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CAR-T: What’s next? Part 1

Over the last two months, several news events have brought CAR-T cells to widespread public attention, the most prominent of which is the FDA approval of the first gene-modified cell therapy, for children with a type of leukemia who have failed other options. The new therapy, Novartis’ Kymriah (tisagenleucleucel; CTL019) is the first in a novel class of treatments known as CAR-Ts, or Chimeric Antigen Receptor T-cells. These are T-cells that are isolated from a patient’s blood, genetically modified to target the cancer cells, then infused back into the patient.

Clinical trials of CAR-T therapies have shown spectacular success, with complete response rates as high as 93% in some early trials (Kymriah’s overall remission rate within three months of treatment was 83 percent in one multicenter trial). The excitement around CAR-T therapies is warranted, and has been building for years within the academic and biopharma communities. The Kymriah approval provides validation for the CAR-T field.

What does that future look like? In one view, Kymriah is just the first of many more successful therapies, as molecular designs and clinical techniques are optimized, manufacturing difficulties solved, and payment issues resolved, genetically-engineered T-cells will go on to conquer many more cancer indications to become a major tool in the oncologist’s arsenal. Isn’t that what’s happening with immuno-oncology drugs already? Perhaps. Or perhaps CAR-T cells, and their younger cousins, genetically-modified T-cell receptors (TCRs), will end up as highly effective niche therapies for use in a few, narrowly-defined indications. The reality, likely somewhere between these extremes, will begin to play out over the next 3-4 years.

To begin to forecast the future of a new market, we begin with what we know, and that is the pipeline of products aiming for commercialization. The first is Kymriah and its approval for ALL, which is relatively rare. Those indicated for the treatment – pediatric patients who fail one or two other treatments – are fewer still, roughly 600 patients per year in the US. There are other indications that will follow, as well as competitors such as Kite (acquired by Gilead) and Juno that are targeting other hematological malignancies with similar as well as new CAR-Ts. Earlier in the pipeline are TCR-based therapies, which may be better at targeting many solid tumors.

According to the Alliance for Regenerative Medicine (ARM), there are 34 gene therapies, including gene-modified cell therapies, in final stages of clinical testing, and another 470 in initial clinical trials. We count 122 gene-modified immune-cell therapies in various stages of clinical testing. ARM estimates global financings of gene and gene-modified cell therapy in 2016 at $2.73 Bn [1]. As the result of these and prior investments we forecast a potential worldwide addressable commercial market of between 4-17 thousand patients treated per year in 5 years, and 17-65 thousand patients/year in 10 years[2], or roughly 30 thousand patients/year in 2027 in our base case. For the purpose of estimating the commercial market size of gene-modified T-cell therapies, if we assume an average price of $300,000[3] per patient treated, this translates to manufacturer sales of around $5 – 20 Bn (base case $9 Bn) in 10 years.

The large ranges in our estimates, and those of other analysts, reflect the huge uncertainties ahead for this new treatment class, in both the size and scope of potential indications that may be addressable as well as the risks and hurdles ahead, not to mention how pricing and uptake will play out. In the next blog post I’ll discuss how we think about these uncertainties in a structured way to shape our view of the potential opportunities ahead for gene-modified cell therapies.


[2] CBA estimates, adjusted for probability of success; ranges comprise conservative and optimistic scenarios.

[3] This figure is around what most investment analysts are using. Although Novartis announced a price of $475,000 for Kymriah, we believe the average price of these therapies will come down as manufacturing costs are brought down, addressable volumes increase, and competitors enter the market. Novartis’ manufacturing costs are believed to be high compared to competitors, around the price they are charging – i.e. Novartis is probably only just breaking even at this point. Note that this price does not include hospital and blood collection costs.

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