The Future of Monoclonal Antibody Therapeutics - S. Riley (2006) WW

7/31/2019 The Future of Monoclonal Antibody Therapeutics - S. Riley (2006) WW

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H E A L T H C A R E

The Future of Monoclonal AntibodyTherapeuticsInnovation in antibody engineering, key growth

strategies and forecasts to 2011

By Sarah Riley


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Sarah Riley

Sarah Riley is an analyst within the healthcare function of Business Insights. She has a

PhD in physiology from King's College, London and is an expert in autoimmune

diseases and cardiology. She has previously worked on commercial analyses of the

generics market, the future of the diabetes market and pharmaceutical licensing

strategies.

Copyright 2006 Business Insights LtdThis Management Report is published by Business Insights Ltd. All rights reserved.Reproduction or redistribution of this Management Report in any form for anypurpose is expressly prohibited without the prior consent of Business Insights Ltd.

The views expressed in this Management Report are those of the publisher, not ofBusiness Insights. Business Insights Ltd accepts no liability for the accuracy or

completeness of the information, advice or comment contained in this ManagementReport nor for any actions taken in reliance thereon.

While information, advice or comment is believed to be correct at the time ofpublication, no responsibility can be accepted by Business Insights Ltd for itscompleteness or accuracy.

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Table of Contents

The Future of Monoclonal Antibody Therapeutics

Executive Summary 12

Introduction 12

Antibody engineering and innovation in the market 13

The current monoclonal antibody market 14

The antibody pipeline and forecasts to 2011 15

Competitive landscape and future growth strategies 16

Chapter 1 Introduction 18

Summary 18

Introduction 19

History of monoclonal antibodies 20

Monoclonal antibody approval process 21

Current approval process 21Biogeneric regulations 22

Key trends in the market 23Advancements in innovation 23Diversification of therapy areas 24Big Pharma entering the mAb market 25

Chapter 2 Antibody engineering andinnovation in the market 28

Summary 28

Introduction 29

The move from murine to fully human mAbs 30Whole IgG monoclonal antibodies 31

Murine 31Chimeric 31Humanized 32

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Human 32

Innovations in antibody structures 33Fab fragments 34Single chain variable fragments 35

Extended release formulations 36

Innovation in antibody conjugation 37Types of conjugation 37

Direct arming: antibody conjugation 37Indirect arming: Bispecific monoclonal antibodies 37Pre-targeting 38

Marketed conjugated monoclonal antibodies 38Conjugation technology 39

Seattle Genetics antibody technology 39ImmunoGen mAb technology 40Peregrine mAb technology 41

Enhancing monoclonal antibody potency 41

Drug discovery 42Cambridge Antibody Technology 44Dyax 45Morphosys 46

Innovation in drug delivery 47Drug delivery devices 47Inhaled monoclonal antibodies 48Oral monoclonal antibodies 49

Chapter 3 The current monoclonal antibody

market 52

Summary 52

Introduction 53

Strategic analysis 53Drivers 54

Pipeline drugs 54Immature market 54Big Pharma entering the mAb market 55High level of innovation 55Approval of new indications 56

Combination therapies 56Resistors 56Publicized side effects 56Drugs suspended from market 57Competition from small molecule drugs 57Pricing and reimbursement schemes 57

Analysis of launched drugs 58Oncology 60

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Rituxan 61Herceptin 63Avastin 65Erbitux 67Campath 69

Zevalin 70MyloTarg 72Bexxar 74

AIID 76Remicade 76Humira 79Raptiva 81Simulect 83Zenapax 84OrthoClone OKT3 84

Hemostasis 86ReoPro 86

Anti-infectives 87Synagis 88

Respiratory 89Xolair 89

Marketed monoclonal antibody forecasts 90

Chapter 4 The antibody pipeline andforecasts to 2011 94

Summary 94

Introduction 95Strategic analysis 95

Opportunities 97Clinical trials 97

Erbitux and Avastin 98Simulect, Zenapax and Campath 98Campath 98Others 99

Innovation in antibody engineering 99New indications 100

Challenges 101Generic biologics 101Adverse reactions in clinical trials, side effects and termination ofdevelopment 102High attrition rates 103

Analysis of pipeline drugs 104AIID 109

Cimzia 109MRA/Actemra 110

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Eculizumab 112AMG-162 113

Cardiovascular 115Pexelizumab 115

Infectious diseases 116

Numax 116Oncology 117

ABX-EGF 117MDX-010+MDX-1379 119Humax 120

Ophthalmology 121Lucentis 121

Late stage pipeline forecasts 123

The antibody market in 2011 124

Chapter 5 Competitive landscape andfuture growth strategies 128

Summary 128

Introduction 129

Key players in the monoclonal antibody market 130

M&A and licensing activity 130Big Pharma acquiring biotechs and antibody companies 133

AstraZeneca and CAT 134Novartis and NeuTec 134

Amgen and Abgenix 135Roche and GlycArt 135MedImmune and Cellective Therapeutics 136Pfizer and Bioren 136

Company profiles 137

Big Pharma 137Roche 137

Company overview 137Strategic and growth analysis 137Marketed products 139Pipeline 140

Novartis 141

Company overview 141Strategic and growth analysis 141Marketed products 142Pipeline 143

Pfizer 144Company overview 144Strategic and growth analysis 144Pipeline 146

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Large biotech 147Genentech 147

Company overview 147Strategic and growth analysis 147Marketed products 148

Pipeline 149MedImmune 150

Company Profile 150Strategic and growth analysis 150Marketed products 152Pipeline products 152

Biogen Idec 153Company overview 153Strategic analysis 153Marketed products 156Pipeline products 157

UCB-Celltech 157Company overview 157Strategic and growth analysis 158Marketed products 159Pipeline products 160

Small biotech/antibody companies 161Medarex 161

Company overview 161Strategic and growth analysis 161Marketed products 163Pipeline products 163

XOMA 165Company overview 165Strategic and growth analysis 165Marketed products 167Pipeline products 167

Technology companies 169BioWa 169

Company overview 169Strategic and growth analysis 169Pipeline products 171

Crucell 172Company overview 172Strategic and growth analysis 172Pipeline products 174

Chapter 6 Appendix 178

Sales data 178

Index 179

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List of FiguresFigure 1.1: History of monoclonal antibodies 21Figure 2.2: Current marketed monoclonal antibodies, 2006 31Figure 2.3: Therapeutic mAbs entering clinical study, 1980-2004 33Figure 2.4: Whole antibody and fragment structures 34Figure 3.5: Drivers and resistors to growth in the monoclonal antibody market 54Figure 3.6: Market dynamics of current marketed drugs, 2004-5 58Figure 3.7: Marketed monoclonal antibodies by therapy area, 2006 60Figure 4.8: Opportunities and challenges in the mAb market 97Figure 4.9: Antibody structure analysis of forecasted monoclonal antibody sales ($m), 2004-11106Figure 4.10: Therapy area analysis in monoclonal antibody drug development, 2006 107Figure 4.11: Therapy area analysis of forecasted monoclonal antibody sales ($m), 2004-11 108Figure 5.12: Key growth strategies in the monoclonal antibody market, 2005-6 133Figure 5.13: Roches SWOT analysis in the mAb market 138Figure 5.14: Novartis SWOT analysis in the mAb market 141Figure 5.15: Pfizers SWOT analysis in the mAb market 145

Figure 5.16: Genentechs SWOT analysis in the mAb market 148Figure 5.17: MedImmunes SWOT analysis in the mAb market 150Figure 5.18: Biogen Idecs SWOT analysis in the mAb market 154Figure 5.19: UCB Celltechs SWOT analysis in the mAb market 159Figure 5.20: Medarexs SWOT analysis in the mAb market 162Figure 5.21: XOMAs SWOT analysis in the mAb market 166Figure 5.22: BioWas SWOT analysis in the mAb market 170Figure 5.23: Crucells SWOT analysis in the mAb market 173

