Novartis is making major investments to be able to offer novel influenza vaccines. Europe's second-largest pharmaceutical company, the fourth largest in the world, is building a latest-technology production site, aiming to improve production reliability for a potential pandemic. NGP spoke with Dr. Jörg Reinhardt, CEO of Novartis’ division Vaccines and Diagnostics, about the company’s proprietary cell culture technology.
Novartis entered the global vaccines market in 2005 with the takeover of California-based Chiron, a vaccines, blood testing and biopharmaceuticals company. The acquisition allowed the company access to the vaccine market for influenza, both seasonal and pandemic, as well as meningitis and other illnesses, and to become the second-largest supplier of flu vaccines in the US.
Novartis is creating a new strategic growth platform in human vaccines – a market which is expected to grow to more than $20 billion in 2009 from about $9.6 billion in 2004.
In December 2006, the Switzerland-based pharmaceutical company decided to centralize its global vaccine operations by moving the global headquarters of the Vaccines and Diagnostics division to Cambridge, Massachusetts – near the Cambridge-based Novartis Institutes for BioMedical Research (NIBR) – which has been the global pharmaceuticals research headquarters for Novartis since 2002.
“First of all it is the talent pool in Cambridge that is attractive to us,” says Dr. Jörg Reinhardt, CEO of Novartis’ division Vaccines and Diagnostics. “There’s also the proximity to NIBR, our research center, which is resulting in a number of potentially significant synergies in research collaborations. We will build up roughly 250 people over the next 12 to 18 months. Half of them will be research and development, and the rest will be commercial, finance, HR and support positions.”
The division’s aim is to improve the world’s vaccines supply – and plenty is needed, for example, in the US. In July 2007, Novartis announced it would provide the US with 40 million doses for the 2007/2008 flu season, which is 30 per cent more than last year. The vaccines for the US will be manufactured in Liverpool. Half of the doses are planned for delivery by the end of September, with all doses expected to be delivered by the end of October.
“The US is an interesting flu market where the opportunity is still larger than the supply,” says Reinhardt, and explains: “In 2007, it has been stated that roughly 130 million flu vaccines – injections or doses – will be available to the US. However, this is a country that recommends that more than 240 million be vaccinated. With such a significant gap between government’s recommendations and availability of vaccination supply, there is room for further growth.”
A growing market
Globally, the demand for vaccines is growing. Governments in Europe and Asia upped their recommendations for flu vaccination compared to two years ago. “From a global perspective, the overall flu vaccine market will grow significantly in double digit terms over the next few years. To gain market share, it will be important to provide differentiated products,” believes the 51-year-old. He thinks that this is possible in at least two ways.
“Firstly, we will work towards products that will provide a stronger immune reaction than current products. That will be achieved through the addition of adjuvants. We already have our own proprietary adjuvant that is available in Europe, MF59, which is an immune response enhancer,” says Reinhardt, who is intending to bring MF59 also to the US market. Focetria, a new human vaccine designed for use following the declaration of an influenza pandemic, incorporates Novartis’ proprietary MF59 adjuvant and received EU approval in May 2007.
“Secondly, we have our new production technology, the cell-culture technology. Our flu-cell culture vaccine, which is the first product of its kind, was approved in Europe this June. We will introduce this product in this year’s flu season in some selected European countries and hope that we will also bring it to the US market in the next couple of years. And so we will have a differentiated offering of standard egg vaccines both with and without an adjuvant, and a flu cell-culture vaccine.” This, Reinhardt is certain, will help his company to gain market share in any market.
The world’s leading vaccine manufacturer, sanofi pasteur, who provided more than a billion doses of vaccine in 2006, and GlaxoSmithKline are Novartis’ main competitors, and will also contribute to the expected US stock of 130 million flu vaccines, which would be the largest available vaccine supply in the US ever. Both share Novartis’ interest in the new cell-culture technology.
