One Man’s Rolodex Helps Operation Warp Speed Live Up to Its Name

(Bloomberg) -- On a Sunday evening in late September, Moncef Slaoui, chief scientific adviser for Operation Warp Speed, was driving from his home in Philadelphia back to Washington, for another week of round-the-clock work. It was 8 p.m. when he put in a call to Roger Perlmutter, head of research for pharmaceutical giant Merck & Co.

“I’m not sure this is going to interest you,” said Slaoui, but he persisted: “This is important.” 

Since the creation of Warp Speed, the massively funded federal effort to stamp out the pandemic with vaccines and drugs, Slaoui’s calls on weekends and at odd hours have become common among his network of drug industry executives from around the globe.

A former GlaxoSmithKline Plc executive, Slaoui has known Perlmutter for years and both have attained acclaim for their scientific prowess and deal-making skills. Now, Slaoui saw an opportunity for a large, experienced drugmaker with an open checkbook to throw in its lot with OncoImmune Inc., a tiny biotech developer in Rockville, Maryland. If Slaoui could entice Perlmutter, the payoff could be big for the country: Warp Speed might accelerate a treatment for the deadliest Covid-19 cases, a critical step in the months before a vaccine is widespread.

News about vaccines and the billions paid by Warp Speed to develop them have monopolized headlines for months.  Slaoui, a 61-year-old Moroccan-born Belgian-American who spent nearly three decades at Glaxo and led its vaccine unit, has been at the center of those deals, choosing which vaccines to fund. Another essential role is fostering small-but-critical agreements like this one. And with well more than 1 million Covid-19 infections cropping up across the U.S. each week, the country desperately needs new drugs.

Slaoui’s plan: a quick marriage that would join the production might of a large drug company with the nimbleness of a little-known biotech consisting of just 10 people. OncoImmune had spent almost two decades developing drugs that target inflammation to treat autoimmune diseases. Now, one appeared to halve the risk of death among those hospitalized with the most advanced cases of Covid-19. 

Six days before calling Perlmutter, Slaoui received an email from Janet Woodcock, a Warp Speed team member recused from her permanent position as director of the U.S. Food and Drug Administration’s Center for Drug Evaluation and Research. The message contained trial data showing OncoImmune’s treatment significantly improved the chances and speed of recovery for “severe and critical” Covid-19 patients needing oxygen. It also brought about a more than 50% decrease in risks of respiratory failure and death.

“Oh my god,” Slaoui recalled saying to himself as he scoured the data. The drug showed the most significant survival benefit he'd seen.

Two days later, he called OncoImmune’s chief executive officer, Yang Liu, and two days after that, Slaoui, Woodcock and others from Operation Warp Speed met with the company’s research team in its Rockville laboratory. As the weekend approached, Slaoui dashed off half a dozen emails to big-company CEOs and research and development chiefs, Perlmutter among them.

Perlmutter, a renowned immunologist on the brink of retirement, flipped through the same data Slaoui had reviewed and he, too, was stunned. “Pretty much nobody was paying attention to it. We were all busy doing other things,” Perlmutter said of OncoImmune’s drug, whose name, CD24Fc, sounds like a character out of “Star Wars.” He assured Slaoui he’d contact Liu.

Eight weeks later, on Nov. 23, Merck said it had agreed to acquire closely held OncoImmune for $425 million in cash. For Liu, a 59 year-old Chinese-American immunologist who in 2001 co-founded OncoImmune with his wife, chief medical officer Pan Zheng, it was a good price for two decades of work.

Merck believes CD24Fc will complement its broader portfolio of emerging coronavirus vaccines and therapeutics. The Kenilworth, New Jersey, company has two vaccines in the works, though they’re far behind the leaders from Pfizer Inc., Moderna Inc. and AstraZenaca Plc, among others. With another biotech, Merck also is developing an antiviral pill for patients with early symptoms of the disease. All are in clinical trials.

CD24Fc, if it pans out, could prove a key weapon against Covid-19. Doctors have few drugs to treat patients with severe forms of the disease, many of whom end up requiring mechanical ventilation, where the risk of death is high. Gilead Sciences Inc.’s antiviral remdesevir speeds recovery, but it hasn’t been shown to reduce deaths. Only dexamethasone, a decades-old steroid that tamps down inflammation, has demonstrated a limited mortality benefit. The two drugs are often given together.

Operation Warp Speed is betting that CD24Fc will become the new standard. Merck aiming to ramp up its manufacturing of the intravenous therapy in the first half of 2021, and Slaoui said the U.S. is in talks to buy that production.  

Liu and Zheng began developing the drug in 2002 to treat autoimmune diseases. In 2009, however, their laboratory made a breakthrough: Scientists found that mice lacking a specific protein, CD24 (for which the drug is named), would mount a massive immune response if given too much Tylenol, experience liver failure and die overnight. Mice with the protein could control their response. Based on that finding, the husband and wife began studying whether the experimental medicine could modulate the immune system with diseases that cause cell death. They launched a trial of CD24Fc in patients with leukemia, which showed promise reducing serious complications from certain stem-cell transplants.

Liu, who recently stepped down as director of the Division of Immunotherapy at the University of Maryland Baltimore School of Medicine to work on CD24Fc, said that his career has focused on one tantalizing question: “When exactly does the body fire off an immune response?”

Answering that has also become a critical battle in the war on the pandemic. Most who contract Covid-19 develop mild-to-moderate symptoms — fever, sore throat, perhaps a dry cough — and recover. Others’ immune systems kick into overdrive, ravaging the body’s own cells and tissues, often hitting the lungs the hardest.

As soon as that became clear early in the pandemic, Liu and Zheng refocused their research. By late September, they had the promising clinical trial results that were soon to catch Slaoui’s attention. 

“We said, ‘That’s amazing. That’s fantastic. We need to get this to OWS,’” said Liu, who shared the data with Operation Warp Speed on Sept. 17.  

In no time, Slaoui was shopping CD24Fc to drug industry executives. “I was excited that he was offering that,” Liu remembers. “To go straight to those at the top of the industry — that would accelerate a deal.”

When Perlmutter stepped up, Liu was thrilled. The two had in met in the late 1990s, when Perlmutter, then chairman of the immunology department at the University of Washington in Seattle, invited Liu to give a lecture. “He’s someone who I know would care about the science," said Liu. “I had a gut feeling that this was going to work.”

Liu and Perlmutter shared a goal: Move fast and don’t sweat the details of negotiations. The deal “came to terms fairly quickly,” Liu said, and both sides “showed a lot of flexibility on price.”

If it hadn’t been for the pandemic, Liu would have preferred to keep a hand in the business and co-develop the drug, but he realized that he needed to step out of the way to make sure that CD24Fc reaches the people who need it.

“We can’t move at that speed,” said Liu. “There was such a big burden on our shoulders every day this wasn’t distributed.”

Now, it’s Perlmutter feeling that weight: “With more than 2,000 dying every day in the U.S., how can we stand by?”

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