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Examination of witnesses
Dr Christian Itin and Professor Sir Peter Donnelly
Q119 The Chair: Good morning. Welcome to the Science and Technology Select Committee. We are continuing our inquiry on innovation in the NHS, personalised medicines and AI. We are very pleased to have two witnesses in our first session: Professor Sir Peter Donnelly, who is the CEO of Genomics Plc, and Dr Christian Itin, CEO of Autolus Therapeutics. You are both very welcome.
I will start by asking you both to set out briefly for us what your companies do, what their main products are and the journey they have had so far towards wider use in the NHS. Perhaps you could say what benefits these technologies will provide for patients and, importantly, how soon. Sir Peter, would you like to start?
Professor Sir Peter Donnelly: Thank you very much. First, let me thank you very much for your interest and the invitation to give evidence this morning. I was an academic for most of my professional career and became an entrepreneur rather late in life. I led the Wellcome Centre for Human Genetics in Oxford and I was lucky enough to be part of many of the major discoveries of the early 2000s, which transformed our knowledge of the way genetics plays in to all the common diseases—heart disease, diabetes and so on.
As academics, we used to talk about the impact this would have on patients and on healthcare, and it slowly dawned on me and a number of colleagues that actually, it was not having any impact, despite what we wrote in our grant applications. So in 2014, we formed Genomics. It was a spin-out from the Wellcome Centre in Oxford, with a vision of continuing to do outstanding science but to develop the products and technologies to make a difference in health and healthcare.
Genomics is now 12 years old; we employ about 140 people and we have raised over £100 million from investors in the UK and the US. We operate in two divisions. One part of our work is in the life sciences, where we use a very large and special genetic data resource that we have built, in effect by bringing together results from thousands of published public studies, to help drug companies find new drug targets, or to validate targets they are interested in or to find the right patients for existing drugs.
The other part of our work and our other division is in healthcare, and I will focus on that today. We are able to use genetics to understand the risk for all the common diseases: heart disease, diabetes, breast and prostate cancer, and so on. To put that in context, until a few years ago, if I had the entire DNA sequence of a healthy 40 year-old, I would learn something medically actionable in about 1% of cases. That is because genetics has played into medicine through looking at rare diseases, typically caused by a single change in our DNA, which has a big impact: think Huntington’s disease or muscular dystrophy and so on. Those conditions are individually rare, collectively they are reasonably rare, and the vast majority of them have an impact very early in life. So if someone gets to age 40 without any signs of those, there is not much left to find in their DNA, hence the 1% number.
Now it is the case that if we have genetic information on a healthy 40 year-old, we will learn something medically actionable in about 70% of cases. That change from 1% to 70% is because we are now able to measure the genetic component of risk for all the common diseases. If you take heart disease as an example, it turns out that there is not one gene that matters for heart disease, or two genes; there are a million or so places in our DNA, each of which contributes to our risk of heart disease. Their individual impact is tiny but collectively, across those million positions, the effects can add up. We are able to calculate an overall score for an individual, what is called a polygenic risk score, and that score gives a summary of that person’s genetic risk of heart disease. There will be a different score for diabetes with a different set of variants.
We have pioneered that technology and it turns out to be really impactful. For common diseases—diabetes, heart disease, breast cancer, prostate cancer, bowel cancer and many others—that genetic component of risk, that polygenic risk score, is one of the largest measurable risk factors. You can do a simple test on an individual and calculate those scores. You can do the test once in their life and calculate the scores for many, many different diseases.
The opportunity there is that armed with a much better sense for each individual of what their particular risks are, we can target screening programmes, treatment programmes and prevention programmes. It turns out that this genetic component of risk is effectively independent of the clinical risk factors we currently measure. Somewhat surprisingly, it is largely independent of family history.
Most people will not know the diseases for which they happen to have high genetic risk. If we look across 10 or 15 common diseases, we will all be at high risk for some of them, but we will not know which and our doctors will not know which. The key opportunity is to identify the risks for an individual. They can make choices and changes, although we would not necessarily want to rely on that. Health systems already have screening programmes, treatment programmes and prevention programmes, and they can deploy those much more effectively if they get people into it. It gives us an opportunity to understand those risks years before symptoms develop.
Dr Christian Itin: Thank you very much for having me today. Autolus, when we started the company in 2014, was a spinoff of the University College in London. The focus of what we are working on is therapies whereby we start with the immune cells of the patients, genetically modify them to recognise cancer cells and then deploy them to have a significant impact in these patients.
The most advanced product we are working with is actually available at the NHS today. It is called AUCATZYL. It is a product that allows us to go after a specific set of very aggressive forms of leukaemia called acute leukaemia, particularly in the adult patient population. The product has an ability, when re-infused into the patients, to really eliminate the leukaemia beyond detection limits. We are seeing that many of the patients achieve long-term outcomes—some of the patients are years after treatment and continue to be free of disease.
It is a product that clearly has a curative intent and it is very different from other approaches we have that typically are given daily, weekly, monthly, and then given for as long as possible until there is a relapse. In our case, it is a single intervention, a single initial administration and from there on the patient has his or her own immune system taking care of the leukaemia and keeping them—for most patients—free of disease for very long periods; some of them may be cured.
This is the approach we are taking with our products. The lead product, as I said, was initially approved in patients with acute leukaemia. We are also evaluating the product in other indications, particularly in very severe forms of auto-immune disease. Those studies are ongoing. Many of them were conducted in the past, and continue to be conducted, within the NHS as one of the key centres we are working with, in addition to centres we are working with in the US or across Europe.
The NHS has been very important for us through the entirety of the existence of the company for clinical work, particularly also for early clinical trials that we are conducting here in the UK. It is very clear high medical need that we are addressing and obviously, over that 10-year period, we have gone through all the stages of drug development.
