Tuberculosis

History, Now, and Why the Future Depends on New Vaccines

Kari Stoever
J2J Lung Health Media Training October 31, 2013

Aeras: Background
Founded in 2003 Fully integrated, nonprofit biotechnology organization with in-house capabilities in finance, portfolio management, GMP pilot manufacturing, translational product development and policy, advocacy and resource mobilization 501(c)(3) organization registered in Washington DC Offices
Rockville, MD (headquarters) Cape Town, South Africa Beijing, China

Governed by a Board of Directors 5 technical advisory groups incorporating expertise from around the world Executive leadership team with decades of experience developing and commercializing new vaccines/biologics ~ 160 employees with annual budget of approx. USD $55 million

Mother Nature is a Serial Killer

The Scale of the Problem

Source: Nature/ World Tuberculosis Report, 2012

TB decline in the pre-antibiotic era

Recent progress in addressing the TB epidemic has been enabled through enhanced global coordination and large investments Launch of global partnerships and new control tools in the 1990s contributed to decreasing TB rates
TB rates per 100,000 population

300 250 200

WHO/IUTLD Global Project on MDR-TB Surveillance DOTSDOTS Plus

UN Millennium Development Goals Stop TB Partnership

Prevalence

150 100 50 0 1990

Incidence HIV co-infection incidence Mortality

1995

2000

2005

2010

2015 Year

Source: Global Tuberculosis Report 2012, WHO (2012), Nature Vol 502, No. 7470 Suppl, S2 (2013)

Incidence of TB is falling so slowly that it will take a millennium to end TB Vaccines needed to turn the tide

Source: Christopher Dye, WHO

Failure to innovate has led to drug resistance strains

> 500,000 MDR-TB cases in 2011 92 countries have reported XDR-TB
Underinvestment in new drugs, diagnostics and vaccines has led to growth of drug-resistant TB.

TB evolving with some strains becoming virtually untreatable

New, novel TB vaccines will aim to

prevent all strains of TB.

Extensively Drug-Resistant TB: 92 Countries

Source: WHO Global TB Report, 2013

10

The problem of microbes becoming increasingly resistant to the most powerful drugs should be ranked alongside terrorism and climate change on the list of critical risks to the nation. Sally Davies, UK Government Chief Medical Officer
11

Full implementation of Global Plan: 2015 MDG target reached but TB will not be eliminated by 2050

Current rate of decline -2%/yr (globally) China, Cambodia -4%/yr (the best observed nowadays) W Europe after WWII -10%/yr (Historical example) TB incidence 10x lower than today, but >100x higher than elimination target in 2050

Elimination target:<1 / million / yr -20%/yr

What are the challenges if we target elimination

1. 2. 3. Still only two-thirds of the estimated total of 8.6 million people who fell ill with TB in 2012 were notified. Despite a reduction of 45% since 1990, still over a million people died of TB out of the estimated 8.6 million new cases in 2012. Currently, only one in five of the notified patients estimated to have MDR-TB is being diagnosed and treated.

4.

The BCG vaccine does not have efficacy in preventing transmission and there is no global strategy to protect against development of diseases in those who are infected with M. tuberculosis.

5.

Insufficient tools to detect, treat or prevent TB, R&D underfunded, and even when tools are available, inefficient transfer of tools/technology.

Controlling and reducing TB incidence requires the application of transformational interventions

Transmissi on
Breakpoints

A1 C

A Preventing Transmission cycle breakpoints

transmission and infection

to infectious TB

B Blocking progression

C Treating and Infectious TB

sterilizing active TB

A2

Infected individuals

Ill-equipped for this Complex Epidemic

We are beginning to see the winds of change, but what we really need is a storm. It is imperative that we transform the way we diagnose, treat, prevent, and control TB through biomedical research and public health measures Anthony Fauci, Director of NIAID

EXPOSED: The Race Against Tuberculosis

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A Global Problem

Source: Nature/ World Tuberculosis Report, 2012

17

A U.S. Problem: Recent Outbreaks

Nearly 10,000 cases in 2012

18

A U.K. Problem: Outbreaks in London

19

A European Problem
Economic burden of TB in Europe: >5 billion/year
Lost productivity and treatment costs

>80,000 cases/year of MDR-TB in Europe

Highest in Eastern Europe and Central Asia

UK: Cost to treat drug-resistant TB >50,000/patient

20

South Africa

21

Russia: Drug Resistance

He that will not apply new remedies must expect new evils; for time is the greatest innovator.
Sir Francis Bacon

