Last week, the MMRF launched a 1,000-patient trial with newly diagnosed multiple myeloma patients, to study the relationship between a patient’s genetic profile and treatment outcome. The study, part of the MMRF’s “Personalized Medicine Initiative,” will track patients from initial diagnosis through the course of their treatment, over a minimum of five years. The study will “conduct sequential tissue sampling to identify how a patient’s molecular profile may affect his or her clinical progression and individual response to treatment.”

To what end? If pharmaceutical companies are reticent to integrate genomic data into the clinic, for the reasons above as well as regulatory issues around data validation and patient privacy, who will? Physicians will, according to Richard Resnick, CEO, GenomeQuest, and a former manager of bioinformatics software at Wyeth-Ayerst. “Physicians could potentially disrupt the value chain in pharmaceuticals, if [drug companies] don’t listen,” said Resnick, during a panel discussion yesterday at a Cambridge Healthtech Institute conference on next generation genome sequencing.

Brad Smith, VP, translational medicine at Quintiles, acknowledged that some Big Pharma companies are recognizing the importance of patient biomarkers in the early stages of drug discovery, but they aren’t making it a priority. “In our partnerships with pharma, biomarkers and lab tests are usually pretty far down at the bottom of the list,” said Smith during the panel discussion. “Suggesting a new endpoint adds risk to the trial protocol.”

What the pharmaceutical industry really needs to overcome cost concerns is a clear success story, said Iya Khalil, SVP and co-founder of GNS Healthcare, during the panel discussion. Despite the approvals last month of Roche/Daiichi-Sankyo’s Zelboraf (for melanoma) and Pfizer’s Xalkori (for lung cancer) – and their respective companion diagnostics – Khalil said the industry still needs a clear, end-to-end success story for expediting drug approval by using data collection, genomic sequencing and microRNA transcription, phenome measures including physiological outcomes, and finally, predictive analytical software. Khalil said the approval of Xalkori, originally a drug targeting the c-MET gene to prevent a certain type of protein expression in cancer cells, hinged on a serendipitous discovery of ALK inhibition. “Pfizer got lucky, good for them, but we know there’s a more rational way to do [discovery] that can work, there’s no reason why…you can’t profile these patients and study these things,” said Khalil. “The question is who is going to take the chance on that pilot that actually shows that this will work.”

At the conclusion of the “Genomics in Clinical Trials: Has the Time Come?” panel, Resnick was asked how many years it would take to have a full genome sequencing done for 50% of the US population. His estimate was 15 to 20 years.

“As a society, as we’re having this big debate around healthcare, everyone agrees that there’s a certain baseline of people that we have to take care of,” says Craig Kephart (pictured right), president and CEO of Centric Health Resources, a direct-distribution company focused on specialty pharma and orphan diseases. “And I put people with rare and pediatric orphan diseases in that bucket. Their condition isn’t based on a health or lifestyle choice—they just lost the genetic lottery.”

According to the National Organization for Rare Disorders (NORD), of the nearly one in 10 Americans with rare diseases (those diseases affecting under 200,000 patients in the US), approximately two-thirds are children. “Many of these rare pediatric diseases are very serious and treatments are desperately needed,” said NORD president and CEO Peter L. Saltonstall in a statement. But, until recently, those desperately needed treatments weren’t exactly on the radar for Big Pharma.

For some orphan diseases, the marketplace may be only 500 or 1,000 patients, so pharma’s opportunity to recoup its investment in bringing a drug to market is very limited, resulting in the need to charge a very significant amount of money for the therapy. Historically, what this has meant for the orphan disease population—especially for diseases that affect less that 6,000 patients, which Kephart calls ultra-orphan diseases—is that pharma never bothered to research possible treatments because the prospective ROI just wasn’t there; or perhaps even worse, a drug did reach patients but was priced unreasonably high to compensate.

“Right now we seem to be going through this foolish-thinking phase where the knee-jerk reaction by managed care is to raise the patients’ financial burden, saying ‘Oh, we’ll cover the drug, but we’re going to make it a Tier 4.’ So the patient will have a much higher out-of-pocket expense,” adds Kephart. “When you look at the impact of these types of rare and neglected diseases, not only are they personally catastrophic for the families and patients affected; they can also be economically devastating.”

