Big Pharma Expanding Further into Gene Therapy

Gene Therapy

Gene therapy might sound a lot like science fiction, and at one point it was, but the fiction part is beginning to translate into real promise, and on the brink of becoming reality.

The science of gene therapy has been around for years, and has always held the promise for some real breakthroughs in the way we treat disease, and in particular, certain diseases that are a result of genetic mutations that have the potential to be corrected with intervention.

There is a lot of research involved here up front, with no guarantees of success, and while big pharmaceutical companies spend a huge amount on research and development each year, which is really their lifeblood, the focus is more on therapies with a lot more widespread application and potential than what the science of gene therapy is looking at currently.

Big pharma does look to serve what is often called the orphan drug market, drugs that cost a lot to produce when you add in all the costs of bringing it to market, but with a very limited number of patients who have the condition it treats, they have to charge truly ridiculous amounts per treatment year.

While many complain about this and see the drug companies as being predators, as one’s life can often depend on their coming up with hundreds of thousands per year to pay for the treatment, there are business reasons for this, ones that require such prices to be charged.

Among those in the know, the biggest criticism about the approach of pharmaceutical companies is their focusing on merely treating the symptoms of disease and not looking to resolve the root causes of the diseases they seek to treat. This is their approach to every disease actually, thus far anyway, and while those who are not that familiar with this reality may speak of things like their seeking cures for diseases, that’s not really where the focus is at all, nor is it the focus of conventional medicine as a whole.

Treating the Cause Is Simply a Lot Better

Curing something involves actually reversing the condition that caused it, but by the time someone is diagnosed, it is often too late, especially with metabolic disorders such as cancer, heart disease, and diabetes. There is research into the causes of these conditions, but nothing big pharma is able to really participate in, because we are now more in the realm of proper maintenance and not the more heroic intervention after the fact that we see them engage in.

For example, cancer results primarily from a failure of the immune system in combination with hormonal imbalances, heart disease is an inflammatory condition of the circulatory system, and diabetes results from hormonal imbalances similar to those with heart disease, which is why they go together so much. You can’t just give someone some pills and fix this, at least with the pills we give, although you can treat the symptoms, but this leaves the causes for the most part unaddressed.

Gene therapy has the potential to be a real game changer, actually offering cures for diseases that are directly a result of gene mutations, as well as offering us a means to better address the conditions where they play some role even though much of the problem may lie elsewhere.

While we are born with a certain set of genes, these genes do modify throughout our lives considerably, and we can intentionally modify them as well through gene therapy. As we identify and come up with solutions with gene therapy, this has great potential to actually treat many conditions, where the therapy may address the actual causes.

We’re a long way off from being able to do very much here, but we have to start somewhere. The lead here has been taken up by smaller biotech companies who have stepped up and carved out niches in either processes to facilitate the practice of gene therapy or by delivering therapies to treat specific conditions thought to be caused by faulty genes.

The conditions that are known to be purely gene related, and thus offer the potential for this treatment to cure the patient, do tend to be these rarer diseases, and therefore this is where the focus is now. In time, this does have the potential for a lot more expansion as we learn more, and while in these cases the result may not be a cure, but it certainly has the potential to offer better treatment as the genetic component of their diseases are better addressed in conjunction with whatever else we prescribe.

Big Pharma Starting to Step Up with Gene Therapy

A recent example is with AveXis’ gene therapy for spinal muscular atrophy, a fatal disease that is inherited. The inherited part makes it a great candidate for gene therapy, and the company had enough success that it was bought by Novartis last year for $8.7 billion, doubling the value of the company’s shares.

More recently, last week in fact, Roche paid $4.8 billion for Spark Technologies, who offers gene therapy to treat a rare eye condition as well as one for Hemophilia B, the rarer form. This time, the price of Spark’s stock more than doubled as a result of this acquisition.

While Spark’s hemophilia gene therapy has not been approved for use yet, their treatment for this rare eye disease has become the first gene therapy approved by the FDA, who seem willing to fast track approvals of gene therapy based upon practical considerations of need, with many patients dying during the wait, as well as to encourage the enthusiasm of companies to pursue more breakthroughs.

Getting a treatment approved is a very expensive proposition, and bringing on board the deeper pockets of big pharmaceutical companies such as Roche and Novartis provide the power to get a lot more done faster, even with the FDA willing to skip some steps.

In time, this will boost the potential of both companies, where the big companies get in on and profit eventually from this exciting new therapy, and the smaller companies get paid for their legwork. We are starting to see this vision mature, and there is much more yet on the horizon.

Marshall Gordon, senior research analyst at Clearbridge Investments, tells us that “big drug companies are waking up and saying this is a real technology and that they need to be there.”

Getting past the FDA isn’t the only hurdle that these treatments are facing though. Due to the combination of the investment these therapies require and the limited number of patients with the conditions they treat, the costs will be extraordinarily high, and these are costs that insurers have to be willing to pay.

For instance, Novartis estimates that the cost of treatment for their spinal muscular atrophy will cost $4 million per patient, and while this may save someone’s life, people normally don’t have an extra $4 million budgeted for that. This is also not something that insurers can make much economic sense of either, as they just aren’t going to be able to collect anywhere near that much in premiums over time from anyone.

There are practical limits to how much you can spend to treat someone, regardless of the consequences, and gene therapy certainly will look to push these limits. It’s not that we’re not doing this now in some areas, but there is a number out there that goes beyond what is possible, where we have to just shut down things.

The good news is that this cost didn’t scare Novartis away, and they do feel that the high price won’t be a roadblock. This particular treatment is among the most expensive ones being considered, so whatever that magic number is that we can’t go over, it seems higher than this.

We estimate that there are about 5,000 diseases that are caused by a single genetic mutation, so there is lots to work on out there, and much is happening as we speak. Many of these innovative companies who are working on this are now waiting their turn.

We will almost certainly see more acquisitions here, and in time, more therapies being delivered to the market. Eventually, as we get more confident with this form of treatment and the research expands enough, we may even move to looking to modify genes to better treat conditions that are only partially influenced by genetics, which is just about everything else apart from these rare conditions, and really expand the scope of this exciting science.

To see the pharmaceutical industry embrace this new form of treatment more and more over time is something that everyone should welcome, even their critics, as this does offer them an opportunity to treat diseases more effectively as well as make money.