earlier this year, two clinical studies of its gene therapy for sickle cell disease — a therapy that also uses lentiviral vectors — were put on hold after one patient developed leukemia and another looked to have myelodysplastic syndrome. The trials have since been resumed, after an investigation concluded the myelodysplastic syndrome case was a misdiagnosis and the cancer case was "very unlikely" to be tied to Bluebird's therapy.
According to Bluebird, the clinical hold for eli-cel shouldn't impact its other programs targeting rare blood diseases and cancer. If the hold is resolved, the company expects to finish submitting eli-cel for approval by the end of the year.
Eli-cel is meant to treat a rare metabolic disorder known as CALD, which is caused by mutations in a specific gene. Regulators in Europe last month cleared the treatment under the brand name Skysona for use in treating certain children with CALD.
"Given what we know, we remain confident that eli-cel can offer hope for patients and families impacted by this devastating disease who have very few treatment options," Bluebird CEO Nick Leschly said in an Aug. 9 statement.
Meanwhile, Bluebird also disclosed alongside its second quarter earnings Monday plans to wind down operations in Europe.
The decision, according to Bluebird, has to do with challenges the company's faced making money from its Zynteglo gene therapy. Zynteglo treats a blood disease known as transfusion-dependent beta-thalassemia, and was given conditional authorization in Europe in mid-2019. But it wasn't until this past February that the first patient was treated outside of a clinical trial and Bluebird hasn't earned any material revenue from sales since.
That's partially because Bluebird and payers can't agree on Zynteglo's price, which starts at $1.8 million. The figure hasn't sat well with certain health authorities, as was evident in April, when Bluebird said it was withdrawing Zynteglo from the German market due to disagreements with regulators there, who reportedly offered to pay up to $950,000 in the event treatment is successful.
Bluebird's announcement suggests this problem isn't isolated to just a few European countries, either. The company said that, moving forward, its severe genetic diseases business will focus on the United States market, its core three programs for sickle cell, beta-thalassemia and CALD, and programs exploring new disease targets that would be suitable for "in vivo" LVV technology.
"European payers have not yet evolved their approach to gene therapy in a way that can recognize the innovation and the expected life-long benefit of these products," Andrew Obenshain, Bluebird's president of severe genetic diseases, said in the Aug. 9 statement.
Bluebird said it's planning an "orderly wind down of operations in Europe," and is considering licensing rights to its gene therapies outside the U.S. to a company with "European experience and capabilities."
The latest updates come at an already busy time for Bluebird, which has been trying to spin off its cancer drug business into an independent, publicly traded company.
While Bluebird clearly sees these moves as necessary, the uncertainty — and the new setback to the eli-cel program — don't seem to be sitting well with investors. Bluebird shares traded at less than $19 apiece by late Monday morning, roughly a third of the value they were at a year ago.