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List of TablesTable 1.1: Current marketed drugs, 2006 24Table 1.2: Key players in the monoclonal antibody market, 2006 25Table 2.3: Marketed therapeutic monoclonal antibodies, 1986-2006 30Table 2.4: Antibody fragment pipeline, 2006 36Table 2.5: Conjugated antibody engineering technology 39Table 2.6: Drug development technology 42Table 2.7: Monoclonal antibody drug discovery technology 43Table 3.8: Marketed therapeutic monoclonal antibodies, 2004-5 59Table 3.9: Marketed monoclonal antibody sales forecasts, 2005-11 91Table 4.10: Other post-marketing clinical trials, 2005-6 99Table 4.11: Late stage monoclonal antibody pipeline, 2006 105Table 4.12: Late stage monoclonal antibody pipeline sales forecast to 2011 124Table 5.13: Key players in the monoclonal antibody market, 2006 130Table 5.14: Monoclonal antibody collaborations, manufacturing, development and supply

agreements, 2005-6 131Table 5.15: Key acquisitions in the monoclonal antibody market, 2005-6 134Table 5.16: Roches marketed monoclonal antibodies, 2006 139Table 5.17: Roches monoclonal antibody pipeline, 2006 140Table 5.18: Novartis marketed monoclonal antibodies, 2006 143Table 5.19: Novartis monoclonal antibody pipeline, 2006 143Table 5.20: Pfizers monoclonal antibody pipeline, 2006 146Table 5.21: Genentechs marketed monoclonal antibodies, 2006 149Table 5.22: Genentechs monoclonal antibody pipeline, 2006 149Table 5.23: MedImmunes marketed monoclonal antibodies, 2006 152Table 5.24: MedImmunes monoclonal antibody pipeline, 2006 152

Table 5.25: Biogen Idecs marketed monoclonal antibodies, 2006 156Table 5.26: Biogen Idecs monoclonal antibody pipeline, 2006 157Table 5.27: UCB-Celltech monoclonal antibody pipeline, 2006 160Table 5.28: Medarexs monoclonal antibody pipeline, 2006 163Table 5.29: XOMAs monoclonal antibody pipeline, 2006 167Table 5.30: BioWas monoclonal antibody pipeline, 2006 171Table 5.31: Crucells monoclonal antibody pipeline, 2006 174

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Executive Summary

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Executive Summary

Introduction

The monoclonal antibody (mAb) market has grown rapidly in recent years,

reaching sales of $14bn in 2005, an increase of 36.5% from 2004 sales of $10.3bn.

Khler and Milstein developed the hybridoma method of murine antibody

production in 1975, which allowed the production of the first mAb to market;

Johnson & Johnsons Orthoclone OKT3 (muromonab) in 1986.

The mAb market is highly innovative and a key trend has been the move frommurine to humanized and fully human antibodies. As technology has progressed

these humanized mAbs have prevented immune responses (HAMA), thus having a

larger market potential.

The traditional therapy areas in the mAb market are oncology and autoimmune and

inflammatory disorders (AIID), however this is forecast to change with the

emergence of other therapy areas including infectious disease and ophthalmology.

The clear leader in the mAb market is Genentech with 5 marketed drugs, with sales

totaling $4,116.4m in 2005.

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Antibody engineering and innovation in the market

The last 5 therapeutic mAbs launched in the US were humanized or chimeric,

supporting the trend of a move away from murine mAbs. Currently, there is only

one marketed fully human mAb, Abbott/CATs Humira.

Marketed conjugated mAbs have relatively low sales compared to the leading

unconjugated mAbs, which is attributed to limited efficacy and difficulty in

administration. Conjugated drugs need to be administered in the presence of a

radiologist and oncologist, which is expensive and limits their use.

Current marketed antibody fragments include ReoPro and CEA-scan (diagnosis),

which are both Fab fragments. A key pipeline antibody Fab fragment is

Genentechs Lucentis, filed for FDA approval in December 2005.

Drug discovery firms are using advances in genomics and proteomics, in addition

to proprietary technology to discover new target antigens and antibodies. The 3

leading players in antibody discovery are CAT, Dyax and Morphosys.

mAbs can only be administered via injection or intravenous infusion, due to their

structure and protein composition. Inhaled antibodies present a viable market due to

this delivery method providing an increase in convenience, and being painless

compared to injections. There are no currently marketed inhaled mAbs.

Oral mAb drug delivery is forecast to have a high market potential, as it provides

the most convenient method of drug delivery. A key oral technology is Emisphere

Technologies Eligen, which uses carrier agents to protect the protein from

digestive enzymes and facilitate the transport of the molecules across membranes.

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The current monoclonal antibody market

The leading mAbs are Remicade and Rituxan, with sales of $3.5bn and $3.3bn,

respectively in 2005. However, sales growth of Rituxan is expected to be limited

due to a lack of studies investigating new indications.

The rapid increase in the number of mAb pipeline drugs is a result of innovation in

the market, which has allowed companies to develop fully human drugs with

reduced immunogenicity and mAb fragments that are cheaper to produce and have

a high efficacy.

Despite the high growth in the mAb market, there remain many issues resisting the

market, including mAbs being withdrawn from the market, publicized side-effects,

pricing and reimbursement issues and competition from small molecule drugs.

Oncology is the largest therapy area within the mAb market, with 8 marketed

products. This therapy area is set to increase with numerous early and late stage

products in development. Key oncology pipeline products include Virexxs

OvaRex, Abgenix/Amgens ABX-EGF and Medarex/Bristol-Myers Squibbs

MDX-010 and MDX-1379.

AIID is the second largest therapy area in the mAb market, with 7 marketed drugs.

Many of the marketed AIID drugs are indicated for the same disease, and

consequently there is a high level of competition between drugs. For example the

leading mAb Remicade, with sales of over $3.4bn in 2005, is indicated for

Rheumatoid Arthritis (RA), as is Humira.

Synagis is the only current anti-infective mAb on the market. However, due to a

large number of early and late stage pipeline products, this therapy area is expectedto expand in the next 5 years. Key pipeline products include Numax and Aurograb.

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The antibody pipeline and forecasts to 2011

Key challenges facing the mAb market include the imminent bioequivalent

regulations, which once in place are forecast to heavily impact sales of currently

marketed drugs. The negative publicity from clinical trials or other reported adverse

side effect will also challenge sales due to physicians switching to alternative small

molecule therapies.

There are numerous mAb drugs anticipated to launch in the next 5 years. Lucentis,

Cimzia and ABX-EGF (panitumumab) were all filed for FDA approval in 2005,

and are all antibody fragments which reflects the trend of innovation in antibody

engineering towards alternative antibody structures.

Advancements in antibody engineering and technology act as a huge opportunity

for growth in the mAb market, as fully human antibodies can be developed, for

example Humira. Several pipeline mAbs are fully human, and thus are anticipated

to perform well in the market: ABX-EGF, MDX-010+MDX-1379, ticilimumab and

Humax.

Late stage pipelines show mAbs being developed for cardiovascular, infectiousdiseases and ophthalmology, in addition to the traditional indications for mAbs of

oncology and AIID. Widening the indications of mAbs allows companies to gain

access to larger patient potentials and avoids competition from similar drugs.

Lucentis (ranibizumab) is a humanized anti-VEGF mAb fragment, which is based

on Genentechs larger anti-VEGF antibody Avastin. The FDA approved Lucentis

on the 30th June 2006 and sales are forecast to reach 685m in 2011.

High sales are forecast for Numax as it has been shown to be highly efficacious: inRSV neutralization studies it is 20 times more potent than Synagis. Therefore

Numax, forecast to launch in 2008, has the competitive advantage over Synagis and

has the potential to enable expansion into additional indications further boosting

sales.

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Competitive landscape and future growth strategies

Four types of company have been identified in the mAb market: Big Pharma, large

biotech, small biotech/antibody companies and technology companies. However,

there is a certain degree of overlap between company types and the strategies they

use to grow their share in the market.

The trend of Big Pharma acquiring companies to gain access to mAb pipeline is a

recent trend seen over the past few years. For example, in June 2006 Novartis made

a $569m bid for NeuTec Pharma, a British drug developer with several late-stage

candidates in the pipeline.

Genentech is the market leading mAb developer and currently has 5 marketed

mAbs. Genentechs highest selling mAb is Rituxan, with US sales of $1,574m in

2004, which increased 16.3% in 2005 to $1,831m. However, Genentech pays

royalties to Roche for their marketed mAbs under their long established agreement.

There are many small biotech and specialty antibody players developing antibody

drugs, with one example being XOMA. XOMA does not have any currently

marketed mAb products, although it has mAbs in development and forms

collaborations with other antibody developers who wish to access its proprietary

technology.

Technology players, for example Crucell, are developing proprietary antibody

technologies to produce novel antibodies at a lower cost than conventional

methods, which they can outlicense to larger companies.

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CHAPTER 1

Introduction

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Chapter 1 Introduction

Summary

The monoclonal antibody (mAb) market has grown rapidly in recent years,

reaching sales of $14bn in 2005, an increase of 36.5% from 2004 sales of

$10.3bn.

Khler and Milstein developed the hybridoma method of murine antibody

production in 1975, which allowed the production of the first mAb to market;

Johnson & Johnsons Orthoclone OKT3 (muromonab) in 1986.

The mAb market is highly innovative and a key trend has been the move from

murine to humanized and fully human antibodies. As technology has progressed

these humanized mAbs have prevented immune responses (HAMA), thus having

a larger market potential.

