The American Society of Gene & Cell Therapy (ASGCT) and Orphan Therapeutics Accelerator (OTXL), a biotech non-profit, have launched the CGTxchange, a jointly owned clearinghouse and marketplace designed to identify, evaluate and advance clinically validated cell and gene therapies (CGTs) for ultra-rare diseases that have been shelved due to commercial constraints.
Credit: ASCGT
This will serve as a new pathway for shelved assets that connects deprioritized clinical-stage therapies with new sponsors or partners, using OTXL’s AI platform to profile and risk-score programs and accelerate their re-entry into development.
“Typical venture capital and biopharma expectations for returns are set well above what most CGTs for ultra-rare diseases can meet in light of recent policy and market shifts,” said Craig Martin, CEO of OTXL. “Yet many of these shelved therapies can still offer meaningful returns to the right partners, as well as tremendous benefits to patients.”
Using OTXL’s AI-based platform, CGT assets can be input into a secure, searchable database and analyzed. The platform generates listings and profiles of shelved therapies, which can then be matched with new clinical sponsors.
“The new joint venture will address a growing and urgent challenge facing the CGT field: policy and economic shifts in recent years have led biopharma sponsors to halt development of hundreds of CGTs no longer considered commercially viable by traditional industry standards, including many that delivered clear benefits to patients in trials,” the companies stated in a press release.
Within the agreement, OTXL will develop the platform for the clearinghouse and marketplace with its AI-based infrastructure and partner network. ASGCT will engage its network of CGT leaders and investors to establish CGTxchange as a leading solution for ‘pre-viable’ CGT programs.
Development of CGTxchange will begin early this year, with an expected launch date mid-year.
How policies and markets created the orphan drug backlog
Until recently, the Inflation Reduction Act of 2022 granted an exemption from Medicare price negotiations for orphan drugs that were approved for a single rare disease. If companies pursued a second indication, the exemption was lost. This led to companies abandoning secondary indications to protect commercial viability.
The One Big Beautiful Big Act largely fixed this by expanding the exemption to allow for multiple indications, but the three years before this fix caused a backlog of shelved assets that had been deprioritized.
Interest rates increased after 2022, helping end the biotech boom of 2020 and 2021. Investors began to shift their focus towards Phase 2-ready assets with clear ROI and away from broad technologies.
When biotech companies face a Series B crunch and cannot commit to manufacturing, they will often shift their focus to their most advanced lead asset while shelving secondary programs, even if those programs are scientifically promising, so they can prioritize clinical trial milestones. This reality can spell trouble for orphan drugs.
Catchings could help move such programs shelved for any of these reasons to get new sponsorship and capital, accelerating their path to market and advancing rare disease treatments.
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