Sometime before the end of March, a person with the inherited blood disease beta thalassemia will receive an infusion containing hundreds of millions of their own stem cells. These cells will have just completed a round-trip journey to a drug manufacturing facility, where they'll be equipped with a modified gene capable of fixing the patient's condition.
The expected infusion will be the first commercial use of a gene therapy approved by the Food and Drug Administration in August. Called Zynteglo, the treatment is the result of more than a decade of research by biotechnology company Bluebird bio. Its approval offered validation to Bluebird and to the broader gene therapy field, which over the past two years has struggled through safety concerns as well as clinical and regulatory setbacks.
Zynteglo's approval, as well as two other FDA OKs in September and November, has gene therapy developers looking ahead. "If you take a step back, I think that what we've gone through in the last couple years is just part of a maturation process," said Faraz Ali, the CEO of Tenaya Therapeutics and an executive at Bluebird from 2011 to 2016.
That process is still playing out, though, and this year companies in the space face a number of important questions. Here are five:
Will approvals lead to commercial successes?
The trio of recent gene therapy approvals — for Zynteglo, Bluebird’s Skysona and CSL’s Hemgenix — is one more than the FDA granted in the five years previous.
More could soon follow. The industry group Alliance for Regenerative Medicine, or ARM, predicts 2023 could bring at least five more gene therapies for rare diseases to the U.S. market, including potential new treatments for sickle cell disease, Duchenne muscular dystrophy and hemophilia A.
But regulatory clearances lead to the even harder test of marketing complex, expensive and unfamiliar treatments. While Novartis’ relative success with Zolgensma — the second gene therapy OK’d in the U.S. — shows what’s possible, the industry has had a poorer commercial track record in Europe, with several companies later withdrawing approved medicines. Bluebird, for instance, pulled from European markets both of the treatments that it is now trying to sell in the U.S.
Geoff MacKay, CEO of the gene therapy developer Avrobio, described 2023’s key theme as “commercial viability.”
“We are at a tipping point in gene therapy supported by real data, real milestones and real patients’ lives changed,” he added in an email.
Accomplishing that will be the challenge faced by Bluebird and CSL as well as any other biotech companies that secure an FDA approval this year.
They’ll face scrutiny over pricing. Both Bluebird and CSL set list prices of several million dollars for their therapies, citing the years of benefit they’re expected to deliver for patients. So far, insurers don’t appear to be pushing back strongly, but that might change when the gene therapies in question affect larger numbers of people.
They’ll also need to prove that they can reliably produce at larger scale treatments that in clinical testing were used only in scores of patients.
“Like all areas of medicine, there will be both winners and losers, but progress through 2023 will provide more clarity on the recipe for success,” MacKay said.
Can the FDA hire fast enough to stay ahead of the growing field?
Behind the gene therapies on the cusp of U.S. approval is a pipeline of experimental therapies swelled by the dozens of biotech companies that jumped into the field over the past decade.
It makes for a lot of work for the FDA, which must weigh in on clinical trial starts and provide regular counsel to companies throughout the development process. At the same time, the FDA center that oversees gene therapies has had difficulties keeping staff, stretched thin by the pandemic and its related vaccine review workload.
“They’ve clearly had some turnover,” said Timothy Hunt, head of ARM. “That has led to some challenges.”
The agency will be getting reinforcements, however, with a planned uptick in hiring following new user fee agreements with drugmakers. The Center for Biologics Evaluation and Research, or CBER, stands to gain nearly 200 new staff over the next two fiscal years.
“This is going to be a big area of emphasis at the FDA,” Commissioner Robert Califf told investors and industry professionals attending the J.P. Morgan Healthcare Conference in San Francisco this week. “There’s a very nice increase in budget for CBER to hire a bunch of people.”
“So we do have jobs, those of you who are tired of investing or whatever,” he quipped.
Additionally, the FDA elevated the division in charge of gene therapies specifically — the Office of Therapeutic Products — to “super office” status, giving it more autonomy and authority.
Drugmakers are watching closely. “The expansion of [OTP] paired with increased regulatory maturity and a promising stream of regulatory activity ... is a signal to the industry that the door is open for innovation,” wrote Avrobio’s MacKay.
How will gene therapy startups fare in a prolonged downturn?
Genetic medicine companies weren’t spared from last year’s biotech market reversal, with more than a dozen cell and gene therapy specialists forced to cut jobs over the course of 2022. That count included relatively large and mature companies like BioMarin Pharmaceutical and Bluebird, as well as high-profile startups like Passage Bio and Tasyha Gene Therapies.