The traditional therapy areas in the mAb market are oncology and autoimmune

and inflammatory disorders (AIID), however this is forecast to change with the

emergence of other therapy areas including infectious disease and

ophthalmology.

The clear leader in the mAb market is Genentech with 5 marketed drugs, withsales totaling $4,116.4m in 2005.

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Introduction

The monoclonal antibody (mAb) market has grown rapidly since the launch of the first

drug, Johnson & Johnsons Orthoclone OKT3, in 1986. The global mAb market

reached $14bn in 2005, an increase of 36.5% from 2004 sales of $10.3bn. The mAb

market is outperforming the total global pharmaceutical market, which grew 7% in

2005.

This chapter covers the history of mAbs, summarizing technological advances and the

current biologics approval process. The marketed products will also be introducedalong with the major players in the market. Key trends in the mAb market are

described to establish a background to the market.

A key theme of this report is the high level of innovation, as demonstrated by

advancements in antibody engineering with the introduction of chimeric, humanized

and fully human mAbs. Other innovation in antibody technology include advancements

in non-invasive drug delivery technology, which is predicted to lead to a huge boost in

sales in the long-term once drugs that utilize this technology come to market.

Current marketed mAbs are predominantly indicated for oncology or arthritis, immune

and inflammatory disorders (AIID). However, mAbs in all stages of pipelines are being

developed for a broader range of indications. It is expected that mAbs directed at

infectious diseases will increase market share and generate high sales, although the

traditional therapy areas of oncology and AIID will continue to dominate the market in

the short-to-mid term.

Due to the high growth experienced in the mAb market in recent years, an increasing

number of companies are looking to enter the market, as reflected by the large number

of M&A and licensing deals in the last few years. Big Pharma in particular are

establishing themselves in the market, which has been achieved by recent acquisitions

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to gain key pipeline mAbs or antibody technology, for example the acquisition of

Cambridge Antibody Technology (CAT) by AstraZeneca and GlycArt by Roche.

The mAb market as defined in this report consists of global sales of all marketed

monoclonal whole antibodies and fragments, excluding polyclonals.

History of monoclonal antibodies

A time line detailing the history of mAbs is shown in Figure 1.1. Khler and Milstein

developed the hybridoma method of murine antibody production in 1975, which

allowed the production of the first mAb to market: Johnson & Johnsons Orthoclone

OKT3 (muromonab) in 1986. Although there were high expectations for murine mAbs,

due to problems with immunogenicity they have declined from favor. Murine

antibodies are seen as foreign by the immune system, which mounts a response known

as the Human Anti-Mouse Antibodies (HAMA) response, producing unwanted side

effects. In an attempt to overcome the HAMA response antibodies were developed that

were chimeric; consisting of 60% human and 40% mouse immunoglobulin.

The next step in the development of mAbs has been the conjugation of toxins or

radionucleotides to further enhance their cytotoxic action. Other advancements that

have occurred in the market include the development in antibody fragments, such as

Fab and single chain antibodies, which can be produced at lower costs compared to

whole antibodies.

The most recent events in the mAb market are the acquisitions by Big Pharma to gain

products or technology, confirming their desire to enter the mAb market. The most

recent deal has been Novartis acquisition of NeuTec, which has promising pipeline

drugs.

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Figure 1.1: History of monoclonal antibodies

Khler and Milstein developed the hybridomamethod of murine antibody production

The first mAb reached the market: Johnson &Johnsons Orthoclone OKT3

Chimeric antibodies (60% human and 40% mouse)were first reported

Humanized antibodies (over 90% human) were firstreported

Medimmunes Synagis was launched for theindication of anti-infective disease.

The first radionucleotide conjugated mAb waslaunched: Corixas Bexxar (tositomomab-I131)

1975

1984

1986

1986

1998

2003

Khler and Milstein developed the hybridomamethod of murine antibody production

The first mAb reached the market: Johnson &Johnsons Orthoclone OKT3

Chimeric antibodies (60% human and 40% mouse)were first reported

Humanized antibodies (over 90% human) were firstreported

Medimmunes Synagis was launched for theindication of anti-infective disease.

The first radionucleotide conjugated mAb waslaunched: Corixas Bexxar (tositomomab-I131)

1975

1984

1986

1986

1998

2003

Source: Business Insights Business Insights Ltd

Monoclonal antibody approval process

Current approval process

On June 30, 2003, the Food and Drug Administration (FDA) transferred several

therapeutic biological products that had been reviewed and regulated by the Center for

Biologics Evaluation and Research (CBER) to the Center for Drug Evaluation and

Research (CDER). CDER now has regulatory responsibility, including premarket

review and continuing oversight, over the transferred products, which include mAbs.

The switch from CBER to CDER has allowed an increase in efficiency and consistency

of reviews and resulted in a decreased average review time. A key difference between

the approval process for mAbs compared to small molecule drugs is that mAbs are filed

under a Biologics License Application (BLA) to the FDA, rather than a New Drug

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Application (NDA). The approval process for mAbs involves the manufacturing

facilities being approved in addition to the processes and actual efficacy and safety of

the product; as a result the approval process for mAbs is a longer and more expensive

process than for traditional drugs.

Biogeneric regulations

To date there are no biogeneric regulations in place in the US, EU or Japan. Sandozs

Omnitrope (Somatropin) was the first generic biologic drug approved by the FDA on

the 30th of May 2006 and was filed under an NDA (new drug application). However,

the FDA has stated that this is not a biogeneric, and thus this approval has not paved

the way for future generic versions of biologics. Biogeneric regulations are not

expected to be straight forward, as it is impossible to create an identical generic

biological, due to the nature of protein folding and the specific method of mammalian

cell culture and purification procedures used by the originator. However, a

bioequivalent or biosimilar drug can be produced, which demonstrates the same

efficacy and levels in the blood. Once bioequivalent regulations are established generic

versions of mAbs are expected to impact heavily on branded sales. One factor that

could resist this decline in product price is the difficulty in obtaining biologic generic

approval, as the manufacturing facilities need to be approved along with the product,

and the manufacturing process is more expensive than small compound production,

limiting the number of players and thus reducing competition.

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Key trends in the market

There are several key trends in mAbs, which are forecast to shape the future market.

Changes in the market have been noted in innovation, therapy areas of launched and

pipeline drugs, and companies involved in developing and marketing mAbs.

Advancements in innovation

The mAb market is highly innovative and a key trend has been the move from murine

to humanized and fully human antibodies. Current marketed antibodies are

predominantly humanized, but there is one marketed fully human antibody, Humira.

Technology has progressed in order to develop mAbs with a larger proportion of

human IgG to prevent adverse immune responses (HAMA), and thus have a larger

market potential. Other antibody innovations include methods to improve efficacy that

have focused on different cell-surface target antigens, for example receptors for

cytokines have been found to be highly effective in killing tumor cells.

mAbs conjugated with other drugs or radionucleotides is another technique to improve

mAb function. Conjugated antibodies bind to a specific target to deliver drugs or kill

only specific cell types, and thus improve cytotoxicity. There are currently 4 marketed

conjugated mAbs and this is forecast to increase, as supported by an increase in license

deals involving companies specializing in this technology (Seattle Genetics and

ImmunoGen). Further advancements in antibody engineering include the production of

antibody fragments, which can be produced more economically than whole mAbs and

retain the targeting specificity. The potential for antibody fragments is large, as they

can be conjugated to radionucleotides, toxins or enzymes, engineered to improve

efficacy and have the advantage of greater biodistribution and can be engineered to

have varying clearance properties.

mAbs currently have to be subcutaneously or intravenously injected because their

protein structure means that if taken orally they would be broken down in the stomach

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prior to absorption into the blood. Injections can be painful and inconvenient for

patients and any drug that improves convenience and compliance will have a huge

patient potential. A key trend forecast to result in a large increase in sales is the non-

invasive delivery of antibody drugs. Emisphere is currently investigating oral

technologies to apply to mAbs, but non-invasive mAbs are not expected to reach the

market in the next 5-10 years.

Diversification of therapy areas

There are currently 18 marketed mAb drugs, with the most recent, Biogen Idecs

Tysabri, launched in 2004. Tysabri was voluntarily suspended in 2005, however it was

allowed back on the market by the FDA in June 2006.

