“Glaxo Exits Cancer Drugs,” read the April 22, 2014, Wall Street Journal headline.
If true, one has to wonder how Axel Hoos, M.D., Ph.D., currently SVP oncology and R&D governance chair, who joined GSK just two years previous in 2012, felt about his career choice. After all, if GSK was indeed exiting oncology, why then would they need to retain one of the most prominent people in current cancer drug development? We interviewed Dr. Hoos in person to discuss this conundrum during the 2016 BIO International Convention in San Francisco. This resulted in the publication of “Is Oncology Back At GSK? Did It Ever Leave?” in Life Science Leader’s September 2016 issue. Within, the executive explained the rationale behind the shedding of its marketed oncology portfolio for $16 billion to Novartis, but the retention of Hoos’ innovative R&D pipeline, which was interpreted by some as a signal of GSK exiting one of biopharma’s biggest and fast-growing markets (i.e., cancer drugs). But according to Hoos, sometimes to best focus on your R&D future, you need to divest from your R&D past. And, as a lot has happened in the four years since we first explained Hoos’ oncology R&D strategy for GSK, we felt it a good time to provide an update and the context of the R&D strategy at GSK.
THE EVOLUTION OF GSK’S R&D STRATEGY
When Hoos first landed at GSK in 2012, generation two of immuno-oncology R&D was well underway, which resulted in approvals of a wave of programmed cell death protein 1 (PD1) and PD1 ligand 1 (PDL1)-blocking antibodies, as well as the bi-specific antibody blinatumomab, the oncolytic virus talimogene laherparepvec (T-vec), and emerging cell and gene therapies using CD19 CAR-Ts. To drive innovation, the GSK strategy was anticipating what may be relevant in the post PD-1 space at a time when PD-1s were just starting: the focus was placed on checkpoint agonists, cell therapies for solid tumors, modality agnostic development, and portfolio synergies. “In terms of checkpoint antibodies, we skipped PD1s and focused on next-generation targets,” Hoos says. “We also skipped the CD19 CARTs, as we decided to focus on solid tumors, as this was unchartered territory, and the population sizes for liquid tumors are relatively small.” Plus, despite the science being exciting, given the high costs of developing a cell therapy CMC (chemistry, manufacturing, and controls) platform, it didn’t make sense to invest in another CD19 that wouldn’t amortize. Instead, GSK decided to go after engineered T-cell receptors (TCRs). As T-cell receptors can bind targets from within the cell, and most of the solid tumor targets are intracellular, this decision aligned with the solid tumor strategy. “I’ll make it simple. We skipped over duplicating generation two IOs because we only intended to make transformational medicines.” And while medicines that bring marginal effects can still be blockbusters because you can sell a lot of them, the benefits delivered to patients (i.e., two to three months of median progression free survival [PFS]) isn’t enough for GSK. “We believe the future of oncology will be attractive only for those drugs that can demonstrate a big effect for patients.” Thus, GSK’s oncology strategy is focused on four scientific areas:
immuno-oncology: using the human immune system to treat cancer
cell therapy: engineering human T cells to target cancer
cancer epigenetics: modulating the epigenome, the information that directs how DNA is read and used, to induce anticancer effects
synthetic lethality: addressing two targets at the same time, which, together, but not alone, have substantial effects against cancer.
According to Hoos, these represent the four pillars of his portfolio built on the principle of modality-agnostic development. “If we select to go after a certain target or specific disease, we want to have all the tools at our disposal to choose the best medicine to make, and the only way to do that is by having the necessary platform equipment to make any small molecule, antibody, adjuvant, or cell therapy.”
OUT WITH THE DPU, IN WITH THE RU
To execute on this, back in 2012, the company used discovery performance units (DPUs). A DPU was basically a small biotech within the structure of a large pharma. In Hoos’ mind, the DPU model was quite successful, as it provided the autonomy to do something within a defined resource frame, have a strategy, raise money for it from governance, and then execute. The remaining oncology DPUs ultimately gave rise to the new oncology therapeutic area (TA) after Novartis. “DPUs had their own CEOs with a budget that had been allocated over three years,” he elaborates. Leveraging the learnings from the DPU model, it was revised with the 2018 arrival of Hal Barron, M.D., CSO, and president of R&D. “With the arrival of a new head of R&D, it is important to rethink things,” Hoos continues. “We now use research units, RUs.” While not too far off from DPUs, they are a bit smaller and are more closely integrated with the translational research and development organizations they supply with new drug programs. “In oncology, we have four RUs — one for each science area we focus on (see above),” Hoos explains.
