Juno Joins Bespoke Cancer Treatment Frenzy as Questions Linger

(Bloomberg) — It’s a cancer therapy straight out of Greek mythology, bespoke medicine with astonishing results in the smallest and sickest of patients.

The treatment, called a chimeric antigen receptor, or CAR for short, has captured the attention of the biggest drug companies and become a hotbed for biotechnology startups. A medical amalgam like the chimera in Homer’s Iliad — a fire- breathing monster with a lion’s head, a goat’s body and a snake’s tail — it may offer the best chance for patients like toddler Greta Oberhofer to beat acute lymphoblastic leukemia.

Investors have poured money into these firms, including Seattle-based Juno Therapeutics Inc., which started trading today with a $3 billion valuation, leaping as much as 63 percent above its price in an initial public offering. Yet therapies like Juno’s have only been tried on a couple hundred patients, and commercializing a tailor-made medicine for the masses is a daunting task.

CARs are engineered T-cells, modified versions of the assassins the body normally deploys to identify and wipe out infected or abnormal cells. The human-made versions are produced by inserting a gene sequence into a T-cell, which allows the T- cell to recognize the tumors and attack them. Children who relapse after treatment for ALL, the most common childhood leukemia, have some of the most dramatic responses, with early signs of the cancer disappearing in up to 90 percent of them.

Night and Day

A year ago, Andy and Maggie Oberhofer of Portland, Oregon, thought they were going to lose Greta, diagnosed with ALL before she was four months old. Greta had a severe reaction after a bone marrow transplant, the standard treatment for kids, from her 2-year-old sister Charlotte. She was on a ventilator and dialysis, her lungs were filling with fluid and her parents were considering end-of-life care. A brief recovery was followed by a relapse in March.

“It was awful,” Maggie said. “We were debating stopping treatment, because we had put her through so much in her short little life. It was put her in hospice or give this a try.”

The family moved to Seattle for seven months, enrolled Greta in a trial at Seattle Children’s Hospital and waited to see if her genetically enhanced T-cells would grow. The therapy itself was very gentle, Maggie says, like night and day compared with Greta’s early days of chemotherapy. Within a couple of weeks, doctors could find no sign of the cancer in her bone marrow. Today, Greta takes no medicines for the cancer and is a happy 22-month-old, a busybody who gets her hands into everything.

Juno’s Debut

Similarly stunning results have drawn some of the biggest pharmaceutical companies — Novartis AG, Pfizer Inc., and Johnson & Johnson — into the therapy, competing neck-and-neck with startup firms like Juno and Bellicum Pharmaceuticals Inc., which went public earlier this week, pricing at $19 a share, beyond the company’s expected range of $15 to $17.

Juno shot as high as $39 today after its shares were priced at $24 last night to raise more than $200 million.

Kite Pharma Inc., which went public in June, reported in August that 12 out of 13 patients with advanced B-cell lymphoma responded to its CAR treatment. Eight of the patients achieved complete remission.

“Every pharmaceutical company is jumping in because they are afraid to fall behind,” said Elizabeth Krutoholow, an analyst for Bloomberg Intelligence in New York. “The potential is there and they want to be involved in some way so they can catch up” if the field takes off, she said. “You have to get in while the iron is hot.”

History Lesson

Drug companies are seeking to avoid what happened with hepatitis C treatments, where the advances moved so fast that some companies fell behind and were blocked out of one of the fastest-growing categories of new medicines, Krutoholow said.

Still, an investment in CAR is no sure thing. Each patient’s T-cells have to be removed, modified, and re-infused, making the process difficult to automate. Novartis has set up a manufacturing plant in New Jersey that is capable of receiving the blood, modifying the T-cells, growing the mixture into billions of cells and shipping it back to patients. While the process will make the technology accessible to patients across the country, it requires expensive labor, generally in a clean room, said Daniel Lee, assistant clinical investigator in the National Cancer Institute’s pediatric oncology branch.

“The goal is to try to make this a more universal, off- the-shelf approach,” Krutoholow said. “If that happens, it could be profitable.” If not, the cost for a pharma company to treat the masses could be “astronomical,” she said.

Small Market

The market for the treatments is also small, since the treatment hasn’t yet been adapted for solid tumors, which account for more than 90 percent of the cancer population. In blood cancers like leukemia, the targets for CARs are found on a B cell, an antibody-making agent that people can live without at least temporarily. The targets on solid tumors, on the other hand, are also found on other healthy cells that patients would die without.

“If we could figure out how to treat a patient with any solid tumor, this could get bigger than it already is,” Lee said. “Some say it will only work in hematological disease, but there is no way to predict.” Until then, drugmakers will be fighting over a limited pool of patients.

Then then are side effects, which can be deadly. Not everyone is as lucky as Greta, who tolerated the treatment well. The therapies can push the immune system into overdrive as they kill cancerous cells, causing a potentially fatal immune reaction called a cytokine storm. Juno noted that 18 percent of 28 adult patients in one of its trials experienced severe cytokine release syndrome, and two died. At least three patients have died from the condition in early Novartis trials, though researchers now treat patients with drugs that can calm the overactive immune system.

Patent Dispute

A patent dispute over CARs could also weigh heavily on Juno. The company and St. Jude Children’s Research Hospital are in a legal battle with the University of Pennsylvania and Novartis over the rights to a St. Jude patent. Losing the case would have a “material adverse effect on our business,” Juno has said in filings.

CAR makers are willing to face all the hurdles because the rewards could be big. Amgen Inc.’s Blincyto, an immunotherapy that treats another form of ALL, costs $178,000 for a standard course of treatment. CAR therapy is likely to be even more expensive because of the technical lab work that goes into making each patient’s treatment.

Since CAR’s best results are in children, and the population is so small, an immediate uproar about its price is unlikely, said Krutoholow.

Blunt Tools

CAR also offers a tantalizing way to reduce the need for chemotherapy, radiation, and bone marrow transplants — blunt tools intended to wipe out cancer but often with toxic side effects, Lee said. More than one in four patients has significant, chronic side effects from standard chemotherapy, he said. As many as one in 10 die from a bone marrow transplant. Chemotherapy must be injected into the spinal cord to kill off any hiding tumor cells, which can damage everything from brain function and IQ to height.

While CARs are still in their infancy, the technology is evolving rapidly. “There is a tremendous amount of refinement going on,” said Michael Jensen, who ran the first CAR clinical trial in 1996.

Current generation T-cells are the medical equivalent of a Model T Ford, said Jensen, director of the Ben Towne Center for Childhood Cancer at Seattle Children’s Research Center and a scientific founder at Juno. The cells will become safer and more effective as more funding pours in and research heats up, he said. “The Teslas are coming.”

To contact the reporters on this story: Michelle Fay Cortez in Minneapolis at [e-mail]; Caroline Chen in San Francisco at [e-mail] To contact the editors responsible for this story: Crayton Harrison at [e-mail] Drew Armstrong