Table 1.1: Current marketed drugs, 2006

Brand Generic Originator Therapy area Launch year

Orthoclone OKT3 muromonab-CD3 Johnson & Johnson AIID 1986ReoPro abciximab Centocor/Lilly hemostasis 1995Rituxan/MabThera rituximab Biogen Idec oncology 1997Zenapax daclizumab Hoffman-La Roche AIID 1997Herceptin trastuzumab Genentech oncology 1998Remicade infliximab Centocor AIID 1998Simulect basiliximab Novartis AIID 1998

Synagis palivizumab MedImmune anti-infective 1998MyloTarg gemtuzumab Celltech Group, Wyeth oncology 2000

ozogamicinCampath alemtuzumab Genzyme oncology 2001Zevalin ibritumomab tiuxetan Biogen Idec oncology 2002Bexxar tositumomab-I131 Corixa oncology 2003Erbitux cetuximab ImClone oncology 2003Humira adalimumab Abbott/CAT AIID 2003Raptiva efalizumab Genentech/Xoma AIID 2003Xolair omalizumab Genentech/Novartis respiratory 2003Avastin bevacizumab Genentech oncology 2004Tysabri* natalizumab Biogen Idec AIID 2004

*Voluntary suspension February 2005, relaunched in June 2006;

AIID = arthritis, immune and inflammatory disorders

Source: Business Insights; Company websites Business Insights Ltd

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The traditional therapy areas covered by mAb drugs are oncology and autoimmune and

inflammatory disorders (AIID), as seen in Table 1.1. However, this is forecast to

change with the emergence of other therapy areas including infectious disease and

ophthalmology. Currently, there is only one infectious disease mAb on the market,

MedImmunes Synagis, but there are many early stage and several key late stage

products in the pipeline. Oncology and AIID are still seen as the major therapy areas in

the mAb market, but the spread of products among the therapy areas is likely to

become more balanced over the next 5 years.

Big Pharma entering the mAb market

The clear leader in the mAb market is Genentech with 5 marketed drugs, with sales

totaling $4,116.4m in 2005. There is a mix of types of companies shown in Table 1.2,

including antibody companies, biotechs and big Pharma.

Table 1.2: Key players in the monoclonal antibody market, 2006

Company Sales ($m) Sales Growth Market Share2004 2005 2004-05 2005

Genentech 2,838.0 4,116.4 45.2% 29.4%Hoffman-La Roche 1,862.7 2,704.7 45.0% 19.3%

Centocor 2,145.0 2,535.0 18.2% 18.1%Abbott 829.1 1,362.4 64.3% 9.7%MedImmune 942.3 1,060.9 12.6% 7.6%Schering-Plough 746.0 942.0 26.3% 6.7%ImClone 244.1 533.7 118.7% 3.8%Lilly 362.8 296.7 -18.2% 2.1%Merck KGaA 99.7 218.0 118.7% 1.6%Genzyme 51.5 60.8 18.1% 0.4%Novartis 49.7e 54.9e 10.5% 0.4%CAT* 22.9 37.6 64.3% 0.3%Biogen Idec 24.0 28.4 18.3% 0.2%Wyeth 26.0 25.6 -1.5% 0.2%Biogen Idec/Elan 2.4 21.2 783.3% 0.2%Johnson & Johnson 17.3e 13.2e -23.7% 0.1%Corixa 3.8e 8.2e 115.8% 0.1%

Total 10,267.3 14,019.8 36.5% 100.0%

e = estimate based on IMS sales data and authors own research and analysisCAT = Cambridge Antibody Technology; * acquired by AstraZeneca

Source: Business Insights; Company reports; IMS Business Insights Ltd

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There is a high level of M&A and licensing deals within the mAb market, which

reflects the high interest and opportunity in the market. The mAb market is a high

growth market that many big pharmaceutical companies want to gain access to, and are

generally looking to achieve this via in-licensing or acquisitions. Since 2005, Pfizer,

Novartis and AstraZeneca have all acquired innovative players in the mAb market. Out

of the major pharmaceutical leaders GlaxoSmithKline and Sanofi-Aventis are yet to

make significant moves to enter the mAb market, however should the market continue

to grow at its current rate then it is likely that these companies will look to make

investments in this area sooner rather than later.

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CHAPTER 2

Antibody engineering andinnovation in the market

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Chapter 2 Antibody engineering andinnovation in the market

Summary

The last 5 therapeutic mAbs launched in the US were humanized or chimeric,

supporting the trend of a move away from murine mAbs. Currently, there is only

one marketed fully human mAb, Abbott/CATs Humira.




radiologist and oncologist, which is expensive and limits their use.

Current marketed antibody fragments include ReoPro and CEA-scan (diagnosis),

which are both Fab fragments. A key pipeline antibody Fab fragment is

Genentechs Lucentis, filed for FDA approval in December 2005.

Drug discovery firms are using advances in genomics and proteomics, in addition

to proprietary technology to discover new target antigens and antibodies. The 3

leading players in antibody discovery are CAT, Dyax and Morphosys.

mAbs can only be administered via injection or intravenous infusion, due to their

structure and protein composition. Inhaled antibodies present a viable market due

to this delivery method providing an increase in convenience, and being painless

compared to injections. There are no currently marketed inhaled mAbs.

Oral mAb drug delivery is forecast to have a high market potential, as it provides

the most convenient method of drug delivery. A key oral technology is Emisphere

Technologies Eligen, which uses carrier agents to protect the protein from

digestive enzymes and facilitate the transport of the molecules across membranes.

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Introduction

The mAb market has advanced over the last 20 years due to numerous technological

innovations. This chapter examines the use of antibody engineering to produce

therapeutic mAbs without the risk of immune reactions, such as the HAMA response

seen with murine antibodies. A key trend in the market has been the move from murine

to humanized mAbs, with the future trend forecast to move towards fully human

antibodies.

Antibody engineering can also be used to improve efficacy as well as reduce sideeffects, and therefore lead to a larger patient potential. Innovation in drug discovery

technology is another key trend in the market which is detailed in this chapter and

allows the development of a huge range of mAbs through proprietary technology

platforms. Several companies are also looking to improve drug delivery technology, by

applying innovative technology to drug delivery devices or the drug itself. Improved

drug delivery will improve convenience and compliance leading to a larger uptake of

antibody drugs, and thus boosting sales.

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The move from murine to fully human mAbs

The first mAb to market was Orthoclone OKT3, a murine antibody launched in 1986.

Murine antibodies cause problems with immunogenicity, and as a consequence are no

longer pursued in current clinical trials. Part-human part-mouse (humanized and

chimeric) mAbs are increasing evident amongst marketed products, as shown in Figure

2.2 and Table 2.3. The last 5 therapeutic mAbs launched in the US were humanized or

chimeric, supporting the trend of a move away from murine mAbs. Currently, there is

only one marketed fully human mAb, Abbott/CATs Humira; however, developers are

expected to focus much more on fully human antibodies in the future, as suggested by

product pipelines across all phases and data regarding mAbs entering clinical trials, as

shown in Figure 2.3.

Table 2.3: Marketed therapeutic monoclonal antibodies, 1986-2006

Brand Generic Company Description Approval dateUS EU

Orthoclone OKT3 muromonab-CD3 Johnson & Johnson murine 06/1986 n/aReoPro abciximab Centocor, Lilly chimeric 12/1994 n/a

Rituxan/ MabThera rituximab Genentech, Roche chimeric 11/1997 06/1998Zenapax daclizumab Hoffman-La Roche humanized 12/1997 02/1999Simulect basiliximab Novartis chimeric 05/1998 10/1998Synagis palivizumab MedImmune humanized 06/1998 08/1999Remicade infliximab Centocor chimeric 08/1998 08/1999Herceptin Trastuzumab Genentech, Roche humanized 09/1998 08/2000MyloTarg gemtuzumab Celltech Group, Wyeth humanized 05/2000 n/a

ozogamicinCampath alemtuzumab Genzyme humanized 05/2001 07/2001Zevalin ibritumomab Biogen Idec murine 02/2002 01/2004

tiuxetanHumira adalimumab Abbott, CAT human 12/2002 09/2003Bexxar tositumomab-I131 Corixa murine 05/2003 n/aXolair omalizumab Genentech, Novartis humanized 06/2003 n/a

Raptiva efalizumab Genentech, XOMA humanized 10/2003 09/2004Avastin bevacizumab Genentech, Roche humanized 02/2004 01/2005Erbitux cetuximab ImClone chimeric 02/2004 06/2004Tysabri natalizumab Biogen Idec humanized 11/2004 n/a

Source: Business Insights; Company websites; FDA Business Insights Ltd

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Figure 2.2: Current marketed monoclonal antibodies, 2006

3

9

5

1

0

1

2

3

4

5

6

7

89

10

murine humanized chimeric human

NumberofmarketedmAbs

3

9

5

1

0

1

2

3

4

5

6

7

89

10

murine humanized chimeric human

NumberofmarketedmAbs

Source: Business Insights; Company websites Business Insights Ltd

Whole IgG monoclonal antibodies

Murine

Murine mAbs are entirely derived from mouse IgG and were the first type of mAbs to

be developed. However, murine mAbs incur problems with immunogenicity, whichmounts a response known as the Human Anti-Mouse Antibodies (HAMA) response,

producing unwanted side effects. Therefore, murine mAbs have not been commercially

successful and as a consequence play a limited role in developers pipelines.

