Advertisement
Guest User

Untitled

a guest
Sep 26th, 2022
127
0
Never
Not a member of Pastebin yet? Sign Up, it unlocks many cool features!
text 9.88 KB | None | 0 0
  1.  
  2. We went inside the lab at Vertex, a company that dodged the market downturn to become one of the best-performing biotechs of 2022
  3. Andrew Dunn
  4.  
  5.  
  6. Vertex Pharmaceuticals CEO Reshma Kewalramani
  7. Vertex CEO Reshma Kewalramani. Vertex
  8. Vertex Pharmaceuticals has grown into a biotech leader from its lucrative cystic-fibrosis drugs.
  9. The Boston biotech is betting on a unique research philosophy and new tech like gene editing.
  10. Insider toured Vertex's newest research lab and sat down with CEO Reshma Kewalramani.
  11. BOSTON — No one seemed to tell Vertex Pharmaceuticals about biotech's recession.
  12. Since last October, Vertex has seen its stock price steadily climb by 60%, while the SPDR S&P Biotech ETF, a leading biotech index, has dropped 33%. According to The Boston Globe, the company now holds the title of Massachusetts' most valuable biotech, with a $73 billion valuation, surpassing the longtime leader Biogen and the COVID-19 vaccine developer Moderna. So far in 2022, Vertex has added $17 billion in capitalization — the largest increase among all 153 stocks that make up the SPDR S&P Biotech ETF, according to market data from the financial-research firm Sentieo.
  13. Driven by a lucrative suite of cystic-fibrosis drugs, Vertex has reached the apex of the biotech industry and is now hoping it can cement its dominant position by repeating its cystic-fibrosis strategy in other illnesses. If it works, Vertex will not only prove a new strategy works to transform its business into a diversified drug company with billions in revenue, but it will also change the future of patients with a range of diseases including diabetes and sickle cell.
  14. "We're going to do what we did in CF again and again and again," CEO Reshma Kewalramani said.
  15. Kewalramani sat down with Insider at the latest symbol of Vertex's ascendancy: a newly opened, $180 million lab in Seaport, a swanky northeastern neighborhood of Boston. The four-story, 267,000-square-foot space is home to Vertex's cell and gene-therapy unit, with about 375 people now residing in the modern-industrial building. The nearby streets named Harbor Street and Seafood Way hint at the area's fishing past, but Vertex is writing Seaport's biotech-heavy next chapter: making insulin-producing cells and DNA-editing drugs rather than lobster rolls and clam chowder.
  16. A mosaic of human cells inside Vertex Pharmaceuticals' cell and gene therapy laboratory
  17. A mosaic of human cells inside Vertex Pharmaceuticals' cell and gene-therapy laboratory. Vertex Pharmaceuticals
  18. Vertex's leaders are already plotting what's next, building a seven-floor, 344,000-square-foot lab across the street that a company representative says will cost Vertex about $265 million.
  19. The growth follows Vertex's clinical success, including a CRISPR gene-editing drug for sickle-cell disease nearing approval, a Type 1 diabetes cell-therapy program, and a nonopioid pain drug.
  20. Kewalramani took over in 2020 with the charge of leading Vertex beyond cystic fibrosis. This latest challenge might be Vertex's largest yet, as biotech's history is filled with companies that struggled to follow a big success, ultimately falling into Big Pharma's acquisitive arms.
  21. "They're in a really good position to get multiple drug approvals in areas completely unrelated to cystic fibrosis over the next handful of years," said Paul Matteis, a biotech analyst at Stifel who covers Vertex.
  22. Still, Matteis said that he's unsure how Vertex's pipeline would fare commercially and that he had a hold rating on the stock.
  23. "What we've seen time and time again for companies built on one drug or a disease area," he said, "is it's really, really hard for lightning to strike twice."
  24. From a rise and fall in hepatitis C, Vertex vows to never be out-innovated again
  25. Ernst ter Haar, a researcher at Vertex Pharmaceuticals, studies a crystal structure of a protein
  26. Ernst ter Haar, a researcher at Vertex Pharmaceuticals, studying a crystal structure of a protein. Vertex Pharmaceuticals
  27. Vertex's first breakthrough came in 2011, when its hepatitis C drug Incivek won approval and soon rocketed past $1 billion in annual sales. But it suffered a rapid downfall, bested by a more efficacious drug from Gilead Sciences that caused Vertex to discontinue Incivek in 2014.
  28. "One lesson we learned very well is we would never, ever allow ourselves to be out-innovated again," Kewalramani said.
  29. At about that time, Vertex's cystic-fibrosis research began to deliver. Each of its four CF drugs has improved on its predecessor. Its latest approved drug, Trikafta, helps about 90% of cystic-fibrosis patients by correcting a mutated version of a key disease-causing protein. Vertex is still working on treatments for the last 10% of patients, who don't produce that protein to begin with.