India: Healthcare Workers at Risk & TDR-TB

23

China: Biggest Disease Burden & Urbanization

Photo: NPR/Ng Han Guan/AP

New York Times, June 15, 2013

24

Vaccines: The Future

25

Vaccines: The Future

Nature will continue to evolve infectious disease threats both endemic and pandemic Rather than resigning ourselves to catastrophic outbreaks, we have the power to disrupt historical trend lines through the use of new vaccines to combat these threats
26

Vaccines: The Future

In the same way that during my Microsoft career I talked about the magic of software, I now spend my time talking about the magic of vaccines. Vaccines have taken us to the threshold of eradicating polio. They are the most effective and cost-effective health tool ever invented. I like to say vaccines are a miracle. Bill Gates

Vaccine Success: Smallpox, Measles & More

Vaccine Success: Polio

Source: WHO/IVB Database, July, 2013

TB and Progress?
90-year-old BCG vaccine is the most widely used vaccine in the world

1908

2013

The Need for New Vaccines

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A century of neglect followed by a decade of progress

2000
No new preventive TB vaccines in clinical trials

2002
1st preventive vaccine enters clinical trials (MVA85A)

2009
Phase IIb proof-ofconcept trials of preventive vaccines initiated

2012
16 vaccines have entered clinical trials, 12 currently in clinical trials

The Global Pipeline of TB Vaccine Candidates

PHASE I PHASE IIa PHASE IIb PHASE III

Ad5 Ag85A McMaster CanSino

VPM 1002 Max Planck, VPM, TBVI, SII

MVA85A/AERAS-485 Oxford, Aeras

M. Vaccae Anhui Zhifei Longcon, China

MTBVAC TBVI, Zaragoza, Biofabri

H1 + IC31 SSI, TBVI, EDCTP, Intercell

M72 + AS01E GSK, Aeras

ID93 + GLA-SE IDRI, Aeras

RUTI Archivel Farma, S.L

Crucell Ad35/MVA85A Crucell, Oxford, Aeras

H4/AERAS-404 + IC31 SSI, Sanofi-Pasteur, Aeras, Intercell

H56/AERAS-456 + IC31 SSI, Aeras, Intercell

Crucell Ad35/AERAS-402

Crucell, Aeras

VIRAL VECTOR rBCG

PROTEIN/ADJUVANT ATTENUATED M.Tb

IMMUNOTHERAPEUTIC: Mycobacterial Whole Cell or Extract

AERAS SPONSORED

Clinical Studies
Global partners for epidemiological studies and clinical trials

Public Health Impact of a TB Vaccine

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Investing in prevention is the greatest austerity measure

At a global level, an estimated US $1-3 trillion over the next 10 years X/MDR TB can be 200-1000 x more expensive to treat than drug-sensitive cases

MDR-TB utilizes 33% of South Africas TB control budget (2% of all TB cases)
Control and treatment would cost us ~$80 billion over the next decade. Yet it could take $800 million over 10-15 years to develop new vaccines.

Deciphering the Tower of Babble?

If we had an AIDS vaccine we wouldnt have to worry about TB Control efforts are working, 40% reduction in deaths over the past 20 years More absolute cases of TB in the world today than in 1990 We will have a TB vaccine in the next decade The vaccine science isnt there, Ill believe it when I see it. We should be investing in drugs and diagnostics instead of vaccines

SUPERBUG

nd I was vaccinated against TB 2 leading cause of death from a single infectious disease

Zero deaths, zero infections, zero suffering Drug-resistant cases on the rise New vaccines would be the singlemost cost-effective tool in our fight against TB. TB is preventable, treatable and cost effective. Cost of XDR treatment up to 1000x more expensive TB is a disease of poverty London is the TB capital of the Europe TB outbreak in Los Angeles

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Communications
Compelling stories from many angles

A Woman's Drug-Resistant TB Echoes Around the World

By GEETA ANAND Updated Sept. 8, 2012 9:03 a.m. ET

Dangerous TB Patient Detained on U.S. Border

By BETSY MCKAY March 1, 2013

Action Urged Against Fake Tuberculosis Drugs

Poor-Quality Medications Are Contributing to Treatment Resistance, Researchers Say
By BETSY MCKAY July 4, 2013

Winners of the 2013 Daniel Pearl award for the worlds best cross-border investigative reporting
Source: wsj.com

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EXPOSED: The Race Against Tuberculosis

A four-part series of 9-13 minute films about the deadly global epidemic of tuberculosis. By telling the stories of four inspiring individuals, interspersed with expert commentary from some of the worlds top TB physicians, scientists, advocates and policymakers, EXPOSED brings viewers to the forefront of the fight against TB.

1: The Global Epidemic Natalie Skipper, an MDR-TB survivor from the United States, and medical experts give a sense of the global TB epidemic.