Another important feature utilized by GSK was vertical integration of a therapeutic area. Vertical integration means going from the beginning of discovery through launch and life cycle management in a seamless process (i.e., discovery and development all under one roof), which aims for optimizing pipeline delivery. In a hybrid model, GSK is utilizing the strengths of horizontally united development and discovery organizations across multiple therapy areas outside of oncology with the seamless vertical integration approach in the single TA of oncology.
As for capital allocation to fund programs across a portfolio? “We shift resources in three major buckets,” Hoos states. The first is what he refers to as bread and butter, which has a moderate risk profile but can deliver the most value over the short term. Thus, Hoos puts the majority of resources here. “If you do that well, you can afford to do some high-risk investments at a lower scale,” he says. This higher-risk bucket Hoos refers to as new territory. These tend to be long-term investments that don’t expect an immediate return, and as such, get less funding. “For me, cell and gene therapy represent a new territory.” These require a few years more than the average program to address high complexity; otherwise, the program won’t make it. The third bucket is intermediate risk, which gets intermediate funding (i.e., not as much as bread and butter, but more than new territory). “Basically, the bread and butter bucket pays for new territory,” Hoos summarizes.
DOUBLING DOWN ON ONCOLOGY VIA DEALS
Barron’s arrival at GSK in 2018 also resulted in a doubling down on oncology. “He [Hal Barron] just funded oncology significantly more than we had before.” This not only helps Hoos move the oncology pipeline more quickly but also enables BD opportunities too. “You need a lot of resources if you want to make big acquisitions.” Speaking of which, in January 2019, GSK inked a deal of $5.1 billion to acquire Tesaro, an oncology-focused company based in Waltham, MA. This gained GSK Zejula (niraparib), an orally active small molecule PARP inhibitor with an FDA approval for maintenance treatment of adult patients with recurrent epithelial ovarian, fallopian tube, or primary peritoneal cancer, who are in a complete or partial response to platinum-based chemotherapy. But Zejula is being studied for other opportunities. For example, the compound had a positive Phase 3 readout at the European Society for Medical Oncology’s (ESMO) 2019 Congress. Known as the PRIMA Trial, for women with advanced ovarian cancer responding to first-line chemotherapy, maintenance therapy with the PARP inhibitor niraparib significantly reduced the risk of disease progression by 38 percent overall and by 60 percent in women with BRCA mutations. Even patients without a homologous recombination deficiency derived advantage from this treatment. The regulatory filing for PRIMA occurred in December 2019 and will “hopefully launch in 2020 with a new and first-line indication in ovarian cancer,” shares Hoos.
A second deal involved a development partnership with Merck KGaA in February 2019. “They developed M7824 (bintrafusp alfa), which is putting two targets into one molecule, PD-L1 and TGF-beta Trap (i.e., a bi-specific),” Hoos notes. “It targets the tumor by carrying the TGF-beta Trap into the tumor and blocks PD-L1 in the tumor.” Currently in a registration trial for biliary tract cancer and in a randomized Phase 2 study for non-small cell lung cancer (NSCLC), it is going head to head against the leading PD-1 (i.e., Keytruda). This codevelopment deal equated to a €300 million investment and is eligible for potential development milestone payments of up to €500 million plus future approval and commercial milestones of up to €2.9 billion.
Another significant deal inked back in October 2019 was a five-year collaboration with Lyell Immunopharma. According to Hoos, Lyell, a San Francisco-based biotech, is developing new technology that deals with T-cell exhaustion. “If you want to make T cells as functional as possible in the tumor, you need to find a way to prevent them from getting exhausted, because the tumor is trying to switch the T cell off.” Lyell has a bunch of technologies that could address T-cell exhaustion, and so GSK is building this into its cell and gene therapy program.
The net result of GSK’s portfolio build stacks up as follows: “We added 75 percent to the nonclinical portfolio from 2016 to today,” Hoos states. “And the clinical pipeline has matured by 320 percent.” From five assets in the clinic in 2016, GSK now boasts having 16.
From this portfolio, GSK delivered regulatory submissions for three novel compounds in December 2019 with prospects of launch in 2020. Think the announcement of GSK’s exit from oncology has been proven a bit premature?