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The role of industry in product/technique development

NICK HAMON: Good morning. My name is Nick Hamon, and I’m the CEO of IVCC. And IVCC stands for the Innovative Vector Control Consortium. And we are a product development partnership involved in vector control. So in this video, I’m going to talk very briefly about the role of industry and their critical partnership in bringing new vector control products to the market, and how a product development partnership, like IVCC, collaborates with industry partners to bring these products through. And we facilitate the development and delivery of these improved net vector controlled tools and solutions, mostly in challenging markets.
So if we were to start from scratch today, a whiteboard, no chemistry, and build an insecticide from scratch with an industry partner from the– right from discovery through to development and launch, it’s a very complicated process and still would cost between $250 and $300 million. The cost of repurposing an older chemistry would be much, much less. And, in some cases, less than $20 million, so obviously, that’s the preferred route. One approach is to take an existing compound that did not get developed for agriculture. Perhaps it’s had an analogue synthesis programme around it to improve activity and performance. And some of these compounds get rejected as they simply don’t have a broad enough spectrum activity for agriculture.
So they don’t hit a number of key market targets. And we can take these chemistries from the chemical archives of these companies. This is exactly what IVCC has been doing in the last 10 years. And we can work with these companies to develop– to develop those primarily for vector control use. And that cost is probably between somewhere between $40 and $100 million, taking existing compounds through the entire product development process through to registration, manufacturing, and launch, and getting it into the marketplace. And it is an enormously complex process. It takes anything from 8 to 12 years for us to achieve, which is about the same time as it takes to develop a brand new drug.
So let’s talk a little bit about the markets and why it might be hard to get the private sector to invest in new product development, at least on its own and not in a partnership. The current numbers for a pharmaceutical suggest that the overall global market is around $900 billion annually. So the rewards or gains for some pharmaceutical product aimed at a disease in a developing country, the return on investment is going to be high. I think in agriculture and crop protection, the global market is around $600 billion. And if you take out just the seed business and focus on new chemistry, it’s probably $30 billion.
And if you look at what a company might get out of playing a major role in public health with a new insecticide, for indoor residual sprays particularly and a product on a bed net, the total market would be around $250 to $700 million dollars, and only if you had 100% market share. And as you recall here, to make sure that we have a number of different chemistries that can be rotated or mixed to avoid the development of resistance. What we really need is a number of chemistries that are in the marketplace at the same time.
I think for those of you with some business exposure and understanding of net present value calculation, which is just a simple way of saying, if I put my money in the bank, did nothing, but get the investment interest over the same length of time that it takes to develop a product. Would I get more money through just basically banking it and getting interest than I would in developing, taking the risk, the time, the effort, and the expense to develop a product? And that– and whatever that product costs. And would I get that back over the 10, 15, 20 year life of the patent?
And would I be able to pay back the $200 million cost that it would take to bring that product to market? And the answer is generally no. For a novel active insecticide focused on public health, particularly malaria, there’s no calculation that will ever give you an acceptable return on investment compared to other types of products that these companies can invest in. So that goes back exactly to why PDPs exists. It’s to facilitate, partly fund, and support the development of new products where the return on investment is going to be modest at best. But the role of the PDP is really not just about bringing products through to market.
They’re working closely with companies to encourage and to stay vested in public health. And our partner companies do recognise their corporate social responsibility and that they have the know how and expertise to develop products that save lives. But, again, the number of those companies that we can work with is very small and getting smaller, and a challenge that is really not unique to vector control, but can be applied equally to the drug world, vaccines, and also diagnostics.
So an awful lot of activity is going on around product development in public health and in vector control to really not just encourage these companies to stay engaged, but also to find ways to truncate the process without compromising safety, get the products to market more quickly, make the regulatory process simpler, and to find creative ways to fund the development costs, which are substantial. So most of the companies that IVCC partners with are in the Fortune 500 space, and several of both pharma and agrochemical businesses. And they truly understand their responsibility. And mostly they stay involved in public health because it is an opportunity to build reputational capital, which is important to them, their employees, and their customers.
And that may be one of the best ways to get a return on investment might be through, really, this building of reputational capital. Saving lives through agricultural chemistry is really something that feels good internally in those companies and is an important measure of how these companies are seen in the marketplace. Something that IVCC has invested significant time to better understand is how R&D based agrochemical companies are looking at growing their businesses around the world. So research has been done in recent years to try and understand if we could eradicate malaria, what impact that eradication would have on the growth of agriculture and smallholder farming, for example. And we know it would be significant.