2: The Rise of a Superbug Dr. Jayant Banavaliker, a leading TB doctor in Delhi, chronicles his daily struggle to save patients using todays limited tools. Plus, Phumeza Tisile fights XDR-TB in South Africa.

3: The Innovation Movement A profile of Unathi Gwintsa, a passionate participant in a TB vaccine clinical trial in South Africa, who is driven by her desire to protect her daughter from TB.

4: The Last Mile Prof Helen McShane, who has spent the last 12 years developing new TB vaccines in the UK, explores why now is a pivotal moment in history to save millions from TB.

EXPOSED: The Race Against Tuberculosis

~ 80,000 views, either on Facebook, Vimeo, YouTube, or the Aeras website, with about 1,500 new views in the last month
1000 non-English views; seen in 135 different countries

Screened for >1,350 government decision-makers, biotech and pharmaceutical leaders, TB vaccine developers, national treatment program managers, research advisors, and more at >20 global events Won PR Dailys Digital PR Award for Best CauseRelated Video and received an honorable mention for Best Digital PR Campaign in the Nonprofit Sector

Building momentum through the development of micro campaigns

Key Issues
Engage new audiences by focusing on key issue areas and communities connected to the TB issue. In addition to helping us reach new audiences and constituencies, these issues have been selected because they are priority areas for target funders as well as the media.

TB & Mining

Human & Animal TB

TB & Health Workers

Launch mid-Nov. 2013

April - June 2014

Launch TBD

Why Focus on these Key Issues?

TB vaccine R&D is a long-term, high-risk endeavor. There are no major scientific milestones on the horizon in 2014. Therefore, we need to engage in key current issues in the broader field of TB to grow and sustain interest and support for TB vaccine R&D on the global health agenda.

The key issues identified provide a potential for increased scientific and/or advocacy collaborations.

With a focus on key issues in the broader field of TB, Aeras will build new partnerships with stakeholder groups and expand our audience. New constituencies will help increase demand for TB vaccine R&D prioritization.

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TB and Mining

Source: Dharmadhikari et. Al., 2013

46

Human and Animal TB

TB in animals and humans continues to be an enormous public health problem and an economic burden on agricultural and health budgets
UK: In 2012, >37,000 cattle slaughtered at a cost of 100M to the taxpayer DEFRA estimates >1 billion will be spent over the next decade for bovine TB control

We can inform vaccine development in both animal and human TB by combining expertise, learning & resources
Source: Department for Environment, Food and Rural Affairs, 2013

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TB and Healthcare Workers

Increased risk of TB infection Short, medium and long-term activities can help protect atrisk populations
We can educate, and motivate a global prevention research agenda

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Content strategy
We are building a robust and integrated communications, resource mobilization and advocacy strategy and process that drives efficiency and scale up in content development and distribution. Every time we publish a fact sheet, report or press release, every time someone speaks on a panel or writes a blog, every time we hold a briefing, we will seek to distribute our content through as many relevant channels as possible building new audiences and support along the way.
Content

Press

Web Feature

Fact Sheet

Email

Social Media

Event / Conf. Call

Stakeholder

Activities/Message Vehicles
Conferences and Events
Leverage national, regional and global fora on key issues platform to place vaccine R&D on the agenda

Microsite and multimedia

Maximize reach of new website capabilities and deepen our social media presence to strengthen Aeras voice in global dialogue on key issues

Fact sheets
Build issue-specific messaging to reach new audience, engage new constituencies, and create TB vaccine R&D advocates

Outreach avenues
Blogs Social media Traditional media Email

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Introduction to the TB Vaccine Investment Case

A dynamic model was developed to address four key objectives: 1. 2. To identify a product development strategy that maximized the public health impact of new TB vaccines; To conduct a strategic market analysis to assess the commercial viability of new TB vaccines; To evaluate portfolio development costs in order to inform on investment strategies by phase of development over time, to support the successful commercialization of at least one new TB vaccine; To demonstrate the cost efficiencies of implementing a portfolio management approach.

3.

4.