Chimeric

Chimeric mAbs consist of 60% human and 40% mouse IgG and were first reported in

1984. The Fab region of chimeric mAbs is murine, whereas the Fc region is human,

and chimeric mAbs are thus advantageous as an immune response can be induced

comparable to natural antibodies. Chimeric mAbs have an improved immunogenic

profile in comparison to murine mAbs, but have more side effects than humanized and

fully human mAbs. Marketed chimeric mAbs include Centocor/Lillys Reopro, Biogen

Idecs Rituxan/MabThera and Centocors Remicade. The number of chimeric mAbs

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entering clinical trials has started to decline, as shown in Figure 2.3, due to the increase

in humanized and human mAbs, which have little or no murine content, and thus

reduced problems with immunogenicity.

Humanized

Humanized mAbs consist of over 90% human IgG and were first reported in 1986. The

murine region of a humanized mAb is located in the variable region in the Fab portion

of the antibody. Humanized mAbs include Roches Zenapax, Genentechs Herceptin

and MedImmunes Synagis. Humanized mAbs make up the largest group of marketed

therapeutic antibodies, with 9 drugs, as shown in Figure 2.2. Tufts Centre for the Study

of Drug Development (CSDD) data (as shown in Figure 2.3) shows that the number of

humanized drugs entering clinical trials peaked in 1996 and has since started to decline

as a result of the increase of fully human mAbs. Due to the lengthy procedure of drug

development and clinical trials, there is still expected to be numerous humanized mAbs

to reach the market, however fully human antibodies are forecast to be the dominant

type reaching the market in the next 5-10 years.

Human

There is only one fully human mAb on the market to date: Abbott/CATs Humira,which was launched in the US in 2003. Fully human mAbs are predicted to dominate

future product launches, as suggested by the shear volume of mAbs entering clinical

trials shown in Figure 2.3. Fully human mAbs have the lowest risk of immune related

side effects because there is no murine content and subsequently those mAbs have the

highest sales potential. Promising fully human pipeline mAbs include Amgens

denosumab and Pfizers ticilimumab.

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Figure 2.3: Therapeutic mAbs entering clinical study, 1980-2004

0

2

4

6

8

10

12

14

1980 1982 1984 19861988 1990 1992 1994 19961998 2000 2002 2004

NumberofmAbsenteringclinicalstudy

Murine

Chimeric

Humanized

Human

0

2

4

6

8

10

12

14

1980 1982 1984 19861988 1990 1992 1994 19961998 2000 2002 2004

NumberofmAbsenteringclinicalstudy

Murine

Chimeric

Humanized

Human

Data are presented as two-year moving averages

Source: Tufts CSDD Business Insights Ltd

Innovations in antibody structures

Antibody fragments can be single chain antibodies or antigen binding fragments (Fab),

as shown in Figure 2.4. Other engineered variants include diabodies, triabodies and

minibodies. Fragments are much smaller than whole antibodies, which gives them the

advantage of better infiltration of tissue compared to full length mAbs, in particular

tumors. mAb fragments also cost less to produce as they can be produced by

recombinant technology rather than the more expensive mammalian cell culture. mAb

fragments can also be altered to have a varying half life in the circulation, providing

added benefits over whole mAbs. Current marketed antibody fragments include ReoPro

and CEA-scan (diagnosis), which are both Fab fragments. A key pipeline antibody

fragment is Genentechs Lucentis, which gained FDA approval in June 2006, and like

the marketed fragments is also a Fab.

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Figure 2.4: Whole antibody and fragment structures

Full-size antibody Antigen-bindingfragment (Fab)

Single-chain

Variable region ofheavy chain

Constant region 1 ofheavy chain

Variable region oflight chain

Constant region oflight chain


Single-

antibody (SCA)





Constantregion (Fc)


Single-chain






Single-

antibody (SCA)





Constantregion (Fc)

Source: Business Insights Business Insights Ltd

Fab fragments

A Fab fragment is created by removing the constant (Fc) region, leaving a smaller

molecule (antigen-binding fragment or Fab) that contains the antigen binding site

allowing comparable target specificity to a whole mAb. Eliminating the Fc portion of

an antibody results in decreased non-specific binding and lower immunogenicity. Fabs

are approximately one third of the size of whole antibodies, while single chain

antibodies are around a sixth of the size.

UCB Celltech is an innovator in Fab fragment engineering technology, and use

PEGylation to extend the half life of their fragments. PEGylation is the process of

attaching one or more chains of polyethylene glycol (PEG) to a protein molecule,

which is necessary as removing the Fc region of the antibody means that the fragment

is rapidly cleared from the body. Current preclinical research is using proprietary multi

PEG patented technology, which allows numerous PEG molecules to be attached to

Fab fragments, with the advantage of reduction in manufacturing costs through less

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wastage of PEG and a greater variability in half-life dependant on the size of PEG

fragments attached. UCB Celltechs bioproduction system offers an alternative to

traditional biomanufacturing of mAbs that can significantly lower cost. UCB Celltech

has developed a proprietary system for manufacturing Fab fragments in microbial

systems, rather than by mammalian cell culture (which is one of the main stumbling

blocks of antibody production), and thus allows fragments to be produced on a large

scale at a lower cost.

Fab fragments are forecast to have a greater impact on the mAb market in the next 5

years than currently seen, due to greater publicity from current marketed drugs and

other fragments in late stage clinical trials. Key therapeutic antibody fragments being

investigated are shown in Table 2.4. However, the emergence of newer fragment types

could be a threat to Fab fragments. Although Fc fragments are not currently in clinical

trials and have numerous safety concerns, they have a high market potential as they are

highly potent to tumor cells and strongly induce complement activation.

Single chain variable fragments

Single chain variable fragments (scFvs) consist of the variable heavy (Vh) and variable

light (Vl) regions of a full antibody connected by a synthetic peptide linker. scFvs have

similar binding properties to Fab fragments, but are smaller making them even better at

tissue penetration, increasing specificity and efficacy.

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Innovation in antibody conjugation

Conjugated mAbs can be used as carrier agents of chemotherapy drugs, radioactive

particles, or toxins. Conjugated mAbs allows these molecules to be delivered to a

specific site or target a certain cell type, due to the unique targeting ability of

antibodies, and consequently have a localized and more direct action. Targeted delivery

of drugs or other agents result in reduced side effects on healthy cells, which is not the

case for many traditional systemic oncology drugs.

Types of conjugation

Antibody conjugation can be categorized into 3 types:

Direct arming;

Indirect arming;

Pre-targeting.

Direct arming: antibody conjugation

Conjugated mAbs can be used as carrier agents of chemotherapy drugs, radioactive

particles, or toxins. Conjugated mAbs allows these molecules to be delivered to a

specific site or target a certain cell type, and consequently have a localized and more

direct action. Currently marketed direct arming conjugated drugs include Wyeths

MyloTarg, Biogen Idec/Bayer AGs Zevalin and GlaxoSmithKlines Bexxar.

Indirect arming: Bispecific monoclonal antibodies

Bispecific mAbs bind two different antigens and hold considerable commercial

potential as therapeutic agents. MicroMet, Elusys and TRION Pharma have developed

technology for conjugating two mAbs to generate bispecific therapeutic antibodies.

MicroMets Bispecific T cell Engagers (BiTE) technology conjugates one antibody that

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recognizes killer T-cells with another antibody that recognizes the target cell. The

resultant antibody can capture the antigen, bringing it into close proximity to the T-cell

which can destroy the antigen if it is recognized as foreign. Elusys Therapeutics

bispecific antibody technology, Heteropolymer (HP) Technology, conjugates an

antibody that recognizes a particular antigen to another antibody that recognizes a

complement receptor, CR1, which is found on red blood cells. The bispecific antibody

binds the antigen to red blood cells, and is destroyed by macrophages in the liver.

Elusys also has a modified version of this technology known as antigen-HP, which can

be used to remove antibodies involved in the pathogenicity of autoimmune diseases.

Pre-targeting

Pre-targeting aims to selectively deliver radionucleotides to tumors, or to selectively

activate prodrugs, and thus reduce the systemic toxicities of these cytotoxic agents.

Seattle Genetics have developed antibody directed enzyme prodrug therapy (ADEPT).

