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 Using cells to fight cancer is a long way from GE's better-known
areas like power generation and aviation, but the head of the U.S.
industrial giant's $18 billion-a-year healthcare operation sees a
big, high-margin opportunity.
John Flannery, who leads GE Healthcare from its headquarters in
Chalfont St Giles, England, reckons he has secured an important part
of the supply chain by buying Biosafe Group, a supplier of cell
processing systems.
"We want to double down on life sciences, and especially so in the
cell therapy business," he said in an interview.
"This more than doubles our capability right now in cell therapy and
we think we can easily have a $1 billion-plus business in cell
therapy in the next 10 years."
GE announced its acquisition of Biosafe on Wednesday but declined to
say how much it was paying. A spokesman said the addition of the
firm, which was established in 1997, would bring 85 new employees
and around 230 customers, doubling GE's cell therapy staff and
sales.
The acquisition comes at a testing moment for cell therapy,
following the deaths of three leukemia patients in a trial of Juno
Therapeutics' <JUNO.O> treatment JCAR015, which caused the study to
be briefly put on hold by U.S. regulators.
GE's confidence in the technology remains intact, however.
"People are still learning, obviously. But this doesn't change our
view that cell therapy is going to be fundamentally transformative
in healthcare," Flannery said.
The first so-called CAR-T cell therapies could reach the market as
soon as next year, with products from Juno, Kite Pharma <KITE.O> and
Novartis <NOVN.S> among the most advanced.
They have delivered remarkable results in early trials against blood
cancers, eliminating all trace of leukemia and lymphoma in some
patients who had run out of other options, and investors have poured
billions of dollars into the field.
GE estimates there are now 375 active T-cell therapy programs, and
seven companies with a market value of $17 billion focused on CAR-T.
EXTREMELY COMPLEX
Producing the therapies, however, is extremely complex, since it
involves extracting cells from an individual patient, altering them
to sharpen their ability to kill cancer cells and then infusing them
back into the patient.
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This, effectively, makes the production process an integral part of
the product, which is where GE comes in.
While GE has no intention of ever marketing medicines, it plans to
offer an "end-to-end" service to drug companies via a range of
tools, from bioreactors for growing cells to software systems for
treatment delivery.
Internal GE research suggests that sales of cell therapies will
reach $10 billion by 2020 and $30 billion by 2030, assuming an
average treatment cost of around $250,000 a patient.
Some analysts have suggested the cost could be as much as $500,000 -
posing a big challenge to stretched healthcare budgets - but
Flannery said economies of scale from standardized production
systems would kick in over time.
The logistical challenges of processing cells from individual
patients have prompted some scientists and companies to take a
different approach by trying to make standardized therapies from
donor cells, on which GE is also working.
GE's drive into cell therapy parallels its established role in
bioprocessing for biotechnology drugs. All eight of the new antibody
drugs approved in the United States last year, for example, use GE
technologies.
Recently, GE has taken bioprocessing a step further by offering
prefabricated modules for building biopharmaceutical factories, with
the first such so-called KUBio factory shipped to China last year.
Ultimately, Flannery wants to see the same turnkey approach applied
to cell therapy.
(Editing by Susan Fenton)
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