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Business Case Key Messages

TB vaccines are our best hope to end the TB epidemic Shared public and private sector investment at key stages will offset risk Even partially effective TB vaccines for adults and adolescents will have a significant public health impact A viable market for TB vaccines exists Greater diversification needed in TB vaccine portfolio A disciplined portfolio management approach is necessary
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Global TB Market Segmentation

Countries in analysis
197 countries included in the Applied Strategy Model 14 countries excluded (no TB and/or birth data 2009) 183 countries included for analysis

183 countries geographic segmentation

Economies are divided according to 2011 GNI per capita, calculated using the World Bank Atlas method low income - $1,025 or less; middle income - $1,026 - $12,475 lower middle income, $1,026 - $4,035; upper middle income, $4,036 - $12,475 high income - $12,476 or more

53

TB Vaccines Target Product Profiles

Adolescents & Adults Vaccine
Indication

Infant Vaccine
To prevent active disease Newborns independent of HIV status 1 dose Routine vaccination of newborns BCG

To prevent active disease 10yo without known active TB 2 doses Routine vaccination of 10yo, and Mass campaigns in 11yo, every 10 yrs HPV coverage rate proxy for 10yo 60% improvement in relative efficacy compared to the control arm

Target Population

# Doses Vaccination Strategy

Vaccination Coverage Rate Proxy

Expected Efficacy

60% improvement in relative efficacy compared to current BCG

As safe as current BCG

Expected Safety

No safety concerns

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Portfolio Evolution 2014-2027 using Monte Carlo Simulations

Number of Vaccines in Portfolio by Development Stage Over Time
25 20 15 10 $40,000 5 0 $20,000 $0 $120,000 $100,000 $80,000
Number of Vaccines

Projected Annual De

$60,000

Discovery / Pre-Clinical 1 Phase 2B Post-Commerce

Pre-Clinical 2 Phase 3

Phase 1 / 2A Pre-Commerce

Discove

Phase 2

Projected Annual Development Costs by Stage

$120,000 $100,000 $80,000

Total Development Costs

$846,786

$60,000
$40,000 $20,000 $0

Discovery / Pre-Clinical 1 Phase 2B

Pre-Clinical 2 Phase 3

Phase 1 / 2A Pre-Commerce

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Portfolio Development Probability of Success

The key outputs of the portfolio development analysis are:
Probability of successful commercialization of a vaccine by year Costs to develop the portfolio to commercialization

Given that there are numerous potential outcomes related to the various probabilities of success, the model incorporates Monte Carlo simulation to analyze the various potential outcomes.
Probability of 1 Vaccine Reaching Commercialization
90% 80% 70% 70% 60% 50% 40% 30% 20% 10% 16% 16% 55% 56% 77% 79% 82% 83%

0%
By Year 2022 By Year 2023 By Year 2024 By Year 2025 By Year 2026 By Year 2027 By Year 2028 By Year 2029 By Year 2030

Based on the base assumptions and the initial portfolio, there is a 55% probability of having one vaccine commercialized by 2024 and greater than 80% chance of having one vaccine commercialized by 2030
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Overall Portfolio Development Costs

Total Portfolio Development Costs - 1 Vaccine Commercialized
100 90 80 70 60 50 Average Std. Deviation Min Max 630,592 97,254 435,250

1,050,286

40
30 20 10 0
$250 - $300 - $350 - $400 - $450 - $500 - $550 - $600 - $650 - $700 - $750 - $800 - $850 - $900 - $950 - $1,000 $300 $350 $400 $450 $500 $550 $600 $650 $700 $750 $800 $850 $900 $950 $1,000 $1,050

As highlighted in the histogram above (based on Monte Carlo simulation of the various potential outcomes), the estimated cost range for developing one vaccines through commercialization can range from $435m to $1,050m, with and average development cost of $630m.

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Portfolio Development Funding Analysis

The financial model also analyzes various funding alternatives for the development of the current TB vaccine portfolio This component of the model leverages the first two components of the model Total development costs required to develop the portfolio - i.e. what amount of funding is going to be needed? Potential royalty stream that can be realized upon commercialization i.e. how is the funding going to be repaid? The model allows for analysis of various non-traditional funding alternatives to facilitate the development of the portfolio, including both debt like investments and equity investments (in addition to grants) The key outputs of this component of the model include: Analysis of the financial returns to the funding sources
The optimal funding sources and security structures will ultimately be determined by the composition of the portfolio and associated risks of development

58

Public and Private Sector Risk-Sharing

A blended-capital financing structure will enable appropriate risk-sharing between private and public sectors:

With governments strong economic and public health interest in new TB vaccines, public funding will be required to support the earlier phases of vaccine development, where the scientific risk is the greatest In return, industrial partners will be expected to cost-share in the later, more expensive phases of development

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Initial Takeaways from our Analysis To-Date

