Cell Therapy Industry HiLites 2009-02-13

A little slower week allowed for a little more in-depth analysis rather than just passing on the headlines. Hope you enjoy...

My post "Regenexx vs FDA 2009" has generated much discussion both on and offline from interested observers, Regenexx patients, and even Dr. Christopher Centeno himself. Some of that discussion has take place at KneeGuru.co.uk where there is an ongoing discussion thread about the Regenexx therapy and some of it has taken place here in the comments section of the blog. Dr. Cento has now posted an email he sent me last week as a comment to the blog for the benefit of all to see. This will continue to be a very interesting case to watch as the year develops and we see whether or not the FDA is satisfied to let this kind of clinical practice proceed.

FINANCIAL

I've always wondered who the investors are who, unlike me - despite my irrational optimism about cell therapies - buy public shares in such early-stage companies like GERN or STEM despite them being so many years away from having a commercial product. Nonetheless, I've always admired Geron's ability to move and capitalize on movements in its share price.

True to its talents, Geron Corporation (Nasdaq: GERN) announced today (Feb 13) the sale of 7.25 million shares of its common stock. The offering is expected to close on February 19, 2009. On February 12, the press release states, "the last reported sales price of Geron common stock on the Nasdaq Global Market was $7.77".

In an article entitled, "Geron's Stem-Cell Hype Soaks Investors", Adam Feuerstein from theStreet.com is reporting the shares were sold at a price of $6.60, a 14% discount to the stock's Thursday closing price of $7.77 and that the spot-financing deal grossed Geron about $43 million. Geron has not yet disclosed the sale price but is expected to so when the financing closes on Feb. 19. Geron shares fell over 14% to below $6.50 in Friday's trading.

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A little update on Northwest Biotherapeutics, Inc. (AIM:NWBS and NWBT; OTC BB: NWBO). Some of you will recall that NWBT went public on the AIM market mid-2007. NWBT's lead product is its DCVax^® platform technology that it is studying in multiple cancers. DCVax^®recently reported some positive interim data in ovarian cancer although their most advanced trials are in prostate and brain cancers.

Last May NWBT announed it had secured a loan of $4 million from Al Rajhi Holdings W.L.L. who held - at that time - in excess of ten per cent of the company's issued and outstanding common stock of the company.

In October the company announced it had entered into a Loan Agreement and Promissory Note with SDS Capital Group SPC, Ltd for $1 million with a maturity date of April 1, 2009. The company anticipated this would get them through November 2008.

In November, the company announced that it had obtained US$1.65 million in debt funding pursuant to Loan Agreements and Promissory Notes with SDS Capital Group SPC, Ltd (“SDS”) and a group of private investors with the Notes maturing April 21, 2009. The company expected this cash would get them through December 2008.

In December, the company announced that it had obtained US$0.5 million in debt funding from Toucan Partners and that these proceeds were expected to fund the Company’s cash needs into January, 2009.

In January, NWBT announced the settlement of a securities class action lawsuit by the payment of a $1 million settlement to be funded out of insurance proceeds. The case alleged that the Company misrepresented certain facts that resulted in the artificial inflation of the price of Northwest Biotherapeutics publicly-traded common stock between April 17, 2007 and July 18, 2007. The Company disputed the allegations of the lawsuit, and denies any such misrepresentation or that the shares of Northwest Biotherapeutics common stock were artificially inflated. Nevertheless the Company announced it was settling the lawsuit to avoid potentially expensive and protracted litigation. The Company also announced that the formal investigation by the SEC into the matter has been closed without any action taken.

Without doubt the lawsuit has severely impacted the company's ability to raise funds. Now that the legal action is settled and the SEC has gone away, their only hurdle is an impossible fund raising market and presumably only weeks left of cash. We will watch with interest.

CLINICAL

Osiris Therapeutics, Inc. (NASDAQ: OSIR) announced the final two-year results for the Company's trial evaluating Prochymal(R) for the treatment of acute myocardial infarction. The data showed lasting clinical benefit in heart attack patients. Prochymal is Osirs' proprietary formulation of adult stem cells designed to provide therapeutic benefit by controlling inflammation, promoting tissue regeneration, and preventing scar formation. The phase I double-blind, placebo-controlled study of 53 patients, which evaluated safety and preliminary efficacy, found heart attack patients receiving the intravenous therapy had lower rates of adverse events and significantly improved heart function. Study findings included:

• The trial met its primary endpoint demonstrating safety of Prochymal in the acute MI setting.
  
• Patients receiving Prochymal had fewer adverse events compared to placebo. A lower percentage of patients treated with Prochymal required repeat hospitalization.
  