We started with a research team out of UCL, forming a company today that has approximately 700 employees, with a presence here in London for most of the R&D activities, but then establishing manufacturing in Stevenage, halfway up towards Cambridge. The facility that we built was very important because the way that you manufacture here is individualised. We manufacture for each patient individually. We are collecting cells from the patients through a process called apheresis. It is a more involved form of a blood draw that allows us to isolate the cells. Those cells are then shipped to Stevenage. We are genetically modifying the cells to now have a receptor, a structure that allows them to attack and directly connect with the leukemic cell, and with that have an ability to recognise it and then do what our immune cells are really good at, which is recognising and destroying cells that are not supposed to be in our body.
This is at the core of what we do. About 400 employees of the 700 are working on the manufacturing side. This is a very difficult form of manufacturing because it is not only individualised—so each patient on his or her own for the product we need to create—but we also are on the clock. All of these patients have very aggressively progressive disease. They can have a progression that is a matter of weeks in many cases, so we have to manufacture in a very timely manner, we have to be highly reliable and it has to work every time because if we are not able to manufacture for that patient, typically that patient does not have another good option left.
That creates a very interesting challenge when you think about that because obviously, the starting point is with the patient. The product, the cells, come to us, they get manufactured, they have to be tested and released and get shipped back to the patient again. The centres, the hospitals themselves, need to be appropriately set up and trained to be able to deliver these therapies, and that makes for a rather involved process. However, it also means that these therapies are relatively expensive. It is worthwhile working on them and delivering for patients because we can generate a very significant outcome for the patients. That is the balance.
The challenge that we have from an access perspective is that this type of therapy works quite differently from other normal therapies that most of the systems are designed to use. Most of those normal therapies are given, as I mentioned, daily, weekly or monthly. In essence, from a system perspective if you are looking at the NHS, you give this product continuously, you pay as you give, and with that you pay until the product stops working. When you think about this process, it is gradual. If it goes from one budget year to the next budget year, it just continues forward. It fits quite nicely with a normal budgeting process, and so on.
The challenge we have with our therapy is it is a one-off therapy. It is one intervention and then there is the potential for a very, very long benefit. The systems we have to evaluate that value, but then also to reimburse and compensate for that value, are not matching because they are designed for a different type of therapeutic. That is the intrinsic tension we have with a lot of these products and therapeutic approaches. We can understand if there is a benefit that gets us out years and maybe for a lifetime, and that obviously is clearly valuable; but it is very difficult to make a determination at the time the product becomes available for evaluation at NICE, or then available for use within the NHS, as the data at that point is still limited.
Our clinical trials are designed to show an initial effect. It is usually surrogate information; it could be responses that we monitor, and then some durability of effect, but it is usually not 10 years or 20 years of follow-up. That, obviously, would not make sense because we would be holding back innovation for a long time. So you have imperfect information, and you then need to extrapolate an outcome that is happening over a very long time. That is the tension we have in the system.
When we think about the actual process, you go through the approval process with the regulatory bodies: the MHRA in the UK, the FDA in the US, the European Medicines Agency. All those agencies recognise that for indications where you have a very, very high medical need and you have a therapy that has a very profound effect, you should find ways to accelerate the approval and make the product available to healthcare systems quickly. The good thing is that the systems on the regulatory side, from an approval perspective, are set up to do that and deliver on that. The problem is that the datasets we are generating are not compatible with the ways we evaluate health economic benefit, because those are all built on large, randomised control studies with very long follow-up time and virtually no risk taken in understanding the benefit you can generate.
We are coming with a very different package: a much smaller dataset, very high treatment effect but limited follow-up. That creates the tension in the process. Navigating, in that context, the process at NICE is not trivial, because your dataset does not fit well with the methodology. At the same time, we also have now, from a payment perspective, the issue that the product is delivered once. It is not spread out over time, so we looked with the NHS at where there is an ability to have payments stretched over time—so it is like a risk-sharing model. The challenge is quite administrative. The budgets are annual, and crossing across that year’s line is very difficult for the system to work with. Therefore, that is not something that can be implemented.
You have to find the balance whereby you have an adequate level of appreciation of the value of the therapy that is in front of the NHS, ultimately. On the other hand, the challenge we have is that the data at that point is not quite compatible.
The Chair: I am sorry to interrupt. We have got a lot more questions to ask you. I think some of them are about the very things you are talking about now, so perhaps we could just pause.
Dr Christian Itin: That is fine.
Q120 The Chair: I was going to ask you both, what are the biggest barriers you faced on the way to reaching this point of adoption and commercialisation? Dr Itin, you have pretty much talked about those. Sir Peter, would you like to say something about the barriers that you faced?
Professor Sir Peter Donnelly: Yes, I am very happy to do so. In the case of polygenic risk scores, we have essentially pioneered the technology. We did the analytical validation in large population studies, showing that they work and they work the way we expect them to. We did clinical validation. We did a trial with the NHS with GPs in the north-east. It is absolutely critical, if something like this is to be rolled out, that it fits in with GP workflows, because they are already massively stretched. That trial was extremely successful. The primary endpoint was indeed checking whether it fitted in with workflows, and it did.
There have also been concerns about how patients would react to it and 98.5% of patients in the trial said they found it helpful. In 13% of cases, the GPs changed their management of patients. We did the clinical trial in the NHS. We have the first MHRA-registered test. We have been through the regulatory hurdle. That is offered in the UK by Bupa, by Spire Healthcare and soon by many of the other private providers. The challenge is now getting that into the NHS so that these scores can make a difference for people. We are the exclusive provider of scores for Our Future Health. We generated something like 42 million polygenic risk scores for them last year, and we will continue to do that as the resource grows. It was great to see the NHS 10-year plan committing to rolling out polygenic risk scores universally over the next decade.
