Medical personnel use a mammogram to look at a lady’s breast for breast cancer.
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SAN FRANCISCO — A longtime but promising group of cancer drugs was a red-hot market in 2023, and more corporations could look to the treatments to fuel growth within the yr ahead.
That was one clear takeaway from the JPMorgan Healthcare Conference in San Francisco, the nation’s largest gathering of biotech and pharmaceutical executives, analysts and investors.
Throughout the four-day event, the biotech and pharmaceutical industry signaled its enthusiasm for antibody-drug conjugates, or ADCs, which deliver a cancer-killing therapy to specifically goal and kill cancer cells and minimize damage to healthy ones. Meanwhile, standard chemotherapy is less selective – it could affect each cancer cells and healthy cells.
Johnson & Johnson last week announced a $2 billion acquisition of ADC-developer Ambrx Biopharma to beef up its existing pipeline of ADCs, which some researchers imagine might be heralding a “recent era” for cancer treatment. Other drugmakers equivalent to Pfizer and Merck, which closed a number of the greater than 70 ADC-related deals during the last yr, said those drugs might be key growth drivers for his or her businesses.
Interest within the drugs will only proceed this yr, as some analysts expect more dealmaking and advancements in ADCs currently in development.
The aspects fueling the recent rise of ADCs won’t abate this yr, and a fear of missing out amongst businesses which have not entered the market will only push more corporations to enter the space, Andy Hsieh, an analyst at William Blair & Company, told CNBC.
Those aspects include increased confidence in ADC technology amongst corporations and researchers, the doubtless longer market exclusivity of those drugs and the rise of attractive ADCs from drugmakers in Asia.
The drugs even have potential to attract huge profits: ADCs could account for $31 billion of the $375 billion worldwide cancer market in 2028, in accordance with a report citing estimates from the drug market research firm Evaluate. The marketplace for those drugs in 2023 was estimated to be price around $9.7 billion, one other report from research firm MarketsandMarkets said.
“It’s sort of like FOMO, right? Everyone wants to achieve exposure to [ADCs] and principally make it a cornerstone of their entire corporate strategy,” Hsieh told CNBC. “I actually don’t see any kind of slowing down and it is going to very much, in our view, be a continuation of the 2023 momentum.”
Why ADCs have turn into popular
ADCs aren’t recent.
Roughly a dozen have won approvals from regulators worldwide, with the earliest coming in 2000. But dealmaking began to select up in 2020 and “really take off” in 2022 and 2023, in accordance with Daina Graybosch, senior research analyst at Leerink Partners covering immuno-oncology.
She called the recent rise of ADCs a “multi-decade innovation cycle,” where it took several years for the industry to make some “fundamental transformative innovation, which then unlocked more investment and rather a lot more potential.”
Improvements in ADC technology appeared to have made some newer iterations of the drugs more secure and effective, which boosted the industry’s confidence of their potential and encouraged more investments within the space. The regular surge of approvals and acquisitions during the last several years also contributed to that confidence, convincing some corporations that ADCs have a “lower-risk development path,” Hsieh said.
A view of an AstraZeneca facility is seen during Prime Minister Scott Morrison’s visit on August 19, 2020 in Sydney, Australia.
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Graybosch highlighted an ADC jointly developed by AstraZeneca and Japanese drugmaker Daiichi Sankyo called Enhertu, which she called the primary of “the next-generation ADC” that had a greater breadth of treatment in comparison with older versions of the drugs. For instance, Enhertu became the primary ADC to point out the power to treat breast cancer patients with each high and low levels of a protein called HER2, which controls how breast cells grow, divide and repair damage.
Drugmakers have fine-tuned key components of ADCs during the last several years, equivalent to the chemical bond that helps those drugs deliver a cancer-killing therapy to cancer cells, in accordance with William Blair’s Hseih. He said corporations are learning easy methods to maximize the efficacy of those drugs “without moving into an excessive amount of negative effects.”
ADCs still have their drawbacks — for instance, cancer tumors can develop resistance to them over time. And never all newer ADCs in development are successful: Last month, Sanofi scrapped its only experimental ADC after it fell short in a late-stage trial in lung cancer patients.
Graybosch also noted that corporations from Japan and China have emerged as effective ADC developers which can be rapidly “innovating tweaks” to the drugs and bringing ADCs to the market that might be higher than older versions of the drugs.
U.S. and U.K.-based corporations are inking deals with those international drugmakers, equivalent to two licensing agreements GSK signed late last yr with Chinese-based Hansoh Pharma for ADCs targeting several sorts of cancer.
The complexity of ADC technology has likely turn into one other motivation for corporations to speculate in and develop the drugs, Hsieh noted. He said it could reduce the possibilities that other corporations will create biosimilars, allowing drugmakers to maintain ADC prices high for longer periods of time.
Gilead’s approved ADC for breast cancer, Trodelvy, has a U.S. list price of greater than $2,000 per vial. But some ADCs available on the market have far higher list prices: A sophisticated ovarian cancer drug from biotech company ImmunoGen costs greater than $6,000 per vial as of 2022.
List prices are before insurance and other rebates.
How some drugmakers are betting on ADCs
Merck now expects $20 billion in recent cancer drug sales by the early to mid-2030s, thanks partially to its recent investments in ADCs, executives announced through the conference. That is double the estimate the corporate provided through the same conference last yr.
The raised forecast signals Merck’s confidence in the longer term of its cancer drug offerings, at the same time as its blockbuster immunotherapy Keytruda nears a lack of exclusivity in 2028. That can expose it to generic competition.
Merck executives highlighted its as much as $5.5 billion licensing agreement with Daiichi Sankyo to jointly develop three of the Japanese drugmaker’s experimental ADCs. This yr, the corporate hopes to win an approval for one in all those ADCs for the treatment of non-small cell lung cancer.
“….We’ve got a number one position now in antibody-drug conjugates, and we have done that through what I believe may be very smart deal-making,” Merck CEO Robert Davis said. He added that “what all of that actually translates to is the potential for growth.”
Newly built Merck research facility situated at 213 E Grand Ave in South San Francisco.
JasonDoiy | iStock Unreleased | Getty Images
Pfizer hopes ADCs will help the corporate turn around after a rocky 2023. Shares fell roughly 40% last yr as Pfizer grappled with weakening demand for its Covid products and other business missteps.
Pfizer CEO Albert Bourla told reporters that the corporate’s $34 billion acquisition of ADC-developer Seagen would help restore investor confidence in Pfizer, especially now that the deal is officially closed.
Bourla noted that antibody-drug conjugates have turn into the most well liked area of oncology, adding that Seagen’s expertise in ADCs will give Pfizer an enormous advantage in developing those drugs further and establishing itself as a frontrunner in cancer treatment.
Pfizer believes the Seagen acquisition will herald greater than $10 billion in risk-adjusted sales by 2030. Seagen specifically brings 4 approved cancer drugs, including three ADCs, which can beef up Pfizer’s own ADC portfolio.