Blog | March 7, 2023

Cell & Gene Therapy COGS: Words Of Wisdom To 'Keep The End In Mind'

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By Anna Rose Welch, Editorial & Community Director, Advancing RNA


When considering whether to invest limited funds in making critical manufacturing improvements early in development, the phrase “It’s either going to cost a lot now, or a lot more later” is no doubt one with which many cell and gene therapy CMC experts are familiar. In fact, this was one of the many snippets of wisdom shared during a recent Cell & Gene Collaborative discussion group featuring Dark Horse Consulting’s COO, Katy Spink.

As we approached the beginning of 2023, I invited Spink to join me and Cell & Gene Collaborative members for what turned into a lively discussion on which manufacturing-centric opportunities and challenges were most likely to energize and/or stump us in 2023. As part one of this two-part series showcased, we’re experiencing a return to “normal” (ish) on the capacity, supply chain, and funding fronts. However, such a return to “normal” is not without some amount of pain — particularly when it comes to sustaining our critically important CMC activities in the face of more discerning and competitive funding. Such financial concerns have fueled greater discussion — including this conversation with Spink and the Collaborative — on how we can double down and improve our operational and manufacturing efficiency and the COGS of our advanced therapies.

As a delightfully diverse space, it goes without saying that understanding a product’s process and COGS drivers will be a highly individualized and complex undertaking. “What drives the COGS of one advanced therapy product will not drive the COGS of another,” Spink acknowledged. For example, allogeneic products will eventually benefit from economies of scale, while the autologous side of the industry will more likely struggle with the logistical/operational costs of scaling out. Viral vector costs are a large component of some gene-modified cell therapy products’ COGS and a much lower percentage of some others.

“Understanding the COGS drivers on your individual process starts with modeling the current COGS and which levers exist — or could exist — to bring the costs down over time,” Spink explained. “It’s critical to identify these drivers as early as possible. You don’t want to arrive at your Phase 3 to discover you haven’t taken the opportunity to pull a powerful COGS lever, but it’s either too late or you’d have to carry out a big, even more expensive comparability study to support the change(s).”

Now, there have been entire books, conferences, webinars, and other resources devoted to helping technical leaders figure out whether the math will or won’t work for a therapeutic product. Even if Spink and I had wanted it to, our hour-long Collaborative conversation could hardly have gone so far as to recreate any of these wheels. However, as we step back and (hopefully) ask, “What does keeping the end in mind look like for our development paradigm and its COGS now and in the future,” there were a few valuable points that came up in the broader discussion I thought were worthy of sharing.

  • In times of greater fiscal caution and concern — like today — we won’t be able to do everything we want. Instead, teams will need to identify the biggest “showstoppers” to prepare for and identify which two or three process development-related moves will be the most important for carrying development to the next milestone.
    • Yes, the steps we choose to take will be iterative. I’ve always loved the phrase “don’t let ‘perfect’ be the enemy of the ‘good enough.’”
  • Not only will these decisions be unique thanks to modality/product nuances, but they will also be influenced by the strengths, combined knowledge, and experiences of the experts on each team.
    • Please note, these experiences and applicable learnings may not always be from within the CGT space — and that’s ok.
  • There will always be some level of sticker shock when it comes to COGS in Phase 1. But rather than thinking about those costs solely in the “bubble” that is Phase 1, CMC teams and their leadership need to be considering how these COGS will evolve throughout development. The real changes in cost will occur at transitions in development — for example, when moving from phase 1 at a scale of 10s to Phase 3 at a scale of 100s to a commercial scale of thousands or even tens-of-thousands.
  • It’s also the CMC team’s responsibility to provide leadership with information on the short- and long-term COGS implications of making — or not making — certain decisions and/or implementing changes early in development (e.g., selecting HEK vs. baculovirus; adherent vs. suspension, etc.) to enable leadership to make data-driven decisions on how to invest limited development dollars.  
  • Such education may require stepping back to the very basics — for example, unpacking what the choices are at hand; how they would work; what the pros and cons of each would be in the short- and long-term; why X is the best approach for achieving the targeted COGS for your product; and how X would work.
  • The size/age of the company, the resources on hand, and the leadership team’s experiences at other companies will also influence their evaluation and perspectives on which efforts they’re willing to pay for in the long-term. COGS may or may not have been a consideration your leaders and teammates were privy to in previous roles —particularly if they came from a background in small molecules or traditional biologics where COGS are not typically as big of a concern. 
  • Such efforts may feel like an uphill battle, but remember, it can take a while to “turn the ship.”
    • For some great insights into the nuances of communicating about tech ops to your higher-ups, C-Suite, and board, I singled out some of my favorite snippets of conversation on this very topic from a podcast about building high-performing CMC teams in my latest manufacturing must-reads newsletter.
  • Just as important as it is to engage and educate leadership teams, CMC shouldn’t be squeamish about engaging their R&D teams/leadership, as well, to limit the amount of “starting over” that will be required when a product transitions from R&D to process development.
  • That trusty phrase “It’s either going to cost a lot now, or more later” is applicable to many different development/manufacturing scenarios. However, I dare say this argument is more regularly being used in the analytical space, where companies are investing more heavily in characterization efforts earlier to better understand their products.
    • See in particular my recent articles on our quest for the potency assay/matrix: part 1 and part 2.
  • It’s true that more and more characterization can lead to more questions as opposed to answers. (Sigh.) But we also don’t want to hold ourselves back based on fear we won’t be able to explain what we find. The more we know about our products structurally and, over time functionally, the more equipped we are to make changes to our processes and understand the significance of those changes on the product from an analytical and clinical comparability standpoint.
  • As Spink added, the business risk of investing millions in clinical trials “blind” to the impact of your process development efforts/changes far outweighs the risk of uncovering something we may find that we don’t quite understand (yet).
  • Though the current funding environment may be tenuous, I liked Spink’s poetic concluding remarks: “Overall, it’s fundamental for any CMC program — but especially in the advanced therapies space — that we do not stop investing in deeply understanding these complex products and their processes. A lack of investment in these areas could ultimately plant the seeds of our future failure.”

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