We have got to the stage where we have built the evidence, we have the product: what are the barriers? There are a number of them. One is that while everyone says, and almost everyone agrees, that we need to put more effort into prevention to preserve the NHS and indeed health systems globally to keep them sustainable, it is striking that in the NHS there is no overall budget for prevention. There is no single person who is responsible for prevention. It is not handled centrally. The NHS is understandably very focused on delivering clinical services. The NHS clinical directors are responsible for delivering services in particular sets of disease areas. In principle they are happy about prevention, but it is not the problems that they are facing.
The first barrier is that although we all say prevention is really important—it is part of the current Government’s three pillars from sickness to prevention—there really is not an internal champion for prevention or a specific budget for prevention. The second challenge is that in any area, and this is one of them, there will almost invariably be a range of academic views, and I was an academic for many years, as I said. The idea that we have to wait for all the academics to agree on something—well, first, it will not happen and, secondly, it will delay things. There are also issues about the adoption of novel technologies in the NHS. I think some of your later questions will come to this, so I will say more about it then. There are a number of issues there, as well.
The Chair: Thank you. Baroness Willis, some of the questions that you were going to ask have been covered.
Q121 Baroness Willis of Summertown: Yes. Dr Itin, I think you have already talked a bit about the journey you have taken to get to where you are now. What I would really like a little more clarity on, though, is: what are the major challenges involved in the approval process that you have had on the way? What things have caused delay? Coming back to the points just made by Professor Donnelly, is it a mindset as much as anything else?
Dr Christian Itin: I am not sure it is a mindset. I think it is the way that the system is set up. It is not contemplating or has not contemplated this type of a therapeutic approach and the type of benefit you could create with it. That creates the challenges in the way that the methodologies are set up to evaluate value, which is obviously what NICE needs to do, which creates quite a significant disconnect to navigate. That is complex.
We are a UK company and have a very good team who were very experienced in doing that in their prior lives, so we are able to navigate it. If I look at it from my prior life, when I built and ran companies outside the UK, I would not have considered coming to the UK for that process. It looked probably way too complex to navigate.
One of the key challenges we are dealing with is getting the right value, but then also the uncertainty once you even manage to get through NICE, and you are within the NHS. From an economic perspective, you then have a further discount that will happen downstream, which is the VPAG, and that is a two-fold problem. One is the magnitude of it, which is unclear, but it is also built on an assumption that there is a certain level of profitability in these products, which is not uniformly true. If you have products like we are producing, which are personalised, they are very expensive to produce. Therefore, the profit margin is limited, the price is already limited and then you get to a point where it becomes economically very questionable whether you have an economic case, and it is very difficult to predict.
We need a lot more clarity, consistency and continuity of how the system works. I just mentioned that we had a 10-year cycle to get the product developed, and 11 years to get it on to the market in the UK. We are ahead of that in the US. However, that creates the challenges.
Baroness Willis of Summertown: If I can come back there, where should that change be within the UK system?
Dr Christian Itin: I think the methodology that NICE is using needs to be adapted to include also these types of new therapies with the types of benefits that we can induce. That is one element, because without that there is no reasonable starting price to work with. We need to be more mindful about the discounting methodology that is being used and take into account that these products are not all the same. Those are two key elements.
When I take a step back and look at the need to manufacture this product, there was no manufacturer out there that could have done that for us. It is also for the Government to realise that domiciling this type of infrastructure in the UK is a real asset because it allows you to redomicile profits from elsewhere into the UK and make them taxable. Therefore, there should be quite an interest in supporting that. There are various ways other jurisdictions would deal with that that are not direct payments, but are typically related to recognising certain reductions in tax levels or recognising that there is a benefit associated with training up a significant part of a workforce.
We have seen across various jurisdictions that it is pretty much universally available but it has not been available in the UK, which I think is somewhat of a lost opportunity. To have an ability to manufacture here, and with that repatriate profits into the country, is critical. In the life science industry, where probably 90% of the volume is generated outside the UK, that is a very sensible thing to consider.
Baroness Willis of Summertown: Is the current NICE assessment for your sort of therapies not fit for purpose?
Dr Christian Itin: It creates a very significant challenge in getting to a value and the recognition of the value that is economically viable. You see a lot of the products not being launched in the UK, and this is very much linked to actual economic viability. The UK is not alone in that. Europe more broadly has an issue with that as well, using very similar methodologies that are established here in the UK, but it is an intrinsic challenge. Ultimately, if we get these products approved through MHRA but we cannot make them accessible to patients, we are not winning. Professor Donnelly commented before that the science is fantastic, but if we cannot actually get it to patients, what are we doing?
Baroness Willis of Summertown: I think there will be a situation, though, where the cost actually comes down as well. There are two sides to that.
Dr Christian Itin: That is correct, but that takes time and it takes volume. When you look at our product, NICE concluded that the product is cost-efficient for the NHS, and I think that is important to recognise. With all the limitations and challenges, we got to that point. Even with the methodologies applied, that is possible but it is challenging for many of the approaches to get there. From the perspective of patients and patient access in the UK, I think it is desirable to look into that and to adjust the methodology that was established in the late 1990s and has not been really adapted in a significant way since.
Q122 Lord Winston: Sir Peter, first, it is very nice to see you here and thank you for coming. I am interested to know how you validate the polygenic scores for common disease risk. Could give us some indication of that first?
Professor Sir Peter Donnelly: Yes. You can do the following kind of analytical experiment. You could design a polygenic risk score and take it into a set of individuals who are independent and were not used for training the score. For example, in UK Biobank, where there is now well more than 10 years of follow-up on people, you can break individuals into groups based on their polygenic risk score and then you can look at disease outcomes in those groups. For example, you can ask, are the individuals with high polygenic risk scores more likely to develop disease over the next 10 years, or over their lifetime, than those with low polygenic risk scores? The answers are really striking.