However, new science, new laws, and new interest from Big Pharma may point to a light at the end of the tunnel, says Kephart. “We are seeing a tremendous focus—all in the past few years—on these ultra-orphan diseases,” he says. “There are a couple of driving factors behind this shift. One of them is certainly all the talk about patent cliffs, the lack of blockbuster drugs, and the R&D pipeline not being as strong as it once was. Pharma companies are naturally looking for new places to grow—and if there aren’t any more big markets to grow in, you have to grow in a bunch of smaller markets.”

Although the changing landscape of Big Pharma has played a part in putting ultra-orphan and rare pediatric diseases back on the map, much of the credit should go to developments in science, particularly in genomics. Kephart says that often, scientists and pharma companies tell him that these rare diseases are easier to crack, because they tend to be isolated to one specific genetic defect or one section of the gene that’s got a mutation, so they can more easily try to create therapies for it.

In the interest of trying to get Big Pharma to put all this newfound scientific and technological insight to good use, US Senator Bob Casey (D—PA) introduced in March the Creating Hope Act of 2011—a bipartisan bill that would encourage the development of new treatments for rare and neglected diseases that disproportionately affect children. But where’s the incentive?

Essentially, the law tells pharma companies that if they focus on a rare or neglected childhood disease and try to bring a drug to market there, they’ll get a voucher for one of their other non-rare drugs to qualify for expedited review through the FDA—thus cutting up to five months off the review process.

So by working on ultra-orphan drugs under this new law (which has not passed yet), a pharma company could then significantly decrease the time to market for one of its other, bigger money-makers. “The idea here is that if you cut four or five months off your review time and get your drug to market sooner, that’s four or five months of revenue that you weren’t counting on,” says Kephart. “That’s just good economic sense.”

In order for treatments for these ultra-orphan diseases to come to market and be accessible to the patient, all the planets need to align perfectly. Pharma needs to be interested; the clinical trials and other R&D costs need to be recouped; investors need to see a strong potential for ROI down the line; and value needs to be evident in more than just (millions of) dollars and cents.

“This is one thing I talk about often to companies and potential clients—they need to focus on the value equation,” explains Kephart. “If your drug is just sort of a nice-to-have convenience, then patients and payers aren’t going to value it. You need to start looking early on, to collect the outcomes that prove your product is making a difference. You need to consider other measures beyond cost—is your drug keeping people out of the hospital, or do the results of taking this drug allow people to go back to work?”

To succeed going forward in this new, leaner, more competitive climate, says Kephart, “Those are the things I think pharma companies have to get used to focusing on, and they’re going to have to make that a part of the deal.”

Francis Collins devoted more than 15 years in the lab to deciphering the human genome. Ten years later, as Director of the National Institutes of Health (NIH), he finds himself in another unique position: to deliver the promise of the genome through the translation of research into technologies, products, and services that are clinically relevant and commercially marketable.

A critical task for Collins this year is to convince Congress to provide healthy funding for NIH amidst plans to cut federal outlays. Flat NIH budgets during the last decade created a huge pent-up demand for funds, which quickly absorbed the extra $10 billion provided by the 2009 stimulus package. Even though the White House sought a 3 percent increase for NIH for 2011, Congress never approved it, and most federal agencies are currently operating at last year’s funding levels.

Collins pressed for Committee approval of the new translational sciences center in December 2010 to be able to include it in the administration’s 2012 budget plan and thus obtain initial funding this fall. But the lack of new money for NIH means that most of the $700 million that would be needed to support translational sciences will have to come from existing funds. That makes the research community nervous, as well as pharma companies that want NIH to continue its focus on basic research.

Speaking to Pharm Exec, Collins says the role for NIH is to “de-risk” the process of drug development and to leverage its own human and financial capital to foster better partnerships with Big Pharma and biotech. He sees a rapidly changing biomedical research landscape as the prime driver behind stronger NIH partnerships with the pharmaceutical industry. He’s optimistic that new genetic discoveries can chart pathways for discovering new medical treatments, and that the emergence of more well-validated genes will be useful in “identifying drug targets in unprecedented numbers.”

