Cell and gene therapies are a niche product area, but with manufacturing capacity limited, several companies, including Novartis, Roche, Catalent, and Thermo Fisher, are getting into the market with multi-billion-dollar deals.

Inside the cell and gene therapy markets

Cell and gene therapies are a niche product area but have been a recent active area of investment by both pharmaceutical companies to add products to the pipeline and manufacturing capabilities and by certain contract development and manufacturing organizations (CDMOs) and contract manufacturing organizations (CMOs) to add cell-therapy manufacturing capabilities to their toolbox.

With cell therapy, cells are cultivated or modified outside the body before being injected into the patient, where they become a “living drug.” With gene therapy, genes are replaced, inactivated or introduced into cells—either outside or inside the body—to treat a disease. Cell and gene therapies are designed to halt a disease or reverse its progress rather than simply manage symptoms. They are often one-time treatments that may alleviate the underlying cause of a disease and have the potential to cure certain conditions, according to information from Novartis.

The market for cell therapies was valued at $2.70 billion in 2017 and is expected to reach $8.21 billion in 2025, growing at a compounded annual growth rate (CAGR) of 14.9% between 2017 and 2025, according to a recent analysis by Frost and Sullivan. Manufacturing automation is expected to play a role in realizing that growth by means of implementation of information technology solutions and single-use manufacturing techniques for optimizing small-volume, high-value manufacturing of novel cell therapies to reduce the time to market.

Chimeric antigen receptor (CAR) T cell therapies are one type of cell therapy and represent a type of immunotherapy that involves a one-time infusion of a patient’s own immune cells that have been genetically modified to recognize and attack cancer. The US Food and Drug Administration (FDA) has approved two CAR T therapies: Novartis’ Kymriah (tisagenlecleucel), the first CAR T therapy approved by the FDA in 2017 for treating certain types of leukemia, and Gilead Sciences’ Yescarta (axicabtagene ciloleucel), initially approved in 2017 for treating diffuse large B-cell lymphoma, and gained by Gilead through its $11.9-billion acquisition of Kite Pharma, a cell and gene therapy company, in 2017.

Manufacturing moves

Novartis and Gilead are among the large pharmaceutical companies investing in cell and gene therapies through manufacturing investments and product acquisitions.

Earlier this year (2019), Novartis acquired CELLforCURE, a CDMO of cell and gene therapies in Europe, from LFB, a French pharmaceutical company. The acquisition included a cell and gene manufacturing facility located outside of Paris in Les Ulis, France and the related adjacent land. The site joins Novartis’ network of cell and gene therapy sites that include sites in Morris Plains, New Jersey and Stein, Switzerland.

Novartis made several other steps to strengthen and expand its cell and gene manufacturing, including signing a strategic licensing, collaboration and share purchase agreement with Cellular Biomedicine Group (CBMG) to manufacture and supply Kymriah in China; expanding an alliance with the Fraunhofer Institute in Germany to support manufacturing for clinical trials and post approval manufacturing; and a contract manufacturing collaboration in Japan.

In 2018, Novartis made a large play in gene therapy with its $8.9-billion acquisition of AveXis, a Bannockburn, Illinois-headquartered clinical-stage gene-therapy company. Earlier this year (April 2019), AveXis announced it had agreed to purchase an advanced biologics therapy manufacturing campus in Longmont, Colorado, to expand its manufacturing capacity for its investigational gene therapy, Zolgensma (onasemnogene abeparvovec-xioi). Zolgensma is under regulatory review for treating spinal muscular atrophy. The Longmont facility will add to AveXis’ manufacturing network. AveXis has a manufacturing facility in Illinois, is building a manufacturing facility in North Carolina that is scheduled to be operational in 2020, and is expanding its product-development capacity at its San Diego facility.

