Canada’s COVID-19 vaccine contender: Medicago’s breakthrough, ties to Big Tobacco and warnings a pandemic was coming

Under a winter’s snow cover on the outskirts of Quebec City, a high-tech greenhouse, set at a balmy 23 C, is growing row after row of a weed that could help end the coronavirus pandemic.

It’s called Nicotiana benthamiana, a relative of the tobacco plant, native to Australia, and it is a key to biopharmaceutical company Medicago’s COVID-19 vaccine.

Medicago is the leading Canadian-based contender to produce a vaccine, with an agreement to provide the federal government with 76 million doses if approved for use.

Medicago’s vaulting onto the mainstage could provide a breakthrough for vaccine science. It involves a new technology that’s rapid and nimble, and a vaccine that can be stored at normal fridge temperatures, of 2 C to 8 C, unlike the two other vaccines currently in circulation, which each require frozen or ultra-cold frozen storage.

While it’s possible the company may emerge as the new wunderkind of the Canadian biotech sector, it wasn’t without adversity.

For years, Medicago warned that Canada needed to prepare itself for a pandemic and lobbied government officials for funding to build a domestic manufacturing site for a vaccine. But Medicago didn’t get what it needed from the federal government until after the COVID-19 crisis struck.

On top of that, in the middle of a pandemic, Medicago is restructuring.

In July, it announced plans to distance itself from a significant shareholder, Philip Morris International, which owns about one-third of the company — a controversial association with Big Tobacco that has been the source of roadblocks and criticism. Then in December, the company replaced its president and CEO.

None of this has stopped Medicago from losing sight of its goal: a vaccine.

“I’m not just optimistic, I’m confident that it will work,” said Dr. Brian Ward, medical officer at Medicago.

In phase one of its clinical trials, 100 per cent of people who received its COVID-19 vaccine developed significant antibody responses with no severe adverse effects.

Phase two clinical trials are currently wrapping up and phase three is expected to begin later this month. It will involve 30,000 people in 11 countries — including Canada — and will ultimately determine if the vaccine protects people from COVID-19. The vaccine requires two doses, 21 days apart, and if approved by Health Canada, could be in the arms of Canadians by the second half of this year.

While Medicago’s vaccine may not be first out of the gate, its technology is still far quicker than traditional ones, like influenza and MMR, which are cultured in chicken eggs — a cumbersome process that can take up to six months. By using plants instead of eggs, Medicago produced a COVID-19 vaccine candidate within 20 days of receiving the genetic sequence.

“The plant is basically acting as a factory to produce the spike protein,” said Dr. Scott Halperin, director of the Canadian Centre for Vaccinology in Halifax.

Once injected with the genetic material for the spike protein, the plant forms what’s called “virus-like particles” or VLPs.

“The human who gets that sees that as, ‘Oh, that looks like a virus,’” Dr. Halperin explains. “It’s not a virus that can infect you because it’s just a plant capsule surrounding the spike protein, but because the immune system is tricked into seeing it as a viral particle, it responds very well.”

The use of VLP technology has already proven an effective platform, most notably with HPV vaccines, Gardasil and Cervarix — but developing VLPs in plants for use in a commercial vaccine has never been done. Medicago has conducted 15 trials for seasonal influenza using this approach and says it “works quite well.” That vaccine is currently under review with Health Canada for approval. “We are hopeful that in the next influenza season we will have a licensed influenza vaccine for the world,” Dr. Ward said.

Pandemic warnings

But if and when Medicago gets the green light from Health Canada to start shipping its COVID-19 vaccine later this year, the bulk of its doses will initially come from the U.S., not Canada.

That’s because Medicago’s Quebec City manufacturing site is still under construction and won’t be ready until the end of 2023, possibly 2024.

“It is extremely disappointing. It’s discouraging and it’s unnecessary,” said Bruce Clark, Medicago’s CEO and president from 2017 until December 2020.

For years, he explained, Medicago had been asking the federal government for funds to assist with pandemic preparedness and to develop a manufacturing plant at home.

“Everybody’s saying this is a wonderful idea, it’s a made-in-Canada solution and then crickets. Nothing.”

A Global News analysis of the federal lobby registry shows that from 2017 to March of 2020, when the pandemic was declared, Medicago representatives met with government officials 24 times, seeking “partnerships and funding to support research, development and commercialization of vaccines” and to prepare against “future outbreaks of emerging infectious disease.”

“If they had made the decision two years ago when we were in discussions with them, we’d have a facility by now,” Clark said.

Medicago had been betting on a pandemic.