At the same time, biotech and pharma companies face serious financial challenges in funding research projects. “These are not easy times for the development of new therapeutics,” Collins allows, noting that venture capital is limited and many biotech companies are struggling to stay afloat.

“So it’s kind of the best of times, and worst of times,” he observes. The scientific enterprise is yielding up a lot of new ideas about therapeutics. Yet, “the traditional private sector efforts to capitalize on that are taking a hammering.” NIH, thus, is “an attractive alternative” for supporting new partnerships between academic researchers and industry.

Collins has an eye out for tax provisions, patent incentives, and regulatory assistance that can encourage such collaboration. And he emphasizes that NIH won’t move into full drug development, but will support projects just long enough for them to become attractive for a biotech or pharma company to pick up. For a completely new molecular entity to treat a common disease, “I suspect the interest in the private sector would be very high, very early,” he says. Conversely, a treatment for a rare disease that affects only a few hundred patients is not likely to generate much interest until further along. NIH is prepared to contribute to promising projects as far down the line as it has to—“but no further,” he maintains.

Bench to Biotech
The NIH translational sciences center envisioned by Collins would house a spectrum of programs now scattered among different NIH entities, according to the report to NIH’s Scientific Management Review Board, which was established two years ago to examine and recommend changes in the agency’s organization and structure. Current translational research programs cover the development waterfront, many funded by the director’s Common Fund, a $500 million kitty that Collins administers to support cutting-edge, trans-NIH projects. Instead of shifting these activities to an existing NIH institute, the advisory group thought it best to establish a new organization to emphasize the importance of these changes.

Several NIH activities may remain outside the new Center, such as the Pharmacogenomics Research Network (PGRN), a group studying how genes affect patient response to medicines for cancer, heart disease, asthma, nicotine addiction, and other conditions. The panel also decided to leave NIH’s Clinical Center as a distinct entity, but with strong links to the Center.

FDA partnership
The new Center also will support NIH collaboration with FDA. Under the collaboration, NIH is funding several research projects designed to assist product development and enhance regulatory review. The first round of grants, which total $10 million over three years, support research on predicting harmful effects of nanoparticles in drug delivery, new models for safety and efficacy screening of drug candidates, innovative statistical methods and study designs for clinical trials, and a novel strategy for predicting eye irritation in clinical studies.

Collins acknowledges that the funding is very modest, but more than what FDA has for this kind of research. FDA chief scientist Jesse Goodman regards FDA’s collaboration with NIH as a real “culture change, and recognition that FDA’s engagement in the development of medical products is very important.”

Conflicts & Costs
One assignment for the new Center is to reduce barriers to public/private collaboration that can be created by conflict-of-interest (COI) concerns and intellectual property (IP) issues. Collins is working to put “NIH’s COI house in order” with more stringent and more transparent financial reporting requirements.

Equally challenging is the task of balancing open access to research data against IP protection. NIH wants to establish models for collaboration agreements and licensing arrangements, although Collins sees most discoveries from public/private collaborations residing in precompetitive space; exclusive licensing agreements should be “limited to circumstances where it’s really needed as an incentive for product development,” he says. Collins made waves in September 2010 by announcing that NIH would license a key protease inhibitor to the UNITAID HIV medicines patent pool, a move designed to spur pharma companies to take similar action.

R&D Support = Lower Prices?
Drug pricing is another issue that emerges in discussions about NIH/pharma collaborations. Collins doesn’t see NIH trying to influence drug prices per se, blanching at remembrance of the “reasonable pricing” debate that made industry very skittish about partnering with NIH back in the ’90s. Yet, he also is concerned about the trend toward more high-cost therapies. “The market can’t bear $93,000 for compounds across the board that give you four months of additional quality of life,” the NIH director told Science magazine in May. “That’s just not going to be sustainable.”

Instead of pressing for lower prices, Collins looks to reduce upstream R&D costs—and resulting product prices—by providing data that supports smaller clinical trials and by rescuing abandoned compounds. “If we could simply improve success rates by a factor of two—you know, only a 90 percent failure rate—that would be a phenomenal achievement,” he enthuses. Throwing out unpromising projects is key to improving the process, he adds: “People should be rewarded for having the courage to do that.”

