Juno Spends Big on R&D, Production in CAR-T Race to Fight Cancer

  • Startup faces off against Kite to develop immune therapies
  • Drugmaker builds manufacturing capacity for future products

At Juno Therapeutics Inc.’s manufacturing facility in Bothell, Washington, only one out of 11 incubators was in action on a recent afternoon, gently rocking the soup of cells that are the drugmaker’s cancer-killing therapy, helping them to grow.

The rest of the cellular nurseries in the room, known as bioreactors, weren’t in use -- yet. Juno has invested more than $200 million a year in research and development and created manufacturing capacity far beyond its immediate needs because it’s focusing on the long-term goal of developing a best-in-class treatment, the company says.

Never mind that Juno’s first commercial product isn’t up for approval until the first half of 2018, probably after that of competitor Kite Pharma Inc.

“If you only invest in near-term technologies today, you could be out-competed in the medium term,” Juno’s Chief Executive Officer Hans Bishop said Tuesday in an interview at the company’s Seattle headquarters. “Of course, we’re competing for time to market. But really we’re competing for the speed at which we generate insights into better products.”

Kite spokeswoman Christine Cassiano declined to comment on Bishop’s statement.

Customized Treatment

Juno is one of a handful of startup drugmakers that are developing a novel treatment known as CAR-T, in which a patient’s immune cells are genetically engineered to fight cancer. The treatment is customized for each patient, meaning it can’t be mass-produced and kept on shelves. It’s also potentially dangerous. While CAR-T has saved patients who have failed multiple previous treatments, it’s also caused toxic immune-system reactions that can be fatal.

The company’s $20 million manufacturing facility, which opened in March, is designed to make several products simultaneously and quickly ramp up its daily production volume, according to Bob Azelby, Juno’s chief commercial officer. That will let the company quickly launch its drug if it’s approved.

Juno also has invested in standardizing its process. It’s currently working on combining into one machine the steps of purifying a patient’s immune-system cells and introducing the gene that will modify them so they latch onto tumors.

It takes an extra step to make sure patients get equal amounts of the two main immune-cell types -- called CD8 and CD4 -- used in the therapy, instead of taking whatever mixture is available in a patient’s blood plasma. That reduces the number of variables and gives Juno one less factor to account for when running trials, Azelby said.

Setbacks

Juno also has experienced setbacks. In July, its shares plunged a record 27 percent after three patient died in a trial. A chemotherapy drug called fludarabine had been added to the treatment regimen for Juno’s leading therapy, JCAR015, causing increased toxicity. The company removed fludarabine from its trial protocol, and the study has resumed, though the delay put it months behind Kite.

When people question whether Juno is moving too fast, Bishop says patients have few other options. The “risk of death without CAR-T cells is almost 100 percent, whereas in the clinical trials we’ve gotten 40 to 70 percent of patients into long-term remission,” he said.

Celgene Partnership

The company has benefited from a broad partnership with Celgene Corp., which signed a $1 billion deal in June 2015, including $150 million in cash and the purchase of 9.1 million Juno shares.

The partnership with Celgene may also protect Juno from being an easy takeover target.

“Anyone that wants to acquire Juno is going to have to go past Celgene, which is intimidating,” Bishop said. Staying independent will also let him keep the staff that has been critical in building the company.

“The moment that management puts a point on the horizon, saying, ‘This is when we want to sell out,’ you can wave goodbye to the top talent.”

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