Following its acquisition of Kite Pharma in 2017, Gilead announced in 2018 that it had leased and purchased new facilities in the US and Europe to expand its cell-therapy manufacturing capabilities. Kite has leased a new 117,000-square-foot site facility in Hoofddorp, the Netherlands to engineer cell therapies, including for Yescarta. The new facility is scheduled to be fully operational in 2020. In addition to the Netherlands facility, Kite purchased a new building in Santa Monica, California from Astellas Pharma that will be used for cell-therapy research, development, and the expansion of clinical manufacturing capabilities. Kite also leased a 26,000-square-foot facility in Gaithersburg, Maryland. The Maryland site will support the work of a new Cooperative Research and Development Agreement with the National Cancer Institute to develop adoptive cell therapies targeting patient-specific tumor neoantigens. Neoantigens are mutations found on the surface of cancer cells that are unique to each person and tumor. This year (April 2019), Kite announced plans for a new facility in Frederick County, Maryland, to produce cell therapies. The 20-acre site will  expand Kite’s ability to manufacture a variety of CAR T, therapies, including Yescarta (axicabtagene ciloleucel), Kite’s first commercially available CAR T cancer therapy, and investigational T cell receptor (TCR) cell therapies being evaluated in solid tumors. The Frederick County facility will become part of Kite’s commercial manufacturing network that includes sites in California and the Netherlands.

Celgene, which acquired Juno Therapeutics, a company developing cell therapies and immunotherapies, in 2018 for $9 billion, announced in February 2018 that it completed the first phase of a new immunotherapy manufacturing center for CAR T therapies at its Summit West campus in New Jersey. Celgene is involved in cellular therapy development through its Celgene Cellular Therapeutics business that focuses on placenta-derived and other stem-cell therapies in multiple diseases. The Juno acquisition provided a scientific platform and scalable manufacturing capabilities, including a research and development facility in Seattle, Washington as well as a manufacturing facility in Bothell, Washington. 

Earlier this year (February 2019), Roche agreed to acquire Spark Therapeutics, a commercial gene-therapy company based in Philadelphia, for $4.3 billion. The deal is expected to close in the second quarter of 2019. Spark Therapeutics will continue its operations in Philadelphia as an independent company within the Roche Group. Spark’s commercial product is Luxturna (voretigene neparvovec-rzyl), a one-time gene-therapy product indicated for treating biallelic RPE65 mutation-associated retinal dystrophy, a rare form of inherited vision loss. The drug was approved by the FDA in 2017 and is currently marketed in the US. The European Commission granted marketing authorization in 2018. Spark Therapeutics’ lead clinical asset is SPK-8011, a gene therapy for the treatment of hemophilia A, which is expected to start Phase III development in 2019. Spark Therapeutics also has other assets in development for hemophilia B, Pompe disease, Huntington’s disease, and Stargardt disease. With the acquisition, Roche also gains a gene-therapy manufacturing facility.

In a smaller investment, last year, Astellas Pharma announced the construction of new research, development, and manufacturing facilities for biologic-based modalities, including antibodies and cell therapies, in Japan and Massachusetts. The facilities will produce clinical trial materials (CTM) for regenerative medicines and cell and gene therapies as well as CTM and commercial supply for antibodies. The Center for Active Ingredient for Biopharmaceuticals in Toyama, Japan, which will cost approximately 10.0 billion Yen ($88.5 million), is scheduled for completion in September 2019. A Center for Multimodality Clinical Trial Materials in Tsukuba, Japan for the manufacture of CTM for early-stage clinical trials for cell therapies and gene therapies, which would cost approximately ¥5.0 billion ($44 million), is scheduled for completion in 2019. The Astellas Institute for Regenerative Medicine, a subsidiary of Astellas and a center for the research and development of regenerative medicine and cell therapy, is moving to new facilities in Massachusetts. The investment is approximately ¥14.0 billion ($123 million). Work began in September 2018 and is scheduled for completion during January 2020.

Novo Nordisk announced in 2018 plans to establish a manufacturing site in Fremont, California to develop and produce stem cell-based therapies. The company signed a long-term lease on a GMP facility, previously operated by Asterias Biotherapeutics, a biopharmaceutical company. The site will support Novo Nordisk’s stem cell-based therapies within Type I diabetes and other chronic diseases. Once operational in 2019, the facility will fulfill the supply of stem cell-based therapies for Novo Nordisk’s clinical trial programs.

