Drugmakers are betting that delivering radiation directly to tumors will become the next big breakthrough in cancer treatment.
bristol myers squibb, AstraZeneca, Eli Lilly Drug companies and other pharmaceutical companies have spent about $10 billion on deals to buy or work with radiopharmaceutical companies. They have acquired smaller startups to get their hands on technology that, while still in its infancy, could treat many types of cancer.
“Any large company that has a commercial presence in oncology or considers oncology an important therapeutic category for them probably needs to have exposure to this space in some way,” said Michael Schmidt, an analyst at Guggenheim Securities.
Two Novartis radioactive drugs are already available. A few dozen more are in development, Schmidt said. He said it’s hard to estimate the overall market opportunity because there are so many potential cancers the drugs could treat.
Schmidt expects the category to grow to $5 billion in revenue if the technology remains limited to treating a few types of cancer, such as prostate tumors and neuroendocrine tumors, and to tens of billions if it proves effective in treating more types of cancer.
These drugs work by attaching a radioactive substance to a target molecule that seeks out and binds to a specific marker on cancer cells. The trick is to find markers that are present on cancer cells but not on healthy cells. This allows the treatment to deliver radiation to the cancer cells while sparing the rest of the body the level of damage that comes with many cancer drugs.
It took some time to prove the technology’s scientific and financial viability. The first radiopharmaceuticals were approved in the early 2000s, but interest from big pharmaceutical companies has only recently increased.
An employee works at the NSA's radiopharmaceutical plant in Idea, Rome, Italy.
Franco Origlia | Getty Images
Manufacturing the drugs requires complex manufacturing processes and logistics, two major drawbacks. Radioactive materials decay quickly, so patients need to be treated within days of receiving treatment.
Pharmaceutical companies have demonstrated their ability to administer complex, time-consuming drugs, such as CAR-T for blood cancers or gene therapies for rare diseases. Then Novartis showed that these strategies could be applied to radiopharmaceuticals.
In 2018, the Swiss drug giant won approval for a radiopharmaceutical called Lutathera to treat a rare type of cancer in the pancreas and gastrointestinal tract. Then in 2022, Novartis won another approval for Pluvicto, a prostate cancer treatment. The drugs are expected to generate combined sales of about $4 billion by 2027, according to consensus estimates from FactSet.
These successes have sparked wider interest in radiopharmaceuticals.
“We put it all together and thought we have to do something, we need to make deals here,” said Jacob van Naarden, Eli Lilly’s president of oncology.
Lilly acquired radiopharmaceutical maker Point BioPharma last year for about $1.4 billion and has also signed a handful of partnerships with companies developing treatments. One of the most important factors in Lilly’s initial research was whether the companies were willing to manufacture the drugs, Van Naarden said. Radiopharmaceuticals are not easy to make, and Lilly wanted to make sure any initial acquisition could produce the drugs itself rather than outsourcing the work.
Manufacturing was also a key component of Bristol-Myers Squibb’s $4.1 billion acquisition of Risebio, said Ben Hickey, president of Risebio. At the time of the acquisition, Risebio was nearing completion of a manufacturing facility in Indiana and had its own supply of radioactive materials needed to develop experimental drugs in its pipeline.
“That was clearly one of the criteria to make sure that our destiny was in our own hands,” Hickey said.
Novartis has shown how important this is. The company initially struggled to make enough doses of Pluvecto. It is now investing more than $300 million to open and expand radiopharmaceutical manufacturing sites in the United States so it can produce the drug and get it to patients quickly. Now the company is able to meet demand for the treatment, which requires careful planning for distribution.
Each dose carries a GPS tracker to ensure it reaches the right patient at the right time, said Victor Bolto, Novartis’s head of U.S. business. Novartis is shipping doses to destinations within nine hours of the plant to minimize the risk of disruption from storms, Bolto said.
Doctors and patients also feel the complexity of this experience.