While GSK is speeding up the development of new cell culture-based seasonal and pandemic influenza vaccines with awards from the US Department of Health and Human Services (HHS), sanofi announced its first phase I trial of a vaccine based on cell culture technology in September 2006. However, Novartis is the only company to receive EU approval for its first influenza vaccine to utilize its proprietary cell line for the production of viral antigen components rather than the traditional chicken eggs.
“Competition,” Reinhardt believes, “is always simulating because it makes sure that you continue to innovate and try to be faster, quicker and better than your competitors. We are in a very good position in this regard because none of our competitors will have a cell-culture based product in the US market in the foreseeable future.”
On August 23, Novartis broke ground on a new state-of-the-art influenza vaccine manufacturing facility in Holly Springs, North Carolina. Once completed, the facility is expected to have an annual production capacity of up to 50 million doses of seasonal trivalent flu vaccine. In the event of a pandemic declaration, the facility is expected to have a capacity of up to 150 million monovalent doses of a pandemic influenza vaccine within six months of the declaration. Reinhardt: “We are excited to be the first company to bring cell culture-derived influenza vaccine manufacturing to the United States. Our future manufacturing facility will help to meet growing patient demand for seasonal influenza vaccines, and will play an import role in preventing the spread of an influenza pandemic.” Completion of the facility in Holly Springs is expected in late 2009, and following validation and FDA approval, initial vaccine production at the site is anticipated for 2011.
Eggs versus cells
There are a number of advantages to cell-culture based influenza vaccines. “First of all they are very clean products with a very good safety and tolerability profile. You don’t have any residual proteins from eggs in this product, for example, which is important for people who are allergic against egg proteins. Secondly, we don’t need any antibiotics during the production of this vaccine, which again makes it a very pure, safe and well-tolerated product. From a technology perspective, it enables us to be faster in the yearly production cycle than with egg vaccine production. That’s a major advantage because speed in this market is important,” Reinhardt points out.
Egg vaccine production involves a laborious process of growing viruses in chicken eggs about nine months before each flu season. In case of a potential pandemic, the cell culture production technology not only proves quicker but it does not depend on egg supply either. “In a case of an avian flu, there may be no eggs available because there may be no chickens who could produce eggs. In such a situation the cell culture technology will be independent from all of this and will provide a significantly higher level of certainty that a product may be available. That’s also the reason why the US government supports our investment in this new cell culture facility in Holy Springs,” says Reinhardt.
Cell culture based influenza vaccines will not, however, replace egg-based production. “We would not have the production capacity to produce only cell culture vaccines in response to what the market may need, so we will, of course, produce egg based vaccines as well.”
Novartis has three different egg based production sites for influenza vaccines: in the UK, in Germany and in Italy. “We will increasingly focus egg-based production at our England site in Liverpool. We are planning to produce even more egg-based vaccines than we do today. There will be a fragmentation in the market and quite a number of still developing countries will rely on egg-based vaccines for quite a while.”
Also, like with any new technology, there are a number of technical hurdles that stand in the way of faster progress with cell-based vaccine production. Reinhardt: “For more than 10 years there has been ongoing activity in this field across the industry. Yet there’s still only one product which has been approved by the authorities. This shows that it’s not that trivial to master this technology. It’s not just the selection of the right cell line to produce the vaccine in, one also needs to characterize the cell line especially from a byproduct perspective; get it to produce at adequate levels; ensure an adequate expression of your virus in the cell line, and so on. There is a wide range of technical problems that need to be overcome and that takes a while.”
Quality and productivity
In Novartis’ 2006 Annual Report, CEO Daniel Vasella states that the challenging task in vaccines is fixing lingering quality and productivity issues, increasing capacity and bringing innovative vaccines to market. And so overcoming the technical hurdles is on top of Reinhardt’s agenda – along with increasing productivity in general.
