Seven years ago, the FDA approved Yervoy, the first immune checkpoint inhibitor for patients with late-stage metastatic melanoma. It was the start of a new era for IO treatments, which rally a patient’s immune system to destroy cancerous cells. Four other checkpoint inhibitors have since been approved, and untold dollars and energy have flooded immuno-oncology (IO) subfields, including cancer vaccines, immunomodulators and chimeric antigen receptor (CAR) T-cell therapies. Seemingly overnight, IO grew from an experimental field of science into one of medicine’s hottest sectors.

Today, there are more than 2,000 cancer immunotherapies in development, including 164 checkpoint inhibitors that target just the PD-1/L1 pathway. The therapies often work in a variety of cancer subsets, triggering a rush of clinical trials as companies jostle for market share. A recent report by the Cancer Research Institute (CRI) found some 1,502 trials with 1,105 drug combinations were underway.

Yet for all the enthusiasm, most IO insiders expect the next seven years to unfold quite differently. At a recent think tank event, hosted by Scientific American’s custom media division and Immunomic Therapeutics, some 85 experts discussed the challenges and proposed a roadmap for how to navigate the next decade of IO.


The IO sector has generated some major deals and investment in recent years. In late 2017, Gilead Sciences, Inc. acquired Kite Pharma, Inc., a leader in the emerging field of cell therapy, for $11.9 billion. Earlier this year, Celgene Corp. acquired Juno Therapeutics for $9 billion to gain cutting-edge CAR-T technology. More recently, Bristol-Myers Squibb paid Nektar Therapeutics $1 billion upfront, along with $850 million in stock and up to $1.8 billion more in milestones, to develop an immunostimulatory therapy that is used in combination with checkpoint inhibitors. It was the largest biotech licensing fee ever recorded.

After such a run, prudence might dictate more measured investment. At this year’s J.P. Morgan Healthcare conference, investors bemoaned ‘IO fatigue.’ But other factors are driving deal activity.

The new U.S. Tax Cuts and Jobs Act is one example. “Large U.S. companies in cancer have cash overseas that will now be taxed at up to 15.5% and thus could be repatriated to the U.S. for deal-making,” says David Thomas, senior director of industry research and analysis for the Biotechnology Innovation Organization. Thomas estimates the potential wellspring at $400 billion. “We’re already seeing IO deal-making pick up,” he says, citing the $9 billion Celgene/Juno deal as a case in point. Celgene had $9 billion in overseas cash when the tax reform took effect.

Biopharma analyst Barbara Ryan, founder of Barbara Ryan Advisors, also sees new partnerships on the horizon. “Since some large players still don’t have the portfolio of products needed to succeed in the age of combinations, there could be a push for collaboration, M&A and licensing,” she says. This could translate into significant opportunity for small to mid-sized IO companies, whether through collaborations with big players or by consolidating between themselves. Ryan predicts federations of small companies innovating under one roof, at the intersection of several different areas of expertise, such as biotech, pharma and predictive analysis.


As IO matures, so too will the challenges the biopharma companies face. One obvious issue is safety. The treatments fight cancer differently than the traditional toxic agents, so new measures for safety, efficacy, and trial enrollment will be required. Identifying and developing clinically relevant biomarkers can also be complicated because immune modulation impacts many cell types and introduces complex interactions among cancer cells, the tumor microenvironment and the host.

“There are also certain types of cancer, like pancreatic cancer, that are really resistant to an immuno-oncology approach, so there needs to be more research to understand exactly how these cancers evade the immune system,” says Bill Hearl, CEO of Immunomic Therapeutics, a clinical stage biotechnology company developing a nucleic acid immunotherapy platform with the potential to treat cancer, allergies and animal health issues.

Companies also need to be cognizant of healthcare costs. IO therapies are expensive — combination therapies could be prohibitively so. Hearl believes innovation is needed here too, through methods such as dose optimization to determine whether doctors could lower the amount of drug used (prices are usually tied to volumes). New payment models could also help manage the costs. Randy Burkholder, VP of policy and research at PhRMA, suggests incentives such as discounts or ‘money back guarantees’ if patients don’t respond to a treatment after a predetermined timeframe. “This would allow companies to enter more innovative, value-based contracts with payers,” he says, pointing to a recent offer by Novartis to refund patients who don’t respond after the first month to Kymriah, its $475,000 gene therapy.

Patient participation in clinical trials will probably become even harder with IO 2.0. Of the 1,500 clinical trials underway for combination therapies, only three percent of cancer patients are enrolled. “There must be front-line communication with doctors and patients about the positive impacts of participating in these studies, including patients receiving an intensified level of monitoring and care,” Hearl says. “Also, some patients will get the standard of care treatment, and can still play a very important role in the trial.”

And at the end of the day, the reward is very much worth the effort for all oncology stakeholders. “Five years from now, I’d expect to see a significant uptake in the number of patients and the number of cancers that are essentially cured or treated in a very, very effective way,” says Garo Armen, CEO and chairman of Agenus, a biotechnology company focused on immuno-oncology. “This will change the landscape dramatically, and IO will be the driver of that—there’s no question.”

Economic forecasts reflect that sentiment. According to Grand View Research, the value of the global IO market is expected to nearly triple in the next decade, from $41 billion in 2016 to $118.8 billion by 2025. IO 2.0 is set for an interesting next act.