Dr. Timothy Korytko, chief radiation oncologist at Bassett Hospital, said the upstate New York health care network needs to upgrade its medical license to handle radioactive materials before administering Lutathera and Plovecto. The drugs, which are given intravenously, must be administered by a licensed specialist.
It may take several weeks from the time a radioactive drug is prescribed to the time it is given. For Pluvecto, patients come to the clinic every six weeks for up to six treatments.
Radiopharmaceuticals begin to degrade as soon as they are manufactured, so they only last for a few days.
Ronald Coy and his wife Sharon.
Courtesy of: Ronald Coy
Ronald Coy knows how important it is to keep an appointment. Coy, a retired firefighter who has been battling prostate cancer since 2015, drives more than an hour across upstate New York to receive Pluvicto treatment at Bassett. He hasn’t had any problems so far, but he worries that a snowstorm could delay one of his appointments between now and the end of January.
“Hopefully we don't get any major storms between now and then, and if we do, it will be a week before I go,” Coy said.
When Coy comes home from treatment, he has to take precautions like staying away from his wife, Sharon, so she doesn't get exposed to radiation. He drinks a lot of water to flush out the excess radiation from his body. And he doesn't mind a few days of minor discomfort if it means fighting cancer.
Investing in the infrastructure to produce and distribute radiopharmaceuticals would be worthwhile for Novartis, Bolto said, for Bluevecto and Luthera alone. But it’s even more attractive because of the potential to treat more types of cancer. He gives the example of Novartis developing a drug to treat a marker found in 28 different tumors, including breast, lung and pancreatic cancer.
“If we can put all these lessons that we’ve developed from manufacturing distribution into the service of lung cancer patients and breast cancer patients, and demonstrate meaningful levels of efficacy and tolerability, then we’re talking about a very significant potential impact on cancer care. And of course, a viable business as well,” he said.
At this point, it’s still uncertain. Executives say the field is still in its early stages, and the promise of radiopharmaceuticals beyond the current cancer treatments they address has yet to be proven.
“If we can expand the range of targets and tumor type, this could be a very large class of drugs,” said Eli Lilly’s Van Naarden, adding that at this point it’s hard to say whether the class will be “very important” or “just important.”
One opportunity the company sees is combining radiopharmaceuticals with existing cancer drugs such as immunotherapy, said Robert Plingie, chief research officer at Bristol-Myers Squibb. AstraZeneca shares that vision.
AstraZeneca spent $2 billion to buy Fusion Pharmaceuticals earlier this year, and Susan Galbraith, the company’s executive vice president of oncology research and development, points to existing regimens that combine immunotherapy with radiation.
Galbraith said the size of AstraZeneca’s radiopharmaceutical portfolio ultimately depends on its initial prostate cancer program and other unannounced targets already in the works, but she believes the technology will become a significant part of cancer medicine in the next decade.
It could take years to understand the technology’s true potential, with many experimental drugs still in early stages of development. One outstanding question, said Schmidt, the Guggenheim analyst, is whether other radiopharmaceuticals are as safe and well-tolerated as Novartis’s Pluvecto, especially those that use other types of radioactive materials.
Ronald Coy has been battling prostate cancer for nearly 10 years. He started taking Novartis's Pluvecto earlier this year.
Courtesy of: Ronald Coy
Big Pharma isn’t waiting to jump in. Stories like Coy’s are encouraging them that the work will pay off.
Over the course of nearly a decade, Coy underwent multiple treatments for prostate cancer that had spread to his bones. After just one treatment with Pluvecto earlier this year, blood tests showed Coy’s cancer had significantly decreased.
Not everyone responds well to Pluvicto, and things could always change for Coy. But for now, Coy feels fortunate to be among the group that responds well to Pluvicto. It's worth the drive and precautions for him.
“I feel very lucky every day because I am – as it is now – part of the third group where it works really well for me,” he said.
— CNBC's Lianne Miller contributed to this report.