With this year’s financial outlook uncertain, the sector may see more consolidation, particularly given the often expansive pipelines that many gene therapy biotechs touted when markets were more favorable. Taysha, for instance, once listed 18 programs in its pipeline and boasted of plans to launch a product every two to three years.
Gene therapy development is also expensive, requiring biotechs to make costly choices around manufacturing.
Already, Editas Medicine, a leading biotech in CRISPR gene editing, this week announced plans to cut back investment in several clinical-stage therapies and lay off 20% of its staff.
“Oftentimes you see that the corners of the sector that are the most cutting-edge ... get it a little bit more disproportionately than others,” said Hunt, of ARM. “But I think it’s balanced out by the realization that the FDA and the [European Medicines Agency] are rewarding innovation.”
MacKay also noted the field’s recent regulatory and clinical progress, but added that he expects investors to remain wary.
“The data will eventually pull the public markets along, but it may take a long time,” he wrote. “Until then, this tough financing environment will spur more restructuring, consolidation, pipeline reprioritization, M&A, market de-listings and, unfortunately, bankruptcies.”
What do recent clinical holds say about the FDA’s views on gene editing?
If all goes to plan, 2023 could see the first FDA approval of a CRISPR gene editing medicine. CRISPR Therapeutics and Vertex Pharmaceuticals currently expect to finish submitting an application to the agency by the end of March, potentially setting up a consequential decision from the regulator later this year.
Developed for sickle cell and beta thalassemia, CRISPR and Vertex’s medicine builds on the long history of stem cell transplantation, using the gene editing technique to modify a patient’s own stem cells in a laboratory, or ex vivo.
An approval would represent a remarkable achievement for a field catalyzed by scientific breakthroughs made just a decade ago. Already, developers have moved quickly to explore gene editing directly inside the body, or in vivo. Intellia Therapeutics, for one, has reported clinical trial results for CRISPR medicines used in vivo to treat two rare genetic diseases.
But in the U.S., there are some signs of caution from the FDA when it comes to in vivo gene editing. The agency has put on hold a study by Verve Therapeutics that uses a newer iteration of CRISPR-based gene editing inside the body, for example.
Safety is of paramount concern when editing genes, both because of the theoretical potential for off-target changes to DNA and the permanence of such modifications.
“Regulatory agencies quite rightly should be cautious,” said Editas CEO Gilmore O’Neill. “That is their job. I think it is our job to make sure that, as we advance our new technologies — and advancing in vivo is an example — we need to be very rigorous about our approach to managing risk.” (Editas is now prioritizing in vivo gene editing.)
Still, the go-slow approach contrasts somewhat with outside the U.S., where Intellia is conducting its studies and Verve has begun human testing of its medicine.
“We're the first in front of the agency with this kind of product,” said Verve CEO Sek Kathiresan, referring to a base editing medicine in an interview this week. “So we're really working it out in real time with them in terms of regulatory expectations for this product."
Kathiresan noted Verve is working through the FDA’s questions following the study hold and said “it’s a matter of when, not if” it can address the agency’s questions.
Can the business model work for ultra-rare conditions?
Many genetic disorders being targeted by gene therapy developers are uncommon, affecting several thousand or a few hundreds of people in a given country. Others are rarer still, found in only a few dozen individuals or even just one or two people — conditions sometimes referred to as “n of one” diseases.
For many of these conditions, the promise of genetic medicines can be great. Treatments for several types of severe combined immunodeficiency, for instance, could be curative. But, despite developing powerfully effective treatments, drugmakers have backed off, deprioritizing SCID gene therapies.
Even the prospect of being able to price treatments in the millions of dollars might not be enough, if companies need to spend much more to collect the needed evidence and can only treat a few patients.
“When you’re talking about dozens of patients, it is tricky to think through how you can capture the appropriate value to the patient,” said ARM’s Hunt. “That has been hard and will be tricky in the future.”
A down market in biotech makes the financial calculus even harder, potentially forcing companies to prioritize projects with greater chances of earning a return on investment.
It’s a problem that regulators are watching, too.
“We’re not going to find enough philanthropic groups to foot the bill for gene therapies for the hundreds upon hundreds of different diseases that need to be addressed,” said Peter Marks, head of the FDA’s CBER, at a conference in October.
“We’re gonna have to find a way to make this commercially viable so that industry can find a way forward towards this.”
He put forward a few proposals for how his agency could lower hurdles for developing therapies for ultra-rare diseases, such as using data from one application to speed review of others using the same technology.
Meanwhile, in the U.S., Bluebird will put the model to the test. It expects to treat only 10 patients a year with its newly approved gene therapy Skysona, for a rare childhood brain disease.
Jacob Bell and Ben Fidler contributed reporting