• Patients receiving Prochymal had reduced incidence of cardiac arrhythmia. Patients receiving Prochymal had a significant and durable improvement in cardiac function.
  

"We are now advancing this program into a larger Phase II trial, focusing on patients with more severe heart damage," said C. Randal Mills, Ph.D., President and CEO of Osiris Therapeutics.

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New Zealand's Living Cell Technologies (ASX:LCT, OTCQX: LVCLY) has reported some interim results from its Russian clinical trial of its DIABECELL® implants for insulin dependent diabetes showing signs of sustained benefit. DIABECELL® is LCT's encapsulated porcine insulin-producing cell product designed for the treatment of type 1 diabetes without the use of immunosuppressive drugs.

A total of seven patients have received DIABECELL® implants, five of whom have had two low dose (5,000 islet equivalents (IEQs) per kg body weight) implants at least six months apart. There have been no remarkable adverse events attributed to double implants. Two patients have received a single higher dose (10,000 IEQs/kg) with no safety concerns to date. Therapeutic benefits have also been observed and are described in the update sent to me but not yet available on the company's website.

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Some of my readers and those who listen to my talks aren't fans of the fact I continue to report on and include 'stem cell tourism' companies in my analysis of the cell therapy sector. I understand the reservations and the fact I include them should not be considered an endorsement. My take is that these companies are not going away, they are real business, they are conducting cell therapy as I define it (shodddy or not, credible or not, ethical or not) and and what is needed (per ISSCR) is an informed and informative discussion about how to inject some level of quality assessments over these otherwise unregulated companies and therapeutics.

One such company is Regenocyte Therapeutic. Operating out of Florida where they have their offices and a clinic (I believe for pre- and post-procedural assessments and care), Regenocyte is in the business of recruiting mostly US patients with heart disease for stem cell injections at a clinic in the Dominican Republic for a cost of somewhere around $55,000. They collect blood in a standard blood draw, send it to Israel for the isolation and expansion of stem cells, and then ship the product and patient to the clinic for the stem cell injection. Sounds like your average stem cell tourism business so far but Regenocyte is trying to be different.

Firstly, they don't pretend to be trying to cure everything. They don't have a long laundry list of illnesses they treat. Their website says they focus is on treating patients with heart attack damage, chest pain, poor circulation, leg pain and heart failure. A November press release listed the diseases they address as including congestive heart failure, cardiomyopathy, peripheral artery disease, coronary artery disease, kidney disease, ischemic heart disease, pulmonary disease and early senile dementia.

This is still a long list but largely cardio-vascular in nature and certainly not nearly as long or diverse as many of these clinics advertise. Having said that, they are not unfamiliar with the kinds of promotions and claims that are the trademark of similar clinics. The leading spokesperson, Dr. Zannos G. Grekos, MD, FAAP, recently boldly stated "we are more than doubling cardiac patients' ejection fraction, improving kidney and pulmonary function, saving limbs from amputation by creating new circulation pathways and most recently reversing the life-threatening effects of metabolic heart disease". Not wanting to stop there he then also announced upcoming plans to treat several neurologically based diseases and macular degeneration.

Secondly, Regenocyte is actively looking for a US manufacturer that will produce their cell product in compliance with FDA's rules governing domestic manufacture and export of their class of product.

Thirdly, they are doing at least some long-term follow-up of patients. “We’ve now treated close to 100 patients with their own stem cells and seen an average 22 point increase in ejection fraction (EF) with a significant improvement in heart failure classification - typically from a Class IV to a Class II status in less than 180 days," Grekos states in a press release this week. The cardiomyopathy treatment study, the first six months of which was published December 2008 in Anti-Aging Medical News, follows patients through one year post-treatment with autologous adult stem cells. Grekos and his team measured patients’ heart function by cardiac nuclear scans, PET scans, and echocardiographs.

Finally, the newly published ISSCR Guidelines has given such clinics a potential stamp of legitimacy. Paul Schwartz, Chief Operations Officer says “The patients’ safety comes first,” he explains. “We adhere strictly to ISSCR (International Society for Stem Cell Research) and WHO (World Health Organization) guidelines...”.

COMMERCIAL

Tissue Genesis, Inc announced they have been awarded a $3.62 million contract from the U.S. Department of Defense to continue its research and development activities focused on additional treatment options for those suffering from Peripheral Vascular Disease (PVD). PVD is a circulation disorder affecting blood vessels outside of the heart, including vessels supplying the hands, feet and legs, which can cause severe pain.