  30. Investors are drawn to Vertex's CF franchise, which is expected to bring in roughly $8.7 billion this year and faces no imminent competition. A would-be rival drug from AbbVie disappointed in a midstage study earlier this year, helping make Vertex what Matteis called "the safest growth story in large-cap biotech," as steady revenues bolster its $9.3 billion war chest of cash and equivalents.
  31. Vertex plays in a 'sandbox' of diseases in a unique R&D strategy
  32. Rather than just maximize profits in CF, Vertex is plowing cash into its unique disease-centric research strategy. While most drugmakers build a pipeline around a key technology or a related group of diseases, Vertex is picking certain diseases like sickle cell or diabetes and then going all in on attempts to transform how they're treated.
  33. "They just focus on things that they think will be big jumps in the standard of care — big ideas," Liisa Bayko, an analyst at Evercore ISI, said. "It's a different approach."
  34. Kewalramani calls it the "sandbox" approach. Scientists search for diseases that check five boxes, including an understanding of the illness' biology and an efficient regulatory pathway. If a disease fits those criteria, it's considered "in play," or in the sandbox. That has led to going after unrelated diseases like sickle cell, diabetes, muscular dystrophy, kidney disease, and pain. And instead of homing in on one technology the way Moderna focuses on messenger RNA, Vertex is agnostic, partnering with (and sometimes acquiring) other biotechs to gain access to a wide range of tools, including CRISPR-Cas9.
  35. For instance, Vertex's approach to sickle cell is led by its CRISPR gene-editing program. But the biotech is simultaneously pursuing earlier-stage research to develop a new pill to treat sickle cell, which could ultimately help reach patients with less severe forms of the disease.
  36. "People always confuse the technology for the science," said Bastiano Sanna, Vertex's chief of cell and genetic therapies. "A technology is a tool to the science, not the other way around."
  37. The company's R&D expenses have steadily grown, to $3.05 billion last year from $1.05 billion in 2016, according to company documents filed with the Securities and Exchange Commission. That has fueled a mix of acquisitions, like the startups Semma Therapeutics, Exonics Therapeutics, and ViaCyte, as well as biotech partnerships with companies like Arbor Biotechnologies, Mammoth Biosciences, and Metagenomi.
  38. While early data from these programs has excited investors about Vertex's long-term potential, it's still too soon to judge its success, Bayko said, as Vertex still doesn't have any non-cystic-fibrosis drugs on the market.
  39. Key tests are coming up, with CRISPR leading the way in 2023 and diabetes further out
  40. Inside the lab of Vertex Pharmaceuticals' cell and gene therapy unit in Boston
  41. Vertex Pharmaceuticals opened its cell and gene-therapy laboratory in Boston in 2022. Vertex Pharmaceuticals
  42. The next test of Vertex's strategy will be an experimental treatment called exa-cel, its CRISPR gene-editing program for sickle cell. The company expects to file for approval by year's end in Europe and the United Kingdom.
  43. The treatment's benefits are the most dramatic example of CRISPR's curative power since its 2012 discovery. In a late-stage clinical trial conducted by Vertex in partnership with CRISPR Therapeutics, 31 sickle-cell patients given the one-time treatment have gone from suffering crippling pain attacks every few months to experiencing not a single crisis. Experts have called it a functional cure for the genetic blood disorder.
  44. "There's nothing better than 100%," Kewalramani said.
  45. Kewalramani declined to say whether Vertex planned to file for US approval before year's end, adding an update would be coming soon. Bayko said investors had long wanted clarity on that timeline.
  46. "We've been waiting for an update on this topic for at least a year, maybe longer," Bayko said. "It's been a very long time, so there's obviously some sticking point."
  47. Exa-cel also requires a complex procedure involving chemotherapy and removing stem cells from the body. Kewalramani declined to provide a pricing range, but Bayko forecasts a price of $1.5 million to $2 million, with sales slowly building to pass $1 billion by 2027.
  48. "This is a procedure done in a hospital that takes a long time," Bayko said. "It's not rolling out a pain medicine that would be pretty easy."
  49. Other, newer programs are even more audacious, like a Seaport-based team trying to cure diabetes. Scientists are prodding stem cells to grow into insulin-producing pancreatic cells, then delivering those working cells to patients with diabetes. Preliminary results have been encouraging, with the first volunteer achieving insulin independence for nine months and counting. A nonopioid pain program is also progressing, with Vertex hoping to start late-stage studies this year after midstage studies showed its pill was better than a placebo at relieving pain after surgery.
  50. To be sure, research programs like the diabetes effort are still early, and the ambition "borders on science-fiction-y," Matteis said. But that's just the type of challenge Kewalramani's team is embracing.
  51. "If anyone can figure it out," Matteis said, "it's going to be Vertex."
  52.  
Advertisement
Add Comment
Please, Sign In to add comment
Advertisement