But its expectation was that when it came, it would be an influenza strain, like the 2009 H1N1 swine flu pandemic, and not a coronavirus.

In 2005, then-CEO Andy Sheldon, who had much experience with pandemic development, started the shift to influenza vaccine development. By the next year, he said there were “frequent meetings” with the federal government, in an effort to secure funds to scale up.

But the money Medicago needed to build a manufacturing site didn’t arrive. At least, not in Canada.

The vision and follow-through for a production plant came in the U.S, from DARPA, an R&D agency of the defence department. In 2009, under the Obama administration, DARPA launched the Blue Angel project as a response to the deadly swine flu that year to show that if another pandemic were to hit, it could respond rapidly with a vaccine.

Medicago won a contract worth US$21 million one year later to manufacture 10 million doses of flu vaccine a month. As part of that agreement and cash infusion, it developed a 9000 m2 R&D facility in North Carolina, raising the rest of the capital required itself.

Not only did Medicago hit its target of making 10 million doses a month, the once fledgling biotech startup now had a production plant. It wasn’t producing at a commercial scale, but it was a start.

“DARPA had money and they had a program,” Sheldon said. “But there was no such program in Canada.”

Should Medicago’s COVID-19 vaccine be approved, the bulk of the supply will initially come from this North Carolina plant. Only 10 per cent will actually be “made in Canada” the first year, coming from its pilot plant on the west side of Quebec City.

“I think what comes to mind is the classic Canadian dilemma,” said Bruce Clark, the CEO from 2017 to 2020. “You have capability that’s sound and proven, but it has to go somewhere else in the world to get validated, typically south of the border, and then the Canadians say, ‘Oh it’s pretty good, maybe we should use it.’”

With the U.S. plant operational, the money started to come in Canada.

In 2015, the provincial government of Quebec came through with a loan for $60 million, while the federal government and the City of Quebec lent $8 million and $6.5 million, respectively.

“They were loans. These were not free gifts,” Sheldon said.

While the Quebec support was “substantial,” Sheldon said the federal contribution was “a bit disappointing.”

Still, it was the capital Medicago needed to start building a commercial-grade production plant in Canada: a facility with a price tag of almost $300 million. But without a federal contract to develop a flu vaccine, Clark said Medicago’s shareholders were skittish about dumping cash into a building that didn’t yet have a purpose — and at the start of 2020, it still wasn’t finished.

“And so they’re trying to figure out, when do they write the big cheques for the facility when they don’t really have a commitment from the Canadian government as to how it’s going to play in their strategy,” Clark said.

It wasn’t until the pandemic struck that the money and a purpose came together.

In March, the federal government announced it would fund Medicago’s COVID-19 vaccine efforts. Seven months later, the federal government signed an agreement worth up to $173 million to accelerate Medicago’s vaccine development, secure doses, and complete the manufacturing plant.

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“It’s good that the Canadian government is now supporting a Canadian company, since the U.S. government supported the Canadian company first,” Dr. Halperin of the Canadian Centre for Vaccinology said.

Innovation, Science and Economic Development Canada acknowledged a “decades-old decline” in federal funding, stating that “specific large-scale direct support initiatives, such as the Technology Partnership Canada program … were ended in 2006.” It says it is now “actively working to support the rebuilding of biomanufacturing capacity in Canada.”

“The reality is it took COVID to get a decision made,” Clark said.

From garage to global commercial enterprise

“There aren’t very many companies in the pharma industry that have gone from a garage to a global commercial enterprise,” said Dr. Ward, Medicago’s medical officer.

The garage was double-wide, in a house still under construction, overlooking the St Lawrence River. There, in 1997, a recent MBA grad, François Arcand, and his childhood friend, Louis-Philippe Vézina, a plant researcher with Agriculture Canada, set up one of the first offices for what was to become Medicago.

“Medicago could be a major disruptive factor, in the fact that it could offer something better, faster and cheaper,” recalls Arcand. Neither he nor Vézina remain with the company.

The company’s name, Medicago, was Latin for the plant they were using at the time: alfalfa. But it wasn’t until Medicago shifted to Nicotiana benthamiana, a cousin of the tobacco plant, that it attracted an investor that would accelerate its growth as well as lead to some of its greatest controversy: tobacco giant Phillip Morris International (PMI).

In the late 2000s, PMI had a mandate to “explore adjacent technologies that could lead to new lines of profitable business” and a robust R&D division that knew the potential of the plant.

“There was a small group at PMI … that were producing proteins in the tobacco plant,” recalls Nathalie Landry, executive vice president of scientific and medical affairs at Medicago. “We were using a different plant that is in the same family … but it’s not the one used to produce cigarettes.”

