AskBio and a few dozen other firms are making North Carolina a pace-setter in highly targeted drug development.
There’s a story that Jude Samulski, perhaps the world’s preeminent gene-therapy research scientist, likes to tell. It’s about a fellow with a degenerative eye disease who is asked to navigate an obstacle course. He wanders, bumping into things and getting disoriented. It takes 76 seconds to finish the course. Six months later and following gene-therapy treatment, he’s back on the course. This time, there’s no disorientation. It takes 14 seconds.
It’s an apt metaphor for the industry itself — years of groping in the dark, of following promising leads that don’t pan out, and then, finally, emerging into the light. There were early missteps as researchers struggled to understand the technology. There was the highly publicized 1999 death of a young patient participating in a trial for a rare metabolic disorder. There was the ebb and flow of capital directed to the industry.
Still, researchers continued to plug away in their labs. One was Samulski, who came to UNC Chapel Hill in 1993 from the University of Pittsburgh, lured in part by a $430,000 faculty recruitment grant from the N.C. Biotechnology Center. He was a true believer.
“We knew from the beginning what this technology (gene therapy) could do,” he says. “We knew if we could make it work, we could change the world.”
Today, there are seven cell and gene therapies approved in the U.S. with dozens more expected in the coming years, according to the Milken Institute. There are about 1,000 in various stages of development with 50 to 75 new therapies expected to be approved in the U.S. by 2030.
These treatments are sometimes referred to as a “third wave,” following small molecule therapeutics and biologics. The promise is enormous. “Molecular medicine will change how we treat disease,” says Samulski. “We’re genetic beings. You fix (a disease) one time (with gene therapy) and it’s over.”
This progress has not gone unnoticed, leading to massive investment in companies involved in the research. In 2018, Novartis bought the gene-therapy company AveXis for $8.7 billion. Its primary therapy, Zolgensma, is used to treat spinal muscular atrophy, the leading genetic cause of infant death, and it produces more than $1 billion in annual revenue. Last year, Roche acquired Spark Therapeutics, a developer of gene-therapy treatments for hemophilia and blindness, among other diseases, for $4.8 billion.
North Carolina is in this game in a big way: in 2020, AskBio, a Chapel Hill-based company co-founded by Samulski and Sheila Mikhail in 2001, was acquired by Germany’s Bayer for $2 billion up front and $2 billion in incentive payments. At the time, AskBio had about 294 employees and nominal revenues relative to the purchase price. Its principal investors were the TPG Capital and Vida Ventures private-equity firms.
Seeing investors drop eye-popping sums on developmental stage companies with little or no revenue is not uncommon in the biotech industry, but AskBio was different. It had already spun out several companies, most significantly Bamboo Therapeutics, a Chapel Hill-based developer of gene therapies for rare neuromuscular diseases. In 2016, Pfizer paid about $200 million up front for Bamboo, with potential milestone payments of as much as $495 million.
In January 2021, Pfizer and Bamboo began Phase 3 trials for a therapy to treat Duchenne muscular dystrophy, a rare disease that causes progressive muscle weakness. This was the first gene-therapy product to reach this stage of development for the disease.
Of equal significance, Samulski and AskBio pioneered a sophisticated manufacturing capability for producing the viral vectors needed to insert genetic material into cells. It has now become something of an industry standard, while protected by multiple patents. This capability made AskBio “fundamentally different from the other gene-therapy companies,” Samulski says.
“The Pfizer acquisition (of Bamboo) confirmed the importance of manufacturing in gene therapy,” says Art Pappas, managing partner at Pappas Capital, a Durham-based investment firm focused on life sciences. “You have to have manufacturing to drive value.”
The idea behind gene therapy is beguilingly simple. Many diseases are a result of one or more defective genes. Replacing those genes with healthy ones should, in theory, be curative. AskBio’s core technology, the Adeno associated virus, or AAV, is essentially a gene delivery vehicle, what Samulski likes to refer to as a “FedEx truck,” allowing the company to address illness at the cellular level. “We learned how to take DNA out (of the cell) and how to put new DNA in and how to do it at scale,” is how Samulski describes it.
“We have a very big pipeline.”
The initial applications have almost all been in rare diseases, defined as one that affects fewer than 200,000 people in the U.S. The goal is to eventually broaden the applications to address conditions that impact much larger populations. AskBio, for example, is pursuing treatments for Parkinson’s and congestive heart failure, each of which effects millions of people in the U.S. and around the world.
Rare diseases themselves are not as rare as is generally believed. “This is a byproduct of the orphan disease world, that everybody thinks they’re small diseases. But if you take everyone who has an orphan disease and put them in one country, it’s the third-largest country in the world,” says Samulski. “They are typically children. Genetic diseases make up 45% of the medical costs in our hospitals.”
Still, the “third wave” is attracting the major pharmaceutical players. Jost Reinhard, head of the cell and gene therapy unit at Bayer, says of the company’s reasoning behind the AskBio purchase, “We (Bayer) were very strong on small molecules and biologics. We asked ourselves, is there a third wave? And if so, how do we want to be positioned?”
It was, he says, not necessarily any individual therapy but the platform technology, including the manufacturing, and the “ability to scale” that made AskBio attractive to Bayer.
