Nasdaq : 3 Biotech pipeline to keep an eye on in 2018
Expo: BioTaiwan Exhibition
2017 has turned out to be pretty good for the pharma and biotech sector where FDA approvals are concerned. Till date, the regulatory agency has given its nod to 43 novel drugs, well above the 22 drugs approved last year. Immuno-oncology was a key focus area in 2017, whether it was to do with scientific conferences, clinical trial collaborations, acquisitions or FDA approvals. The approval of Novartis's NVS Kymriah, a gene cell therapy, and Gilead's GILD Yescarta, a CAR-T (chimeric antigen receptor T cells) cell treatment, ensured that the highly lucrative immuno-oncology market remained in the limelight. The $11.9 billion acquisition of immuno-oncology focused Kite by Gilead also increased interest in this category with investors expecting more acquisition announcements in this area. While we see 2017 as a year focused on immuno-oncology, here is a look at three therapeutic areas that we think will garner a lot of interest in 2018.
Immuno-oncology will remain a key focus area in 2018 as well. The basic concept of cancer immunotherapy or immuno-oncology is to utilize certain parts of the immune system to fight the disease. This can be done by stimulating the immune system to attack cancer cells or by introducing immune system components into the body. While some immuno-oncology treatments have the potential to be effective as monotherapies, others may be more effective when combined with other treatments.
Different types of immunotherapies include monoclonal antibodies/mAbs (man-made versions of immune system proteins which can be designed to attack a very specific part of a cancer cell), immune checkpoint inhibitors (recognize and attack cancer cells), vaccines (help prevent or treat cancer) and others that boost the overall immune system. Encouraging results generated by some companies demonstrating partial and complete responses in late-stage cancer patients and the recent FDA approval of Kymriah and Yescarta has raised hopes for cancer patients and increased interest in this segment of the cancer market. With immuno-oncology set to change the treatment paradigm for cancer, this area represents huge commercial potential. Companies that have progressed quite a bit in this area include Juno Therapeutics JUNO , Incyte and bluebird bio BLUE with these companies often considered to be acquisition targets.
Alzheimer's disease is an area where many companies have tried their luck though not with much success. Over the last several years, big players like Merck, Lilly LLY , Pfizer and J&J have all faced setbacks in their quest to find a treatment for Alzheimer's. Companies that are currently working on Alzheimer's disease treatments include players like Biogen BIIB, Novartis, AstraZeneca, Eisai and Amgen. Biogen's aducanumab is one of the most important candidates in the company's pipeline with the candidate currently in a couple of late-stage studies. Biogen is also working on elenbecestat (E2609), a BACE inhibitor in a phase III program and BAN2401, a humanized beta amyloid antibody in phase II development with top-line results expected by the end of January 2018.
All three candidates are being developed in collaboration with Eisai. Lilly also has quite a few Alzheimer's disease candidates in its pipeline including lanabecestat, which is being developed in collaboration with AstraZeneca with data readout expected in 2019. Meanwhile, Novartis and Amgen are collaborating for BACE1 inhibitor CNP520 which has fast track status in the United Status. Roche is also collaborating with AC Immune for the development of Alzheimer's disease treatments. Although Alzheimer's has historically been a very challenging therapeutic area with quite a few stocks stumbling in their efforts to find a treatment, the market is highly lucrative. As a result, several companies continue to invest heavily in developing Alzheimer's disease treatments. According to the Alzheimer's Association, in the 10 years from 2002-2012, 244 drugs were tested for Alzheimer's in studies registered with clinicaltrials.gov out of which only one succeeded and went on to gain FDA approval.
While these numbers are far from encouraging, success in this area means huge returns considering more than five million Americans are living with Alzheimer's disease with the numbers expected to increase to as much as 16 million by 2050 (Data: Alzheimer's Association). It is considered to be one of the biggest burdens of society and is the sixth leading cause of death across all ages in the United States. The market has immense commercial potential and companies coming out with new treatments could rake in billions of dollars in sales.
Another segment of the pharma and biotech industry that will remain in the limelight next year is the medical marijuana industry. The industry got its first exchange traded fund ("ETF") earlier this year and has been attracting interest from investors over the last few quarters. The industry is expected to grow rapidly with legislators allowing or looking to allow more legal uses of marijuana and marijuana-related products, especially in the medical and life sciences industry. Some of the key players in this area include GW Pharmaceuticals plc GWPH , INSYS Therapeutics, Corbus Pharmaceuticals Holdings and Zynerba Pharmaceuticals.
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