For heart disease, people with high polygenic scores in the top 3% are about 20 times more likely to have heart disease by the time they are 70 than people with low polygenic risk scores. For diabetes, that number is about 30-fold. For prostate cancer, it is 40-fold. For breast cancer, it is 10 or 15-fold. You can do those analytical experiments to see whether the polygenic risk scores are associated with more disease.
What does it mean to say that a risk score is valid? This is a slightly technical diversion. You are making a probabilistic statement about people and saying that 10% of the people in this group will develop disease over the next 10 years. To check whether that is right, you need to check whether it is calibrated. If you look at a group with those properties, is it true that 10% develop disease over 10 years? We can do those experiments as well. We do them in UK Biobank and in studies in other populations. We pay a lot of attention to checking how these scores perform not just in individuals of European ancestry but in individuals of many other ancestries as well. That is what would be called analytical validity, and then you can check what the clinical impact is through studies like the ones I have described.
Lord Winston: Much of the time you are not really talking about personalised therapies, are you? Are you talking more about preventatives in watching, or are you talking about something more active? Where does personalised therapy come into this?
Professor Sir Peter Donnelly: Yes, these polygenic risk scores are what it says on the tin—they are risk scores. Although some people have criticised them because they perform poorly as diagnostic tests, I think no one sensible has ever suggested that they should be used as diagnostic tests. A polygenic risk score, from a doctor’s point of view, is like a cholesterol measurement. It is something you can know about your patient that affects their risk of developing heart disease or, for other diseases, the other polygenic risk scores. It is not a diagnosis but it affects risk.
The health system, and GPs in particular, are very good at handling risk scores, so they routinely estimate risk for their patients for cardiovascular disease, for example. There are algorithms that combine the patient’s age, sex, blood pressure, BMI, cholesterol level and so on. If you want to add in a polygenic risk score, it is just another risk factor. You have an algorithm that takes the current scores and adds in genetics.
Genetics can be a really important risk factor for men between 40 and 55. For example, for heart disease, the genetic risk by itself is as significant as all those other risk factors combined. For breast cancer, the genetic component of risk massively outweighs all the other risk factors individually and collectively. It is by a long way the largest individual risk factor. That is the way we can validate these scores.
Then for each disease you have to work out how that plays into a pathway in the NHS. In cardiovascular disease, that is very straightforward. GPs are already estimating risk for their patients, combining age, sex, blood pressure, and so on. They just do the same thing, but they do it more effectively by adding in genetics.
If you take a disease like breast cancer, in the UK all women are offered mammograms for breast cancer when they turn 50. Now it turns out there are huge differences in risk for different women because of this genetic component that we are not currently measuring. Quite a lot of women have the same level of risk as a 50 year-old when they turn 40. To put it rather bluntly, it is bonkers that those women now have to wait 10 years before they start their screening programmes.
Lord Winston: Would this be without, for example, the BRCA-type genes?
Professor Sir Peter Donnelly: Yes. The BRCA genes have a huge impact on a woman’s risk. This is not that. This is the cumulative effect of a million or so small variants. It is a different type of genetics from what we are currently using. The work that has being done around BRCA mutations is incredibly important and should absolutely continue. However, we can do a much better job than just saying to women, “Wait until you get to 50 and then we will offer mammograms”. We could offer mammograms based on an individual woman’s risk. That is obviously good for the women involved. It is very good for the NHS because then, each mammogram it is spending money on is more likely to find a cancer if you are targeting it at the women who are at higher risk.
Lord Winston: Where does the role of NICE comes into this? This kind of cost effectiveness is a critical question for us and other bodies.
Professor Sir Peter Donnelly: Yes, it is a great question. Let me answer it on a number of levels. The first one is that it is now very clear—and Andrew Scott, the economist, has done some fantastic work on this—that there are massive benefits to the economy broadly from getting better at prevention. His work shows that, if you could reduce the impact of an incidence of six common disease or disease areas by 20%, it would add 0.75% to GDP over five years and about 1.5% over 10 years. There are massive economic impacts.
NICE is not tasked to look at economic impacts. The only thing it looks at is the health costs and the benefits to individuals via QALYs. That could change. NICE could be asked in tools that improve prevention to do an assessment that factors in the broader economic value. That is the first point. The way I would put it is that NICE has been told to answer the wrong question. Then when you look at the impact in the way NICE assesses things, there are a couple of issues. These are tools that will produce benefits in five years, 10 years, or 15 years by people who might have otherwise had a heart attack not having one because they are identified and put on statins. Those benefits are long term.
There is a rather doctrinaire approach that says you cannot possibly roll this out until you have done a study that follows people for 15 years to see whether there are fewer heart attacks. Now that obviously would mean you would never roll it out, but in the case of heart disease it is a very good example. If someone is at high risk in the way that we identify them currently, a doctor could follow standard guidelines and put them on statins. We have a huge amount of evidence of the impact of statins. We do not have to do 10 or 15-year studies to find out what the risk reduction and disease reduction is through statins.
It is a really good example, because it turns out that polygenic risk scores are not just helpful for predicting individuals who are at high risk; they can be very informative for treatment effects. Someone who has a high polygenic risk score for heart disease sees a bigger impact of statins than does an average person. That is a win-win. If you can identify the right people to go on statins and put them on statins, statins are 50% or so more effective on those individuals than they are on average.
The second problem that NICE can have, and we went through a route of getting formal advice from them, is that it says, “Do not come back to us until you have done formal randomised clinical trials and have 10 years follow-up”. Change will just never happen if that is the attitude. Further, and it is a slightly technical point, although randomised trials are the gold standard, it just does not work. It is not effective in a prevention context.
It is great that the NHS committed in its 10-year plan to rolling out polygenic risk scores. There is a lot of activity going on in the NHS, led by Sue Hill, who leads the genomic medicine part of the NHS, working hard to get implementation studies in place this year. The real challenge is to work out how we do this in practice. We know it works in principle. We have done small trials that show that it works and we know it has very substantial benefits. Let us work out how to do it in practice and get it rolled out in a number of areas and then see how to move that to a national rollout.