With the grant, Tissue Genesis will explore transplanting Adipose (fat) derived Stromal Cells (ASCs), isolated from a patient’s own fat using the Tissue Genesis Cell Isolation System, directly into tissues damaged by a low blood supply. This is expected to increase circulation and relieve symptoms of PVD. An improvement in circulation is directed at preventing disease progression, which left untreated ultimately results in 130,000 amputations annually.

According to Anton C. Krucky, President and Chief Executive Officer of Tissue Genesis, the Department has now awarded the company nearly $24 million to research and develop autologous, adipose derived regenerative medical therapies.

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Cord Blood Registry, a services company in the collection and preservation of newborn stem cells from umbilical cord blood, announced the company exceeded $100 million in annual revenue for 2008 – an increase of 28 percent over 2007. In addition, the company surpassed 250,000 total cord blood units in storage, which represents a 26 percent growth rate for 2008. The company also announced that it released its 100th cord blood unit for medical use, a milestone attesting to the rapidly increasing use of a child’s own newborn stem cells (also called autologous use) for medical therapies to help repair damaged tissue and regenerate healthy cells.

In 2008, the company released one cord blood unit every other week for medical use. To date in 2009, the company has released more than two units per week for medical use. The majority of units released – more than 80 percent – have been used to treat the child from whom they were collected. CBR CEO stated that they expect to release more units for medical use this year than they have released in the previous 12 years.

CBR also announced that it is in discussions with three leading medical institutions to launch a clinical study that will evaluate the use of a child’s own newborn stem cells to treat hearing loss caused by an accident or severe illness. The research will be facilitated and coordinated by The CBR Center for Regenerative Medicine which is currently screening potential candidates for the study.

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Hongkong's Cordlife and Switzerland's BioSafe SA, have announced they have brought the Sepax automated cord-blood processing system to Hong Kong. Sepax is reported to harvest significantly higher numbers of stem cells from cord blood. To date, over 400,000 cord-blood units in 40 countries have been processed using Sepax. The Swiss-made system is also accredited with health ministries worldwide, including those of Japan, the European Union, Canada and Australia.

RESOURCES & EVENTS

NLHBLI has issued a new RFP for PACT centers and administrative office entitled "Cell Processing Facilities in support of the NHLBI Production Assistance for Cellular Therapies (PACT) Program and Support of NHLBI Translational Research in Cell Therapies." The period of performance is for five years beginning on or around November 2, 2009.

Looks like they are wanting to expand to 6 centers in total. I can't imagine the 3 existing centers - University of Minnesota 's Molecular and Cellular Therapeutics facility (MMCT), Baylor College of Medicine's Center for Cell and Gene Therapy (CAGT), and the University of Pittsburgh's Cancer Institute (UPCI) - not getting renewed. What will be interesting is to see who applies and who they choose for the other 3. Will there be any "corporate" service companies that apply and/or are selected?

What's interesting is the fact this is being renewed despite my understanding that at least initially they had difficulty finding ways to spend their money under their mandate as it was initially conceived. This is in part, I believe, why PACT resorted to spending their money on educational type activities. Not that they weren't needed and certainly the identification of that need was also, I suspect, part of their motivation to steer in this direction. Still, according to their most recent newsletter, as of December 2008, PACT had received over 655 application requests for the manufacturing of cell therapy products and while this resulted in over 180 cell products have been administered to patients, it was only from 14 approved projects.

While we're on the subject, one of the useful non-manufacturing outputs from PACT is an abridged list of commercially available cytokines and antibodies. This is not purported to be an exhaustive list but if you see changes you think should be made, let me know - I'll collect your input and forward it on to them.

For those interested, PACT also has a list of cell therapy facility/process/compliance-related SOP's which are available upon request.

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ISCT is hosting a two-part validation webinar:

• (Part 1): Validation and Qualification of Equipment and Reagents. Wednesday, February 18, 2009,12pm - 1pm EST. Speakers:Lizabeth Cardwell MT(ASCP), RAC, MBA, Principle Consultant, Compliance Consulting, WA; Karen Edward, BS, Advanced Cell and Gene Therapy, NY
  

• (Part 2): Validation of Processes: Retrospective and Prospective. Wednesday, March 25, 2009,12pm - 1pm EST
  

Sign-off...

So that's the shape I saw the biz of cell therapy taking this week. Hope you got something useful...

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Cell Therapy 2009. San Diego. May 3-6.
Attend. Exhibit. Sponsor. Submit your abstract (Deadline: February 200
http://www.celltherapy.org

I'll see you there, right?

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p.s. Ok I didn't actually buy a bus ad. I cheated. I used the free online bus ad generator :)