Under agreement with StreetWise Reports, I'm pleased to share their recent coverage of the regenerative medicine sector.
Original Source: Source: Peter Byrne of The Life Sciences Report (1/22/15)
"Convert Catalysts into Profits: Sagient Research's Edward Stopke"
The biotech sector is teeming with companies racing to bring the hot new drug or therapy to the marketplace. But realistically assessing the therapeutic potential of pipeline products is the healthy approach for selecting a winner. In this interview with The Life Sciences Report, Edward Stopke of Sagient Research unveils his list of companies with catalytic moments in the making.
The Life Sciences Report: What types of catalysts affect biotech stocks?
Edward Stopke: The primary catalyst affecting a biotech stock is trial data, especially large Phase 3 trials that test the compound against a comparator. The other main catalysts emerge from regulatory interactions with the U.S. Food and Drug Administration (FDA) or the European Medicines Agency. Product safety rulings can drastically affect the trajectory of a biotech stock, of course. But investors need to watch a company's interactions in meetings with the advisory committees serving the governmental agencies. These interactions can presage whether or not the agency will eventually approve the drug.
TLSR: Are there economic catalysts that affect the life sciences sector as a whole?
ES: Pending changes in pricing policies for therapies can catalyze shareholder actions. Historically, many companies have been able to price high without too much backlash from payers. Companies have typically charged less for treatments with large patient populations, and the more expensive treatments target smaller numbers of patients. But during the last year, some high pricing became less sustainable. I am thinking of Gilead Sciences Inc.'s (GILD:NASDAQ) pricing for Sovaldi, its treatment for hepatitis C virus (HCV), which caused quite a stir with insurers and governments alike. Companies generally argue that high prices are in line with previous treatments and that the products offer superior efficacy. But the sheer number of eligible patients for a high-priced drug can strain entire healthcare systems. I predict that during 2015 payers will force prices downward, not just for highly prevalent diseases such as HCV, but in all therapeutic markets, stem cells included.
TLSR: What catalysts are coming up for stem cell companies in 2015?
ES: Cytori Therapeutics Inc. (CYTX:NASDAQ) is developing a stem cell therapy from fat-derived stem and regenerative cells. It has Phase 1/2 data for heart disease slated for release in Q1/15. Vericel Corp. (VCEL:NASDAQ), which recently changed its name from Aastrom Biosciences Inc., has Phase 2 data expected in H1/15 on tissue repair cells for heart failure. Athersys Inc.
(ATHX:NASDAQ) is developing a stem cell product called MultiStem.
TLSR: What are the projected applications for MultiStem?
ES: Athersys is studying MultiStem in human trials for stroke, myocardial infarction (MI) and graft-versus-host disease (GvHD). It is in Phase 2 development for stroke and early Phase 1 for MI and GvHD. The firm completed enrollment in its Phase 2 stroke study before the new year, so the first 90-day results will emerge in Q1/15E. Athersys plans to progress its MI program into Phase 2 in Q1/15. The company is looking for a development partner to further its program. Announcing a partnership deal would signal investors that experts have faith in MultiStem, and Athersys' stock price would respond positively.
TLSR: Who else do you like in the stem cell space?
ES: bluebird bio Inc. (BLUE:NASDAQ) is developing its Lenti-D product, which is more of a gene therapy product, but does consist of the patient's own stem cells. These are modified by the lentiviral vector to deliver genetic material into the cells themselves. There is a lot of hype floating around this company. It is currently in Phase 2/3 studies for a rare genetic disease, adrenomyeloneuropathy, which is similar to multiple sclerosis. Hopefully, we will see data for that pipeline product next year.
TLSR: What other therapeutic spaces do you like for strong catalysts in early 2015?
ES: Neuralstem Inc. (CUR:NYSE.MKT) has a major depressive disorder product in clinical trials code named NSI-189. It is an oral compound designed to stimulate neurogenesis of the hippocampus, which could potentially reverse the atrophy seen in depression and schizophrenia. So far, we have only seen earlier preclinical and Phase 1 data, but those results have shown meaningful reductions in both cognitive and depressive symptoms in patients who are on active therapy. And the treatment has been well tolerated.
TLSR: How does Neuralstem's product differ from competitive products?
ES: There are many treatments on the market for treating depression, of course. Most of these products, however, are small molecules. They work by inhibiting the reuptake of a combination of norepinephrine, serotonin and/or dopamine. Neuralstem's treatment uses the patient's own neural stem cells to protect against damage to the nervous system itself, and to repair existing damage, too.