CDMOs beef up cell and gene therapy manufacturing

This year has also seen two major deals among CDMOs for cell and gene-therapy manufacturing. Earlier this month (April 2019), Catalent agreed to acquire Paragon Bioservices, a Baltimore, Maryland-based contract provider of viral vector development and manufacturing services for gene therapies, for $1.2 billion. The deal is expected to close in the second quarter of 2019. Paragon has specialized expertise in adeno-associated virus (AAV) vectors, the most commonly used delivery system for gene therapy as well as capabilities in GMP plasmids and lentivirus vectors. The company provides GMP development and manufacturing services for recombinant viral vectors, vaccines, hard-to-express recombinant proteins, and oncolytic viruses from research and process development to GMP manufacturing for clinical trials and commercial launch.

Earlier this month (April 2019), Paragon opened a new 200,000-square-foot GMP gene-therapy biomanufacturing facility in Maryland’s Anne Arundel County. The facility is equipped with several 500-liter and 2,000-liter single-use bioreactors for clinical through commercial material production.

Last month (March 2019), Thermo Fisher Scientific agreed to acquire Brammer Bio, a CDMO of viral vector manufacturing for gene and cell therapies, for approximately $1.7 billion. The business has nearly 600 employees at primary locations in Massachusetts and Florida. Brammer Bio is on track to deliver $250 million of revenue in 2019 and expects to continue to exceed the projected market growth rate of 25 percent over the mid-term. The transaction, which is expected to be completed by the end of the second quarter of 2019, is subject to customary closing conditions, including regulatory approvals. Upon completion, Brammer Bio will become part of Thermo Fisher’s pharma services business within its Laboratory Products and Services Segment.

Lonza, already positioned in cell therapy manufacturing and viral product manufacturing, made several moves in 2018. In October, it acquired a controlling stake with the right to acquire full ownership in Octane Biotech, a company based in Kingston, Ontario, Canada that provides cell culture and tissue engineering systems. The move positions Lonza to develop the technology to support scalable autologous manufacturing. The two companies have collaborated since 2015 on the development of Octane Biotech’s Cocoon system, a patient-scale, closed and automated cell-therapy manufacturing system. Following a joint-development program, the Cocoon system now incorporates the majority of unit operations needed for scalable end-to-end manufacturing of cell therapies, including mesenchymal stem cells and CAR T cells. In addition, disposable cassettes can be modified to accommodate autologous cell-therapy processes for adherent cells, non-adherent cells, and combination products.

In addition, in 2018, Lonza announced that it was installing multiple cell-therapy suites at the company’s biomanufacturing site in Portsmouth, New Hampshire. In February 2018, the company established centers of excellence in cell and gene therapy across its network, placing Portsmouth as a clinical and commercial manufacturing center. The company’s sites in Pearland, Texas and Geleen/Maastricht, the Netherlands also provide cell- and gene-therapy services, including process and analytical development, clinical product supply and commercial product supply. Lonza opened a new 300,000-square-foot dedicated cell-and-gene-therapy manufacturing facility in Pearland, Texas in 2018. Lonza’s sites in Portsmouth and Singapore also serve as clinical and commercial manufacturing sites.

Fujifilm Cellular Dynamics, Inc. (FCDI), a US subsidiary of Fujifilm Corporation and a developer and manufacturer of human induced pluripotent stem (iPS) cell technologies, announced in January 2019 an investment of about $21 million to open a new cGMP-compliant production facility with the goal of industrializing iPS cell manufacturing for regenerative medicine therapies. The facility will support FCDI’s internal cell therapeutics pipeline and will also serve as a CDMO for iPS cell products. The facility is slated to be operational by March 2020.