ADEPT utilizes mAbs directed to tumors, which are not internalized, but remain on the

cell surface. mAb fragments are fused to enzymes and once administered accumulate in

tumor tissues. A prodrug is subsequently given, which is converted at the target site to

release active drugs to kill cells.

Marketed conjugated monoclonal antibodies

There are currently 4 marketed conjugated antibodies:

Wyeths MyloTarg, calicheamicin conjugate;

Biogen Idec/Bayer AGs Zevalin, radioimmunoconjugate,90

yttrium;

GlaxoSmithKlines Bexxar, radioimmunoconjugate,131iodine;

Peregrines Cotara, radiolabeled tumor necrosis therapy, 131iodine (approved in

China only).



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radiologist and oncologist, which is expensive and limits their use. Despite the

disadvantages with administration, there is a potential market for conjugated mAb in

complex diseases including cancer where specific targeting, increased tissue

penetration and high efficacy are all important.

Conjugation technology

There is a high level of innovation in conjugated mAbs, with key technologies

developed and licensed to other companies. Table 2.5 shows the major technologies in

the conjugated antibody market, which have been developed by Seattle Genetics,

ImmunoGen and Peregrine Pharmaceuticals.

Table 2.5: Conjugated antibody engineering technology

Company Technology Description

Seattle Genetics Antibody drug ADC technology allows mAbs linked to cytotoxic drugs toConjugate (ADC) be internalized, which result in cell type specific cell death.Antibody directed mAb fragments are fused to enzymes and accumulate inenzyme prodrug tumor tissues once administered. A relatively inactive formtherapy (ADEPT) of an anti-cancer drug (prodrug) is then given and is

converted by the targeted enzymes to a potent cell-killingdrug.

ImmunoGens Tumor-Activated TAP allows cytotoxic agents to be delivered to specificProdrug technology cancer cells. Agents are conjugated to a mAb, which is(TAP) stable in the circulation, but is rapidly broken down inside

cancer cells.

Peregrine Tumor Necrosis TNT utilizes mAbs directed to dead and dying tumorPharmaceuticals Therapy (TNT) cells. Radioisotopes are conjugated to these antibodies,

which are carried into tumors to kill them.

Source: Business Insights; Company websites; MedTRACK Business Insights Ltd

Seattle Genetics antibody technology

Seattle Genetics have developed antibody directed enzyme prodrug therapy (ADEPT)

and antibody drug conjugate technology (ADC). ADC technology allows mAbs linked

to cytotoxic drugs to be internalized, resulting in highly-potent agents. The pipeline

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drugs SGN-35 and SGN-75 employ ADC technology. ADEPT utilizes mAbs directed

to tumors, which are not internalized, but remain on the cell surface. mAb fragments

are fused to enzymes and once administered accumulate in tumor tissues. A prodrug is

then given, which is converted at the target site to release active drug to kill cells. The

ADEPT platform is utilized in the research program SGN-17, composed of a mAb that

binds to a human melanoma-associated antigen and the highly specific enzyme -

lactamase. When the prodrug is activated by the catalytic action of -lactamase, the

fully active agent melphalan is generated.

Numerous licensing deals have been established allowing companies to gain access to

this technology, including Genentech, UCB Celltech, Protein Design Labs, CuraGen,

Bayer and MedImmune. Recent collaborations involving Seattle Genetics and their

proprietary ADEPT or ADC technology include:

PMSA development, collaboration and license utilizing ADEPT, June 2005;

MedImmune collaboration employing ADC technology, April 2005;

Celera collaboration utilizing ADC technology, July 2004.

ImmunoGen mAb technology

ImmunoGens Tumor-Activated Prodrug (TAP) technology can be used to deliver

cytotoxic agents to specific cancer cells. ImmunoGen has designed agents that are

conjugated to an antibody with a link that is stable when in the circulation, but is

rapidly broken once it has entered the cancer cell, which allows more agent to be

delivered compared to a single cytotoxic agent. Advantages of this system include high

specificity, high potency (highly potent small-molecule effector drugs that are at least

100-1000 times more cytotoxic than traditional chemotherapeutics), stable linkage and

release (the cytotoxic agent is only released when inside the cell), reduced toxicity (and

more tolerable side effects) and non-immunogenic (humanized antibodies and non-

protein-based small-molecule effector drugs, reducing the risk of immunogenicity).

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Peregrine mAb technology

Peregrines Tumor Necrosis Therapy (TNT) utilizes mAbs attracted to dead and dying

cells found at the core of tumors. Radioisotopes can be conjugated to these antibodies,

which are carried into the tumors to kill them. Cotara is Peregrines leading TNT

compound. Peregrine has also licensed a TNT therapeutic for the indication of lung

cancer to Medipharm BioTech and is the first radio-labeled mAb approved for cancer

therapy in China.

mAbs can also be conjugated to other antibodies to create a bispecific mAb. These

molecules are still at an early stage of development, but have the potential to greatly

increase efficacy, and thus are forecast to have a high market potential. Due to the

human immune system consisting of polyclonal antibodies to generate an effective

response, bispecific molecules may re-create a natural response, which could be

effective in treating more complex diseases.

Enhancing monoclonal antibody potency

The potency of a mAb is very important as a highly efficacious drug will be more

frequently prescribed and achieve high sales; therefore any method to improve

antibody potency is very attractive. Technology can be applied to marketed drugs to

enhance antibody dependant cellular cytotoxicity (ADCC) (for example as applied to

Rituxan and Herceptin) and fucose-free antibodies can be generated, which have an

increased efficacy. Another method to enhance effector function is Xencors xmAb

engineered Fc domains, which can be inserted into an antibody candidate to improve

ADCC, improve half-life and structural stability. GlycoMAb glycosylation technology

is a method of increasing the potency of therapeutic antibodies targeting undesirable

cells by engineering the carbohydrate component present in all such antibodies. In

particular, GlycoMAb specifically increases ADCC, an immune effector mechanism

crucial for the in vivo target-cell killing activity of antibodies.

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Table 2.6 shows the key drug development technologies for generating enhanced

effector functions.

Table 2.6: Drug development technology


Roche GlycoMAb technology Genetically engineering cells to produce bisected non-fucosylated oligosaccharides. GlycoMAb antibodiesbind with higher affinity immune effector cells, thusleading to more efficient killing of the antibody-targeted cells by ADCC.

BioWa Potelligent technology Proprietary technology used to create fucose-freemonoclonal antibodies, with a marked increase inantibody dependent cellular cytotoxicity (ADCC).

Xencor xmAb engineered Fc xmAb engineered Fc domains can be inserted into andomains antibody candidates to improve ADCC, improve half-

life and structural stability.


Drug discovery

There are a large number of specialist drug delivery and technology companies in the

mAb market who partner or license with drug developers to discover new antibody

targets. Some of the leading antibody drug developers, such as CAT and UCB Celltech,

also have their own proprietary technologies, as detailed in Table 2.7. Advances in

genomics and proteomics have really been the catalyst of the growth in this segment of

the market.

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Table 2.7: Monoclonal antibody drug discovery technology


CAT Phage Display and Phage Display and Ribosome Display technologies forRibosome Display fully human antibody selection and optimization. CAT

has a vast phage antibody library with over 100bndistinct antibodies.

Dyax Phage display technology Bacteriophage libraries are used to select and producehigh affinity Fab fragments and antibodies, using anautomated screening system.

Morphosys Human Combinatorial HuCAL generates highly specific antibody fragmentsAntibody Library and fully human mAb drug candidates. HuCAL

GOLDhas the added benefit of CysDisplay screeningtechnology.

Symphogen Symplex Platform for the discovery and identification ofmonoclonal and polyclonal drug leads.

Ablynx Nanobody platform Single-domain antibody technology used to discoverand develop high-affinity drug leads.Vaccinex Library-based antibody Two discovery platforms for antibody discovery: the

discovery technology first based on membrane-bound antibody expressionand the second employing secreted antibodies.

Curagen Genomics Potential drug targets are selected and systematicallyprioritized using more detailed expression analysis.

UCB Celltech SLAM (selected SLAM generates a diverse range of high-affinitylymphocyte antibody antibodies against targets which have provenmethod) difficult to raise antibodies against by conventional

hybridoma technology


The 3 leading players in antibody discovery in terms of number of licensing deals made

in the last 2 years are CAT, Dyax and Morphosys, which are discussed in more detail

in the following section. For example, Curagen has extensive knowledge about the

human genome and can use this knowledge to aid the development of therapies. Two

key biotechnology companies, Seattle Genetics and Abgenix, have formed an alliance

with Curagen to develop antibody therapies, combining their own antibody engineering

capabilities with targets that Curagen can supply. This provides a strong platform from

which the two companies can develop antibodies, which would not be possible alone.

