The collaboration, the first of its kind between Washington
and a drug company, will allow funding to move around GSK’s
antibiotics portfolio rather than focusing on a single drug
candidate.

The rise of antibiotic resistance is causing alarm among
governments worldwide, leading to warnings from officials such
as England’s chief medical officer Sally Davies that the issue
is a “ticking time bomb” threatening public health.

Thomas Frieden, director of the U.S. Centers for Disease
Control and Prevention, recently called for an urgent fight-back
against “nightmare bacteria”.

At the same time, there is concern about the potential
threat from terrorists who might use infectious agents such as
anthrax and plague as bioweapons.

The collaboration between GSK and the Biomedical Advanced
Research and Development Authority (BARDA), part of the U.S.
Department of Health and Human Services, will study potential
new drugs to treat conventional pathogens and those that could
be developed into weapons.

Britain’s biggest drugmaker said on Wednesday it would
receive $40 million for an initial 18 months and up to a total
of $200 million if the agreement is renewed over five years.

The problem of antibiotic resistance and the rise of
so-called “superbugs” that cannot be treated with traditional
medicines has been growing for years, but drug companies have
been reluctant to invest in new medicines because of poor
returns.

Patients tend to take antibiotics for only a short period,
prices are traditionally low and any new antibiotics are likely
to be reserved for serious infections – once again minimising
the sales opportunity.

COST SHARING

David Payne, head of GSK’s antibacterial discovery unit,
said public-private partnerships, like the one with BARDA, were
a key part to solving the problem.

GSK is one of relatively few large pharmaceutical companies
still pursuing research into new antibiotics – but its
scientists still have to put forward a viable business case
internally for their research.

The financial support from BARDA is therefore a big help and
will mean that experimental compounds are developed faster than
would otherwise have been the case.

“This is a significant step forward because it enables us to
share the cost of developing antibacterials,” Payne said in an
interview.

The compounds covered by the BARDA deal are still in initial
Phase I testing, which means it will be several years before
they are approved for use – assuming they succeed in later
clinical trials.

A joint oversight committee, including representatives of
both BARDA and GSK, will monitor progress of the experimental
medicines, make decisions on allocating funds and decide whether
compounds should be added or removed from the programme.

GSK, along with other drugmakers, already has separate
contracts with BARDA for other specific drugs and vaccines.

The decision to adopt a “portfolio approach” this time,
however, makes the arrangement much more flexible, since it
means work can move swiftly to other molecules if a particular
drug candidate fails in tests, as often happens.

“It reflects the reality of what goes on in drug discovery
… you want to be able to easily move money from one molecule
to another,” Payne said.

That bullish sales forecast by analysts at U.S. bank
Citigroup highlights the growing excitement surrounding
so-called immunotherapy after positive results from clinical
trials conducted by companies such as Bristol-Myers Squibb
and Roche Holding.

“We believe this market will generate sales of up to $35
billion (a year) over the next 10 years and be used in some way
in the management of up to 60 percent of all cancers,” Citi
analyst Andrew Baum said on Wednesday.

Citi’s forecast is considerably higher than current market
consensus, but if it proves correct, then cancer immunotherapy
would exceed the peak market value of top blockbuster drug
classes such as statins for high cholesterol.

After years of puzzling over how to get the body’s immune
system to respond more effectively against tumour cells,
scientists are now finding a number of promising avenues.

The new drugs are designed to target areas that act as
brakes on the immune system. By interfering with these brakes,
the drugs free the immune system to attack and kill cancer
cells.

Bristol-Myers Squibb’s nivolumab and Roche’s MPDL3280A are
two leading contenders in the field. Both had an impressive
effect against a variety of cancers, according to preliminary
trial results released last week.

Further details of the studies will be presented at a
meeting of the American Society of Clinical Oncology in Chicago
early next month.

MANAGEABLE CANCER

Conventional chemotherapy and other cancer drugs often have
a powerful effect in shrinking tumours, but the effect is
typically short-lived. The effect of immunotherapy can last much
longer because the immune system has effectively been reset to
remember how to keep fighting cancer cells.

