Blog | October 25, 2021

Is The CGT Industry Too Diluted To Sustainably Scale Manufacturing?

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By Anna Rose Welch, Director, Cell & Gene Collaborative
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Every year around this time, I have the infamous — but nevertheless enjoyable — “crystal ball” conversation with executives for the outlook edition of Life Science Leader magazine. As you can imagine, crystal ball-style questions are exceptionally fun in the CGT industry, which changes shape as quickly as a sand dune in a hurricane. Thankfully, Robert Hariri, M.D.,Ph.D., CEO and Chairman of Celularity, was more than willing to answer my questions, and he spared no enthusiasm in doing so.

During our lively conversation — much of which gravitated toward the industry’s pursuit of allogeneic cell therapies — he also offered his thoughts on what maturity and industrialization would look like for the CGT manufacturing space in the year(s) ahead. Depending on who you ask, maturity/industrialization will mean something different for each type of therapy and in each particular area of manufacturing. But in the grand scheme of things, I think we can all agree that, based on the regulatory challenges we’ve seen as of late — whether it be potency assays, comparability issues, and/or quality lapses, — the industry has a consistency problem.

It’s no surprise, therefore, that “consistency” was the term Dr. Hariri and his other CGT compatriots used to describe the CGT industry’s foremost manufacturing goal for the year ahead (and upcoming years). Broadly speaking, this means chipping away at persistent scalability, quality, and analytical challenges to reduce overall COGs and treat more patients. In the allogeneic cell therapy space in particular, Dr. Hariri believes that companies over the next year or so should strive to agree upon and set rigorous release criteria that will indicate cell performance, stability, and durability.

“You want to make sure not only that your product can be used, but that you’re taking steps to increase the probability your product will be used,” he added. “If your product has a long shelf-life and it can be easily stored, it’s more likely to fit into healthcare systems and, in turn, reach the most patients.”

In order to achieve the level of industrialization that will make a future of greater access possible for CGTs, however, there’s another type of “consistency” Dr. Hariri hopes will take shape in the industry sooner rather than later.

“It’s going to be very helpful for a couple of companies to be declared as the leaders of the field,” he offered. “I believe this field is going to transform healthcare and has the potential to create huge industry players. One of the most interesting questions to me is, ‘Who is going to be the first hundred billion-dollar cell therapy company?’ But to get to that answer, we can’t be afraid to debate whether the CGT industry should have 600 companies or whether it should have 60.”

He poses an intriguing question. (I’d even go so far as to call it a tad bit spicy — which is the best kind of question, really.) After all, if Fräulein Maria from The Sound of Music were providing the soundtrack for the CGT industry today, it would no doubt be to the tune of: “The hills are alive with the sound of [marketing].” Those of us on the biotech side — and, in turn, investors — are inundated with new [insert buzzy adjective here] cell and gene therapy companies and technologies, many of which are painted as the answer patients and/or manufacturing paradigms have all been waiting for. In many cases, the likelihood a majority of these smaller companies will bring their own product or multiple products to market on their own (i.e., without being acquired) will be slim.

While we, of course, want to see a wide variety of companies master diverse and complicated science and succeed in bringing life-saving cures to patients, there is also a certain level of pragmatism that the industry and its investors will need to embrace in the long-run. (Now, whether the CGT space has actually arrived at this natural inflection point yet is another fun question to debate.) 

Funding has been plentiful over the past year or so for CGT companies — and rightfully so. But the number of funding-hungry innovators emerging on the market in the space today also begs the question: will too much high-risk, resource-intensive innovation in the CGT space hold the industry back from solving the manufacturing problems that are keeping larger patient populations and accessible price points at bay?    

Consider patient cost in the monoclonal antibodies space for example; given my background in biosimilars — which were the more affordable (but still pricy) alternatives to the brands — I am well-versed in patients’ struggles to afford thousands-of-dollars-worth of chronic disease medications per month. And this is in a space in which the manufacturing platforms, technologies, and processes are infinitely more mature and standardized than those of the topsy-turvy CGT world.  

In addition to dealing with the challenges and current inability to scale cutting-edge science to commercial scale, CGT companies are embroiled in a make-vs.-buy debate that may involve investing in GMP ($$$) manufacturing facilities or wooing emotionally distant outsourcing partners — or a pricy combination of both. Running undercurrent to these big-picture trends are complicated supply chains and shortages in critical manufacturing materials, capacity, and talent, the demand for which ultimately creates a suppliers’ market (goodbye, $$$$).  

Bottom-line, securing enough funding for manufacturing — and ensuring you allocate that funding properly throughout development — can be, and often is, a treacherous pitfall for CGT companies. Reaching large-scale relevance in healthcare systems will require industrialization, the costs of which will not be meager and will demand prepared and willing investors.  

“The time has come to have earnest discussions with the investment community about no longer betting in binary outcomes” Dr. Hariri explained further. “Instead of betting on companies that promise very high risk, very high reward, why not invest in controlled risk and a company’s ability to leverage success and build a durable sustainable business well beyond its first registration?” 

Establishing thousands of proofs-of-concept and/or commercialized products that only treat several hundred patients will just not be enough to build a sustainable industry in the long-run. As Dr. Hariri continued to passionately emphasize throughout our conversation, we must instead be aiming for the stars. For the CGT industry, “reaching for the stars” just might mean striving for a more consolidated and industrialized industry, capable of funding and successfully developing advanced therapies to address a much larger universe of patients.