Lord Winston: We are obviously very short of time, unfortunately, and I do not want to press things too long, but do you see a big role for primary care in this aspect of medicine?
Professor Sir Peter Donnelly: Yes. Now, it differs disease by disease. As I said, for each disease, you need to work out what the right pathways are. For heart disease, which is the natural first place to roll it out because all the evidence is there—it is been recommended by the European Society of Cardiology and the American Heart Association—GPs are already doing risk assessments and this naturally just fits into those. For diabetes, again it is handled in primary care, identifying people who are at high risk. That is where polygenic risk scores would sit naturally. For breast cancer, where there is a national screening program, it would be much more natural to feed the polygenic risk scores into the screening programme so that they invite different women at different ages. I think it is a sort of horses for courses. You have to work out disease by disease whether the right pathway to implement it is in primary care or secondary care.
Q123 The Chair: You mentioned UK Biobank. Have you found working with UK Biobank and Genomics England to be satisfactory in their ability to support commercialisation? What could be improved on that front?
Professor Sir Peter Donnelly: The UK Biobank is fantastic. It is an extraordinary resource that is the envy of the world, and it is used across the world, notwithstanding the recent very serious data issues. As a result, it is brilliant. It is very well set up for use by commercial companies, as it is by researchers. I was lucky enough indeed in my academic role to lead on the genetic component, the first stage of the genetic component of UK Biobank, so I had a hand in building it and now we and many other researchers globally benefit from it.
Our Future Health, which is the next level, I think is becoming and will be an extremely powerful resource. They have been asked to recover their costs, so whereas for a company like ours UK Biobank charges £5,000 to £10,000 a year, Our Future Health charges £300,000 a year. For a company which is not yet profitable that is an enormous cost, and there is a real risk with Our Future Health that it becomes a bit of an own goal. It was a resource set up with a large amount of taxpayer funding, in large part to boost the UK economy in a space where it is extremely strong, where early-stage companies are priced out. I think that is an issue that needs attention. The worry is that our better-funded competitors from other countries will be able to afford to pay those access fees, and we will not.
Finally, you mentioned Genomics England, which is another great resource. We have in the past worked very successfully with the programme and the data. When we reapplied for access, our application was denied on the grounds that we work with private insurers. For example, the user group in Genomics England felt that it was not appropriate for entities that work with insurers to have access to the data. I think that the management of Genomics England have a different view, and I am trying to change that. However, it is a bit frustrating that, again, there is another resource. We believe that getting these scores into the hands of people and their doctors is a really important thing. At the moment, the way to do that in the UK is through the private providers. We are absolutely focused on getting it rolled out in the NHS. However, there is a lack of nuance in a view that says that Genomics England data cannot be made available to people who work with insurance companies.
The Chair: That is interesting, thank you. Lord Willis, coming in online. Yes.
Q124 Lord Willis of Knaresborough: First of all, thank you very much for a very interesting speech this morning. Both of you are trying to sell diagnostics and therapeutics to the NHS, and I understand that. You have told us a great deal about what the challenges, difficulties and obstructions are there. How do you think the Government and NHS should address them? If you are a Government and you have the ability to get this committee to say what the Government should be doing, what are your reasons? What are the key things that the Government should do, rather than simply saying these are problems that they are not dealing with?
Dr Christian Itin: The first area that we talked about before is to look at the methodology for health economics that we are using and make sure that therapies that have curative intent and substantial outcomes are appropriately reflected in that methodology. That is one element.
The second is that there is an opportunity we have not talked about before for real-world data collection and real-world evidence. What we are basically talking about is an evidence gap; there is a certain amount of information at the time of decision-making and there is clearly a gap. Part of closing the gap is around real-world data collection. I think there should be an opportunity within the NHS to do that, which would add a lot of improvement in decision-making, but it also would allow for earlier adoption of therapies. You are not flying blind; you are collecting data that you can reassess downstream. That is the second area that I would recommend looking at.
The third is not just the NHS for approved products—it is also important to look at the ability to translate the academic research into early clinical datasets. That is certainly an opportunity that the MHRA has now, given that there is a higher degree of independence from other bodies at this point. I think it is focusing on that and improving the ability to translate early programmes into clinical trials and accelerate the processes in there. The competition here is not the US. The competition is China, where that process takes about two to three days. We are losing out in a massive way.
A lot of the early research that we look to translate into companies is at a significant disadvantage because of that. There is opportunity there to make sure we are adequately set up at the MHRA to support that process. That could benefit the attractiveness of the NHS for clinical trial conduct, which I think is important. It also would be generally a very positive development for companies that are being founded in the country to help them gain momentum and have an ability to compete internationally.
Professor Sir Peter Donnelly: I will add a number of things. The first is, to give them their credit, the Government have done and said a number of very positive things. Having the rollout of polygenic risk scores in the 10-year plan is audacious. It offers the UK an opportunity to lead the world in this new branch of medicine, but we need to grasp that. They need to encourage the NHS to drive through the barriers to get it happening.
They have also adopted a policy in their life sciences industrial sector plan of using procurement to support small and growing UK companies. We fully endorse that. We are absolutely committed—we are a British company and we are committed to succeeding in Britain. We are passionate about getting things to work in the NHS, but there is a real opportunity for Governments to act by doing procurement in slightly different ways that can achieve the ends they need and support growing companies. They are two really positive things.
On additional factors, many of the issues raised in the Sinker report from a number of years ago about innovation in the NHS absolutely resonate—on NHS staff not having the capacity, disjointed policy, and adoption, where you have to speak separately to each ICS and large body. There is a culture in parts of the NHS, as others have pointed out, that is anti-commercial and a bit negative about companies. I do not know if that is an easy fix, but it is something Governments need to be aware of.