Taking Risks
The dark cloud over these and other NIH initiatives is an ever tighter funding climate for federal agencies. “That’s what keeps me awake at night,” Collins says. “We have such exciting scientific opportunities now, but we’re really in a squeeze as far as our ability to support them.”
While trying to figure out what NIH can afford to do, Collins insists the wrong move is to “just hunker down and not try anything new.”

Pushing for such a significant organizational change at NIH in a very short time is certainly risky. But NIH “is about innovation,” he emphasizes. “It’s about taking risks.”

The full version of this interview will be published in February’s Pharmaceutical Executive.

“These are very difficult times for the research-based industry. To be successful, the industry is going to need to improve the efficiency of its R&D process, attract the assistance of regulatory authorities around the world, and get a handle on an increasingly difficult reimbursement environment,” Tufts Center Executive Director Ken Kaitin told Pharm Exec. The importance of replenishing the pipeline with useful new medicines has never been more stark, as this year and next also mark the peak in the trend toward patent expirations.  The industry is on the cusp of an unprecedented loss of revenues:  at least $130 billion, according to IMS and other industry data crunchers.

The primary conclusion of the report is the unrelenting progression of costs.  It is now higher than ever, with the average price tag to bring a compound from discovery and proof of concept to commercialization, minus opportunity cost, topping out at $1.3 billion. And fewer new products are likely to be anointed as blockbusters, with annual sales in excess of $1 billion. The science behind these medicines is more daunting while the data on efficacy is questionable, particularly when framed in the long-term perspective that is increasingly required by payers. The Tufts research also documents the ways in which payers and intensifying therapeutic competition within classes are combining to slow uptake of new drugs, with most fresh innovations failing to realize the initial sales expectations of Wall Street after launch.

In response, pharma is doing better within its own zone of control, focusing on internal changes designed to lower operational costs and slow the failure ratio for compounds at a late stage of development.  These measures include greater reliance on translational science to help identify the right disease targets for new molecules; a commitment to partnering with external service providers to share risks, reduce cycle times, lower costs, and improve resource management; and greater use of sophisticated portfolio management techniques.  These approaches are promising in that they lower costs while also ensuring that development programs are prioritized around those compounds most likely to find favor in the marketplace.

Other near-term trends highlighted in the Outlook 2011 are the following:

*  The FDA will focus its efforts on confronting new emerging threats to public health, led by antibiotic resistance, emergency drugs, anesthetic agents, new therapies for cognitive disorders, and newer and better pain medications.

*  Although more than half of all FDA-regulated clinical trials in 2010 were conducted outside the US, sponsors will seek to decrease the number of countries hosting development activity in an effort to reduce global logistical and regulatory complexity. Consolidation of effort will be the norm.

*  Monoclonal antibodies (mAbs) remain the hottest arena for competitive research, as annual global sales of these products currently approach $40 billion.

*  Among private payers in the US, risk-sharing agreements to manage uncertain outcomes and costs —where pharmaceutical companies agree to share the risk regarding a newly approved product’s cost effectiveness in clinical practice — will become more common.

One issue not noted in the report is the implications of conducting so much trial work in settings outside the US on the flagging attitude toward risk.  If the industry proves lax in regulating itself with the strong internal controls required to prevent abuse or neglect in countries where official trial standards are weak, then confidence in the science behind research could wane, leading to fewer new approvals.

The low-ball $43.7 billion buyout offer was made late Sunday night. Although widely viewed as a fait accompli, by Friday the Wall Street Journal’s Health Blog was reporting that “it sounds like Genentech may put up a fight.” 

Even more interesting, TheStreet.com’s Adam Feuerstein was floating the prospect of Genentech, backed by private equity, making its own hostile bid for Roche. “If I were [Genentech CEO Arthur] Levinson, I’d get in the face of [Roche Chairman Franz] Humer and tell him, ‘You don’t buy us, we’ll buy you, punk’” is how one analyst put it.

Everyone loves a good fight. But lost in the breaking story was the news on Tuesday of another Roche acquisition. The Swiss drug giant paid $125 million for a little biotech in Madison, Wisconsin, called Mirus Bio, the maker of a systemic delivery technology for RNA interruption therapeutics. Called Dynamic PolyConjugates (DPC), these tiny transporters are amazingly target specific—they seem able to enter a single cell and dump their payload without apparent spillover.