Medicago, which had gone public a year earlier, was in a precarious spot. Much of its funding had dried up and it needed an infusion of cash.

“It was a tough time,” recalls Andy Sheldon, the CEO from 2003 to 2017.

So when Sheldon realized PMI representatives were attending the same biotech conference he was in Vancouver in 2007, he quickly brokered a meeting.

A year later, PMI invested $16 million in Medicago to become a 49.8 per cent shareholder of the company.

“They were our major lifeline, an economic lifeline for the start of the company,” Dr. Ward said.

“Their involvement was actually probably critical for the survival of the company.”

In 2013, a new investor came along with experience developing pharmaceutical products: Mitsubishi Tanabe Pharma. The Japanese-based firm became the majority shareholder of Medicago, taking the company private. PMI’s interests were reduced to a 40 per cent stake at that time, which today stand at approximately one third.

But regardless of PMI’s ownership share, Medicago’s relationship with Big Tobacco has been an ongoing source of friction.

When trying to attend WHO meetings, Medicago found it difficult to get a formal invitation.

“We manage to always get the notification and invitation. But it’s not through the ‘big door,’” Landry said. “WHO, although they love the product and the technology, they have to deal with the fact that we’re supported by tobacco. … It’s difficult for Medicago to be associated with WHO.”

The WHO has a detailed framework about who it will partner with, stating it “does not engage with the tobacco industry or with non‑State actors that represent the interests of the tobacco industry.” However, a spokesperson for the WHO said “Medicago has been treated the same as all other influenza vaccine manufacturers and they have been in various WHO meetings.”

Last July, Medicago announced a new partnership with another major pharmaceutical company, GlaxoSmithKline — one of the leading makers of smoking cessation products, with brands like Nicorette and the NicoDerm patch. Medicago would be using GSK’s adjuvant in its COVID-19 vaccine to amplify its effectiveness.

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At the bottom of the press release, Medicago signalled it was planning to distance itself from PMI. It said PMI was seeking offers from investors who might be “better suited to help Medicago on the next phase of its journey.”

“You can anticipate that having a big pharma working with a tobacco company could be a challenge,” Landry said.

GSK declined to comment on PMI’s potential exit and whether it was spurred by its recent partnership with Medicago.

“Any attempt to divert attention away from a vaccine candidate is irresponsible,” PMI spokesperson Corey Henry said. “Medicago has completed its first phase of clinical trials, which yielded positive results and require progression.”

Despite signalling its intent to look for a more suitable partner, the impact of Medicago’s association with PMI endures.

Notably, last November, the medical journal The Lancet, which had published Medicago’s influenza study only a month earlier, decided not to publish the Quebec company’s phase one COVID-19 results over concerns about who was supporting the research.

In an email obtained by Global News, a senior executive editor from The Lancet explained to Medicago: “We have no major issue with the science of this trial, and it seems to be a promising public health advance. … I’m afraid the editorial meeting concluded that we should follow the guidelines and not publish research supported by the tobacco industry.”

The Lancet said it does not comment on individual cases and would not explain why it had accepted Medicago’s influenza study earlier this fall and not its subsequent COVID-19 research.

Meanwhile, Medicago’s medical officer Dr. Brian Ward vigorously defends the integrity of his work.

“We are not publishing tobacco science.”

The federal government would not answer questions about whether Medicago’s association with PMI impacted its earlier decisions whether or not to fund Medicago.

In the most recent chapter of its corporate makeover, in early December, Medicago parted ways with Clark, a former PMI VP, and replaced him with Takashi Nagao, former chairman of the Medicago board and Mitsubishi Pharma Tanabe executive.

While Mitsubishi Tanabe Pharma declined to comment on the change in leadership, Medicago’s Nathalie Landry said that while Clark was “instrumental in leading Medicago to where we are today … Takashi is qualified to lead Medicago through this business model change.”

80 million doses expected in 2021

Today, the pace of construction at Medicago’s new production plant on the north-east side of Quebec City plant mirrors the urgency in its labs.

A greenhouse, the size of 10 football fields will soon grow thousands of plants which could satisfy far more than the Canadian demand.

If Health Canada gives it the go-ahead, Medicago expects to deliver 80 million doses of its COVID-19 vaccine this year, doubling that in 2022. By the time the new facility is fully functioning in late 2023 or early 2024, it hopes to produce a billion doses a year.

“The pressure is high, and I think everybody in the company is tired,” Dr. Ward said. “But we’re also among the few people in the world that are actively working to try to make things better.”