Spark Raises $73 Million to Shepherd Gene Therapy through Phase 3 Trials

By Aaron Krol 

May 30, 2014 | Spark Therapeutics, a gene therapy company pursuing a Phase 3 clinical trial to treat a progressive retinal disorder, this week announced a Series B funding round that co-founder and CEO Jeff Marrazzo says will put the company on solid footing through an FDA decision on its lead therapy.

That Spark has made it this far is a testament to both the groundbreaking research and the financial commitment of the Children’s Hospital of Philadelphia (CHOP). Spark is a commercial spin-off of research efforts at CHOP that have been ongoing for over a decade, largely under the direction of Katherine High, who leads the hospital’s Center for Cellular and Molecular Therapeutics. By the time Spark officially launched last October, CHOP had already completed a Phase 1/2 trial of the company’s lead therapy and begun the current Phase 3 trial, as well as developing a large stock of other therapies in earlier stages of testing.

“Spark, while relatively new as a corporate entity, is built on ten years of success at the Children’s Hospital of Philadelphia,” Marrazzo told Clinical Informatics News. “We’ve really benefited as a company from keeping that team together. It’s certainly one of the best, if not the best, in the field.”

CHOP also committed $50 million to Spark at the time of the company’s launch, $10 million of which was invested in a Series A round. This week’s Series B was the first chance for traditional venture funds to get on board, and seven new investors, led by Sofinnova Ventures, have together with added funding from CHOP provided an additional $72.8 million.

Encouraging Signs 

Spark’s ability to attract such a large group of investors to gene therapy – a field that has so far never produced an FDA-approved product – owes a great deal to positive signs from its ongoing Phase 3 trial. The therapy under study targets retinal dystrophy caused by pathogenic variants of the RPE65 gene, which codes for a protein involved in the signaling cycle in the retina. Affected individuals may experience a slow deterioration of vision over years, or in more extreme cases, early-onset blindness followed by atrophy of retinal cells.

Like most other gene therapies in active development, Spark’s lead program uses a viral vector – in this case, a modified adeno-associated virus (AAV) – to insert a functional copy of the relevant gene into cells in the affected tissue. An earlier Phase 1/2 trial with 12 participants yielded improvement in every subject’s functional vision as their retinas began to produce working protein. The therapy seems to be particularly effective if administered early in the disease’s progression; all five school-aged subjects in the Phase 1/2 trial were able to move from Braille classrooms to sighted classrooms after being treated in one eye.

Gene therapy is an especially exciting frontier for medicine because it promises lasting benefits after a single course of treatment, with the inserted gene being replicated as cells naturally divide. Spark’s lead therapy was first tested in October 2007, so the first patient has now gone over six years since the viral vector was injected. “For that patient, and all those who followed, what we’ve seen is that the response was stable and is still stable,” says Marrazzo. “That’s as far out as I can say, but certainly we believe this has the potential to be a single-dose, curative therapy.”

Despite these encouraging early results, there are still reasons to be wary. Gene therapy has been haunted by two incidents in clinical trials from the late 1990’s and early 2000’s – one in which a viral vector triggered a fatal immune response, and one in which cells’ natural genomes were disrupted by an inserted gene, triggering multiple cases of leukemia. A younger generation of gene therapy developers, like Spark, has had to be very attentive to these potential safety issues. One innovation in recent years has been the growing use of AAV as a vector – AAV inserts its DNA at a specific site on chromosome 19, a feature that guards against harmful changes to the host genome.

Marrazzo adds that the decision to target the retina has, in the case of the RPE65 therapy, mitigated the risk of a serious immune reaction, because of a difficult-to-penetrate blood barrier at the back of the eye. “We have not had any product-related adverse events, and we feel confident that will continue,” says Marrazzo.

Spark’s lead program is about as close to an FDA decision as any gene therapy has come to date. The Phase 3 trial has been ongoing, at both CHOP and the University of Iowa, since late 2012, and has passed its enrollment target of 24 patients. Spark now has the funding to carry the trial through to completion.

Scaling Up 

It’s unclear exactly how many patients stand to benefit if the FDA finds the RPE65 program safe and effective. Retinal disorders have traditionally been diagnosed by symptoms, not by the particular gene involved. “There are so many different types of retinal degeneration, caused by different gene mutations,” says Marrazzo. “It’s only within the last decade or so that we are able to more precisely subtype and classify patients.” He estimates that there may be around 1750 individuals in the U.S. without functioning copies of RPE65, and a similar number in Europe. This figure is based on overall diagnoses of the conditions Leber’s congenital amaurosis and retinitis pigmentosa, both of which can be caused by RPE65 mutations.

Spark is now laying the groundwork for commercial activities, should its lead therapy be approved. Part of this week’s funding round will go to a new corporate headquarters near CHOP in West Philadelphia, which will include manufacturing facilities. The company is also aiming to have 50 employees by 2015.

“[The new funding] will also help us advance multiple other programs into the clinic and through initial proof-of-concept,” says Marrazzo. Through the efforts of CHOP, Spark has inherited at least half a dozen therapies in development, which include a treatment administered to the liver currently in Phase 1/2 trials, aiming to cure or alleviate symptoms of hemophilia B. Marrazzo is also hopeful that success with the RPE65 therapy could quickly translate to other retinal diseases, using the same viral vector and route of administration, but different genes.

With a comfortable financial backing, and an advanced lead program, Spark is looking to the future. Gene therapy is an untested market, and the combination of small patient pools and single-dose treatments raises questions about reimbursement, which will have to recoup the large investments companies like Spark are making in their research programs.

“This is a new paradigm in some respects, but in other respects there are elements of healthcare delivery today that are [similar],” says Marrazzo, citing orphan disease drugs and one-time surgical procedures as models for the commercial questions Spark could one day face.

“First and foremost,” he adds, “we believe that this can be substantially transformative in the lives of these patients. I think the value we can capture from the reimbursement system will be commensurate with the amount of value that we’re able to create.”



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