“The vision is unique. There is the ability to treat rare diseases but also to explore beyond monogenetic (diseases that involve just one gene) to create a broader portfolio.”
AskBio lists six treatments in its pipeline. The three most advanced address Pompe disease, Parkinson’s and congestive heart failure. All are in Phase I trials, designed to “explore safety, feasibility and efficacy.” Phase II trials, intended to demonstrate safety and efficacy, have been designed and submitted and are awaiting approval from the federal Food and Drug Administration to move forward, according to Mikhail, AskBio’s chief executive officer and co-founder. The company is also investigating a novel approach to treating Alzheimer’s though that is in an earlier stage of development.
Role of the state
There are 55 gene-therapy sites in North Carolina where companies conduct research, manufacturing and other activities. The state is generally considered among the top two or three regions in the country for gene-therapy research and manufacturing, along with the San Francisco Bay area and Boston. Samulski is a seminal figure in all this, generally credited with putting the state and the Research Triangle on the map through both his work and support of others.
While the Biotech Center helped provide the funding that brought him to North Carolina, the state itself has not always been as supportive as it might have been. Early in the company’s history, Samulski appealed to state lawmakers for financial support for expanding AskBio’s manufacturing capabilities. The request generally fell on deaf ears.
That failure to recognize the industry’s growth potential frustrates Samulski. “They probably would have had to discover America multiple times before they realized there was something here,” he says jokingly.
Partly as a result, AskBio’s primary manufacturing facilities involve three plants in Spain. A fourth plant is in the planning stages with a location decision pending. North Carolina is one of several sites under consideration, Mikhail says.
In recent years, pharmaceutical manufacturing has become a strength for the state. By Samulski’s count, there are “46 or 47 gene-therapy companies that have come to North Carolina to do their production.”
The Biotech Center has supported the emergence of the gene-therapy industry through grants totaling about $6.63 million since 1993. In some cases, it takes warrants as well, a bet on the upside of these companies.
Samulski would be happy to see even more research support for the universities as well as additional funding for the Biotech Center. As he told the Raleigh News & Observer at the time of the Bayer acquisition, “We not only can be the manufacturing,” he said, “we can be the innovation hub, like Boston and San Francisco …. We can capture something and become the Silicon Valley of gene therapy.”
The fact that Pfizer has kept its research base in North Carolina following the Bamboo acquisition is “pretty profound,” Pappas says. “It’s added another dimension to what’s happening in North Carolina. We’re just at the beginning of growth for life sciences in the state.”
Reinhard says Bayer’s “strategy was not just to acquire intellectual property but to make sure we have the talent, the brains and the academic ecosystem. I’m convinced there’s a very positive future for AskBio in North Carolina.”
The next phase
While much of the early work in gene therapy focuses on relatively obscure illnesses, there are promising trials in late phase for diseases that have a higher public profile, including hemophilia and sickle cell anemia, says Kathy High, president of therapeutics at AskBio. “These are diseases everyone has heard of,” she says. “(Addressing these conditions) will elevate the awareness of gene-therapy.”
There are some inherent advantages in gene therapy drug development compared with more traditional pharmaceutical treatments. “If you look at the first two products that were approved using AAV therapy, they were approved on studies that involved a few dozen patients,” says High. “If they’re missing one gene and you put that gene into the right target tissue, you can get a pretty impressive clinical response. The effects are so dramatic you don’t need to enroll that many patients and treat them to demonstrate a very big difference between the control group and the treated group.” The impact can be a much lower cost of clinical development, she says.
As to AskBio, the agreement with Bayer requires that the company hit what Mikhail characterizes as a “basket of technical, manufacturing, clinical development, and revenue milestones all of which are achievable if we execute.”
Technical and regulatory obstacles still must be overcome, but there is no longer much doubt that gene therapy will have a major impact on the way health care is delivered. “The breakthroughs over the last decade have been amazing,” says Mikhail. “Our children and grandchildren will have much brighter futures.” ■
These are among the gene-therapy companies with research and/or manufacturing facilities in North Carolina.
- Astellas Gene Therapies – Ramping up a new $110 million gene-therapy manufacturing facility in Sanford.
- Beam Therapeutics – Building an $83 million biomanufacturing facility in Durham to produce precision genetic medicines using a pioneering technology known as base editing.
- Biogen – Building a $200 million facility to support production of its gene-therapy pipeline in RTP.
- CARsgen Therapeutics – Building a $157 million, 200-employee Durham site for manufacturing anti-cancer therapies. It’s a Chinese company.
- Jaguar Gene Therapy – Building a $125.4 million site in RTP.
- Novartis Gene Therapies – Producing Zolgensma to treat spinal muscular atrophy in Durham.
- Pfizer – Invested $500 million to expand its gene-therapy production in Sanford.
- Precision Biosciences – Forged a $2.7 billion partnership with Eli Lilly with its gene-editing platform.
- Resilience – Acquired Durham’s bluebird bio gene and cell therapy manufacturing site for $110 million.
- StrideBio – Signed multiple collaborations to develop technologies.
- Taysha Gene Therapies – Building a $75 million gene therapy manufacturing facility in Durham.Source: NC Biotechnology Center