By Joseph Walker
The Covid-19 pandemic is turning some fierce drug-industry foes
into the best of frenemies.
The pharmaceutical giant standing at the center of this team of
rivals is GlaxoSmithKline PLC, the world's largest vaccine maker by
sales. The British company is jointly developing a Covid-19
antibody drug with a San Francisco upstart, offering rivals a
proprietary ingredient that is designed to boost a vaccine's power
and planning to share research study results.
"We felt this very unusual situation required something that GSK
hadn't done before, and something we hadn't seen in the industry
before either, " says Roger Connor, president of Glaxo's vaccines
What makes Glaxo's collaboration so unusual is that competition
typically defines the relationship among drugmakers. Company
researchers race to be first to bring a new kind of therapy to
market or work on treatments that can outdo older medicines, while
marketers roll out campaigns designed to boost sales at the expense
In the age of Covid-19, old adversaries are uniting around a
common enemy: the new coronavirus. Their nascent partnership is now
visible in everything from trials to research to manufacturing.
Glaxo and eight other pharmaceutical firms even took the rare step
of issuing a joint pledge last month to seek regulatory approvals
for their vaccines only after proving their safety and
effectiveness in large, final-stage clinical trials.
The most common area of cooperation thus far is manufacturing.
Some longtime rivals are striking deals to stretch their capacity
to meet anticipated demand. Roche Holding AG is helping manufacture
an antiviral drug in development by rival Regeneron. Amgen Inc.
will help make Eli Lilly & Co.'s antiviral drugs if the
treatments are authorized by regulators. Pfizer has dedicated
manufacturing capacity to turning out doses of remdesivir, an
antiviral made by rival Gilead Sciences Inc.
The camaraderie also extends to the traditionally cutthroat
realm of research. Regeneron Pharmaceuticals Inc. scientists
contributed to research on a vaccine in development by BioNTech SE
and Pfizer Inc., and were co-authors on a paper this summer
detailing the results. In another rare move, Merck & Co.'s
research and development chief called his Glaxo counterpartment in
April to pass along a tip that one of Glaxo's molecules showed
promise in Merck's Covid-19 lab tests.
Glaxo's most prominent contribution to this new era of
collaboration is its decision to share a proprietary vaccine
component known as an adjuvant -- an ingredient that helps boost a
vaccine's protective power by rousing the body's immune response.
Glaxo now has agreements to supply that ingredient to four vaccine
developers, including French drugmaker Sanofi SA, and stands ready
to produce one billion doses of its adjuvant next year. It normally
produces tens of millions annually.
Some analysts say the company could enjoy benefits from selling
its adjuvant for Covid-19 shots without impairing its lucrative
vaccine business. "There is political capital to be gained from
what they're doing, and there may be some financial returns to be
had as well," says Andrew Baum, a Citigroup Inc. analyst who
follows health care.
Glaxo says it doesn't expect to profit from its Covid-19 vaccine
collaborations during the pandemic, and it will invest any
short-term profits in coronavirus research and pandemic
"The adjuvant can be equally important -- maybe crucial -- to
the vaccine being effective," says Hal Barron, Glaxo's chief
scientific officer and president of R&D. "We thought that's
where our unique opportunity to make a difference could be.
The Team of Rivals
The alliance among drugmakers took hold in mid March as Glaxo
closed labs amid a sharp uptick in Covid-19 infections around the
world. Suddenly, Dr. Barron had to figure out how to run a global
R&D organization under lockdown. He and his team debated which
workers should be deemed essential and continue to work on-site,
and which clinical trials should be paused and which ones to
"I've never been in a situation like this," he says. "I wasn't
sure what the right thing to do was."
Dr. Barron called Mathai Mammen, a friend who heads drug
research and development at Johnson & Johnson. They compared
notes on how to decide which drug studies to pause and which
scientists were essential enough to continue coming in to the
office. Toward the end of the call, Dr. Mammen invited Dr. Barron
to join a larger group of R&D chiefs to share information about
the virus and approaches to drug development, Dr. Barron says.
Glaxo had a potentially critical role to play in the response to
Covid-19, as one of the world's largest vaccine sellers. Sales of
its shots totaled about $9.4 billion last year, the most of any of
the top four vaccine-makers globally. The company also had a
history of rallying its employees to respond to pandemics. In the
years leading up to the 2009 swine flu pandemic, it spent $3.2
billion on R&D, acquisitions and manufacturing in preparation
for a flu pandemic.
On Sunday, March 8, many of the biggest drugmakers convened for
a group call. Aside from Drs. Barron and Mammen, participants
included the heads of research from AstraZeneca PLC, Bristol-Myers
Squibb Co. and Novartis AG, recalls Andrew Plump, president of
R&D at Takeda Pharmaceutical Co., who was also on the call.
"Things were happening so, so quickly, with organizations
closing down and quarantining, and beginning work-from-home
policies," recalls Dr. Plump. "We were all scrambling. And there
was also an immense amount of interest in all of us stepping up and
trying to provide solutions."
By the end of that call, the research bosses resolved to keep
the virtual meetings going and to open up the group to other
companies and, occasionally, government officials such as Francis
Collins, director of the National Institutes of Health, and
officials from Operation Warp Speed, a $10 billion U.S. government
initiative to speed the development of drugs and vaccines for
Covid-19. For months, they met regularly using videoconferencing
Concerns about running afoul of antitrust regulations were
alleviated when federal regulators made it clear that research
cooperation in the fight against Covid-19 was permissible. The
Justice Department and Federal Trade Commission issued a joint
statement on March 24 stating "there are many ways firms, including
competitors, can engage in procompetitive collaboration that does
not violate the antitrust laws."