Other manufacturing activity in cell and gene therapies

Smaller companies also are making moves in cell and gene therapy manufacturing. bluebird bio, a Cambridge, Massachusetts-based gene-therapy company, announced in March 2019 the opening of its first wholly owned manufacturing facility in Durham, North Carolina, that will produce lentiviral vector for the company’s investigational gene and cell therapies, including: bb2121 and bb21217 for the treatment of multiple myeloma and potentially LentiGlobin (betibeglogene darolentivec) for the treatment of transfusion-dependent β-thalassemia and sickle cell disease.

bluebird bio purchased the facility in November 2017. Once completed, the company will have invested more than $80 million building the site, which will be equipped with multiple manufacturing suites capable of producing lentiviral vector. The facility also includes warehouse and quality control testing laboratories. As the company reported in March 2019, facility construction is substantially complete and equipment qualification is underway. Initially, bluebird bio expects the facility to produce clinical and commercial supply of lentiviral vector, which is a key component of the company’s gene and cell therapies. The company says the facility is large enough to accommodate future expansion, including the possibility of manufacturing commercial drug product.

Allogene Therapeutics, a clinical-stage biotechnology company developing allogeneic CAR T therapies for cancer, and headquartered in South San Francisco, California, entered into a lease agreement earlier this year (February 2019) to build a 118,000-square-foot cell-therapy manufacturing facility in Newark, California. The facility will be used to manufacture the company’s proprietary allogeneic CAR T therapies.

Rubius Therapeutics, a Cambridge, Massachusetts-headquartered biopharmaceutical company developing cellular therapies, is investing up to $155 million to establish a manufacturing facility in Rhode Island. The company announced in 2018 that it intends to invest up to $155 million over a more than five-year period to renovate a 135,000-square-foot manufacturing facility through the adaptive reuse of an existing building in Smithfield, Rhode Island. Rubius is developing a class of therapies that it calls Red Cell Therapeutics (RCTs), which are based on red blood cells. The company has developed a platform to genetically engineer and culture RCTs as cellular therapies.

Earlier this year (2019), Hitachi Chemical, a Tokyo-based chemicals and industrial manufacturer, agreed to acquire Apceth Biopharma, a Munich, Germany-based CDMO of cell and gene therapies, for EUR 75.5 million ($86.5 million). With the acquisition of Apceth, Hitachi Chemical will be expanding its business presence footprint in Europe. The move is part of Hitachi’s life-sciences strategy to launch and build a regenerative medicines business in the US, Europe, and Japan. In May 2017, Hitachi acquired PCT, LLC, a Caladrius Company (currently Hitachi Chemical Advanced Therapeutics Solutions, LLC), a US-based contract manufacturer of regenerative medicines. In April 2018, it began operation of a new facility in Yokohama, Kanagawa Prefecture, Japan to provide contract development and manufacturing services for the development of regenerative medicine products.

In 2018, Mustang Bio, a New York-headquartered clinical-stage biopharmaceutical company and a subsidiary of the biopharmaceutical company, Fortress Biotech, opened a CAR T cell-therapy manufacturing facility at the UMass Medicine Science Park in Worcester, Massachusetts. The 27,000-square-foot facility was designed to support the clinical development and commercialization of Mustang’s CAR T product candidates and enable proprietary cell-therapy research.

Also in 2018, Abeona Therapeutics, a Dallas, Texas-headquartered clinical-stage biopharmaceutical company, opened a commercial GMP manufacturing facility for gene and cell therapies in Cleveland, Ohio called The Elisa Linton Center for Rare Disease Therapies. The GMP facility is designed to manufacture clinical and commercial-grade products over Abeona’s multiple clinical programs, including therapies to treat recessive dystrophic epidermolysis bullosa (RDEB), a rare skin disorder, and Sanfilippo Syndrome, a rare autosomal recessive lysosomal storage disease.

Editor’s note: This article was updated to include the announced expansion by Gilead Sciences’ Kite Pharma for a new site for cell-therapy manufacturing in Frederick County, Maryland (announced April 24, 2019) and for bluebird bio’s manufacturing facility in North Carolina.