On the sorts of changes we talked about with NICE, the Government, rightly, as did previous Governments, want to increase growth in the UK. It turns out that getting better at preventing disease and getting people in middle age back into work is a major driver there. There is now strong economic evidence. The Government could tell NICE that when it is assessing new technologies in this area, it could factor in the general economic benefits over and above the specific health benefits.
The Chair: Lord Winston, did you want to ask Dr Itin anything?
Lord Winston: I think I have covered it.
The Chair: Lord Stern, we have heard something already about the economics.
Q125 Lord Stern of Brentford: Yes. I was going to ask you about regulation and innovation for NICE and MHRA, but you have covered those points directly. I want to ask you a more specific version of the question that could greatly help us in our recommendations around the way in which these kinds of innovations are assessed at the individual level and as a matter of strategy for overall resources. They are related questions, but they are conceptually and methodologically distinct. For transparency, I am a professor of economics at the LSE. Andrew Scott did his MSc with us then stayed on as a research associate in our department, and I am a great admirer of his work.
It is a matter, not only for NICE but also for the Treasury, that in our fiscal rules we do not count the capital that is created. In this case, we do not count the value of the loss of human capital that is prevented. Of course, we have value of prevented fatalities of, ballpark, 2 million per person, and you are well aware of that. If we were making a recommendation about the economic value, at the individual and strategic level, and on how much to devote to prevention in what way, what would you recommend to a combination of NICE, MHRA and the Treasury, significantly? Twenty-five years ago, I was in charge of the Green Book at the Treasury. The arguments you are making need NICE and the Treasury to work together on different kinds of ways of assessing at the strategic level for the UK economy as a whole and for the individual actions of the kind you recommended. Could you help us with some specific ideas?
Dr Christian Itin: This is a challenging field. Let me start out with from a methodology perspective—we talked about that. Productive life has to find a proper way of measuring that and reflecting it in the calculations for benefit. That is one element. On the one hand, when we think about what we have talked about today—and this is part of what Professor Donnelly talked about—it is about making sure that we prevent disease. What I talked about is if we have disease, we have to make sure that we cure the disease so the individual can go back and be a productive member of society going forward. That value of being a productive member of society has to be captured, and we need an appropriate methodology around that. I am not sure that that is currently adequately reflected.
The second aspect is to understand that the contributions to the country are, on the one hand, to obviously maximise the health of the population, but on the other hand it is also a significant area for income into the country. As an industry from a life science perspective, we are mostly export orientated. There is a very significant component there that, if you think about the taxation perspective, tends to get lost. It also tends to get lost in the industrial policies that are being formulated, that tend to be focused on very early-stage activities but are not really focusing on producing products here in the UK and having an ability to export those products. It is a lot about knowledge export that is often quite hard to quantify and create cash flows into the economy here.
It is about making sure that there is a consistent view from the tax authority and Treasury side across the cost element, and the prevention of cost, but also the ability to see that there is an ability to generate income into the country. Both of those need to be looked at. Today, there is no body within the Government where that comes together, where those views are being combined. That is a challenge, and we face that when we are looking for ways to set up manufacturing here in the UK. It is a huge investment for a small company, and there are no tools at that point to support that. That was stunning to me, given that I have worked outside the UK and have seen many different programmes from other jurisdictions. There is a lack of awareness there.
The final point is that there are some tools that are very specific to the UK and very positive. One of the key things are the R&D tax credits. That is the most significant tool that the Government currently have to support early investments in R&D. We are seeing at this point that it can take a very long time to get these R&D tax credits back into the companies, to a point where it becomes very difficult to predict at what point and to what volume that would occur. That creates a challenge for many companies in the life sciences sector in the UK, to understand how they could think about those incentives and work with them. In general, it is one of the best tools that I have seen across many jurisdictions to support early R&D and translate the early R&D into actual company formation and pushing them forward. If you can strengthen that and make sure that the system works, and works in a timely manner, that would have a huge impact on the utility and the way to translate it.
Q126 Lord Winston: As this is your field, a brief issue that is a regulatory issue as well: what use is the important side effects and risks of CAR-T therapy?
Dr Christian Itin: The therapy itself is, in essence, utilising the most powerful cells in our immune system, the T cells. Most of the adverse events that are associated with this type of therapy are adverse events we all know. Those are fever and chills, the types of adverse events that we have known through Covid, but we also know from when we have a flu infection. This is very common.
There is a rarer form of adverse events that could be transient neurological adverse events, that can happen in a subset of patients. Those are the types of typical adverse events that are specific to the therapy and different from other types of therapies that we have been seeing: cytokine release syndrome, that we heard a lot about during Covid, and a limited form of transient neurological adverse events that, for most of those products, are fully reversible. Those are the adverse events that we are looking at. Our product has a very low level of both. That is why it is also cost efficient, because it is inducing a very limited number of adverse events and creates a very significant benefit at the same time.
Lord Winston: We had a colleague in the House of Lords who died recently after this treatment.
Dr Christian Itin: I am sorry to hear that.
Q127 The Chair: Professor Donnelly, Lord Stern was asking about the interaction of the Treasury with NICE and MHRA. Do you want to comment on that?
Professor Sir Peter Donnelly: Yes, please. Were you to recommend much more joined-up and closer working between NICE and the Treasury, that would be extremely welcome, for all the reasons given. It would be fantastic. Another thing worth mentioning is that the current head of MHRA, Lawrence Tallon, has argued that one of the issues we have is that we often spend a lot of time thinking about the risks of doing something, and we do not appropriately weight the risks of not doing it.
Another key part of all of this is discussion on both the prevention and the treatment side. We have a system that, for understandable reasons, favours the status quo and assesses dangers of doing something new. To do that in a balanced way, we also need to be weighing up the disadvantages of not doing something—so it is about having a system that can properly weight, at least in the public segments. The MHRA made that point repeatedly. Getting that into practice, not just in the MHRA but in NICE and in government and Treasury thinking, would be helpful as well.
