Monday, November 21, 2011

Companion Drug/Diagnostic Pathway: A Question of Where and Who

By Cole Werble / Email the Author

FDA has put a lot of thought into preparing for the drug/diagnostic companion products that presage the era of personalized medicine; but the lure of fewer controls and less development costs is tugging some of the effort off-shore. FDA is also scaring off small companies from genomic test projects and their VC investors. Is this really an opportunity that is slipping away from the US or just an opportunity only for some participants?

The Food & Drug Administration has the right to be proud of two landmark companion diagnostic approvals in the oncology area this year: Pfizer’s Xalkori with an Abbott Vysis FISH Probe Kit for lung cancer and Zelboraf and a companion cobas 4800 BRAF V600 Mutation Test for melanoma, both from Roche.

The approvals show that FDA and sponsors can coordinate the separate regulatory/development efforts of a drug and diagnostic through two FDA review organizations under different legal authority to accomplish targeted therapy approvals rapidly. Both drug/diagnostic combos were approved in less than five months from submission of the applications. More impressively, both were approved within about five years of the start of IND trials.

That is fast action and promising as a sign that the US is on the leading edge of personalized medicine – an important place to be for health advances and a successful bioeconomy in the second decade of the new century.

But participants in the field see clear threats to that early success.

Some of the prominent ones were highlighted at two recent Institute of Medicine meetings on clinical trial infrastructure and facilitating development and utilization of genome-based diagnostic tests.  The most troubling threats stem from the practical decisions on regulatory/development strategies facing current sponsors and the drying up of funding sources for start-ups in the field.

Global Sponsors Must Choose Sites Carefully

Amgen Senior VP global regulatory affairs and safety Paul Eisenberg explained the tough choices about where to do companion development and the disincentives to doing the work in the US. 

“If we want to develop personalized medicine in the oncology space with a companion diagnostic, that represents a very significant regulatory burden with multiple steps in the US,” Eisenberg told a Nov. 7-8 workshop on the future infrastructure for clinical trials in the US.

A sponsor needs to ensure that it has a test that it will ultimately be able to get approved, Eisenberg observed.  That means there is “a regulatory pathway that involves co-development of a diagnostic and your drug.  Manufacturers can navigate that successfully; there have been some excellent recent examples.” In fact, Eisenberg gives FDA credit for “probably leading the world in thinking through some of the scientific issues related to companion diagnostics.”

However, that leadership may not override the practical advantage of a shorter regulatory pathway.  Eisenberg said that it is necessary to look at the development process from the point of view of the sponsor and “recognize that if you are [developing] in Europe, the standard is completely different.” He discussed the companion product process as a current, topical example of how the US stacks up against other areas as a locus for development activities.

Eisenberg pointed out that a sponsor has to make “many choices about where we want to initiate a trial.” He said that “ideally, we would like to initiate in the US.”

The US requires an IND upfront.”I can start those trials in other countries with what is called a clinical trial notification process. In other words, the process to initiate a clinical trial in some countries is to notify an IRB, have a protocol and ethical consent and as long as that protocol is approved, one can proceed with the clinical trial. That differs quite substantially from the IND process; it also differs subtly from the European process, in that there are significant differences in the expectations around clinical trial materials and how they are manufactured and how that manufacturing is assessed.” 

In the companion product space, the time advantage ex-US relates to easier paths for the diagnostic components. Diagnostic tests are self-certified in Europe, the Amgen exec pointed out, and that means “substantially less regulatory hurdles” for a company involved in personalized medicine. Avoiding the complications of a second, separate review and development program clearly has one level of appeal to a sponsor.  

Eisenberg observed, however, that the genomic test pathway is still in the formative stage. While praising FDA’s activities to create the parallel, coordinated reviews, he noted “we are evolving in many areas in which we interact with FDA: some tests are done by central laboratories, for example. Not every test will be manufactured and submitted to FDA for approval as a test kit.”

That is Eisenberg’s way of gently referring to the continuing alternative route to market for genomic/targeting tests through or through the CLIA (Clinical Laboratory Improvement Amendments) procedures controlled by the Center for Medicare & Medicaid Services and the Centers for Disease Control & Prevention.   

VCs See FDA Costs and “Uncertainty”

The fuzzy lines between FDA and CLIA as well as the different cost structures for the various paths for developing tests in the US are part of the drop in funding for start-ups.

Sue Siegel, general partner at the Silicon Valley venture capital firm, Mohr Davidow, blamed the lack of clarity in the US regulatory situation for a pronounced run from investing in the area by venture funds. “The complexity that currently exists in the reimbursement and regulation framework creates uncertainty that the venture capital community cannot invest in,” she told a Nov. 15 IOM workshop. Thirty years in the VC business, Mohr Davidow  was one of the first to carve out a specialty in personalized medicine investing.

Because of the current lack of regulatory certainty and reimbursement clarity, Mohr Davidow is eschewing new investments in personalized medicine and genomic tests. And they are not alone in changing course.

Siegel said 40% of VC surveyed recently indicated that planned to decrease investments in life sciences in the next three years and a similar percentage reported planning to invest more in Asia and Europe. With an implicit nod to the appeal of the lesser regulatory burdens, she said VCs are investing in UK, Germany (which she described with amusement as a shocking location for VC investment) and China.

For a start-up company to develop a genomic test and take it through the FDA approval route, Siegel estimated the cost to market at $150 million to $250 million. For a start-up to get a lab-developed test to market through the non-FDA route, the cost falls closer to $100 million. She declared the economics don’t work for VCs and start-ups through the FDA route. She did add as an aside that the higher FDA costs might be less of a deterrent to companies like Roche. 

That sidenote about the different economics for larger companies raises an interesting twist to the discussion of the FDA route as a disincentive for companion product development.

Siegel also mentioned that what a VC is looking for is a route to market that takes about 3-5 years. She was quite enthusiastic about that timeframe as the type of attractive development period that VCs can “get their heads around.”  She contrasted that with the drug development process, notorious for taking closer to a decade.

But, looking back at these two just-completed cancer companion approvals, how long did they take?

Xalkori and Zelboraf each took about five years from IND stage to approval. That sounds attractive, even by demanding VC standards. That suggests that the developing answer to the costly FDA route to market when compared against foreign and domestic alternatives may not be so unappealing.

In fact, companion diagnostics, especially in the oncology area, may not so much be a field of  development that will be forced overseas in the future but more a field where only the big players can play. That often has its own type of special type of attraction – especially to the big players.