TLSR: What expertise do Neuralstem's managers bring to the marketplace?
ES: Neuralstem's chief scientific officer and senior vice president of research previously worked at the National Institutes of Health's Laboratory of Molecular Biology, where they researched the isolation of human neural stem cells.
TLSR: Do you see any other potential catalysts for Neuralstem?
ES: If all goes well, Neuralstem's NSI-189 product will move into Phase 2 development in Q2/15, so that is a good advancement opportunity. We should see topline results in the early part of this year for the firm's other stem cell products, including NSI-566. That treatment is currently being studied in a Phase 2 trial for Lou Gehrig's disease.
TLSR: Who is making waves in the cancer treatment space?
ES: There is a lot of excitement surrounding the chimeric antigen receptor (CAR) T-cell immunotherapies that engineer the patient's own immune cells to target tumor-specific molecules. Kite Pharma (KITE:NASDAQ) is developing its CAR T programs for hematologic cancers, and its KTE-C19 program has shown high response rates in earlier Phase 1/2 studies. Kite just bought a licensing deal with Amgen Inc. (AMGN:NASDAQ). The deal is related to the next generation of immunotherapies based on Kite's cell therapy platform. Celgene Corp. (CELG:NASDAQ), Novartis AG (NVS:NYSE) and Juno Therapeutics (JUNO:NASDAQ) are working on similar programs.
Rexahn Pharmaceuticals Inc. (RNN:NYSE.MKT) has a couple of clinical-stage oncology candidates. Its most advanced compound is known as Archexin. It targets the PI3K pathway and is being studied in a Phase 2 trial for renal cell cancer. While we have not yet seen data yet from this compound, last year the FDA approved Gilead's Zydelig for lymphoma, which has a similar mechanism of action. Other large pharma companies, such as Novartis and Merck and Co. Inc. (MRK:NYSE), are studying similar compounds in various oncology indications. The research synergy with these big firms could prove fruitful for Rexahn in terms of acquisition potential.
TLSR: I see that Rexahn recently appointed Richard Rodgers to its board. What does Rodgers bring to the company?
ES: He brings experience with in- and out-licensing, as well as mergers and acquisitions. He was previously with Abraxis BioScience Inc. until it was acquired by Celgene. He was also with MGI Pharma Inc., which was acquired by Eisai Inc. (ESALF:OTCPK).
TLSR: What types of specific catalysts are likely to affect Rexahn's stock price?
ES: If Rexahn can harness Rodgers' experience to secure a licensing deal for Archexin, its stock price would obviously respond positively. It has a few other early-stage compounds in various tumor types. If any of these products survive later-stage studies, the market will provide rewards. We could see some Phase 1 data from Rexahn's RX-5902 and RX-3117 compounds in the near future. These are being studied for very solid tumor indications.
TLSR: What other biotechs with emerging catalysts do you follow?
ES: I like quite a few smaller companies, like Raptor Pharmaceutical Corp. (RPTP:NASDAQ), Celator Pharmaceuticals (CPXX:NASDAQ), Sarepta Therapeutics Inc. (SRPT:NASDAQ), Celldex Therapeutics Inc. (CLDX:NASDAQ), PTC Therapeutics Inc. (PTCT:NASDAQ) and Rockwell Medical Inc. (RMTI:NASDAQ). Each of these has a unique pipeline.
TLSR: Can you synopsize where each of these companies is at in the pipeline?
ES: Raptor Pharmaceutical's main compound is Procysbi. It is already on the market. It was approved in 2013 to treat cystinosis, and it is one of only three such treatments approved in the U.S. Raptor is also studying Huntington's disease and nonalcoholic fatty liver disease, the latter being of notable interest due to its large market size and connection to obesity. Raptor is expecting results from its larger Phase 2b study in H1/15.
Celator Pharmaceuticals is developing CPX-351 for leukemia. It began Phase 3 development in late 2012 with about 300 patients. The first results from this study are expected sometime in Q2/15.
Sarepta Therapeutics has a number of compounds. The most advanced is eteplirsen, developed for a type of muscular dystrophy. We have seen clinical data on it, and it is fairly good, although taken from a small subset. There is a lot of speculation about whether the FDA will accept Sarepta's new drug application (NDA) and what kind of data the agency will require for approval. Sarepta expects to file around the middle of this year. A successful filing and acceptance could move the stock price nicely.
PTC Therapeutics is developing its ataluren compound for muscular dystrophy. The company submitted a rolling NDA to the agency in late December. It is not yet a complete application, but it does allow completed portions of the application to be submitted and reviewed on an ongoing basis. PTC hopes to complete the application in late 2015. We should see the first results from its larger Phase 3 study toward year-end 2015.
