The issue surrounding gene therapy and genomic modification has been a hot topic for some time. The thought of using gene editing to replace faulty DNA with healthy DNA in patients with Genomic disorders was first presented in 1972 by a paper published in Science titled “Gene Therapy for Human Genetic Disease” by Elizabeth F. Neufeld and colleagues.

We have certainly come a long way since 2003 when we saw the completion of the Human Genome Project. The sequencing of the human DNA – which at the time cost more than $2.7B USD and about 15 years to complete – allowed for scientists to discover new genetic targets that could be attributed to disease. Today, the whole genome can be sequenced for less than $1000 USD and it will not be long until the cost is reduced to just $100/person.

With decreasing costs in genome sequencing, drug developers can expect to be able to generate animal models that allow for scientists to identify specific biological targets that cause underlying disease. Furthermore, it has allowed for identification of biomarkers of disease and better understanding of drug safety profiles.

Genomic medicine falls within three major categories, including Gene Editing, Gene Therapy and Genetically-Modified Cell Therapy.

 

What is Gene Editing?

Gene editing allows for scientists to find and target a specific piece of DNA. This target gene can then be knocked out or deleted – most useful for disease causing genome, repaired with new DNA – great for diseases where one single nucleotide is misspelled, or a new DNA can be inserted into the site – great for manufacturing of therapeutic proteins. Furthermore, unlike gene therapy, gene editing allows for scientists to target disease that are caused by multiple genes through multiplexing. Multiplexing is the concept of introducing multiple gene editing targets simultaneously – something that is unachievable via gene therapy.

The system is exceptionally cheap and easy to use. Simply put, gene editing uses specific enzymes and proteins to edit DNA. Thus far, there are four specific systems that are used by various research institutes and big pharmaceuticals. These four include, CRISPR/Cas9, Zinc Finger Nucleases (ZFN), TALEN and meganuclease. There are also companies that are using combination of these systems, such as MegaTAL which is a combination of TALEN and meganuclease.

From the listed above, CRISPR/Cas9 has been the most prominent due to its versatility, simplicity and affordability. The CRISPR technology – which stands for Clustered Regularly Interspaced Short Palindromic Repeats – is a system that has been modified from an ancient bacterial immune system.  CRISPR/Cas9 system consists of an enzyme Cas9 in addition to a guide RNA. The Cas9 is responsible for the cutting of DNA and the guide RNA is responsible for telling the Cas9 where to cut. The cell is then fed a new DNA (edit, replacement, or deletion) and then that specific DNA is changed to exactly what was initially intended.

A. Wild-type Cas9 nuclease site specifically cleaves double-stranded DNA activating double-strand break repair machinery. In the absence of a homologous repair template non-homologous end joining can result in indels disrupting the target sequence. Alternatively, precise mutations and knock-ins can be made by providing a homologous repair template and exploiting the homology directed repair pathway. B. Mutated Cas9 makes a site specific single-strand nick. Two sgRNA can be used to introduce a staggered double-stranded break which can then undergo homology directed repair. C. Nuclease-deficient Cas9 can be fused with various effector domains allowing specific localization. For example, transcriptional activators, repressors, and fluorescent proteins. Source: https://www.neb.com/tools-and-resources/feature-articles/crispr-cas9-and-targeted-genome-editing-a-new-era-in-molecular-biology

 

Areas for concern

SPECIFICITY

One of the major drawbacks of CRISPR/Ca9 system is its specificity. However, this technology has been used in combination with other existing technology such as Adeno-associated virus vectors (AAVs) and LNPs that allow for specific targeting and delivery of these genes to specific diseased tissues. For instance, the AAV technology allows for targeting eyes, liver, blood/bone marrow, muscles, central nervous system/brain, heart and the pancreas.

 

OFF-TARGET GENE EDITING

Another area of concern is the potential of off-target cuts. This issue can be addressed via using the appropriate method of delivery in combination of careful screening of guided RNA thus eliminating those who bind to off-target sites. Additionally, the development of novel Cas9 endonucleases that do not bind to wild-type DNA will aid in removing concerns surrounding off-target gene editing.

 

LONG-TERM OUTCOMES

Lastly, the long-term effects of gene editing is unknown. Thus far, data surrounding the long-term effects of permanent edits years or decades later is lacking. For this reason, thus far, the main focus has been to target diseases where the risk versus reward is quite high and patient’s mortality is in balance with the outcome of genes editing taking place and no other options remain.

