Over the course of this series, we have investigated the acceleration of change in the healthcare sector, with the pandemic acting as a catalyst. Last week we explored access to medicine and how it rests on a handful of large pharmaceutical companies; both in terms of delivering the new medicines to fill treatment gaps and a COVID-19 vaccine. But this creates a murky picture of where innovation really happens, what’s driving it and what’s enabling it.
At the core of innovation is one fundamental driver – research. In healthcare this is the understanding of how diseases work, therefore enabling the development of new treatments and diagnostics. In this article we shall explore the pathway to next generation healthcare, uncovering the real enablers of innovation to fuel the next breakthrough.
Looking back 100 years ago, the most common cause of death was from infections like tuberculosis (TB), but this is no longer the case following the discovery of antibiotics. Contrast that with today; one of the biggest causes of death is cancer, killing nearly 10 million people every year from a combination of ineffective treatments and slow diagnosis. Other disease areas such as genetic and neurological are still absent of meaningful treatment. Whilst modern medicine has evolved, there is still much work to be done.
The key to problem solving diseases is by measuring, imaging and collecting as much data as possible. This is where Life Science companies can assist, creating new, more accurate, cheaper and quicker instrumentation. The technological development of these tools is pivotal in the first step on the journey to innovate new treatments and diagnostic tools. One area in particular, DNA and gene sequencing, has transformed our understanding of disease as the price to sequence a genome has rapidly declined from millions of dollars to hundreds. The human genome, which is the full set of our genes, is in effect our coding, determining select characteristics. Research has shown that some genes can predispose us to certain diseases, such as certain cancers and also impact response to treatments.
Graphic: data source – National Human Genome Research Institute
Amity International Fund holding Oxford Nanopore, the biggest holding within IP commercialisation company IP Group, develops gene sequencing technology. They offer a broad range of sequencing instruments, from large desktop instruments for processing high volumes of samples to highly portable devices that can fit in the palm of a hand. This technology has proved valuable in the fight against COVID-19, with over 50 public health authorities, including the CDC, purchasing this technology for research purposes. However, the real differentiator of Oxford Nanopore is its affordable handheld devices, lowering the barriers to this technology for less well funded projects, to the ultimate benefit of more research and more innovation.
One of the most exciting breakthroughs from genomic research has been the use of gene-editing to create new medicines, capable of biological re-coding. This technique has been used successfully to treat some cancers by weaponising our own immune systems cells to recognise and attack cancer cells. For example, therapeutic Kymriah by Novartis (Amity International Fund holding) uses this method to treat a form of blood cancer. It has also allowed “cures” for select genetic diseases, where therapies edit and rewrite the genetic fault causing disease. There are currently 18 FDA approved gene/cell therapies. Luxturna by Spark therapeutics, acquired by Roche (Amity International Fund holding), was the first approved and treats a rare eye degenerative disease. Given the active research and development in gene and cell therapies, the FDA anticipates up to 200 gene/cell therapy applications every year now and expect to be approving 10-20 of these therapies each year from 2025.
Whilst genomics has provided a crucial layer in understanding some diseases and treatments, a large pitfall is that aside from genetic diseases, looking at a genome likely won’t distinguish a healthy person from a sick person. Proteins are in control of running cells, directing growth, instructing death and the conversations between cells. When something goes wrong in these critical processes, as a downstream effect of genes and other environmental factors, disease occurs. Proteomics is the study of the full set of proteins produced within a cell, tissue or organism, also known as the proteome. Humans have 20,000-25,000 proteins, around ¼ of which are yet to have their specific function determined.
Proteomics could fill many gaps in our understanding of disease including Alzheimer’s, studying the proteins in the brain can help us understand and pinpoint how Alzheimer’s develops. It is also hoped that proteomics research can hail a new era of precision medicine, the idea of delivering the right medicine to the right person and identifying new targets for therapeutics. Bruker (Amity International Fund holding), a scientific instrument specialist, has a range of proteomics research tools which are used by all leading proteomics laboratories in some form now, having doubled sales over the past 3 years when they first entered. Beyond proteomics there are other ‘omics still in its infancy such as metabolomics, lipidomics etc. each offering its own tier of understanding.
Graphic - https://pubs.acs.org/doi/10.1021/acs.jproteome.8b00504
Innovation at source
The majority of novel medicines come from outside large pharmaceutical companies. In 2018 64% of novel medicines approved by the FDA were from emerging biopharma companies. This has been an evolving trend over the past decade; in 2009 smaller company contribution was much lower at 31%1.
We have seen this demonstrated with the race for the COVID-19 vaccine. The large pharmaceutical names of Pfizer and AstraZeneca are the headline acts we tend to associate with the vaccines, but the innovation rests with the partners of BioNTech and Oxford University. The relationship between large pharma and innovative small/mid-sized companies offers a symbiotic relationship of innovation for scale.
The majority of scientific breakthroughs are still very much conducted at academic institutions and small companies. Whilst it is challenging and higher risk for us to invest at this level, we can instead gain exposure through supporting the enablers of innovation – those developing the tools and technology that makes this research possible. The companies that provide these solutions are foundational to the carrying out of the research itself; without them, it would be impossible to develop innovative treatments for diseases that threaten a healthy future. Therefore as responsible and sustainable investors we see it as vital to allocate capital to these companies helping to push the boundaries of frontier medicine.