Celldex Therapeutics' most advanced candidate is rindopepimut, which is being developed for glioblastoma, brain cancer. Topline results for a large Phase 3 are expected in the middle of this year. If the results prove positive, Celdex shareholders will benefit, as rindopepimut is the firm's main compound in a large treatment space.
Rockwell Medical has a single compound called Triferic. It is being reviewed by the FDA as a treatment for iron deficiency in chronic kidney disease patients. The agency is expected to give a decision on provability by the end of this month.
TLSR: Aside from handicapping the pipeline products, what qualities do you look for in a firm?
ES: It is vitally important to understand the capital structure of a company. As far as a company's potential staying power, I look at the general platform. Is it a stem cell platform? Is it a genetic therapy type of platform? Is it a completely new mechanism of action? Is it something that could be used in various types of diseases?
TLSR: Sounds good, Edward. Thank you for speaking with us.
ES: Thank you, Peter.
Edward Stopke is a financial analyst with BioMedTracker and has been with Sagient Research for three years. He is responsible for day-to-day analysis with the BioMedTracker analyst team, and works with the scientific analysts to determine the financial and market impact of early-stage drugs. In his time with Sagient, Stopke has gained an understanding of the pharmaceutical and biotech development process to better develop revenue models for various indications. Stopke received a bachelor's degree in economics from San Diego State University.
Want to read more Life Sciences Report interviews like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see a list of recent interviews with industry analysts and commentators, visit our Interviews page.
DISCLOSURE:
1) Peter Byrne conducted this interview for Streetwise Reports LLC, publisher of The Gold Report, The Energy Report, The Life Sciences Report and The Mining Report, and provides services to Streetwise Reports as an independent contractor. He or his family own shares of the following companies mentioned in this interview: None.
2) The following companies mentioned in the interview are sponsors of Streetwise Reports: Rexahn Pharmaceuticals Inc., Neuralstem Inc., Athersys Inc. The companies mentioned in this interview were not involved in any aspect of the interview preparation or post-interview editing so the expert could speak independently about the sector. Streetwise Reports does not accept stock in exchange for its services.
3) Edward Stopke: I own, or my family owns, shares of the following companies mentioned in this interview: Gilead Sciences Inc., Sarepta Therapeutics Inc. I personally am, or my family is, paid by the following companies mentioned in this interview: None. My company has a financial relationship with the following companies mentioned in this interview: None. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I determined and had final say over which companies would be included in the interview based on my research, understanding of the sector and interview theme. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.
4) Interviews are edited for clarity. Streetwise Reports does not make editorial comments or change experts' statements without their consent.
5) The interview does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer.
6) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their families are prohibited from making purchases and/or sales of those securities in the open market or otherwise during the up-to-four-week interval from the time of the interview until after it publishes.
Streetwise – The Life Sciences Report is Copyright © 2014 by Streetwise Reports LLC. All rights are reserved. Streetwise Reports LLC hereby grants an unrestricted license to use or disseminate this copyrighted material (i) only in whole (and always including this disclaimer), but (ii) never in part.
Streetwise Reports LLC does not guarantee the accuracy or thoroughness of the information reported.
Streetwise Reports LLC receives a fee from companies that are listed on the home page in the In This Issue section. Their sponsor pages may be considered advertising for the purposes of 18 U.S.C. 1734.
Participating companies provide the logos used in The Life Sciences Report. These logos are trademarks and are the property of the individual companies.
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Thursday, January 22, 2015
Friday, January 9, 2015
Where Do Cures Reside? ARM Executives Think the Answer Is in Regenerative Medicine
Under agreement with StreetWise Reports, I'm pleased to share their recent coverage of the regenerative medicine sector.
Original Source: George S. Mack of The Life Sciences Report (01/18/2015)
http://www.thelifesciencesreport.com/pub/na/where-do-cures-reside-morrie-ruffin-and-michael-werner-of-the-alliance-for-regenerative-medicine-think-the-answer-is-in-regenerative-medicine
Where Do Cures Reside? Morrie Ruffin and Michael Werner of the Alliance for Regenerative Medicine Think the Answer Is in Regenerative Medicine
The practice of medicine is being transformed. The journey has been arduous, but revolutionary stem cell, gene and immunocellular therapies are rapidly moving toward pivotal milestones—and investors in the space should strap in for a rewarding joy ride. In this interview with The Life Sciences Report, Alliance for Regenerative Medicine cofounders Morrie Ruffin and Michael Werner consider how new federal guidance might enable new standards of care in cardiovascular, neurologic and oncologic medicine, and offer a preview of next week's Biotech Showcase in San Francisco.
