You inhale and exhale over 20,000 times per day. Air, dust, pollen, and millions of bacteria and viruses. Thankfully, 3 billion years of evolution has led to formidable defenses. Our lungs are really, really good at keeping foreign objects out. Our immune system is really good at tackling anything that slips through.
That's great for survival, but not so good for drug developers. Over 23 clinical trials have evaluated genetic medicines for lung diseases and disorders ranging from cystic fibrosis to asthma since 1993. All have failed. Try as it might, the biotech sector cannot conquer the lungs.
That may change in the next decade. An emerging crop of companies have studied past failures to devise new ways to deliver genetic medicines into the lungs. In fact, investors should have clinical data from multiple programs by the end of 2023. It may not be on the investing radar now, but lung diseases represent the next untapped blockbuster market for investors.
Why are the Lungs Impenetrable?
As one of the only major organs exposed to the environment, the lungs require effective defenses against infections. The lungs retain a fine mucus layer to prevent bacteria and viruses from reaching your cells, much like quicksand in old Bugs Bunny cartoons. And that's the baseline. Many lung diseases are characterized by above-average mucus production, which increases the delivery challenges facing drug developers.
Some would-be infections that get trapped are exhaled instead. Others are neutralized by finely-tuned immune processes within the lungs, including some systems specifically honed to the air pathways. That creates additional challenges for potentially curative genetic medicines. Many are delivered with viral vectors or lipid nanoparticles, which are often identified as foreign invaders by the immune system. Almost all contain genetic instructions that risk triggering secondary immune responses. After all, your immune system might think the genetic payload is from a harmful bacterium or virus.
Then again, evolution is akin to an arms race. Our immune systems cannot stop every pathogen we encounter. Similarly, there are ways to sneak around the immune system with properly-designed genetic medicines.
How are Biotech Companies Approaching the Lungs?
Almost every therapeutic modality in genetic medicines is conjuring up ways to circumnavigate the defenses of the lungs. Some companies will be familiar to investors. For example, Moderna (MRNA) and Vertex (VRTX) have a longstanding collaboration to deliver mRNA and gene editing payloads to the lungs. Arrowhead Pharmaceuticals (ARWR) is leading the way for RNA interference (RNAi) and gene silencing. Meanwhile, lesser-known companies such as Krystal Biotech (KRYS) and 4D Molecular Therapeutics (FDMT) have competing ideas for delivering gene therapies.
Moderna and Vertex formed a partnership to treat cystic fibrosis with mRNA tools in 2016. That was amended in 2020 to focus instead on gene editing. At the time of the restated collaboration, Vertex Chief Scientific Officer Dr. David Altshuler summed up the difficulties faced by stating, "delivery of such therapies remaining the most significant technological and scientific challenge." The partnership is focused on finding novel delivery shuttles for the therapeutic payloads that won’t trigger immune responses, including new types of nanoparticles.
Others think they have the delivery shuttle part figured out. For example, 4D Molecular Therapeutics is using adeno-associated viral (AAV) vectors to deliver genetic material to correct cystic fibrosis. If the disease-driving CFTR gene can be functionally replaced, then any individual with cystic fibrosis could benefit from treatment. That's important considering there are many different mutations that have required individual treatments to date.
However, AAV vectors are far from perfect. They have a small capacity, which means they may be relatively inefficient at delivering meaningful amounts of genetic material. In fact, the human CFTR gene is over 22% larger than an AAV delivery shuttle. That's forced 4D Molecular Therapeutics to instead attempt to deliver a miniaturized version.
AAV vectors also trigger immune responses, which means some individuals wouldn't be eligible for treatment or could only ever receive a single dose. That could become a problem considering lung cells are replaced relatively frequently. The simple reality is that any successful genetic medicine will likely need to be administered on a continuous basis.
That leads investors to an intriguing approach from Krystal Biotech. The Pittsburgh biotech is developing a technology platform based on herpes simplex virus (HSV). Unlike AAV gene therapy, HSV gene therapy doesn't trigger immune responses, which means it can be dosed in perpetuity.
HSV delivery shuttles can also carry over six times more genetic material than those based on AAV and twice that of lipid nanoparticles. In fact, KB407 intends to deliver two full copies of the human CFTR gene into lung cells, which provides a significant efficiency boost over other methods in the industry pipeline. Animal studies suggest the asset can efficiently cross mucus layers in diseased lungs, but investors will soon get the same data in humans. Clinical trials are expected to begin in 2022.
Cystic fibrosis isn't the only lung disease in desperate need of new treatment options. Arrowhead Pharmaceuticals thinks it has cracked lung delivery for RNAi therapeutics, which don't require encapsulation in viral shuttles or lipid nanoparticles. How so? The company attaches chemical compounds to the therapeutic payload, which helps guide the payload through mucus layers and into the proper cells.
The company this summer initiated phase 1 clinical trials for ARO-RAGE in asthma and ARO-MUC5AC for various inflammatory lung diseases. It has multiple other next-generation assets in the works for other diseases, including cystic fibrosis. That said, the company's previous attempts to penetrate the lungs ended in terminated clinical trials after worrisome safety signals emerged in animal studies. Investors are hopeful the newer tools will put those concerns to rest, but it highlights the difficulties facing drug developers nonetheless.
Keep an Eye on Lung Biotech in 2023
It may not be on the radar of investors in summer 2022, but conquering the lungs represents a multi-billion-dollar opportunity for drug developers. Importantly, many patients with no or poor treatment options could have safe, effective, and convenient options available soon.
The nerdy technical details suggest companies are getting close to breaking through historical barriers, which could yield effective treatments for diseases such as cystic fibrosis and asthma. That could create a multiple biopharma companies worth over $10 billion and portfolio-building gains for investors. If you're looking for growth in a world with tightening financial conditions, then keep an eye on biotech's quest to conquer the lungs.
