Thoughtleader: Stephen Sherwin, Cell Genesys

June 1, 2007

Pharmaceutical Executive

Volume 0, Issue 0

Cell Genesys knows something about building successful biotech companies. In fact, its chairman and CEO, Stephen Sherwin, MD, a Genentech alum, has built at least three, if you count Cell Genesys spinouts Abgenix and Ceregene. Through a strategy of M&A and licensing programs-plus betting on the right technology at the right time-Cell Genesys has been able to raise enough capital to gamble on what Sherwin believes could be the future's most promising therapies, including gene activation, immunotherapy, and oncolytic virus therapy.

Cell Genesys knows something about building successful biotech companies. In fact, its chairman and CEO, Stephen Sherwin, MD, a Genentech alum, has built at least three, if you count Cell Genesys spinouts Abgenix and Ceregene. Through a strategy of M&A and licensing programs—plus betting on the right technology at the right time—Cell Genesys has been able to raise enough capital to gamble on what Sherwin believes could be the future's most promising therapies, including gene activation, immunotherapy, and oncolytic virus therapy.

The company is currently developing GVAX, an immunotherapy vaccine that is in Phase III clinical trials for prostate cancer and Phase II for leukemia and pancreatic cancer. It is also developing a Phase I bladder-cancer drug based on a modified adenovirus (the virus that causes the common cold) that attacks tumor cells while sparing healthy ones. And while the technology is still unproven, Sherwin recalls the initial skepticism the scientific and financial community had toward monoclonal antibodies. It's an analogy he takes to heart: The work of Abgenix's researchers is behind the newly approved colon-cancer drug Vectibix, a monoclonal antibody that Amgen is now hoping to turn into a blockbuster. (Amgen completed its acquisition of Abgenix last year.) Here Sherwin talks about the many evolutions of Cell Genesys, why he believes the company's current development programs can overcome early failures in the field, and what he thinks about the skepticism toward new technologies.

Why has Cell Genesys gone through so many evolutions over the past 15 years?

The interesting thing about biotechnology start-ups is that what they focus on is very much a reflection of what people will pay for—and that has moved around. When we started Cell Genesys, there was a lot of interest in new technologies, and that was the intent of our original business plan. We were interested in cellular therapies—hence the name Cell Genesys—and our program was primarily focused on T cell therapy in HIV infection. But we recognized that that was an area with higher risk, and we were interested in technologies that were a little less risky and perhaps closer to the market.

We didn't know what the products would be, because we didn't have proof of technologies. It would be difficult to start such a company today, given the discipline of venture capital investment. But in the late 1980s, when we started Cell Genesys, we were all benefiting from the blush of success with Genentech and Amgen.

A+ Is for Abgenix

Where is your focus now?

In the mid-'90s, just as we were spinning out Abgenix, we concluded that it was going to be tough to commercialize T cell therapy for HIV. It was around that time new drugs for HIV infection, like protease inhibitors, were coming to market, and what was once viewed as a hopeless disease—where all extraordinary therapies needed to be considered—had become a product disease.

In 1997, we acquired Somatix, which had just started work on something called GVAX. By the late '90s, we had reformatted GVAX to create a prostate-cancer product.

What distinguishes GVAX from other immunotherapy products?

There are different approaches to immunotherapy relating to how you format your product and how you try to stimulate the immune system. That said, the biggest difference between companies in the field is the need to pick the right molecular target. Generally speaking, immunotherapies are slow-acting, and attempting to use them rapidly in aggressive cancers where patients have short survival rates is an impossible challenge to overcome. And many of the failures that have occurred are easily explained because companies attempted to do just that.

By way of example, there were two Phase III failures last year in advanced pancreatic cancer. If you take a step back, you realize those patients may have no more than three to four months median survival. Most people believe immunization takes about six to 12 months. How can you possibly expect to have therapeutic benefit under those circumstances?

GVAX uses a multi-antigen approach. It is a series of products made from cell lines that can be mass produced and are not patient specific. The cells are irradiated so they can't grow and reproduce, and they're modified to produce the immune activator GM-CSF. Of course, tumor cells don't, under ordinary circumstances, make things to stimulate the immune system; they make things to suppress the immune system. But we have altered the tumor cells so as to stimulate an immune response against tumor cells.

What kind of results are you seeing?

We are encouraged by what we've seen across our Phase II studies. We have seen objective evidence of antitumor activity with a group of related products: prostate cancer, pancreatic cancer, all kinds of leukemia. And when you see consistency of data across multiple related products, your confidence builds.

Our trials have shown a potential survival benefit with a favorable side effect profile compared with traditional chemotherapies. When we took the survival signal and the side effect profile and put them together, we were convinced that it was appropriate to advance to Phase III. Our first Phase III study, VITAL-1, compares GVAX to Taxotere with the primary end point being improvement in survival, and it should be completed later this year. That's a 600-patient study enrolling now at about 120 sites in the United States and Canada. The second study, VITAL-2, is a newer study. It will probably involve 80 to 90 sites in the United States and Canada. That study compares GVAX with Taxotere to Taxotere alone. It also has survival as the primary end point.

What's the promise of the virus platform you're working on?

We have a Phase I trial going on in patients with recurring bladder cancer. We actually have had two acquisitions that bear on this platform: one in 2001, when we bought a private company called Calydon that had been working on these kinds of products, and another two years later with Novartis, where they contributed products and technology to our effort.

The idea of viral-based treatments for cancer is based on the fact that you can genetically alter these viruses to be more selective in the growth of cancer cells. Under normal circumstances, a virus lyses a cell, multiplies, and the cell bursts. If you could direct that specifically to a cancer cell, then you would have a potential therapy for cancer.

Our particular products are derived from adenovirus. One of the limitations of these viral therapies—which is true of the adenovirus therapies—is that eventually the body will mount an immune response against the virus. But what's interesting about our product CG0070 is that it also carries the GM-CSF gene. So we believe it could potentially work through two mechanisms: direct viral killing of the cancer cell and stimulating an immune response by way of the introduction of GM-CSF.

Are you planning to commercialize GVAX on your own or find a partner?

We are in active discussion with prospective partners at this time. One of the things that we're looking for in a potential partner is a company that can help us prepare for a successful launch and commercialization. That includes understanding the market and beginning to educate physicians who will use this product. We believe urologists and oncologists will use the product, and it's new to both groups. And it also means addressing reimbursement challenges.

How do you overcome skepticism toward unproven technologies?

That's one of the challenges that we have at Cell Genesys today. Not every investor and not every potential partner will be willing to hear our story. There are people who want to follow the second and third, not first, company to market. But it does mean that you have to ask yourself more frequently than not what your conviction is for pushing forward. You have to have perseverance and patience.

I fundamentally believe that we can use antibodies to treat cancer. We have commercially validated the use of monoclonal antibodies to treat cancer beyond my wildest expectations. So, if we can use a protein product in the immune system to treat cancer, why is it such a leap of faith to assume that we will learn how to stimulate the immune system so that it can produce its own antibodies? We have many examples of drug development where we treated diseases first by giving the product that was made outside the patient, then learning how to stimulate its production. We do both of those things in treating diabetes; we induce insulin secretion, but we also give insulin.

Stephen Sherwin, MD, has been the chief executive officer of Cell Genesys since its inception in 1990; he was appointed chairman of the board in 1994. He previously held positions at Genentech and the National Cancer Institute. He received his MD from Harvard Medical School.