There is a significant market potential for commercialized TB vaccines, particularly an adult/adolescent vaccine The overall market potential of a successful adult/adolescent vaccine seems sufficient enough to support meaningful financial returns to industry and potential niche public/private investors in the development of the vaccine portfolio. Having a robust and diverse pipeline of vaccine candidates in early development stages is critical to attracting investment capital as the portfolio approach increases the likelihood of successful commercialization and thus financial returns. There might be possible RSFF direct and/or indirect financing opportunities in late stage R&D phases
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Global Portfolio Management Principles A streamlined decision-making framework in order to advance the global TB
vaccine portfolio and realize overall R&D cost efficiencies through effective portfolio management will follow the principles:
Optimization: The framework will utilize existing technical expertise, scientific advisory committees and governance structures of key parties and build new capacity where needed in order to enhance portfolio decision-making and maximize organizational synergies and knowledge sharing. Transparency: Procedures and decision-making will be clear and objective based on objective gating and priority setting criteria that disclose and avoid any conflict of interest. Sound Financial Management: Funds will be managed in a rational manner with sufficient control over the use of those resources to ensure that stage gate decision processes are adopted and utilized. Diversification: The portfolio will be global and diverse to minimize financial risks and create the best opportunity for success; similarly, funding sources should include a broad array of different types of financing to increase the pool of available resources as much as possible. Effectiveness: The collaboration will offer donors and investors a highly efficient mechanism in order to show value for money, participate in risk-sharing and reduce time to market. Affordability: Vaccines to be developed will have to be available worldwide at affordable prices. 61

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Enhancing Portfolio Management Capabilities

Leverage Aeras and TBVI scientific expertise in the Global TB vaccine partnership regarding decisions on development of projects within the TB vaccines portfolio. Link funding decisions to scientific decisions made by Global TB Vaccine Partnership Incorporates both preclinical and clinical portfolios to optimize diversity Prioritizes around a set of predefined targeted product profiles (TPPs) that seeks to maximize the public health impact of new TB vaccines Implements 1 universal and shared set of rigorous stage gating criteria and milestone based finance through contractual agreements Shares information from all trials successful or failing to improve selection and design of future trials. Consults outside expertise to review and offer expertise on the 62

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Funding priorities have lagged relative to the morbidity and mortality of tuberculosis
Tuberculosis has led to more deaths in the last 200 years than any other infectious disease but has received significantly less funding in the last 10 years as compared to HIV and malaria1

1,000,000,000 Tuberculosis death

$43 billion HIV/AIDS global funding

Small pox Malaria Plague Influenza Cholera HIV/AIDS 30,000,000 HIV/AIDS death
1 Based on OECD and IHME Development Assistance for Health (DAH) funding data

Malaria

Tuberculosis

$7 billion global funding

Source: Global Tuberculosis Report 2012, WHO (2012), Nature Vol 502, No. 7470 Suppl, S2 (2013), Financing Global Health 2012, IHME

TB R&D funding overview

US $600 million was invested in TB vaccine R&D between 2005 and 2011 5 institutions/agencies provided nearly 80% of funding (BMGF, NIH, EC, DFID, DGIS) To date, EDCTP has invested approximately 42 million towards site preparedness and capacity building for TB vaccines in Africa, with additional direct funding for specific clinical trials PDPs across the board have seen cuts in the order of US $30-50 million per year over the past three years. Only 3 new G8 governments are exploring new or increased funding for PDPs Germany, Australia and Japan Global trends show declining support for neglected disease R&D overall TB R&D has seen an 8.3% drop from 2010
The majority of funding is allocated to drugs (42.5%), followed by basic research (26.8%), preventative vaccines (18.8%), diagnostics (9.1%) and therapeutic vaccines (0.01%)

Every major scale-up in US funding for a global health crisis has occurred thanks to strategically executed communications campaigns, constituency building and active advocacy efforts.

US Global HIV/AIDS YOY Funding: From $614 Million to $5.5 Billion

US Malaria YOY Funding: From $146 Million to $834 Million

US TB Funding Fails to Keep Pace

US TB funding has failed to keep pace with that of malaria and HIV/AIDS which increased 6x and 9x respectively in the past decade. Had TB funding kept pace with these diseases, support would be between $500 million to $760 million per year.

$300.0

$250.0

US Global TB Funding: From $85 million to $254 million.

$243.2

$254.4 $238.4

$200.0 $176.6 $163.2 $150.0

$100.0

$85.1

$92.0

$91.5

$94.9

$50.0

$0.0 2004 2005 2006 2007 2008 2009 2010 2011 2012

Source: Congressional Resource Service

In 2011, HIV vaccine R&D received ~9x ($845M) more funding compared to TB vaccine R&D ($95M). Public sector support was ~19x higher.

Source: TAG, 2012

Source: HIV Research Tracking, 201

Effective messaging, communications and storytelling along with a strong economic case for investment will facilitate resource mobilization efforts for the entire field

We Must Increase Momentum

Thank You.