So the business case for malaria eradication is really rather strong. So just to give you a few statistics from a recently published paper, somewhere between 30% and 40% of all Africans are involved in smallholder farming. And if we could eradicate malaria, the overall difference in harvest value, cumulatively from 2018 to 2040, would be around $295 billion. So that’s a huge market opportunity for companies that are really focused on agriculture rather than public health, and that is a growth opportunity. And as women are generally the caregivers in Africa when it comes to malaria and other diseases and supporting their families, if you can reduce the malaria burden, this also has significant impact on the lives of women.
So impact on gender equality is also being evaluated. Ethical companies very much understand that a short term investment in building products to eradicate malaria, long term helps them build healthy societies that leads to growth in the property markets in which they operate. Which, is again, is agriculture. So what does it take to just bring one novel insecticide to market? And keep in mind that it’s more than one insecticide. If we just go with one, we’re back to the monotherapy situation that we have with pyrethroids on bed nets up until recently. And these chemistries will have a very short life expectancy. So we need combinations of products and product rotations, so we need multiple chemistries.
So what’s it going to take to make sure that we can produce those chemistries and not reproduce the pyrethroid experience? So IVCC was formed in 2005, and by 2008 we had a number of companies– around six– that were prepared to give us access to their chemical archives. In that time between 2008 and today, we’ve looked at around four and a half million compounds, in total something around 29 different chemical classes. And today, we’re very active in five chemical classes with high potential and have eight primary compounds with which we hope to put a number of those into full development.
But the result of that, and because there are a lot of hurdles to jump with these chemistries before they finally get to a registration, we hope to have at least three additional active ingredients in the vector control tool box so that we can rotate chemistries. We can rebuild nets and make them effective again, and we can have alternative indoor residual spray products. So 4.5 million down to three is the kind of success rate that’s expected, not just in agriculture but in pharmaceutical novel chemistry screening. And that gives you some idea of the complexity and expense of it.
So IVCC is that critical point now where we are making some very difficult, complex, and expensive decisions, on which of these chemistries to put into full development. This is a little bit like backing a horse in the horse race. Because once you’ve started the process of creating safety data, toxicology data, you’re into a $20, $30, $40 million event or a series of events, in fact. And you really are trying to back a winner, something that will not fall into a fence on the way through. And that can happen very frequently and does. Those winners have to be from very different chemical classes. They have to work together.
They have to be safe, and they’re going to have to make sure that they don’t develop resistance. Which is not just about the chemistry, but how you treat the chemistry in the marketplace. So why are industry and the private sector so important for the control of vector-borne diseases? And how will the role of industry in vector control and innovation change in the future? So industry is important to us, even though there’s a lot of innovation coming through from academia or small organisations and companies. The probability of them making it to market is really quite small.
And even when they do, somehow these chemistries are going to need a major industry partner to scale up, to manufacture, to be able to deliver them into the field, and to manage their use and steward the use of these chemistries safely in the marketplace. So even though we work with probably 20 or 30 different projects that are not covered by big industry, our objective is to help them partner and find an industry partner with the interest and expertise to take them through the product development process. These are R&D based companies have a tremendous amount of experience, not just in the science but also how to go to the market through the regulatory process. So you need biologists.
You need formulation chemists. You need synthesis chemists. You need regulatory scientists. You need armies of people to really be able to take an idea all the way from the bench right through to impact. So a lot of that expertise really sits within the industry, so we need to keep them engaged. So the role of industry is becoming increasingly important, primarily because there are fewer industry partners left with the know how and expertise that can bring these chemistries to market. It’s really rare. And, in fact, I can’t even think of a significant intervention. And by significant, I mean one that’s going to have global impact on a disease.
And that’s not going to need an industry partner somewhere along the line, particularly when it comes to scale up, manufacture, and distribution, et cetera. It’s almost impossible to imagine a transformational chemistry or product that doesn’t at some point need that partner. And there are very few, and fewer and fewer of them, in fact, of these partners around. So they’re particularly important, and I think they know well how to work with PDPs, with universities, with the whole stakeholder community, and really navigate a very complex development process to truncate that process and to get products to the market as soon as possible and have impact. Thank you.

In this step, we join Dr Nick Hamon as he discusses the role of industry in vector control. Dr Hamon is the Chief Executive Officer of the Innovative Vector Control Consortium (IVCC). IVCC is the only Product Development Partnership (PDP) working in vector control.

IVCC brings together partners from industry, the public sector and academia to create new solutions to prevent disease transmission. This is achieved through the focusing of resources and targeting practical scientific solutions, accelerating the process from innovation to impact. In this video, Dr Hamon draws on his experiences with IVCC to explain the need for industry partners in vector control, and how industry collaboration can lead to the successful implementation of control interventions.

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The Global Challenge of Vector Borne Diseases and How to Control Them

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