An effective, efficient delivery system is the Gorgon blocking the road to RNAi drug development, and the Mirus purchase indicates that Roche is up for the challenge. Pharm Exec spoke to Louis Renzetti, Roche’s global head of RNAi therapeutics, to find out what’s cooking.

All of a sudden, Roche is a leading player in the RNAi space. How did that happen?
We’re serious about the further evolution of medicine—especially better efficacy in more people and gaining better control of some serious diseases. And whenever we were looking at emerging technologies, RNA interference always came to the top of the list.
But we knew that if we were going to get into this, we had to make a very real and focused commitment. We began investing a year ago, and that’s how we ended up with our [$1 billion milestone] deal with Alnylam [for an IP license] and acquisition of its European RNAi research site.

Why Mirus Bio?
Mirus offers us two things: a really cool technology and a team of scientists with deep know-how. They addressed the delivery problem almost from a virus approach and developed DPC technology, which selects a particular cell—much like an antibody—and gives nearly 100 percent gene knockdown.

So this week it’s Genentech and Mirus. What’s on the shopping list for next week?
Well, we’re developing a global RNAi network of scientists—we have the Madison site, the Center of Excellence in RNAi Therapeutics in Germany, as well as labs in Nutley, New Jersey, and Basel, Switzerland. We have efforts going on using proteins as a delivery technique. We all agree that there’s probably not going to be a one-size-fits-all approach because these are complex diseases and we’re looking at knocking down multiple genes and different genes in the same population.
This is all part of Roche’s ongoing drive toward personalized medicine. Our diagnostics division can help identify biomarkers and pathways. Genentech has deep expertise in oncology and immunology, and we expect there to be synergy between monoclonal antibodies and RNAi.
We believe in this area as a therapeutic. We want to turn RNAi into drugs.

For more on how Roche is rockin’ RNAi therapeutics—and why they may leave Merck and Pfizer in the dust—read Dirk Haussecker’s blog here.

The product, which grew out of research at the M.D. Anderson Cancer Center, uses a modified adenovirus to deliver the TP53 gene to cells in the tumor, causing them to express the tumor-supressing protein P53. The drug, which is delivered into the tumor by injection, recently completed a Phase III trial in end-stage head and neck cancer. In the trial, patients with the right P53 profile showed a strong response to the drug and a good safety profile.

Gene therapies have had a hard row to hoe since 1990, when the first experiments were conducted. Effectiveness was occasionaly spectacular, but safety failures, when they’ve occurred, have been pretty spectacular too. But with significant unmet need, good biomarker support, a well-understood method of action, and strong safety data, Advexin could be the drug that gets FDA to change its mind.

One way or another, gene therapies are obviously attracting a lot of attention. Here’s a small sampling of the news from just the past couple of weeks:

• Researchers speaking at the American Urological Association explained that they had treated erectile dysfunction by injecting naked copies of the Maxi-K gene directly into penile smooth muscle. Safety is currently looking good, but the researchers want to go back with a higher dose to test efficacy.
• A Phase I trial is getting under way to test Celladon’s Mydicar in severe heart failure. The treatment involves injecting the gene that expresses the enzyme SERCA2a into the hearts of patients who underproduce it.
• Amsterdam Molecular Therapeutics announced that it has finished enrolling a pivotal trial for product AMT-011 (Glybera(R: 68.11, -0.77, -1.11%)) for Hyperlipoproteinemia. The disease, which is currently untreatable, causes patients to have a defective HPL gene, and thus fail to produce a key enzyme that breaks down fats. AMT-011 uses an adeno-associated virus to deliver healthy copies of the gene to muscle tissue.
• An Australian researcher who had previously controlled hemophilia with gene therapy, only to have the immune system undo his work far too quickly, announced that he would launch a clinical trial by the end of the year to see if he could use immunosuppression to get the body to accept the new genes.
• And finally, in a sign of just how close some observers think we are to practical gene therapy, sports officials announced that they are already on the lookout for “gene doping,” the latest, and as yet entirely hypothetical form of illegal performance enhancement.