- Novartis is teaming up with a gene therapy developer to produce lentiviral vectors for its highly anticipated drug CTL019 (tisagenlecleucel) as well as other CAR-T candidates.
- The deal hands Oxford BioMedica $10 million upfront, though the British drugmaker could snag more than $100 million over the next few years if it provides certain "performance incentives and bioprocessing and development services," according to a Thursday statement. Oxford BioMedica may also reap undisclosed royalties on potential CTL019 sales as per an earlier agreement with the big pharma.
- If CTL019 hits at least $1 billion in peak, worldwide annual sales (assuming it progresses to market), investment firm Jefferies estimates that Oxford BioMedica will reap £65 million to £75 million ($84 million to $97 million) annually from the Novartis deal, which is set for three years but could last up to five.
Novartis filed CTL019 as a treatment for adult lymphoblastic leukemia with the Food and Drug Administration earlier this year, and could see an approval decision as soon as September. The Swiss drugmaker anticipates the CAR-T therapy, along with about a dozen other pipeline candidates, to be potential blockbusters.
That's good news for the bottom line over at Oxford BioMedica, which specializes in developing lentiviral vectors — a type of retrovirus used to transport genetic material into cells — through its LentiVector technology platform. Moreover, CAR-T drug production has already proven profitable for Oxford BioMedica.
Last year, Oxford BioMedica's gross income increased 64% from 2015 to £30.8 million. Much of that growth came from new bioprocessing facilities that allowed vector production for CTL019 development to balloon. The company has been working with Novartis for years, inking a deal back in 2013 worth a tiny £2.5 million and £4 million ($3.2 million to $5.1 million) that was advanced a year later and valued at up to $90 million.
"The new deal with Novartis will strengthen the Group’s balance sheet immediately and will support the Group’s continued growth over the next three years," John Dawson, Oxford BioMedica's CEO, said in the July 6 statement.
Jefferies analyst Peter Welford echoed those sentiments in an investor note, highlighting that Novartis has disclosed five other CAR-T medications in its pipeline in addition to CTL019. Collectively, the investment firm believes those programs could reach $2 billion in peak, worldwide sales.
"We are confident [Oxford BioMedica] is on a path to sustainable profitability," Jefferies analyst Peter Welford wrote in a July 6 investor note. "Successfully securing external funding for continued clinical development of the largely overlooked proprietary pipeline could crystalise additional value."
For Novartis, locking down a commercial and clinical supply of the lentiviral vectors it will use to generate CTL019 strengthens its manufacturing position ahead of a potential approval for the CAR-T drug. Due to the complex nature of ex vivo autologous cell therapy, manufacturing is a key focal point. Production speed and reliability of production will be crucial to the commercial success of any CAR-T cleared for market.