“In the first year or so since the acquisition of Chiron we have been focusing on improving the quality of production cycles in the production plants; and also on improving the productivity. So far we have been reasonably successful with this. Our output of flu vaccine last year was significantly higher than in 2005 and our output this year will be significantly higher than last year.”
In addition, Reinhardt goes on to say, his division is strengthening its capabilities in all other functions, such as marketing, development and research. His main focus is on two major franchise areas: flu vaccines and meningitis vaccines. “There is still a significant medical need for a number of potential combination vaccines for different groups of meningitis as well as for a specific vaccine against meningitis B. One of the main hurdles worldwide is to come up with a universally effective vaccine for the many different strengths of meningitis B.”
The genomic revolution and the availability of new technologies, says Reinhardt, has enabled his division to make significant progress with a vaccine for the B serogroup of meningitis B, for which there is currently no effective vaccine. It is currently in phase II studies to identify dosing in adolescents, with data expected by the end of 2007. “We are pushing this as quickly as we can through development and hope that the vaccine can be submitted before the end of the decade in international markets, which would be a significant step forward and cover a significant medical need,” states Reinhardt.
Using a process called ‘reverse genomics’, Novartis’ research group in Siena, Italy, is identifying the genes in a pathogen responsible for the production of potential antigens that are leading to the production of antibodies once the human body is exposed to the pathogen. Reinhardt: “Going the genomic way means going via identification of genes and of proteins that are encoded by these genes. These proteins are produced in a recombinant way, meaning that very specific proteins are identified to develop the vaccine. The outcome is usually three or four very defined proteins that are highly antigenic and lead to a good immune response. These are far away from the former generation of vaccines, which were undefined products of variable quality.”
Reinhardt’s division is currently working on early stage vaccines, for example against Helicobacter pylori, which is the main reason for gastric cancer, and also against Group B streptococcus, a pathogen which threatens the life of newborn babies. In the preclinical stage, candidates include vaccines against pathogens like Chlamydia, candida, and Group A streptococcus.
The biggest challenge of the industry, Reinhardt believes, is to create ways to fulfill the needs of different parts of the world’s population. “There is a discrepancy between vaccination in developing countries and in developed countries. Developing countries are still far behind in terms of not only number of vaccines but sometimes also quality of vaccines. It will be a challenge going forward to find ways to actually provide the vaccines to both parts of the world in an adequate way.”
To address this challenge, Novartis works together with UNICEF and other organizations that work towards responding to the needs of developing countries.
“We have a number of products that we provide to those organizations. But developing countries’ needs as compared to the developed countries, for example, in the meningitis field, are different. Some groups we see in Africa or in Asia don’t exist in Europe or the US. That means that one has to develop different vaccines for Africa and Asia.”
Novartis’ vaccine division is all geared up to tackle this and other challenges ahead. To strengthen its pipeline, in July Novartis formed one of the vaccines industry’s most comprehensive and innovative strategic alliances with Austrian Intercell AG. Among the various unpartnered Intercell projects eligible to Novartis are the IC43 vaccine candidate for use in patients with hospital-acquired pseudomonas infections, which is now in phase II trials and will expand the range of nosocomial vaccines in the Novartis pipeline, and the pre-clinical vaccine IC47 against pneumonia infections in the elderly and infants.
“We will continue to focus on increasing our quality and productivity standards from a technical perspective. We will focus on further improving quality and performance of our overall workforce and we will accelerate innovation. From a long term perspective, the only way to maintain a successful business is to be innovative and come up with vaccines that really fulfill medical needs. If we succeed doing that, we will be a successful organization,” says Reinhardt.
With the acquisition of Chiron, Dr. Jörg Reinhardt became CEO of Novartis’ Vaccines and Diagnostics in April 2006. Previously, Reinhardt was Global Head of Development in the Novartis pharmaceuticals division, overseeing clinical, pharmaceutical, chemical and biotechnological product development, drug safety assessment and regulatory affairs.