The Life Sciences Report: On Dec. 22, the stem cell and regenerative medicine space saw a very significant development. The U.S. Food and Drug Administration (FDA) published a newdraft guidance paper on what constitutes minimal manipulation of human tissues and cells. Although this document is not binding, it does tell us what the agency is thinking. In effect, tissues and cells that have been processed in some way will be treated as drugs, and will come under the regulatory umbrella of the FDA. What does this mean for the industry?
Michael Werner: As sometimes happens with government agencies, major regulatory documents are released right before the holidays. As far as the Alliance for Regenerative Medicine (ARM) is concerned, our member companies are currently looking at the paper and trying to digest it. This draft guidance is open for comment for 60 days after its publication in the Federal Register. We will go through it with a fine-tooth comb, and we will prepare formal comments, which we will submit to the FDA early this year.
Generally speaking, I think the most significant aspect of the guidance is that it provides greater clarity on the FDA's definition of minimal manipulation and, therefore, which products can qualify as minimally manipulated, and which will be regulated as biologics or drugs.
What ARM has said, from its inception many years ago, is that this industry needs a clear and predictable regulatory pathway. The regulations for minimal manipulation have been around for a while, but as this field has expanded, and as the technology has changed, questions have arisen about how the FDA is applying its regulations, and what “minimally manipulated” means in the context of new, tissue-engineered products.
At the very least, it's important that the FDA has, through this document, been transparent about its views.
TLSR: Michael, will you explain further why this transparency is important?
MW: Companies need to know what the FDA is thinking. We've had conversations with individual companies that think the FDA will regulate them as a 361 HCT/P, but are not totally sure, which makes it hard to plan clinical programs. The fact that the FDA has come forward with a document like this is great. As always, the devil is in the details, and we will certainly be going over the document carefully. But published guidelines are a good thing.
TLSR: Could this guidance, in effect, run retail or storefront stem cell therapeutic clinics out of business?
MW: Time will tell. In terms of its impact on what you describe as storefront, I think it really comes down to this: If you are running one of those kinds of operations, or if you perform so-called stem cell tourism, you are now on notice about what kinds of technologies, processes and products are subject to FDA regulation. If you're a storefront clinic, you now know that the FDA not only believes it has jurisdiction to regulate, but how it's going to regulate in the days ahead. It lays the foundation for FDA's enforcement actions going forward.
I think we can expect the agency to use its enforcement discretion in a more consistent way. How aggressive it will be in terms of going after storefront clinics remains to be seen.
TLSR: Do you feel that this, in the long run, is going to be positive for the regenerative medicine and stem cell industry?
MW: I think it will. If you're a product developer, what you want is clarity. You want to know where the goalposts are, and you don't want the goalposts to keep moving. If the FDA is transparent, then that's 80% of the ballgame for the product developer.
Now, in terms of specific policies, the specific ways FDA is going to apply the regulations—that remains to be seen. Companies can—and will—go back to the FDA and say "Here are our thoughts about some of the specifics." Of course, each individual company must go through an iterative process with the agency regardless.
TLSR: It feels like the track to progress, and to the market, for the regenerative medicine industry has been even more difficult than it was for monoclonal antibodies, for lack of a better comparator. What do you think has held the industry back?
MW: One thing has been the clarity of the regulatory pathway. You describe the industry as being held back, but I'd like to say, more positively, that more clarity and predictability in the pathway would enable more products to move forward.
Another key issue involves standards, which has been acknowledged by the FDA and industry as important in terms of enabling more products to come to market. We also need changes to the reimbursement and payment systems, both public and private, to reward innovation. These are different products and models, differentiated by how they treat diseases at the underlying molecular and cellular level, and they could lead not only to treatments, but also to cures.
We need support from the U.S. government in terms of policies, in the same way that governments in Japan, the United Kingdom and elsewhere around the world have been enacting policies specifically designed to support the sector. The U.S. government needs to do the same.
The field is now poised to make a significant impact on healthcare. It's hard to say what's held the field back, but reimbursement is certainly a challenge that we need to get our hands around, to make sure the sector reaches its potential.
TLSR: Morrie, did you want to comment? The cell therapy/regenerative medicine sector has been in development now for about two decades-plus, yet I see only a couple of stem cell companies with a market cap above $1 billion ($1B), and all the rest are in the penny-stock to $500 million category. Why have cell technology companies lagged biotech?