 

Where does opportunity lie?

As stated above, initial efforts have been mostly focused on what are called orphan disorders. These are diseases/disorders that mostly effect a small population of people, and usually are the cause of a single gene defect.

Below, we will discuss the most opportunistic areas for investment and growth in field of genomic medicine. The estimated addressable market for genomic medicines could be more than $5 trillion USD. Beginning with the a while spectrum of rare genetic disorders and transitioning into more common diseases.

It appears that the approach has been multimodal. First to focus on targeting diseases with single-gene defects as most gene therapy and editing is being developed to replace, knockout or modify a single gene / mutation site. This would be most beneficial in diseases and disorders such as Duchene muscular dystrophy, spinal muscular atrophy. Furthermore, we can see blood disorders such as hemophilia, sickle cell disease and beta-thalassemia and blood cancers such as multiple myeloma and other rare blood disorders.

 

Bluebird Bio Inc. (BLUE) The next disruptor of gene therapy, cell therapy and gene editing.

Of all the private and public companies on the quest to tap into what will be a multi-trillion-dollar market of genomic therapy, Bluebird Bio Inc. (BLUE) would be considered to be the front runner.

Bluebird Bio Inc. (BLUE) describes itself as a clinical-stage company committed to developing potentially transformative gene therapies for severe genetic disease and T cell-based immunotherapies. We believe that Bluebird Bio Inc. (BLUE) is a triple threat, and it has positioned itself to become the key biopharma in gene therapy, cell therapy and gene editing. Bluebird Bio Inc. (BLUE) has specialized in the ability to modify T cells in a way so that they can recognize tumor-specific proteins that are expressed by cancer cells. Once recognized, these T cells can initiate the killing of cancer cells.

Bluebird Bio Inc. (BLUE) has several value drivers that will undoubtedly place it in the leading position for gene and cell therapy, we will highlight those below.

Transfusion - Dependent β - Thalassemia

CAR T bb2121 for multiple myeloma

Bluebird Bio Inc. (BLUE) and Celgene Corporation (CELG) are working to develop bb2121 which is a CAR T cell targeting the B-cell maturation antigen (BCMA). At the American Society of Clinical Oncology (ASCO) meeting, Bluebird Bio Inc. (BLUE) presented an update on the CAR T bb2121 results for relapsed/refractory multiple myeloma patients.

They showed an impressive efficacy with the active doses more than 15E6 cells which showed a rather intact overall (ORR) and complete response rate (CR) of 81% and 47%, respectively, with a median progression free survival (PFS – the length of time patient lives with stable disease) of 11.8 months in the dose escalation cohort. Results are impressive as they surpass the current standard-of-care Darzalex with 29% ORR, 3% CR, and 3.7 months median PFS). Furthermore, 100% of evaluable patients showed no detectable disease.

 

LentiGlobin for transfusion-dependent beta-thalassemia and sickle cell disease

Severe sickle cell disease (SCD) has a US prevalence of 100k and a EU prevalence of 113k. The Global annual birth incidence is between 300 – 400k. This disease has a high morbidity along with high mortality with a median age being in the 5th decade of life. Current treatment of underlying disease – allo-HSCT –  is only limited to paediatric patients and are only recommended for those with match sibling donors.

At the European Hematology Association (EHA) meeting, Bluebird Bio Inc. (BLUE) showed some impressive results surrounding outcome of patients treated for severe sickle cell disease and in transfusion-dependent beta-thalassemia.

In the LentiGlobin Phase 1 (HGB-206) study for sever sickle cell disease, patients achieved asymptomatic disease levels across all patient groups with more than three-month follow-up. In the group A (Gen 1) long-term data on seven patients with more than 2 years follow-up demonstrate steady levels of LentiGlobin Vector and HbAT87Q were maintained.

With a global prevalence of about 300k and incidence of about 60k, transfusion-dependent beta-thalassemia is an inherited blood disease that requires lifelong iron reduction therapy in addition to frequent blood transfusions. Current treatment options for the underlying disease are limited to allo-HSCT which is saved primarily for paediatric patients who have sibling donor matches.

