Cell and gene therapy (CGT) is not just hype. We’re seeing real progress in the fight against cancer and other diseases using CGT, with stem-cell research leading the way. In fact, according to some estimates, CGT is growing to unsustainable levels, with more than 1,000 CGT clinical trials across the globe toward the end of 2019. Financing is on the rise as well. Companies conducting CGT and other leading-edge research raised nearly $2.6 billion in the third quarter of 2019, bringing the year-to-date financing total to more than $7.4 billion. And the US Food and Drug Administration estimates it will approve up to 20 cell and gene therapy products a year by 2025.
Despite the progress, however, there are a number of challenges healthcare professionals, researchers, governments and businesses must overcome for CGT to make a real-world impact on fighting global disease. These challenges exist largely because of the unprecedented surge in CGT activity. The current drug development and commercialization paradigm has not changed in the last half-century, and the system is constrained. Understanding and addressing these challenges can help lay the foundation for a clearer path toward the next wave of discovery.
The current CGT system is built for small molecules and biologics. We need new capabilities to develop and commercialize CGT at scale while rethinking the end-to-end system. Major challenges today include:
Finding and managing the right patient. Up to two-thirds of clinical trials fail to meet their enrollment targets, and about 20 percent of oncology trials fail due to inadequate patient recruitment. Complicating matters, unlike traditional therapies, CGT requires significant patient engagement and support during the long treatment process. To conduct CGT clinical trials over the next few years, the industry needs more than 100,000 patients. What’s more, some of these patients—up to 15 percent—are unlikely to complete the trial at all.
Creating a responsive treatment center model. Many clinical practices lack adequate capabilities such as cell handling to manage cell therapies. As a result, clinical trials are largely conducted at academic research facilities that meet the standards of organizations such as the Foundation for the Accreditation of Cellular Therapy (FACT). However, there are only 218 FACT-accredited institutions in the US. Additionally, delivering CGT requires responsive customer service capabilities, while many hospitals prefer simpler standardized procedures.
Collecting raw materials. The FDA requires cell extraction and handling to follow Good Manufacturing Practices, which are challenging to implement at scale. Among other things, cell labs are constrained for storage space and staff, and find it difficult to follow non-standard, sponsor-specific procedures. Additionally, many specialty centers have their own health information technology infrastructure, which is often not interoperable or connected with treatment centers.
Orchestrating cell delivery with specialized couriers. Today, there are very few couriers with the capabilities to meet the rigorous quality standards, special handling and tracking requirements for shipments under refrigerated, frozen and cryogenic conditions. With a minimum of two shipments for every patient and working with more than 500 manufacturers globally, today’s package and logistics service providers’ capacity is constrained, to say the least.
Other challenges include ensuring patient safety as well as decentralizing and lowering the costs of manufacturing operations. Indeed, the transformation in the cellular mechanisms puts clinical trial subjects and commercial patients at increased immunologic risk. As far as the mechanics are concerned, the majority of CGT efforts are being led by startups, which have limited resources to acquire essential data. Perhaps more challenging, they depend on contracting and manufacturing partners to manage cell processing and production. These potential partners are in short supply, however, with waiting lists backed up months and even years.
The way forward
We see two important developments taking shape in the CGT space that will be critical in overcoming the challenges. First, the operating model will have to decentralize. As a result, several types of business will emerge. Players can build capabilities and enable the decentralization or collaborate with new businesses to engage in this new economic model.
The CGT ecosystem is likely to move away from a traditional, linear and centralized operating model to a decentralized model with multiple hubs and spokes, enabling flexibility on where to develop therapies, collect cells and tissues, treat patients and manufacture products. In this decentralized hub and spoke operating model, current value chain partners’ roles will evolve, and their capabilities will expand. The wide network of municipal hospitals will dramatically increase patient access, decrease therapy costs, improve translational research capabilities and address patient referral impediment, minimizing patient leakage.
To manage the tsunami of CGT development assets and capitalize on the market dynamics, we envision six types of business entities emerging:
- Network manufacturers. Providing and enabling a distributed network of CGT product manufacturers to de-risk the supply chain.
- Hub and spoke connectors. Next-generation logistics providers to run the just-in-time supply chain, facilitate cell transfer operations and deliver raw material to the manufacturer and final product to the hospitals.
- Donor and tissue operators. Modular and distributed manufacturing facilities that will help add local capacity to the system, further accelerating decentralization.
- Stakeholder engagement champions. Working with industry standards bodies and IT infrastructure providers to drive standards harmonization and implementation.
- Data aggregators. Evolving oncology research and driving innovation across the drug development lifecycle.
- IT infrastructure enablers. Providing tools that facilitate the collection, breakdown and analysis of disparate patient, tissue, transport, manufacturing and health outcomes data.
Change and opportunity
Although we’ve seen tremendous progress on medical diagnosis and treatments, drug development and care delivery paradigm hasn’t structurally changed much. It was never designed to deal with the vast growth of potentially curative and personalized medicine, today a target of significant healthcare investments.
The CGT development pipeline and the commercial demand are challenging the healthcare ecosystem and creating significant constraints to deliver potentially transformative therapies to the market. The industry is experiencing unprecedented change, presenting opportunities for industry incumbents to rethink their business models.
Our vision of a decentralized model and the new business models is similar to other consumer industries, putting customers and influencers in the center of the value chain. The patient-centered, hub and spoke and system will usher in the future of healthcare. The growth of a network of fully capable treatment centers, wearable technology and remote monitoring will increase the emphasis on gathering and analyzing large amounts of real-world outcomes data further accelerating the prevention, proactive diagnostics, development and commercialization of more personalized CGT.
Stay tuned to this site for more insights and details of the future of CGT.
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