Morrie Ruffin: We actually don't see it that way. That's one of the things we will show in the data that will be coming out in our Regenerative Medicine and Advanced Therapies State of the Industry Briefing on Jan. 12 at the Biotech Showcase in San Francisco.
Clearly, as in any sector, there are going to be successes and failures, but we do see a very significant and recognizable upward trend in the amount of money being raised in the sector. The cancer immunotherapy space is drawing a lot of interest right now.
But if you look across the board at cell therapy, gene therapy and immunocellular therapy companies, we count nine to 10 public companies with $1B-plus market caps in the sector right now. And there are obviously a number of private companies raising significant amounts from private investors as well.
TLSR: Morrie, are we on the verge of seeing pivotal data come out of companies in the sector?
MR: We are about to see a number of very significant events in the sector. Clearly, both those working in the industry and investors are looking for positive clinical events—milestones—that signal we are making progress in the clinic, and that we understand how we might commercialize these therapies. Over the next year or two, you will see a number of very significant data events around cell therapy. We are already seeing this in the oncology space, which is why there is so much interest in what's happening with cell-based or immunotherapies. This has led to a significant interest in cellular therapies across the board. Investors are going to hear a lot in the near future, as people begin to understand the clinical milestones that are going to drive this sector over the next 12–18 months.
TLSR: What do you think is the greatest obstacle to this industry moving forward? Is that issue being addressed currently?
MR: One of the challenges in this space—and I think this is to be expected in any evolving sector—is the issue of commercialization, which concerns manufacturing, scale-up and all the things required to make these new products available and successful. I believe that we have made tremendous progress just in the last few years in understanding what this will take, whether it's an allogeneic therapy or an autologous therapy. I think this is one of the reasons we see manufacturing and tool companies making significant investments in the sector. Companies like GE Healthcare (a unit of General Electric Co. [GE:NYSE]), Thermo Fisher Scientific Inc. (TMO:NYSE), the Lonza Group AG (LONN:SIX; LO3:FSE; LZAGF:OTCPK) and others are heavily engaged in this space. They see the huge opportunity here.
The cell therapy companies also understand that infrastructure is going to be an important part of how these therapies are brought to the market, and to the patient. One of the things we have been anticipating is having the processes of manufacturing, handling, and scale-up catch up with the lab bench science, and then duplicating that science on a large, profitable scale. I think we are on the cusp of that.
TLSR: Michael, you raised a point about government being involved in regenerative medicine, and you mentioned Japan, which has a new regulatory pathway in place whereby companies, in effect, have to show safety and the equivalent of Phase 2 proof of concept to get conditional approval for a cell therapy. Do you see the U.S. doing anything like that?
MW: I'll put it this way: I think it's possible the U.S. will take steps analogous to what other countries are doing to support the field. Is the FDA going to give conditional approval if a company shows certain kinds of safety data? I'm not sure about that, but I do think it is possible to take steps to smooth the pathway forward. For instance, we've talked with the FDA about standards in product development and manufacture. This is an idea that the FDA itself has said is critical to its product review process. Other ideas could include expedited approval programs. Such a program was recently created in the U.S. to support development of antibiotics.
The question is whether the kinds of programs that already exist can be applied or adapted to regenerative medicine, cell therapy and gene therapy products. I think you're more likely to see changes in existing U.S. policy, rather than copying Japan's policy or copying what other countries are doing.
TLSR: What do you think will be the motivating factor for policymakers to accelerate cell therapy development?
MW: There is more recognition that this sector could, potentially, cure diseases that have gone untreated or have been deemed incurable. In diseases like stroke or heart disease, we are basically treating symptoms. We are certainly helping people, but we are not actually curing disease. We're not getting people all the way back to health.
I think there's a greater recognition on the part of policymakers, as well as others, that regenerative medicine—and we use that term very broadly—is where cures and treatments are going to reside. Therefore, you're starting to see more acknowledgment of that. The U.S. government needs to make sure there are policies in place that will allow this industry to thrive.
TLSR: Morrie, you and Michael are going to be at the Biotech Showcase in San Francisco. What will you and ARM members be doing for attendees?
MR: One of the things we're doing, at the kick-off for the showcase at 8 a.m. on Monday, Jan. 12, is presenting our Regenerative Medicine and Advanced Therapies State of the Industry Briefing. This will be our fifth briefing at the Showcase. In the two-hour briefing, we will provide information on the performance of the sector. We will look back at 2014 and 2013, highlighting the progress made in the sector. Then we will look forward to what we anticipate to be major milestones and major events over the coming two years.