Citigroup said that immunotherapy has the potential to
transform a significant percentage of cancers into something
akin to a chronic disease, in a similar way to how HIV drugs
have made the viral disease a manageable condition.

On the back of its upbeat prediction for the immunotherapy
market, Citigroup has upgraded shares in Bristol-Myers Squibb
and Roche to “buy” from “neutral”.

Roche stock was trading 1.7 percent higher by 0914 GMT,
outperforming a flat European drugs sector.

Other leading players with a range of drugs, vaccines and
cell therapy treatments in the cancer immunotherapy field
include GlaxoSmithKline, AstraZeneca, Novartis
, Merck & Co and Amgen.

In addition to the progress being made in research, analysts
believe that the immunotherapy field could also benefit from a
new U.S. Food and Drug Administration initiative to speed
approval of important and innovative drugs.

The U.S. watchdog recently started a scheme to allow quicker
studies of life-saving therapies designated as a “breakthrough”,
provided that clinical data is compelling.

(Editing by David Goodman)

Moving research and global headquarters to Cambridge, with minimal disruption, is a key test for new Chief Executive Pascal Soriot as he tries to change the drugmaker’s culture and puts ground-breaking science at the center of its activities.

The move to the university city, involving nearly 2,000 jobs, is the centerpiece of a $2.3 billion restructuring plan unveiled by Soriot in March, which also includes a 10 percent cut in overall staff numbers by 2016.

An AstraZeneca spokeswoman said on Monday that the drugmaker was still considering its options, adding an update on the final location was likely in the next couple of months.

Two property industry insiders familiar with the deal said the Cambridge Biomedical Campus (CBC) was the frontrunner. The other option is Granta Park, another research park outside Cambridge where AstraZeneca’s MedImmune unit is already located.

Situated two miles from central Cambridge, the CBC is an extension of a site occupied by the world-famous Addenbrooke’s Hospital that has been developed in conjunction with the University of Cambridge and the Medical Research Council.

With outline planning consent for 70 acres to accommodate up to 2.3 million square feet of new buildings, there is plenty of room for the purpose-built global research center and corporate headquarters that AstraZeneca plans to establish by 2016 at cost of around 330 million pounds ($500 million).

CBC Project Director Jeanette Walker said the park was in advanced talks with several major companies.

“We are hoping to close a number of discussions this summer that would see building start early next year for a number of potential occupiers,” she told Reuters, while declining to identify specific companies.

The new AstraZeneca facility could eventually reach 750,000 square feet, although not all that would be delivered in 2016, according to one property industry source.

RELOCATION INCENTIVES

A smooth transition to the new site is crucial for AstraZeneca, which is in a race to develop new drugs and strike external deals to replenish its medicine chest as old blockbusters lose patent protection, sapping sales.

Menelas Pangalos, the group’s head of innovative medicines, said the drugmaker would offer enticing packages to make sure key scientific staff relocated to Cambridge.

“We are going to have very aggressive retention and relocation plans. We have time to plan the move and make it as flexible and as attractive as possible for people,” he said.

“Over the next month or two we should be able to talk about that in a lot more detail.”

Many AstraZeneca scientists were shocked by the decision two months ago to shutter the company’s Alderley Park facility in northwest England, for many years a hub of the group’s research.

The closure, while offset by the Cambridge investment, was also a blow to the British government. Alderley Park lies within the Cheshire parliamentary constituency of finance minister George Osborne.

AstraZeneca aims to tap into an environment of world-class academic and clinical life sciences research in its new home in Cambridge. In addition to ready access to hospital clinicians, its researchers will also be rubbing shoulders with top academics.

Cambridge’s Laboratory of Molecular Biology – home to 13 Nobel Prize winners over the years – has also moved to a new CBC facility that will be formally opened by Queen Elizabeth II on Thursday.

“We’ve lost some of our scientific confidence,” Soriot complained earlier this year, when setting out his major overhaul for AstraZeneca.

Whether the big move will help the drugmaker regain its swagger in drug development remains to be seen. The relocation will only be completed in 2016 and the fruits of future research collaboration with its new neighbors are even further off.

(Editing by Mark Potter)