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Cambridge Antibody Technology

Cambridge Antibody Technology (CAT) (now part of AstraZeneca) has developed

Phage Display and Ribosome Display technologies for the selection and optimizationof fully human antibodies. CAT has created large libraries of antibody genes collected

from the blood of healthy individuals, and currently has a vast phage antibody library

with over 100bn distinct antibodies. The size of CAT's libraries allows the isolation of

antibodies to potential disease targets rapidly and efficiently. Phage display libraries

form the backbone of CATs strategy to develop a portfolio of antibody-based drugs.

Six fully human therapeutic antibodies developed by CAT are in clinical trials, with

Humira (adalimumab) being the first antibody developed by CAT to reach the market,

launched by Abbott in January 2003.

CAT benefits from using its own proprietary phage display technology as it puts the

company in a strong intellectual property position, in addition to the library being

extremely large and thus having the potential to contain high quality fully human

antibodies that will bind specifically to any given target molecule. Phage display is

advantageous as it speeds up the process of antibody production by avoiding the need

for immunization of animals, which takes several weeks to months before antibodies

can be attained. Further benefits include the wide range of target antigens and

automation of processes. CATs competitors within phage display technologies include

Dyax (with whom CAT has a broad cross-licensing agreement), and Morphosys. Key

deals and collaboration using CATs proprietary technology include:

Gala Biotech, a division of Cardinal Health, announced a cell line engineering

collaboration with CAT, May 2005;

CAT partnered with Chugai to develop novel human mAbs in October 2002.

CAT has the largest antibody library compared to Dyax and Morphosys, and thus has a

competitive advantage. The acquisition of CAT by AstraZeneca also makes CAT an

attractive licensing partner, due to a larger financial backing and enhanced reputation.

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Dyax

Dyaxs phage display technology uses libraries that contain bacteriophages which

display Fab antibody fragments, which are utilized to select and produce high affinity

fully human Fab fragments and antibodies using an automated screening system.

Dyaxs phage display libraries were developed by taking gene fragments from human

donors (encoding the light chain variable region and part of the heavy chain variable

region), modified with synthetic DNA that encodes the key antigen recognition sites in

antibodies. Using this technique Dyax has created phage libraries that contain around

45bn human antibody fragments, with distinct antigen recognition sites. The total size

of Dyaxs libraries is over four times larger than MorphoSyss HuCAL phage display

libraries.

Dyaxs key partnerships include AstraZeneca and Biogen Idec, with the majority of

deals focusing on out-licensing its technology and forming research collaborations.

Key deals and collaboration using Dyaxs proprietary technology in the last 3 years

include:

Dyaxs antibody phage display libraries were licensed to Tanox, Inc. for

therapeutic antibody development in November 2004;

Inhibitex and Dyax announced a collaboration to develop monoclonal antibodies

against enterococci in October 2004;

Dyax and URRMA Biopharma announced a co-development agreement for AIDS

antibodies in October 2003.

Although Dyaxs antibody library is smaller than CATs it is larger than Morphosys

library, and thus is more attractive for licensing partners due to the larger choice of

antibodies.

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Morphosys

MorphoSys has developed a proprietary technology to develop human antigens in

laboratories, called HuCAL (Human Combinatorial Antibody Library). The HuCALtechnology is an in vitro method generating highly specific antibody fragments and

fully human antibody drug candidates. Features of the HuCAL system include rapid,

high-throughput generation of fully human antibodies, with a proven success with

difficult antigens (non-immunogenic or toxic antigens), and binding affinity can be

further increased through targeted optimization. The use of MorphoSys proprietary

trinucleotide mutagenesis technology (TRIM) allows the synthesis of any chosen

amino acid at the variable regions of the antibody, allowing a vast structural diversity.

The HuCAL system also allows easy switching between different antibody formats, forexample monomeric Fab fragments can be converted into a dimeric format. When Fab

fragments are inserted into a standard immunoglobulin expression vector, fully human

IgG antibodies can be produced.

HuCAL GOLD combines the advantages of the Fab format found in the HuCAL Fab

library with the advanced selection properties of the proprietary CysDisplay screening

technology: a novel and efficient display technology for selecting high binding affinity

antibodies from libraries using filamentous phage. The Fab format is particularly well

suited for the development of therapeutic antibodies as it guarantees high stability and

monomeric appearance and is easily convertible into a complete human

immunoglobulin without loss of function.

Morphosys key partnerships are with Bayer, Centocor/Johnson & Johnson, Roche and

Schering, who have all integrated HuCAL into their R&D processes. Other recent key

deals and collaboration using Morphosys proprietary technology include:

MorphoSys' antibodies by design and JPT Peptide Technologies announced a

cooperation agreement in April, 2005;

MorphoSys Antibodies by design and Chimera biotech announced a cooperation

and co-marketing agreement in February, 2006.

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pressure delivery could potentially damage fragile molecules, such as mAbs; successful

delivery of such molecules therefore requires a device with carefully controlled power

levels. Examples of delivery devices include pen-injectors (e.g. Confidoses auto-

injector) and needle-free devices (e.g. Aradigms IntraJect), which can be used with

immediate release and sustained release formulations of proteins.

Prefilled devices could also be used with mAbs, which would be more convenient,

ensure accurate dosing and be more useful for RA patients who can find it painful to

use their hands to manually fill a needle. Several companies are involved in

development of this technology, which include Antares Pharma Inc, Aradigm

Corporation, Bioject Medical Technologies Inc and Biovalve Technologies Inc.

Prefilled delivery devices are anticipated to reach the market in the next 5 years as the

technology is already in place. New injectable delivery devices are forecast to boost

mAb sales due their increase in patient compliance, although sales will decline rapidly

once non-invasive mAbs reach the market.

Inhaled monoclonal antibodies

Inhaled antibodies present a viable market due to this delivery method providing anincrease in convenience, and being painless compared to injections. There are no

currently marketed inhaled mAbs; however several products are in development:

Enzon and Nektar have formed a strategic alliance for the development of Enzons

single-chain antibody products using Nektars Pulmonary Particle technology

(inhalable technology);

In preclinical asthma studies, Alexion has demonstrated efficacy of an inhaled mAb

anti-C5 antibody (eculizumab) to block airway hyper responsiveness;

In June 2000, MedImmune, Inc and Alkermes, Inc announced that they had signed

an agreement to develop an inhalable formulation of a mAb targeting the

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respiratory syncytial virus (RSV) using Alkermes AIR pulmonary drug delivery

technology.

Inhaled mAbs are forecast to reach the market after prefilled injectables, but before oral

mAbs. The impact of inhaled mAbs will have a huge positive impact on the mAb

market; however they will cost more than injectables, which already demand a

premium price and therefore act as a resistor to growth. Another resistor to growth will

be the launch of oral mAbs, as they will further increase patient convenience.

Oral monoclonal antibodies

Oral mAb drug delivery is forecast to have the highest market potential, as it provides

the most convenient method of drug delivery. However, this is still at an early-stage of

development and currently inhalation technology is the most advanced non-invasive

method of mAb drug delivery. A key oral technology is Emisphere Technologies

Eligen, which uses carrier agents to protect the protein from digestive enzymes and

facilitate the transport of the molecules across membranes. Another key technology is

Access Pharmaceuticals proprietary vitamin B12 oral drug delivery technology. In

September 2003, Access entered into a research collaboration with Celltech to develop

oral drug delivery options for Celltech's mAbs and antibody fragments. In preclinical

studies, this technology has already demonstrated its potential to facilitate the

absorption of proteins following oral administration.

Oral mAbs are predicted to have the largest impact on sales growth compared to

prefilled injectables and inhaled mAbs, due to oral administration being simple and

pain free. Oral antibodies are not expected to reach the market in the next 5 years.

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CHAPTER 3

The current monoclonalantibody market

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Chapter 3 The current monoclonalantibody market

Summary

The leading mAbs are Remicade and Rituxan, with sales of $3.5bn and $3.3bn,

respectively in 2005. However, sales growth of Rituxan is expected to be limited

due to a lack of studies investigating new indications.

The rapid increase in the number of mAb pipeline drugs is a result of innovation

in the market, which has allowed companies to develop fully human drugs with

reduced immunogenicity and mAb fragments that are cheaper to produce and

have a high efficacy.

Despite the high growth in the mAb market, there remain many issues resisting

the market, including mAbs being withdrawn from the market, publicized side-

effects, pricing and reimbursement issues and competition from small molecule

drugs.

Oncology is the largest therapy area within the mAb market, with 8 marketed

products. This therapy area is set to increase with numerous early and late stage

products in development. Key oncology pipeline products include VirexxsOvaRex, Abgenix/Amgens ABX-EGF and Medarex/Bristol-Myers Squibbs

MDX-010 and MDX-1379.

