Investment and Development Landscape of Autologous and Allogenic Cell Therapies
A healthcare development update by Peter Bak, PhD, Mavra Nasir, PhD and Dominique Lefebvre
The clinical pipeline for cell therapies has grown significantly, with growth in allogeneic therapies outpacing autologous approaches. While the late-stage cell therapy pipeline is relatively thin, the FDA predicts by 2025 they will approve 10 to 20 cell and gene therapy products annually. In a new article Back Bay considers the recent surge in VC investments and opportunities for advancement.
Chimeric antigen receptor T (CAR-T) cell therapies have revolutionized cancer treatment and have, in some instances, demonstrated curative potential. To-date, the FDA has approved six CAR-T cell therapies for the treatment of hematologic malignancies such as leukemia, lymphoma, and multiple myeloma. Approved CAR-T therapies, are truly a personalized (or “autologous”) therapy, as the manufacturing of these products requires harvest, genetic manipulation, and expansion of a patient’s own cells. As sponsors rack up additional CAR-T approvals, the manufacturing challenges faced by commercial autologous cellular products have taken center stage.
While autologous approaches provide therapies tailored to individual patients, the demand is significantly outpacing the manufacturing capacity creating challenges for patient access. In addition, some patients are ineligible or never receive treatment. For example, a patient may not have a number of available T cells to manufacture the product, due to disease progression and/or prior chemotherapy treatments. Additionally, in some instances, there is a race to manufacture the product in the face of an aggressive cancer.
As an alternative, sponsors are developing cellular products where the starting cellular material is not sourced from the patient that will ultimately receive the therapy. Known as allogenic approaches, these therapies aim to replicate the stunning clinical successes of autologous approaches with a truly “off-the-shelf” approach.
Given this interest, Back Bay Life Science Advisors assessed the evolution of the clinical pipeline and financing landscape for cell therapies, with a particular focus on autologous versus allogeneic technologies to gain insight into the future market’s direction.
The clinical pipeline for cell therapies has grown significantly, with the growth in allogeneic therapies outpacing autologous approaches
The annual number of cell therapy trials has almost doubled (1.8x) since 2017, with the bulk of trials (~70%) in the early stages (Phase I & I/II) of development [Figure 1a]. While the late-stage cell therapy pipeline is relatively thin, the FDA predicts that by 2025, they will approve 10 to 20 cell and gene therapy products annually. The decrease in the number of cell therapy trials in 2022 is reflective of the dip in biotech investment post-pandemic and reduced clinical development for COVID-19-related assets.
While autologous approaches are currently dominating cell therapy development (~11% YoY), the number of clinical trials for allogeneic approaches is accelerating (~16% YoY) [Figure 1b].
A driver contributing to the growth of the clinical pipeline and allogeneic approaches is the surge in venture backed investment from 2020-21
Venture financing in cell therapies was at a record high in 2020 and 2021, in line with the overall robust activity seen across the healthcare sector. The number of financings in cell therapies increased by roughly three times in 2021 versus 2017 (63 vs 22) with 50% of it for allogeneic technologies (34/63), 38% for autologous (24/63), and the remainder for companies with both capabilities (9/63) [Figure 2a]. By 2022, the frequency of cell therapy sector financings had reverted to pre-pandemic levels seen in 2019, reflective of a macrotrend observed in the healthcare industry across all verticals agnostic of technology area. The surge in financing in 2020-21 for allogeneic approaches highlights the industry’s interest in off-the-shelf approaches given the scalability and manufacturing barriers of commercial autologous therapies.
Despite the rise in the number of allogeneic financings, the average deal size remains relatively similar across autologous and allogenic approaches [Figure 2b]. Except for 2022, when the average deal size for autologous technologies was twice as large as those for allogeneic-only.
However, investors may still be cautiously watching the field due to a number of ongoing clinical questions as it pertains to allogenic therapies. Firstly, the durability of effect remains a key question in the space. As an example, interim results in a 16 patient study Caribou Sciences’ CB-010 allogenic therapy achieved a complete response in 69% of patients initially, although only one patient remained in remission 18 months later and another 24 months later, to date. On the contrary, Kymriah and Yescarta demonstrated favorable overall survival rates (55% and 43%) in B-cell acute lymphoblastic leukemia and large B-cell lymphoma patients at 5 years. While the trials for allogeneic therapies have prompted concerns about their durability, there remains ample opportunity for advancements with this early-stage technology, particularly due to the small sample sizes that have been considered to date. In addition to advantages in dosing and manufacturing processes, investors are looking closely at the potential efficacy and safety advantage over autologous approaches. Existing clinical data for allogeneic therapies have reported no cases of graft-versus-host disease cases, which was initially a notable concern. Clinical readouts for allogeneic therapies in 2023 (e.g., Beam Therapeutic’s BEAM-201) will be key to determine their value proposition and potential positioning moving forward.
Companies with autologous and allogeneic programs have seen a steady increase in average financing and command significantly higher average market cap
A total of $14.8B venture capital dollars have been deployed from 2017-22 for cell therapies specifically, with the majority dedicated to companies with autologous capabilities (45%), followed by allogeneic (37%), and lastly those with both platforms (18%) [Figure 2a]. Even though dual capability companies fall short in aggregate financings, the average financing size for such technologies has steadily increased by ~28% since 2019 [Figure 2b], and their average market cap is ~7x higher than companies solely developing either autologous or allogeneic assets [Figure 2c].
Cell therapy developers are targeting oncology indications such as multiple myeloma and B-cell non-Hodgkin lymphoma
Clinical development of cell therapies is primarily focused on oncology (~66% of trials), although autoimmune, inflammation, central nervous system (CNS), and metabolic disorder trials are also prevalent [Figure 3a]. The high prevalence of infectious disease trials (~7% of trials) is mainly due to COVID-19-related assets. Oncology also predominantly dominates cell therapy venture financings, accounting for ~70% of investments [Figure 3b]. Oncology is an area of focus for cell therapy developers as it can command high price points relative to other therapeutic areas. The potentially curative modality is also compatible with many oncology indications. Notably, the activity within autoimmune and inflammation is focused on indications such as osteoarthritis, GvHD, and Crohn’s disease due to a combination of their ability to command higher price points and the high residual unmet need. For assets being developed in areas where premium pricing is less feasible, allogeneic approaches offer a significant cost advantage.
In recent years, novel cell therapy approaches such as macrophage and γδ T-cell therapies have emerged into the clinic
T-cells and stem cells are currently dominating cell therapy clinical development and venture financings (~77% of all trials and ~60% of all financings) [Figure 4a-b].
Although clinical development activity for natural killer (NK) cell, macrophage, and γδ T-cell therapies has increased in recent years [Figure 4c]. More novel cell therapy approaches are emerging in the clinic as of 2020, including macrophage and γδ T-cell therapies. Venture interest in emerging cell types is also increasing with a ~23% YoY increase in the number of financings for non-T-cell therapies. While T-cell approaches have been successful in the clinic, investors are interested in harnessing the unique biology of alternative cell types to address a number of issues with first-generation T-cell approaches, such as efficacy, side effects, tissue tropism, and manufacturing.
Looking forward
While the biopharma space has seen macroeconomic head winds, 2023 has been particularly volatile for allogenic cell therapies. Recently there have been data readouts negatively impacting share price as well as high profile company closures. Nevertheless, it is still early days as sponsors look to optimize product profiles (e.g., lymphodepletion regimens, number of cellular products delivered, cell type, etc.). As consolidators saw fit to place bets with investments and partnerships in the allogenic space, we may be seeing renewed momentum in the space.