With that statement, "we felt that we had enough cover to do
what we needed to do," says Dr. Plump.
The group established a mandate to tackle short-term problems,
such as developing reliable laboratory tests to screen the
thousands of drug molecules the companies had stored in their
libraries against the coronavirus. They also agreed to dramatically
increase the speed at which they shared clinical trial data with
one another, posting the anonymized data within one week of
receiving results from their Covid-19 studies. Outside researchers
are allowed to scrutinize the data to learn more about the
The Big Picture
Glaxo began reaching partnerships on its own, too. One developed
from a call Dr. Barron received in mid March from his friend George
Scangos, chief executive of a small San Francisco drug-developer
with a focus on infectious diseases.
Dr. Scangos asked whether Glaxo would be interested in
collaborating with his company, Vir Biotechnology Inc., on a
Covid-19 monoclonal antibody drug that is engineered to mimic the
natural antibodies the immune system makes to fight the virus.
"If we're going to do this, we need to go fast, because every
day matters," Dr. Scangos recalls saying.
Usually, such deals might take several months to a year to
hammer out. Dr. Scangos and Dr. Barron set a goal of signing an
agreement within three weeks.
Some of the calls involved saying, "OK, if that's important to
George -- done," recalls Dr. Barron. "And he would say, 'OK, if
that's important to you, done. Let's move this thing along. Can't
lose the big picture.'"
The companies announced a deal on April 6, within 18 days of
starting negotiations. Under the terms, Glaxo would purchase a $250
million stake in Vir at $37.73 a share, a 41% premium to the
company's average share price over the previous three months.
Clinical trials are under way and the companies expect potential
authorization for the drug in the first half of 2021.
Glaxo was even more aggressive in its pursuit of vaccine makers
that wanted access to its adjuvant, the ingredient that boosts the
immune response to a vaccine.
One was Sanofi, which said in February it was developing a
Covid-19 vaccine candidate. Mr. Connor called David Loew, the head
of Sanofi's vaccine unit, to see if the French drugmaker would be
interested in pairing its vaccine with Glaxo's adjuvant.
"This is an unusual call to have, but this is an unusual
circumstance," Mr. Connor recalls telling Mr. Loew during the
initial call, in March.
Executives say the company settled on its adjuvant strategy as a
way to contribute to the Covid-19 response without losing focus on
its pre-pandemic mission of reinvigorating the company's product
pipeline or disrupting its existing vaccine manufacturing supply
chain. The company's senior management had been overhauled a few
years earlier amid shareholder disillusionment over the company's
mixed record in launching new blockbuster drugs. Its adjuvant was
already proven to work with other vaccines, reducing its risk, and
would be less of a manufacturing logistical challenge.
During pandemics, adjuvants are especially valuable because they
can increase the potency of vaccines, allowing companies to produce
more doses from each batch it manufactures. Glaxo's adjuvant,
called AS03, is a combination of vitamin E and liver oil taken from
sharks. The company used it to enhance the effectiveness of its
vaccine for the H1N1 pandemic in 2009.
To find partners for its adjuvant, Glaxo launched an internal
project led by a team of Glaxo drug hunters who looked for anyone
working on a key vaccine component -- a protein known as an antigen
-- that would cause a person's immune system to build up defenses
against the new coronavirus. The hope was that people who got the
antigen through vaccination would develop antibodies and perhaps
other defenses that could protect against Covid-19.
Glaxo's drug hunters mapped every antigen in the works for
Covid-19 using squares on a PowerPoint slide. Every square
contained the name of a potential partner, details about the
vaccine and a contact person who had spoken with Glaxo. The slide
resembled a digital quilt, with some 100 squares.
Some in the quilt approached Glaxo seeking help. Glaxo reached
out to others. The campaign was "quite unusual for us," says Mr.
Connor. "Going out and offering it to the world was something
quite, quite different."
On that first call with Sanofi, Mr. Connor said he remembers
telling Mr. Loew: "'There is an opportunity here for us to do
something together, which means that we could ultimately go faster
for the world and make a difference to the common enemy, which is
the virus itself.'"
Within 36 hours, they agreed to create a joint task force that
would start exchanging information and planning how to make the
partnership work while the companies worked out a formal agreement.
"We knew that the world was waiting," Mr. Connor says.
Initial meetings, held by videoconference among employees across
multiple time zones, were "slightly awkward" as the rivals turned
teammates felt each other out, said Thomas Triomphe, Sanofi's
executive vice president for vaccines.
The companies hope to have results from early-stage studies in
late November or early December, Mr. Triomphe said. They aim to
start a 30,000-person study by the end of the year and to have the
vaccine approved in the first half of 2021, he says.
"When you're facing a public-health crisis there is no team with
a blue T-shirt and a team with an orange T-shirt. Very quickly,
there was only one team," Mr. Triomphe said.
(END) Dow Jones Newswires
October 24, 2020 00:15 ET (04:15 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
Historical Stock Chart
From Nov 2020 to Dec 2020
Historical Stock Chart
From Dec 2019 to Dec 2020