This expansion into gene editing is a landmark for the entire industry. Gene editing at scale has been prophesised for decades but now it has come to market and from here we expect it to move into other diseases.
We met with leading companies across each of these respective approaches to gene editing, including Vertex Pharmaceuticals, Intellia Therapeutics and Beam Therapeutics. Across the piste, we are looking at therapies either already coming to market or doing so over the next couple of years.
The disruptive potential of these one-time cures has not been lost on big pharma, whose economic prospects hinge on supplying patients with repeatable drugs, and they are rapidly partnering with these pioneers.
AI deployment is still nascent across healthcare, but pioneers are building new barriers to competition.
Technology platform shifts always entail time for dissemination, but healthcare has an especially complex regulatory landscape to navigate and the majority of companies are taking a cautious approach when it comes to AI. This means, however, that those companies wholeheartedly embracing AI stand out.
Moderna, for example, is already deploying AI at scale and witnessing significant productivity gains. AI initiatives were the driving force behind a 10 per cent reduction in selling, general and administrative expenses last quarter.
We believe the greatest potential for AI industry-wide is in early-stage research and drug discovery, shortening the decade long pursuit of commercialisation. Early data from AI-enabled drug development platforms is encouraging, with data points showing the ability to shorten the timeline to drug candidate identification by up to 50-75 per cent versus the industry average.
Through direct cost savings, improving R&D productivity and increased probability of success of pipeline programmes, we believe that AI has the potential to drive an inflection in Eroom's law.
Zooming out, we think that the IP advantage of these pioneers’ full embrace of AI is likely underappreciated – a faster time to patent drugs is the cornerstone of pharma economics, and AI is proving it can accelerate this process, which is creating new moats around competitors.
The pace of innovation we are witnessing across the healthcare sector is breathtaking. As long-term investors in innovation, the opportunities unfolding today make us excited about the decade ahead.
Clare Pleydell-Bouverie and Storm Uru are fund managers within the Liontrust Global Innovation team
