Regeneron: New York State of Mind - Pharmaceutical Executive


Regeneron: New York State of Mind

Pharmaceutical Executive

From traps to antibodies

Despite Regeneron's success with the Traps—Zaltrap pricing snafu notwithstanding—Yancopoulos wasn't satisfied. The VelociGene technology allows researchers to manipulate the mouse genome at high-throughput speeds, and the VelociMouse technology expedited the generation of genetically engineered mice, using embryonic stem cells, to research the function of single genes. In 2006, the NIH selected the VelociGene platform as the anchor of its Knockout Mouse Project, who's mission was to target some 3,500 genes, one at a time, to understand their biological function and relationship to specific disease.

But those technologies, despite improving significantly on the state-of-the-art, and enabling the development of the Trap products, still had limitations. So Yancopoulos and his team invented the VelocImmune technology to create fully human monoclonal antibodies. The VelocImmune mouse is an elegant solution to problems with creating antibodies, in that it enlists the mouse's immune system in selecting the best antibody, in vivo. When the molecules are cloned out of the mouse, they're optimized for humans because "we replaced six million base pairs inside the mouse DNA, with human DNA, to allow the mouse to make antibodies that would be fully human...but selected by the mouse to bind to the target," explains Stahl. The difference between "humanized" and "fully human" antibodies in this context is that with "humanized" antibodies, "they still have in the range of three to five percent mouse DNA and mouse protein," says Stahl. "Whereas ours are fully human because we took the entire human genomic region encoding the target binding variable domains of the antibodies and put it into a mouse; there's only human sequence there, and no mouse sequence."

Regeneron's newest platform technology for creating fully-human monoclonal antibodies led to its biggest deal to date. The collaboration, again with Sanofi, was first signed in 2007, and essentially pays Regeneron to continue its research on monoclonal antibodies, and test them in the clinic. In 2009, the collaboration was expanded to provide $160 million a year, for seven years, including another $30 million for manufacturing expansion costs in Rensselaer. In return, Sanofi has the right to co-develop and license promising antibodies, on a 50/50, profit-sharing basis, globally.

Several of these antibodies have already reached Phase III trials. Alirocumab, an antibody targeting PCSK9—"the biggest target in cardiology right now," according to Stahl—is the closest antibody to market, according to Michael Aberman, Regeneron's VP of strategy and investor relations. Like the orphan drug Arcalyst, the idea for PCSK9 followed a biological insight from academia; a study published by Helen Hobbs in the New England Journal of Medicine linked a genetic mutation to very low cholesterol levels. Aberman says he expects alirocumab to launch in 2016, and sarilumab, a Phase III drug for rheumatoid arthritis, around the same time, followed by dupilumab, for asthma, soon after. Regeneron has entered clinical trials with over a dozen antibodies already. The company's next stage of growth depends on the VelocImmune platform, the latest iteration of Regeneron's self-made technology.

The object lesson: break the creative paradox

There's a paradox inherent to any creative pursuit that depends on generating a commercial return: if the primary objective is to make money, then creativity is constrained by narrow, prescriptive pathways proven to meet that objective. On the other hand, creativity allowed to flourish in a vacuum, unencumbered by a sense of market need, usually leads to failure—it may be spectacular or brilliant, but it's a failure nonetheless.

No one understands the commercial imperative more than two New Yorkers like Schleifer and Yancopoulos. Even though Schleifer says "science and innovation is probably more important than the business side of things," he knows the science can't proceed without the business. Regeneron's science is succeeding over the long term, because Schleifer gave it time to grow; he didn't fret over short-term failures, because he was confident in Yancopoulos, and in himself, and he wanted to build a business, not create a flash-in-the-pan payday. "To be successful, continually successful, you have to be investing in the near-, mid-, and long-term constantly," says Schleifer. "Companies rot when senior management no longer cares about the long term."

Yancopoulos, in choosing a career in industry over academia, brought the best aspects of the latter to bear on the former. Too much focus and constraint in R&D is "anti-science and goes against how things work," he says. Scientific discovery is tangential; it's the side path that brings you, unexpectedly, out into a beautiful vista, says Yancopoulos. "That's why there's so much failure [in R&D], because the straight path doesn't lead you to success."

In May, Regeneron bought back the rights to two novel ophthalmology antibodies it invented, from Sanofi. They paid a combined $20 million upfront, and will pay a combined $45 million in milestones, if the PDGF and ANG2 ophthalmology indications succeed in the clinic. "If we execute on our goals, if we are successful with what we want to achieve with PCSK9, if we're successful with our IL-4 and our IL-6 receptor antibodies, and if Eylea delivers what we hope it can deliver, then I believe we will have a good stock performance," says Aberman. "There are all kinds of risks associated with that, but it's a thesis you can hang your hat on." If those plans don't work out, Schleifer and Yancopoulos are confident that something else will.

Ben Comer is Pharm Exec's Senior Editor. He can be reached at


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