Q128 Lord Drayson: I want to turn our focus on to the environment in the UK for the capital markets. You are to be congratulated on the progress that you have made, despite the challenges you have described, in building two world-class companies. You have done that in a period when the financing environment in the UK has changed materially.
We are looking to understand the environment that you are experiencing now. It is fair to say that both of you have been through a process where your shareholder base has become increasingly Americanised. That is a fair summary. Dr Itin, on the decision to float on NASDAQ rather than London, what could the UK have done, or could do now, to mean that a UCLH spinout like yours—manufacturing in the UK, based on UK science, supported by UK taxpayers—floated in and generated wealth for the UK?
Dr Christian Itin: That is a very good question. To start answering the question, we have to ask ourselves where the capital gets aggregated. That is about investing or looking to invest in life science companies and the risk profiles that we represented. The answer to that question is that the global capital gets aggregated typically in US funds, where we have quite a concentration of the knowledge base required to invest into this space. A big challenge that we are dealing with is that that capital is not in the UK and not in Europe. It is aggregated for these types of investments in the US. Considering that that is where it is aggregated, most of the investments are being made through the US exchanges in an homogeneous legal framework. If we had floated on the London Stock Exchange, we would not have many investors who could have invested in the company from the UK at that time. We also would have operated in a different legal system, which would have created a barrier to access capital concentrated or aggregated in the US into a UK company. We now operate between two different legal systems and, if you have a fast-paced market and a challenging environment, that creates an imbalance and a disadvantage from an access to capital perspective.
Lord Drayson: That is a very helpful and accurate summary of the environment. However, if you go back 20 years, it was not like that, and I speak from personal experience. It was possible to float on the main market of the LSE in the mid-90s. On the actions that the UK Government and London stock market need to take to attract this capital away from the consolidating US funds—and we have heard about the Mansion House reforms—what needs to be done to make a difference?
Dr Christian Itin: That is an incredibly challenging question. What you are basically asking is how do we de-aggregate the capital in the US and aggregate it here. That is the fundamental basis. The exchange is an afterthought—that is an electronic trading platform that can be anywhere. Shifting the capital over is a hard thing to do because it has a lot to do with the risk appetite of the investment institutions in the UK, whether there is that level of risk appetite, and the type of capital being aggregated in the UK institutions and the financial institutions. That is ultimately a very challenging thing to do. I am not sure it is driven by Government action as much as the aggregation and ability of those institutions to aggregate capital. There is also a size benefit, in the size of the exchange and the amount of opportunistic investing on the same platform with the same regulatory background. That is an advantage. You are right, this was a very substantial hub 30, 40 or 50 years ago. That centre of gravity has obviously shifted, and that is a hard thing to reverse.
Lord Drayson: But it has to be reversed, because a significant proportion of that aggregated capital is UK pension fund money.
Dr Christian Itin: Part of it is, yes.
Lord Drayson: Is there any sense that the tide is shifting? Are the Mansion House reforms having any effect? Are there any grounds for optimism that a future Autolus Therapeutics, five or 10 years from now, would practicably be able to IPO in the UK, and perhaps see where Genomics is going to float?
Dr Christian Itin: I would have loved to float in the UK, but it did not make sense to do it at the time. That is not different today—I would still take the same decision. The perception of having more capital being made available for these types of investments and companies that we are representing in the UK will start changing. What it boils down to is where the capital sits and what the appropriate infrastructure is that we are using.
Lord Drayson: Yes, the expertise to be able to make good investments.
Dr Christian Itin: The other part would be from a regulatory perspective to harmonise the regulatory background. If the process where I can make that investment is the same, that scale helps. Whether this is purely UK or a broader European view, I will leave up to you, as you have way more experience than I do on those topics. There is certainly an element of scale that matters.
Lord Drayson: Peter, Genomics Plc is a private company with a very strong shareholder base. Your current shareholders are split between UK-based and US shareholders at the moment. What is the prognosis for Genomics Plc of the exit for those shareholders and potential future listing or acquisition, and where will it happen?
Professor Sir Peter Donnelly: That is a good question. As you might imagine, we think about these things a lot. The answer for the company is the availability of growth funds. Growth equity is a really important thing. That is where Mansion House should have a positive impact. The potential for UK pension funds to be investing in UK growth companies is important. There is, or has been in the past, a well-documented dearth of those funds. As a company, that is of major interest to us.
On looking forward to exits, whether that is an acquisition, change of control through private equity or a listing, as a company we are open-minded and will assess the options when they happen. Happily, we do not have to take a view now on where we would list. I am sure that at the time we will assess it. As Dr Itin said, we would also love to be able to list in the UK but, at the moment, for all the reasons you just heard, it is not a particularly attractive position. Another reason that you in fact mentioned in one of your questions is that there is so much more expertise in analysis around the US exchanges, NASDAQ in particular, than there is for specialised companies in the UK. There are a lot of headwinds. Maybe progress will be made by the time it is a live issue for us.
Lord Drayson: In your evidence, you mentioned there is an anti-commercial attitude in the NHS. I agree with that—I have experienced that. Why do you think that is?
Professor Sir Peter Donnelly: That is something that has been reported elsewhere, and it is not uniform. Having been an academic, I can identify with these sorts of views. Many people who are working in the NHS are driven by doing public good, and there is a natural concern and scepticism about private enterprise. That leads to suspicion and concern. The reaction to Palantir is an extreme example of that.
In conversations with different bits of the NHS, we have found that interesting. As an academic, it is an exaggeration to say that I am much in demand, but people were often keen to get my advice. Having left that world and founded a company, I know most of the things I knew as an academic and now know a hell of a lot more that will be useful. In contrast, people just do not want to speak to you. I have had national clinical directors who would say they will not take a meeting because I am representing a commercial organisation.