TLSR: Will there be an emphasis on any particular topic, or will it be a very broad briefing?
MR: We will be talking about several different things, but we plan to spend a lot of time talking about the progress being made in the gene therapy sector and genetically modified cell therapies.
When we talk about advanced therapies in regenerative medicine, we are being inclusive of all the companies working in the in vivo and ex vivo gene therapy areas, whether that's cancer immunotherapy, or CAR (chimeric antigen receptor) T-cell receptors, or other strategies being employed to harness the immune system to attack cancer. This will be a big part of the briefing. We will also look forward to a number of the major data events that we anticipate in 2015, in a number of indications, including stroke, cardiovascular disease and a number of neurodegenerative disorders.
TLSR: Thank you both for your insights.
Morrie Ruffin has more than 20 years of experience in the biotech and healthcare industries. He is a founder and managing director of the Alliance for Regenerative Medicine, the global organization representing the interests of the regenerative medicine community. Ruffin is also the managing partner of Adjuvant Partners, a boutique regenerative medicine and advanced therapies business consulting firm. Prior to joining Adjuvant Partners, he was the chief executive officer of LifeTech Innovations LLC (LTI), a business development consulting firm. Prior to his position at LTI, he was executive vice president of capital formation and business development at the Biotechnology Industry Organization (BIO), the largest trade organization representing the biotech and drug development industries. Prior to joining BIO, Ruffin worked for U.S. Senator Arlen Specter for five years as his senior legislative assistant. He received his master's degree in international studies and economics from the Johns Hopkins School for Advanced International Studies and his bachelor's degree from the University of Virginia.
Michael Werner is a partner in Holland & Knight's Washington, D.C. office. He has almost three decades of healthcare law, lobbying, regulatory, reimbursement and policy development experience in Washington. He is also is the cofounder and executive director of the Alliance for Regenerative Medicine, a Washington, D.C.-based organization whose mission is to advocate for federal funding, regulatory and reimbursement policies that will advance regenerative medicine research and product development. Before joining Holland & Knight, Werner was president of The Werner Group, a Washington, D.C.-based firm that provided lobbying, regulatory, and bioethics consulting services for biotechnology and pharmaceutical companies, physicians, health plans, investors, and patient advocacy groups. Prior to founding The Werner Group, he was chief of policy for the Biotechnology Industry Organization (BIO), representing over 1,000 biotechnology companies in the U.S. and other countries. Werner is also a founding member of the Board of Directors of the Coalition for the Advancement of Medical Research. He was senior healthcare advisor to U.S. Senate Majority Leader George Mitchell, a congressional investigator for the U.S. Senate Special Committee on Aging, and senior advisor to Maryland Governor William Donald Schaefer. Werner is a frequent media commentator and has appeared in the Wall Street Journal, Science, Scientific American, the Washington Post, BIOWorld, Congressional Quarterly and the Baltimore Sun, as well as on many TV and radio news programs. In 2013, he was named one of the Top 50 Global Stem Cell Influencers by Total BioPharma.
Want to read more Life Sciences Report interviews like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see recent interviews with industry analysts and commentators, visit our Streetwise Interviews page.
DISCLOSURE:
1) George S. Mack conducted this interview for Streetwise Reports LLC, publisher of The Gold Report, The Energy Report, The Life Sciences Report and The Mining Report, and he provides services to Streetwise Reports as an independent contractor. He owns, or his family owns, shares of the following companies mentioned in this interview: None
2) The following companies mentioned in the interview are sponsors of Streetwise Reports: None. The companies mentioned in this interview were not involved in any aspect of the interview preparation or post-interview editing so the expert could speak independently about the sector. Streetwise Reports does not accept stock in exchange for its services.
3) Morrie Ruffin: I own, or my family owns, shares of the following companies mentioned in this interview: None. I personally am, or my family is, paid by the following companies mentioned in this interview: None. My company has a financial relationship with the following companies mentioned in this interview: None. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I determined and had final say over which companies would be included in the interview based on my research, understanding of the sector and interview theme. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.
4) Michael Werner: I own, or my family owns, shares of the following companies mentioned in this interview: None. I personally am, or my family is, paid by the following companies mentioned in this interview: None. My company has a financial relationship with the following companies mentioned in this interview: None. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I determined and had final say over which companies would be included in the interview based on my research, understanding of the sector and interview theme. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.
5) Interviews are edited for clarity. Streetwise Reports does not make editorial comments or change experts' statements without their consent.