AIID is the second largest therapy area in the mAb market, with 7 marketed

drugs. Many of the marketed AIID drugs are indicated for the same disease, and

consequently there is a high level of competition between drugs. For example the

leading mAb Remicade, with sales of over $3.4bn in 2005, is indicated for

Rheumatoid Arthritis (RA), as is Humira.

Synagis is the only current anti-infective mAb on the market. However, due to a

large number of early and late stage pipeline products, this therapy area is

expected to expand in the next 5 years. Key pipeline products include Numax and

Aurograb.

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Introduction

The mAb market is an immature market with only 18 currently marketed mAbs

worldwide, and an additional 3 marketed in China and Japan. The total market has

grown rapidly over the last few years and reached $14bn in 2005, an increase of 36.5%

from 2004 sales of $10.3bn. There are numerous factors which have led to the increase

in sales in the market, which are discussed in this chapter, including drug specific

factors such as approvals in additional indications. Other issues have also shaped the

mAb market in the last 2 years, including clinical trials for currently marketed drugs,

regulations, attrition rates and innovation in antibody engineering.

Strategic analysis

The therapeutic mAb market is an area of high growth with many factors influencing

the market, as shown in Figure 3.5.

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and YM Biosciences nimotuzumab in China and Chugais Actemra in Japan. The

mAb market is an immature market, with a huge potential for future growth in a variety

of disease indications.

Big Pharma entering the mAb market

In the last few years Big Pharma has begun to enter the mAb market, which has been

achieved by M&A and licensing deals with biotech companies that have key mAb

pipeline drugs or proprietary technology. Big Pharma are attracted to the mAb market

as it has demonstrated rapid growth in the last few years and it is immature, with a

huge potential for future growth. Big Pharmas entry to the mAb market will act as a

major driver to growth, due to their large financial power to develop and market

pipeline drugs.

High level of innovation

There is a high level of innovation in the mAb market, which is starting to overcome

some of the issues with currently marketed mAbs. This includes advances in antibody

engineering technology, which has allowed the generation of fully human mAbs.

Humira is currently the only marketed fully human mAbs, however key late stage fully

human mAbs include UCBs Cimzia and Genentech/Novartis Lucentis, which are bothanticipated to launch in 2006. Other innovations are in drug delivery, such as extended

release formulations of existing drugs to improve the pharmacological profile.

Controlled release versions allow the patient to reduce the number of doses of drug

required, leading to improved compliance. Examples of innovative drug delivery

technologies include Alzas Alzamer and Alkermess Prolease. Innovations in drug

delivery devices are another driver to mAb growth as prefilled devices are simpler to

use and increase patient compliance. Drug delivery devices that could potentially be

used with the currently marketed mAbs include pen-injectors (e.g. Confidoses auto-injector) and needle-free devices (e.g. Aradigms IntraJect), which can be used with

immediate release and sustained release formulations of proteins. However, these will

only act as a driver in the mid-long term.

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Approval of new indications

A major driver to growth in the mAb market is the approval of new indications for

existing drugs. In March 2006 the FDA approved an additional indication of Erbitux

for the treatment of squamous cell carcinoma of the head and neck, in addition to its

primary indication in colon cancer. A key driver to Avastins growth includes its

approval for use across renal cell carcinoma, NSCLC and breast cancer, and for use

with a wider range of cytotoxics and approval for adjuvant therapy. The trend of

additional indications being approved for marketed drugs is set to continue, as it is has

been shown to successfully boost sales and extend product lifecycles.

Combination therapies

Another key driver to growth is in combination therapies, which allow current

marketed products to gain access to a wider range of indications and have a larger

patient potential. Rituxan combined with Valcade is currently in clinical trials, as is

Herceptin in combination with Taxol and Abraxane. In addition, Erbitux is in trials

with carboplatin, paclitaxel, cisplatin, and docetaxel, and will allow the range of

indications to be increased if the results are favorable.

Resistors

Publicized side effects

A resistor to the growth of the mAb market is from negative publicity due to adverse

reaction to mAbs. Warnings on FDA approved drugs are available on the FDA website,

in addition to being publicized on the internet on several sites with the information

compiled. Such information could act to scare the general public into requesting

alternative drugs from their physicians, such as competing small molecule products.

The severe adverse side effects seen in Tegeneros TGN1412 trial in the UK raised

public awareness about mAbs and left the general public with a negative opinion

concerning this type of therapy.

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Drugs suspended from market

In February 2005, Biogen Idec voluntarily suspended Tysabri (natalizumab). Biogen

Idec confirmed that one fatality and one additional case of progressive multifocal

leukoencephalopathy (PML) had occurred in patients receiving Tysabri for multiple

sclerosis (MS). There is no known link between Tysabri and PML, however Biogen

Idec suspended Tysabri as a precautionary measure. In June 2006 the FDA formally

agreed to allow Tysabri back on the market. There is still no known link between

Tysabri and PML, but the benefits of the drug are considered to outweigh the risks.

However, the FDA suggested that patients try another MS drug first and avoid drug

combinations while taking Tysabri. The suspension of Tysabri is expected to have a

negative impact on Tysabri sales, due to risks of the drug being highlighted and its use

being limited. The suspension of Tysabri will not act as a significant resistor to the

mAb market as a whole, but it has provided negative publicity that may discourage

some physicians from prescribing mAbs.

Competition from small molecule drugs

Competition from small molecule drugs is a huge resistor to growth for the current

mAb market. The breast cancer market is predicted to become dominated by small

molecule drugs, for example Abraxane (reformulated paclitaxel) and the pipeline drug

GSKs Lapatinib, which will impact on mAb drugs such as Herceptin. Small molecule

drugs are also set to impact sales of the anti-angiogenesis mAb Avastin, with the

launch of Novartis/Bayer AGs pipeline product PTK787 (vatalanib), while Raptiva

and Remicade are predicted to be impacted by Enbrel (Amgen/Wyeth), a protein

targeting TNF.

Pricing and reimbursement schemes

As a result of high pricing, mAbs are not always covered by government pricing

reimbursement schemes, and this limits the mAb market. Enbrel and Humira had

limited coverage under the US Medicare scheme, but as of 2006 are now fully covered.

In the UK, patients with RA are prescribed 2 different DMARDS prior to mAb therapy

under the NHS, which is largely due to the high price of mAbs.

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Analysis of launched drugs

The market dynamics of the current marketed mAbs are shown in Figure 3.6 and Table

3.8. The leading mAbs are Remicade and Rituxan, will sales of $3,477m and $3,323m,

respectively in 2005. However, sales growth of Rituxan is expected to be limited due to

a lack of studies investigating new indications, while Remicade is predicted to have

limited future growth due to continuing competition from Humira and from UCBs

pipeline mAb Cimzia. The highest sales growth during 2005 has been seen for Avastin,

139.4% ($556.5m), which is mainly due to approval for use a range of indications:

renal cell carcinoma, NSCLC and breast cancer, and for use with a wider range of

cytotoxics and approval for adjuvant therapy. The largest decline in sales growth was

for Orthoclone OKT3 (-23.7% in 2005), which is primarily because of Orthoclones

murine composition leading to adverse reactions such as fever, nausea and vomiting.

Figure 3.6: Market dynamics of current marketed drugs, 2004-5

-100%

-50%

0%

50%

100%

150%

200%

-1000 -500 0 500 1000 1500 2000 2500 3000 3500 4000

Sales, 2005 ($m)

Salesgrowth,

200

4-5(%)

Bexxar

Tysabri

Orthoclone OKT3

Mylotarg

Zenapax

Simulect

Campath

Rituxan/MabThera

Herceptin

Remicade

Humira

Avastin

Synagis

Zevalin

Erbitux

Xolair

ReoPro

Raptiva

Bubble size represents market share

AIID Oncology Anti-infective Respiratory Hemostasis

-100%

-50%

0%

50%

100%

150%

200%

-1000 -500 0 500 1000 1500 2000 2500 3000 3500 4000

Sales, 2005 ($m)

Salesgrowth,

200

4-5(%)

Bexxar

Tysabri

Orthoclone OKT3

Mylotarg

Zenapax

Simulect

Campath

Rituxan/MabThera

Herceptin

Remicade

Humira

Avastin

Synagis

Zevalin

Erbitux

Xolair

ReoPro

Raptiva

Bubble size represents market share

AIID Oncology Anti-infective Respiratory HemostasisAIID Oncology Anti-infective Respiratory Hemostasis

Sourc

The Future of Monoclonal Antibody Therapeutics - S. Riley (2006) WW

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