more drugs like nusinersen—RNA-based drugs administered via infusions into the spine. Biogen believes it has a leg up on the industry developing drugs this way—as opposed to, say, antibody drugs or small molecules—because of the work it’s done with Ionis on nusinersen. Ehlers says Biogen might be able to use the same method to treat several severe neurological diseases. These efforts are early. Just one such program—a Phase 1 study for the notoriously tough to treat ALS—is in human clinical testing. But Ehlers says multiple, similar-type programs could follow; it’s a clear area of R&D investment for Biogen going forward. “It just opens up the mind to all kinds of things that weren’t previously addressable,” he says.
New CEO Michel Vounatsos added on a conference call last week that Biogen has a “renewed prioritization on business development activities,” suggesting more deals are coming now that the Bioverativ spinoff is complete. “We need to do a little bit of buildup in the early clinical portfolio,” Ehlers says.
Bioverativ
Cox ran Biogen’s hemophilia manufacturing and commercial operations when Eloctate and Alprolix were approved in 2014. When Biogen’s board decided to spin out Bioverativ, he had the choice of either running Biogen’s technical operations or being the CEO of a new, smaller company. Over the years, he’d become more and more familiar with hemophilia as a disease. Shortly after Biogen acquired Syntonix, for example, Cox remembers attending a National Hemophilia Foundation event. A parent confronted him at the booth Biogen had set up. “She said, ‘I hear you’re the manufacturing guy,” Cox recalls. “Well I’ve got two boys who have hemophilia. Why should I trust you?”
Hemophilia patients, a majority of whom are male, often have to be infused with replacement clotting factors multiple times a week, depending how severe their disease is, to protect them from bleeds that can cause joint or organ damage. The selling point of Eloctate and Alprolix is that they don’t have to be given as often as conventional clotting factors. Cox says patients on Alprolix or Eloctate typically get down to two or fewer infusions per week. But for children, the responsibility of administering the drug still often falls to their parents. Uninterrupted drug supply is critical, and that’s what Cox was in charge of. “You had mothers that cared so much about these boys,“ he says. “It really draws you in.”
Biogen’s two hemophilia products grew from $134.4 million in revenue in 2014 to $560 million in 2015 and remain on the upswing, generating nearly $850 million last year. “People were embracing [them],” Cox says. So he took the Bioverativ job. He now assumes the challenge of building a business anchored by Eloctate and Alprolix despite emerging competition and other challenges.
The good news for Bioverativ is it has $325 million in cash in the bank, no debt, two products already on the market, and a track record of $108 million profit for its products in 2015. That gives Bioverativ a head start trying to round out an identity as a developer of drugs not just for hemophilia, but a variety of blood diseases, starting with sickle cell disease and beta thalassemia via a partnership Biogen forged with Sangamo Biosciences (NASDAQ: [[ticker:SGMO]]) in 2014. It’s developing a longer-lasting version of Eloctate—BIVV001, for hemophilia A—that should start clinical testing this year. Bioverativ also has the wherewithal to add assets that might help in the near term. Cox confirms Bioverativ is looking for deals, but declined to give further details.
But Bioverativ will likely have to be aggressive. Gene therapies for hemophilia are working their way through clinical testing and, while questions remain, they offer at least the potential for long-lasting, if not permanent, treatment. There are also a slew of competing clotting factor replacement therapies from Shire, Bayer, Novo Nordisk, and others on the market.
Kimberly Haugstad, the president and CEO of the nonprofit Hemophilia Federation of America, also says that she’s started to see insurers—who have become more and more emboldened to fight drug prices—implementing “step therapy” measures in hemophilia. That means patients might have to fail a lower-cost therapy first before getting reimbursed for a more expensive, longer-lasting treatment like Bioverativ’s two drugs.
“We have not seen this before and it is extremely worrisome for us,” she says.
Cox downplays the competitive threats. Despite the early promise, there’s a lot to be worked out with gene therapy, he says. At this point, no one knows how long it’ll last, or whether it’ll work in much of the population. There have been variable results for gene therapies in clinical trials and immune system reactions to some treatments. Patients, he says, just want to get a dose of clotting factor once a week or less and know they’re protected from bleeding episodes.
Haugstad, however, says that every hemophilia patient’s situation is different, and even if patients get frequent infusions to protect them, they’re not stress free. People always have to consider what daily activities are safe, be prepared for emergencies, and stay on top of whether their therapy is being insured. “If you’re asking me what patients really want,” she says, “we dream of a life without any needle sticks or worry of a spontaneous bleed.”
Add it all up and Bioverativ has some work to do. “If this company rests on its hemophilia revenues,” Gertler says, “it won’t be a success.”
