Shift in strategy at Crucell no threat to licensing business

Like many life sciences companies before it, Crucell of the Netherlands has started a major shift in strategy from a technology platform company to one involved in in-house product development. Could this put pressure on its well-established and lucrative licensing business?

Crucell is best known for its PER.C6 cell line technology, already licensed to around 25 partners for the production of vaccines, monoclonal antibodies and gene therapeutics. Latterly, the company has started developing its own vaccine products, aided by its positions in PER.C6 and adenoviral vectors, and this has led to suggestions that it may lose existing partners operating in the same competitive arena.

"Customers will terminate licenses,"​ predicted Crucell's chief executive, Dinko Valerio, at the firm's first meeting to present its product pipeline to financial analysts last Friday. However, he feels that this is a small price to pay for the huge increase in visibility its in-house development activities will bring.

PER.C6 has become established as one of the best platforms to make vaccines, and has become an established industry standard - one that companies who need efficient production in mammalian cells cannot afford to ignore. The experience the company has gained in developing PER.C6 gives it a competitive advantage in vaccine and antibody development, particularly with regard to the speed in which products can be brought through development, according to chief scientific officer Jaap Goudsmit.

The shift in focus is tangible in all sectors of the company. While staffing levels remain at around the same level as a year ago (around 185 employees), the largest group (30 per cent) are now involved in product development. Last year research was the biggest department, according to Dr Valerio. The company has also recently appointed a new head of development, Jean-Yves Guichoux​, and upgraded its facilities to include a complete revamp of its manufacturing facilities to meet current Good Manufacturing Practice standards set out by the US Food and Drug Administration (FDA).

This upgrade, as well as the completion last year of a Biosafety Level 3 (BL3) lab and an ongoing project to construct a 100-litre bioreactor process facility to allow the company to scale-up production, has brought Crucell to a new stage in its development. It can now contemplate working on a range of vaccine types, from the mundane (e.g. influenza) to the virulent (Ebola).

Goudsmit told the meeting that Crucell is focusing on vaccines for infectious diseases because this represents a growing market. On one hand it is driven by a hike in population density that is increasing exposure of humans to animal diseases, an ageing population and increasing global travel. Severe Acute Respiratory Virus (SARS) and Hong Kong flu are good examples of these phenomena, he noted. Meanwhile, on the other, the threat of bioterrorism looms large, stimulating research into less common but virulent pathogens.

PER.C6 is a great tool for making inactivated vaccines in the classical sense, he noted, and is a versatile tool as many viruses grow within it. Crucell is using this platform on its own to develop a vaccine for influenza that should be significantly cheaper to produce than other products. And, because of the speed in which it can be used to produce vaccine, it provides the first real way to allow a vaccination-based response to both epidemic and pandemic flu outbreaks.

The company said it expects to file Investigational New Drug (IND) applications seeking approval to start trials of both the pandemic and epidemic vaccines in 2005.

The platform is also being used to develop a vaccine against West Nile virus, a disease seeing exponential growth in the US and which has now reached both the UK and France. Crucell has developed a goose model of the infection as well as a preliminary cell-based production system, and the company hopes to be in a position to start clinical trials in 2005.

Meanwhile, the combination of PER.C6and Crucell's AdVac adenoviral vector technology expands the utility of the cell line to other viruses and pathogens that do not grow within the cell line itself. In this way, the company has been able to start a program to develop an Ebola vaccine, in which sequences of DNA from the virus are spliced into the vector and used to produce the antigens that will form the basis of the vaccine.

Crucell's recombinant Ebola vaccine is currently in preclinical development, with results expected during the first half of 2004. If the outcome is favourable, the company expects to file an IND in 2004.

Finally, the Dutch company has a programme alongside GlaxoSmithKline and the Walter Red Army Institute of Research (WRAIR) in the US to see if the PER.C6/adenoviral vector approach can be used to develop an effective vaccine against the malaria parasite. This vaccine has shown promising results in the mouse malaria model and further results in monkeys are expected in the first half of 2004.

The move towards a full product development program has swelled Crucell's cash burn to an estimated 22 to 25 million euros in both 2003 and 2004. But with around 90 million euros in cash, the company will have no need to raise funds, at least in the short term, said Leon Kruimer, Crucell's chief financial officer.