6) The interview does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer.
7) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their families are prohibited from making purchases and/or sales of those securities in the open market or otherwise during the up-to-four-week interval from the time of the interview until after it publishes.
Streetwise – The Life Sciences Report is Copyright © 2014 by Streetwise Reports LLC. All rights are reserved. Streetwise Reports LLC hereby grants an unrestricted license to use or disseminate this copyrighted material (i) only in whole (and always including this disclaimer), but (ii) never in part..
Streetwise Reports LLC does not guarantee the accuracy or thoroughness of the information reported.
Streetwise Reports LLC receives a fee from companies that are listed on the home page in the In This Issue section. Their sponsor pages may be considered advertising for the purposes of 18 U.S.C. 1734.
Participating companies provide the logos used in The Life Sciences Report. These logos are trademarks and are the property of the individual companies.
101 Second St., Suite 110
Petaluma, CA 94952
Tel.: (707) 981-8204
Fax: (707) 981-8998
Email: jluther@streetwisereports.com
Original Source: George S. Mack of The Life Sciences Report (01/18/2015)
http://www.thelifesciencesreport.com/pub/na/where-do-cures-reside-morrie-ruffin-and-michael-werner-of-the-alliance-for-regenerative-medicine-think-the-answer-is-in-regenerative-medicine
Where Do Cures Reside? Morrie Ruffin and Michael Werner of the Alliance for Regenerative Medicine Think the Answer Is in Regenerative Medicine
The practice of medicine is being transformed. The journey has been arduous, but revolutionary stem cell, gene and immunocellular therapies are rapidly moving toward pivotal milestones—and investors in the space should strap in for a rewarding joy ride. In this interview with The Life Sciences Report, Alliance for Regenerative Medicine cofounders Morrie Ruffin and Michael Werner consider how new federal guidance might enable new standards of care in cardiovascular, neurologic and oncologic medicine, and offer a preview of next week's Biotech Showcase in San Francisco.
The Life Sciences Report: On Dec. 22, the stem cell and regenerative medicine space saw a very significant development. The U.S. Food and Drug Administration (FDA) published a new
Michael Werner: As sometimes happens with government agencies, major regulatory documents are released right before the holidays. As far as the Alliance for Regenerative Medicine (ARM) is concerned, our member companies are currently looking at the paper and trying to digest it. This draft guidance is open for comment for 60 days after its publication in the Federal Register. We will go through it with a fine-tooth comb, and we will prepare formal comments, which we will submit to the FDA early this year.
Generally speaking, I think the most significant aspect of the guidance is that it provides greater clarity on the FDA's definition of minimal manipulation and, therefore, which products can qualify as minimally manipulated, and which will be regulated as biologics or drugs.
What ARM has said, from its inception many years ago, is that this industry needs a clear and predictable regulatory pathway. The regulations for minimal manipulation have been around for a while, but as this field has expanded, and as the technology has changed, questions have arisen about how the FDA is applying its regulations, and what “minimally manipulated” means in the context of new, tissue-engineered products.
At the very least, it's important that the FDA has, through this document, been transparent about its views.
TLSR: Michael, will you explain further why this transparency is important?
MW: Companies need to know what the FDA is thinking. We've had conversations with individual companies that think the FDA will regulate them as a 361 HCT/P, but are not totally sure, which makes it hard to plan clinical programs. The fact that the FDA has come forward with a document like this is great. As always, the devil is in the details, and we will certainly be going over the document carefully. But published guidelines are a good thing.
TLSR: Could this guidance, in effect, run retail or storefront stem cell therapeutic clinics out of business?
MW: Time will tell. In terms of its impact on what you describe as storefront, I think it really comes down to this: If you are running one of those kinds of operations, or if you perform so-called stem cell tourism, you are now on notice about what kinds of technologies, processes and products are subject to FDA regulation. If you're a storefront clinic, you now know that the FDA not only believes it has jurisdiction to regulate, but how it's going to regulate in the days ahead. It lays the foundation for FDA's enforcement actions going forward.
I think we can expect the agency to use its enforcement discretion in a more consistent way. How aggressive it will be in terms of going after storefront clinics remains to be seen.
TLSR: Do you feel that this, in the long run, is going to be positive for the regenerative medicine and stem cell industry?
MW: I think it will. If you're a product developer, what you want is clarity. You want to know where the goalposts are, and you don't want the goalposts to keep moving. If the FDA is transparent, then that's 80% of the ballgame for the product developer.