Lord Drayson: This is something I want to probe. Both of you please comment on this, because we have had evidence along those lines from other witnesses about this attitude towards commercialisation at the top of the NHS, not necessarily from clinical staff but, as you say, national clinical directors, and so forth. In your experience, is there an understanding in the management of the NHS of the importance to the UK’s economy and its ability to fund the NHS in having a healthy and growing life sciences industry contributing to taxation in the UK, or is that something that they are just not interested in?
Professor Sir Peter Donnelly: It is certainly not front of mind. It is not perhaps articulated as well as it could be. I was going to call the example you just gave nuanced, but it is not very nuanced—it is a statement of things that are pretty obvious. You are right in pointing to the fact that that is not something that is as widely or well understood as it could be.
Dr Christian Itin: Our experience may be a bit different, because most of it has been since we developed in the UK through the physicians that we worked with who are absolutely outstanding and phenomenal to work with. We have had very positive experiences, but we built that relationship over a long time. Even when we conducted our pivotal studies, those were in multiple centres across the UK. We did a lot of work with UCLH, of course.
As we now roll out, there are some very strong relationships we can build on. It has a lot to do with the community, the physicians caring for those particular patients and the network that they have established among themselves. There is a very strong awareness that these patients need different options, because the current therapeutic options that are available are limited and there is a significant medical need. With that as a backdrop, the interactions that we had on the commercial side with the NHS were positive.
Our experience was different, but it was a very different perspective. It was focused, because it was a defined patient population in medical need. You are looking at a much broader use across the system, so that is a different situation. We did not encounter that particular point.
The Chair: We have almost reached the end of our session. Lord Willis, who is coming online, has the final question for both of you.
Q129 Lord Willis of Knaresborough: We have heard most of the answers to this question, but I would like you to make it a bit tighter for us. As a committee, we will make recommendations to the Government and NHS intending to improve the NHS’s adoption of innovative technologies. What are your top three recommendations for that? What should we say to the Government as three recommendations that would improve the situation that we now have?
This was not on my set of questions, but I ask a further question. Throughout the whole of your discussions this morning, the US has been an important element, and the difficulties of meeting what happens in the US. Why are we not talking about the EU at times? Why is there nothing happening in the EU that would be able to adopt right across the board? First of all, please give me your three points.
Professor Sir Peter Donnelly: On the first point, everyone argues, and the Government have it as a high priority, that prevention is important—but it needs teeth, with someone senior in the NHS responsible for prevention, and there needs to be a budget for prevention. There are structural issues, then there need to be commissioning pathways for this kind of technology.
Secondly, to go back to the discussion we had earlier, in assessing technologies around prevention we need to have the joined-up thinking that does not just assess the benefits narrowly from a health perspective. They are extremely significant, but we also need to assess the benefits to the broader economy through growth, and so on. There is the joined-up thinking that one of your colleagues suggested between NICE and Treasury, for example.
The third point is it is great that there is a policy that the Government can use procurement to support the growth of companies that have huge potential in the UK. That needs to be actioned.
Dr Christian Itin: The first one is to get to a better alignment between NICE, MHRA and NHS so that the data being generated not only serves the regulatory process but can also be recognised at NICE, in an appropriate way, and be recognised within the NHS. We saw disparities in our process that were quite remarkable.
The second area is around the ability to leverage the R&D tax credits and make sure that that is a tool you can protect going forward, and you can operate in a timely manner so that the companies can work with it in a predictable manner. As an industry, that is going to be absolutely critical. We have seen challenges in that process. To give you a sense of the disparity, our last R&D tax credits were received in the fiscal year of 2022.
The last thing I would recommend is to encourage the NHS to look into real-world evidence generation and collect real-world data. A lot of the conversation we have had today is around an evidence gap. That would be the way to close the evidence gap and be able to adopt earlier, but also generate data alongside to make sure that the assumptions that have been made at earlier adoption are properly fulfilled and, if needed, can be corrected. Those are the three areas that I would focus on.
On the question about the EU and the European side, the challenges that we are discussing in this group are very much reflected across Europe, with the added element of complexity that the NHS, and with that NICE, have a view of the full cost of the healthcare system. That is not true across Europe, because reimbursement in Europe is split into two big categories. One is everything related to infrastructure, which is directly paid through taxes and invisible to most people in the system. There is then a limited amount of actual therapeutics and diagnostics cost, and specific aspects of treatment and imaging cost that are covered through the classical payors, whether these are state run or private. The problem is aggravated in Europe in not being able to fully describe the health economic benefit of any of those therapies, because you have this split view.
From that perspective, it is almost more challenging for us as a company to deal with the European situation than the UK. On top of that, with the most favoured nation issues with the US, the UK is currently exempt from being included in that calculation, which has allowed us to move forward in the UK. Europe is not, and that creates a significant hurdle for anyone to currently contemplate launching products in Europe. We have a real issue that needs to be broken through. At this point, it is a very challenging situation in Europe, worse than what we are collectively looking at in the UK.
Professor Sir Peter Donnelly: We are passionate about getting this technology rolled out widely. I am convinced it will be a routine part of healthcare in 10 years, in some parts of the world in five years. When it is, if we fast forward 20 or 30 years, there will be millions of people alive who would not be otherwise, because of the ability to target prevention treatment and screening programmes much more effectively than we do now.
Europe is an important potential market, and we are in early discussions in a number of different European countries. For us as a relatively small company, focus is important, so we are concentrating on the markets where there are quicker routes to adoption. We see the UK as extremely promising there, through the private varieties we have already, but in particular the NHS. The Middle East is another area that is eager to adopt new technologies and there are learnings from that. We are also in conversations in Asia and the US.
The Chair: Thank you both very much for answering all our questions. We are very grateful. We have learned a lot in the last hour or so. Many thanks. We are now going to pause for the next session. Thank you.
