This is Why Novartis AG Folded Its CAR-T Unit

This Is Why Novartis AG Folded Its CAR-T Unit October 26, 2016
By Alex Keown, BioSpace.com Breaking News Staff

BASEL, Switzerland – When Novartis shuttered its five-year-old Cell and Gene Therapy Unit in August, it sent shockwaves through the CAR-T community as some believed it to be a signal the company was abandoning the immuno-therapy research program for good.

This, despite the company saying on several occasions that the move was not an end of CAR-T at the Swiss company, but merely part of a restructuring process that would be more cost efficient. That was something Novartis Chief Executive Officer Joe Jimenez reiterated during a conference call with investors on Tuesday—shortly after the company confirmed it planned to move forward to regulatory approval for its pediatric leukemia CAR-T therapy, CTL019 in early 2017. Jimenez said, according to BioPharmaDive, that moving the division into the company’s oncology unit was about cost control.

"Now, there was some speculation as to why we integrated the standalone unit into the functions at Novartis and this was done to give the unit the deep capabilities of drug development and global manufacturing, while at the same time, lowering overhead costs, as we start to prepare for the launch," Jimenez said, according to the report. So, fully integrating into the oncology unit will help also on the commercial side, as we launch.”

Novartis’s decision to eliminate the Cell and Gene Therapy division is in line with the company’s integrated development model, which includes three focused, customer-facing divisions. The divisions will be Innovative Medicines (formerly the Novartis Pharmaceuticals division), which will include the Novartis Pharmaceuticals and Novartis Oncology business units; Sandoz, the generics and biosimilar division, which includes the Retail Generics, Anti-Infectives and Biopharmaceuticals franchises; and Alcon , the eye care devices division, which includes the Surgical and Vision Care franchises. The divisions will be supported by Novartis Institute for Biomedical Research, Global Drug Development and Novartis Operations, which includes Technical Operations and Novartis Business Services.

Novartis is looking to shore up its finances as it faces diminishing revenues from its cancer drug, Gleevec, which is facing increased generic competition here in the United States. However, sales have not fallen to the level initially expected. According to Novartis’s third-quarter reports the drug brought in $834 million. Still, as the company looks to develop other strong revenue sources, Jimenez said the company will continue to integrate functions across divisions to help with costs.

Novartis’s experimental chimeric antigen receptor T cell (CAR-T) therapy for the treatment of children with relapsed/refractory acute lymphoblastic leukemia, has demonstrated strong efficacy in earlier trials. In December, during a session of the American Society of Hematology meeting in Florida, the company revealed Phase II results that showed 55 of 59 patients, or 93 percent, experienced complete remissions with CTL019. The study did show that at the end of one year, 55 percent of patients had a remission-free survival rate and that 18 patients continued to show complete remission following one year.

In addition to its leukemia treatment for children, Novartis also plans to file an application for a diffuse large B cell lymphoma (DLBCL) CAR-T treatment in 2017, which will likely put the company behind rival CAR-T company, Kite Pharma and its lead CAR T- product candidate, KTE-C19, for DLBCL. Kite aims to file for an approval of its lead CAR-T therapy by the end of the year. Earlier this month Arie Belldegrun, Kite’s chief executive officer, told investors that he has scheduled a pre-application meeting with the U.S. Food and Drug Administration. If the FDA gives the nod, that would make Kite’s candidate the first CAR-T therapy to reach the market.

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