HGB -207: 7/8 patients are producing ≥ 7.6 g/dL T87Qof HbAby 6 months

Non-β00 transfusion-dependant beta-thalassemia (TDT) patients with more than six months are producing normal amounts of total hemoglobin and are transfusion free in the Northstar-2 study. In the LentiGlobin HGB-207 (Northstar-2) phase 3 study, 11 patients treated showed an 82% of the CD34+ cells transduced and by six month 7/8 are producing more than 7.6 g/dL of HbAT87Q and maintaining total hemoglobin levels between 11.1 – 13.3 g/dL.

In the LentiGlobin HGB-204 (Northstar-1) phase 1/2 study using the Gen 2 product in the Non-β00 TDT, 8/10 patients were transfusion independent for a median of 33 months as of last follow-up.

 

Lenti-D for childhood cerebral adrenoleukodystrophy (CCALD)

Childhood cerebral adrenoleukodystrophy (CCALD) is a rare neurological disorder caused by a single gene mutation found on the X chromosome, thus mostly effecting males. With an early age of onset of about 6 – 8 years old, the disease causes loss of brain function which subsequently results to loss of life before adolescence.

The Lenti-D phase 2/3 Starbeam study showed that 88% (17/18) patients remain alive and free of major functional disabilities. Bluebird Bio Inc. (BLUE) has expanded the study to enrol a total of 30 more patients and plans to submit regulatory filings in 2019.

 

Manufacturing facilities / agreements to ensure commercial capacity

All signs are pointing towards Bluebird Bio Inc. (BLUE) move towards commercialization capacity. They have recently purchased a 125k sq ft manufacturing facility in North Carolina in hopes to expand the company’s production. They are focused specifically on the gene and cell therapies including bb2121/bb21217 in multiple myeloma, LentiGlobin in TDT and severe SCD and Lenti-D in CCALD.

Additionally, Bluebird Bio Inc. (BLUE) have entered into partnerships with manufacturers in the US and EU for additional support for lentiviral vector production. They have also partnered with Apceth Biopharma of Germany and Lonza in US to help produce drug product for both the Lenti-D and LentiGlobin.

 

Strategic partnership with Regeneron Pharmaceutical Inc. (REGN)

Bluebird Bio Inc. (BLUE) recently announced that they have entered a strategic partnership with Regeneron Pharmaceuticals Inc. (REGN) in hope to expand their scope with regards to cancer cell therapy.

The terms of the deal state that REGN has the option to opt-in to a co-development and co-commercialization agreement with 50:50 cost and profit sharing or the program will be wholly owned by Bluebird Bio Inc. (BLUE) and they would make milestone payments along with royalties to Regeneron Pharmaceuticals Inc. (REGN). Access to Regeneron Pharmaceuticals Inc. (REGN) VelociSuite technology will allow for Bluebird Bio Inc. (BLUE) to modify T cells receptors to express fully human antibodies that will be able to recognize tumor-specific antigens – both intracellular and extracellular – and eliminate the targeted tumor. This partnership will broaden Bluebird Bio Inc. (BLUE) scope with regards to treatment of various types of cancer.

This partnership will initially focus on only six undisclosed targets and thus will broaden Bluebird Bio Inc. (BLUE) scope beyond the BCMA and can help use their technology for development of new products. This move which has given both parties the opportunity for co-development and co-commercilization or wholly owned with royalties owed to Regeneron Pharmaceuticals Inc. (REGN), will be a significant step forward for Bluebird Bio Inc. (BLUE) as they continue to create a strong foothold in the space.

 

Final Words

As you can see, Bluebird Bio Inc. (BLUE) has positioned itself very well to become the source of medical cure for various diseases in the next decade or so.

We look to Northstar-3 data for the Non-β00 TDT along with proof-of-concept sickle cell disease data at the American Society of Hematology (ASH) meeting early December (Dec. 1 – 5). Further, we expect positive reports surrounding the data for CCALD around the same time as well as US filing in 2019. Additionally, we expect announcements of new diseases and disease targets due to the new partnership with Regeneron Pharmaceuticals Inc. (REGN).

The market potential for revenues for the bb2121 for treatment of multiple myeloma could reach a peak of $1.5B USD. Market potential peak for Lenti-Globin for rare blood disorders could be more than $4B USD for sickle cell disease and $1.5B for transfusion-dependant beta-thalassemia. Lastly, the market potential peak for Lenti-D for treatment of childhood cerebral adrenoleukodystrophy can be about $250M USD.

Our 12-month price target for Bluebird Bio Inc. (BLUE) is $300, an 100% upside from the current trading price.