CAMBRIDGE, MA — When looking to the future of the drug industry, the allure of Boston is strong.
This week, the Japanese drugmaker Astellas became the latest company to open a research hub in the region, following Eli Lilly, Novo Nordisk and other companies that recently set up similar outposts.
“Innovation is our lifeline, and we need to have a footprint here,” Astellas CEO Naoki Okamura told Endpoints News in an interview after a sake barrel-breaking ceremony to celebrate the opening of the company’s new 62,000 square-foot research center in Cambridge, MA.
The 400-person center, which will also house some business development and commercial teams, is Astellas’ long-term investment in a future beyond Xtandi, the prostate cancer drug it developed with Pfizer that brought in more than $5 billion in revenue last year. Sales continued to grow in the second quarter, but key patents for the treatment are set to expire over the next three years.
In a wide-ranging interview, Okamura discussed the company’s post-Xtandi plans, its M&A strategy, its new focus on protein degraders, its longstanding commitment to cell and gene therapy, and the importance of planting roots in Boston.
“This center is going to be a critical key success factor,” he said.
In the near-term, Okamura said that Astellas needs to boost sales of five other drugs, including Veozah, a pill for treating hot flashes during menopause; Izervay, an eye injection for a form of vision loss called geographic atrophy; and three cancer drugs named Padcev, Xospata and Vyloy. The latter drug is approved in Japan and currently under review at the FDA, with a decision expected in November.
But those five key drugs accounted for just $1.1 billion in sales in 2023, less than 10% of the company’s total revenue. Sales of both Veozah and Izervay have been sluggish. Reaching the company’s profit margin target will require getting some of those drugs approved for additional diseases and running a “leaner organization,” Okamura said.
“The strong growth of these five strategic brands is the must,” he said. “But that doesn’t guarantee sustainable growth.”
Filling a pipeline
The Cambridge research site will help fill the company’s early-stage pipeline. It has a big emphasis on developing protein degraders and other small molecules that act as molecular matchmakers. Astellas’ efforts were spearheaded by its own scientists who were itching to work on the molecules, which promise to tackle many notoriously tough-to-drug proteins.
Just a few years after greenlighting the program, Astellas has already made a degrader for KRAS G12D, a mutant protein common in pancreatic, lung and colorectal cancers. It plans to disclose the first glimpse of data from the Phase 1 study at ESMO, a European cancer conference, this month.
Tadaaki Taniguchi“This is just a start,” chief medical officer Tadaaki Taniguchi told Endpoints.
Astellas has several other protein degraders in the works, including a pan-KRAS degrader and undisclosed programs for cancer and non-cancer targets, he added.
But the homegrown molecule may be an outlier in the company’s future pipeline. Astellas got most of its approved drugs, and many of its experimental ones, from other companies, and Okamura expects that trend will continue.
“We kind of stopped thinking that internally-developed product is the best product,” Okamura said. “Going forward, there would be very few, if any, compounds that we say that this is our internally-discovered, developed product.”
The company has been striking partnerships with smaller biotechs and academic centers, many focused on cell and gene therapies. In January, the company announced a five-year collaboration with Mass General Brigham in Boston, although details about that partnership are sparse.
Astellas is also opening its first US-based SakuLab, a rentable lab space and biotech incubator. Several other pharma companies in Boston have similar setups at their research centers, giving them a front-row seat to some of the newest ideas in the industry.
“We also need to continue to show our presence, that we are here and are open to collaborate,” Taniguchi said.
These efforts are small compared to its $5.9 billion acquisition Iveric Bio and its eye drug Izervay last summer. It was the company’s largest acquisition ever. And while Okamura said Astellas will remain “opportunistic,” another Iveric-sized purchase isn’t happening anytime soon.
“We had been watching the compound for more than eight years until we made the final decision to acquire,” Okamura said. “Six billion dollars is somewhat the limit for our financial capacity. So if you ask me, are you going to do a similar size M&A in three years? I don’t think so.”
‘No intention to give up’
The Iveric acquisition also meshed with the company’s longstanding ambitions to create regenerative medicines for vision loss, and it gave Astellas a foothold in the ophthalmology market.
Astellas is currently testing a stem cell-derived therapy in people with geographic atrophy. If it works, it could restore eyesight instead of simply slowing vision loss like Izervay. The Phase 1 study is expected to wrap up in January 2026.
“Izervay is going to be a front-runner for our follow-on products,” Okamura said.
At a time when many pharma companies are abandoning gene therapy programs, especially for rare diseases, Astellas insists that it has no plans to give up on the medicines, even in the face of one of the industry’s most tragic failures.
Four boys died after receiving the company’s gene therapy for a rare neuromuscular disease in 2020 and 2021, likely due to liver failure from the high doses of virus used to shuttle the therapeutic gene. But Astellas still wants to find a way to use that gene therapy, and others, more safely.
“People tend to look at the four boys’ deaths. And that’s a very unfortunate and tragic situation,” Okamura said. “On the other hand, there are healthier boys who received [the therapy] and survived for three to five years already. So we believe in the power of gene therapy to really make the difference.”
Okamura believes Astellas has an obligation to improve the safety of the treatment. It is working with startup Kate Therapeutics on a new version of the therapy that the company hopes is better at targeting muscle cells and avoiding the liver.
“We know that the correct transgene to the targeted cell should cure the situation,” Okamura said. “And we have no intention to give up.”