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Four themes set to dominate the life sciences industry

If you asked the average person what they know about life sciences, they would be likely to express a vague notion about an advanced area of medicine, without being able to pinpoint any practical benefit, writes Ilya Yasny, head of scientific research at EG Capital Advisors.

Such disengagement with the general public is unfortunate, given that this industry has the potential to transform the way we treat diseases, with drastic implications for life expectancy, patient comfort and healthcare funding.

Yet it should not come as a surprise, given that most coverage of the sector tends to be written by people with a scientific background for people with a scientific background, with little thought given to the person on the street.

It is therefore useful to sum up why the life sciences industry is so important, in a way that everyone can understand. From that point of view, the following four themes represent the perfect starting point.

Curative therapies

When discussing the most ground-breaking advances in medicine, it may seem odd to start with a new approach to treating people that actually cures diseases. After all, isn’t that just what medicine does? Well, not quite.

Advanced therapies represent a “third wave” in the evolution of medicine. The first wave, synthetic chemistry, refers to small-molecule drugs such as antibiotics, which became widespread in the 20th century. These are predominantly used to alleviate symptoms.

Large proteins, the second wave, emerged in the 1990s and refer to biological drugs made from living organisms. Biological drugs such as monoclonal antibodies do not just alleviate symptoms, but modify diseases. Yet while this second wave represented an enormous step forward in the field of medicine, these treatments are still largely symptomatic.

This helps to explain why there is so much excitement surrounding the third wave: advanced therapies. These use genes, tissues and stem cells to treat a range of conditions and, most importantly, they cure them for good.

Preventative medicine

The ability to cure diseases represents a major step forward for medicine, but what would be even better is preventing them from taking hold in the first place.

Vaccinations currently represent the most high-profile example of preventative medicine, given their role in bringing the coronavirus crisis under control, but there is also enormous potential in the field of diagnostics.

New blood tests can detect cancer at a stage when it is barely visible to the human eye, allowing treatment before symptoms develop and, more importantly, before the disease has the chance to spread.

These tests also have applications in other areas that have traditionally been harder to treat, such as neurological diseases.

Personalised therapies

The personalisation of therapies, based on the genetic characteristics and molecular traits of each patient, is already a widespread theme in cancer treatments.

Fifty years ago, for example, there was only lung cancer. Thirty years ago, this disease was divided into several tissue traits, such as small cell lung cancer, non-small cell lung cancer, squamous cell carcinoma and a few others.

Today there are dozens of types of lung cancer, with different mutations: for example, ALK (anaplastic lymphoma kinase) and BTK (Bruton’s tyrosine kinase) mutations are examples of enzymes which can be overexpressed in cancer. There are now options to treat these in a targeted and personalised manner, making the treatment more effective, with fewer of the side effects that arise from a blunt one-size-fits-all course of chemotherapy or radiotherapy.

This personalisation is rarely applied beyond cancer, but in every field of medicine, there is potential value to be found in working out which treatment will be most efficient in a specific population of patients.

Gene editing

Last year, Emmanuelle Charpentier and Jennifer Doudna won the Nobel Prize in Chemistry for their work in the discovery of CRISPR/Cas9 genetic scissors.

In the natural world, the scissors recognise DNA from viruses, but Charpentier and Doudna proved they could be used to cut DNA molecules at a specific site. CRISPR-Cas9 can now be used to insert, delete or rearrange DNA in the genome.

You can judge the potential of gene editing from the billions of dollars in investment that has surged into companies whose treatments are based on this technology. Yet it is still early days for this field of medicine and although preliminary trials have reported good results, it will take about three to five years before the first treatment receives approval.

This is why it is sensible to approach CRISPR-Cas9 technology with a degree of caution. There is room for improvement in terms of the specificity of gene editing and the efficacy and safety of these procedures.

But the excitement around this technology means some gene editing companies are already worth more than $10bn (€8.2bn), even though they only have one product in clinical trials. This helps to highlight an important rule when investing in an exciting, high-growth area such as life sciences: you need to separate the hype from the reality. 

This article was written for Expert Investor by Ilya Yasny, head of scientific research, EG Capital Advisors.

Part of the Mark Allen Group.