Now, in terms of specific policies, the specific ways FDA is going to apply the regulations—that remains to be seen. Companies can—and will—go back to the FDA and say "Here are our thoughts about some of the specifics." Of course, each individual company must go through an iterative process with the agency regardless.
TLSR: It feels like the track to progress, and to the market, for the regenerative medicine industry has been even more difficult than it was for monoclonal antibodies, for lack of a better comparator. What do you think has held the industry back?
MW: One thing has been the clarity of the regulatory pathway. You describe the industry as being held back, but I'd like to say, more positively, that more clarity and predictability in the pathway would enable more products to move forward.
Another key issue involves standards, which has been acknowledged by the FDA and industry as important in terms of enabling more products to come to market. We also need changes to the reimbursement and payment systems, both public and private, to reward innovation. These are different products and models, differentiated by how they treat diseases at the underlying molecular and cellular level, and they could lead not only to treatments, but also to cures.
We need support from the U.S. government in terms of policies, in the same way that governments in Japan, the United Kingdom and elsewhere around the world have been enacting policies specifically designed to support the sector. The U.S. government needs to do the same.
The field is now poised to make a significant impact on healthcare. It's hard to say what's held the field back, but reimbursement is certainly a challenge that we need to get our hands around, to make sure the sector reaches its potential.
TLSR: Morrie, did you want to comment? The cell therapy/regenerative medicine sector has been in development now for about two decades-plus, yet I see only a couple of stem cell companies with a market cap above $1 billion ($1B), and all the rest are in the penny-stock to $500 million category. Why have cell technology companies lagged biotech?
Morrie Ruffin: We actually don't see it that way. That's one of the things we will show in the data that will be coming out in our Regenerative Medicine and Advanced Therapies State of the Industry Briefing on Jan. 12 at the Biotech Showcase in San Francisco.
Clearly, as in any sector, there are going to be successes and failures, but we do see a very significant and recognizable upward trend in the amount of money being raised in the sector. The cancer immunotherapy space is drawing a lot of interest right now.
But if you look across the board at cell therapy, gene therapy and immunocellular therapy companies, we count nine to 10 public companies with $1B-plus market caps in the sector right now. And there are obviously a number of private companies raising significant amounts from private investors as well.
TLSR: Morrie, are we on the verge of seeing pivotal data come out of companies in the sector?
MR: We are about to see a number of very significant events in the sector. Clearly, both those working in the industry and investors are looking for positive clinical events—milestones—that signal we are making progress in the clinic, and that we understand how we might commercialize these therapies. Over the next year or two, you will see a number of very significant data events around cell therapy. We are already seeing this in the oncology space, which is why there is so much interest in what's happening with cell-based or immunotherapies. This has led to a significant interest in cellular therapies across the board. Investors are going to hear a lot in the near future, as people begin to understand the clinical milestones that are going to drive this sector over the next 12–18 months.
TLSR: What do you think is the greatest obstacle to this industry moving forward? Is that issue being addressed currently?
MR: One of the challenges in this space—and I think this is to be expected in any evolving sector—is the issue of commercialization, which concerns manufacturing, scale-up and all the things required to make these new products available and successful. I believe that we have made tremendous progress just in the last few years in understanding what this will take, whether it's an allogeneic therapy or an autologous therapy. I think this is one of the reasons we see manufacturing and tool companies making significant investments in the sector. Companies like GE Healthcare (a unit of General Electric Co. [GE:NYSE]), Thermo Fisher Scientific Inc. (TMO:NYSE), the Lonza Group AG (LONN:SIX; LO3:FSE; LZAGF:OTCPK) and others are heavily engaged in this space. They see the huge opportunity here.
The cell therapy companies also understand that infrastructure is going to be an important part of how these therapies are brought to the market, and to the patient. One of the things we have been anticipating is having the processes of manufacturing, handling, and scale-up catch up with the lab bench science, and then duplicating that science on a large, profitable scale. I think we are on the cusp of that.
TLSR: Michael, you raised a point about government being involved in regenerative medicine, and you mentioned Japan, which has a new regulatory pathway in place whereby companies, in effect, have to show safety and the equivalent of Phase 2 proof of concept to get conditional approval for a cell therapy. Do you see the U.S. doing anything like that?
MW: I'll put it this way: I think it's possible the U.S. will take steps analogous to what other countries are doing to support the field. Is the FDA going to give conditional approval if a company shows certain kinds of safety data? I'm not sure about that, but I do think it is possible to take steps to smooth the pathway forward. For instance, we've talked with the FDA about standards in product development and manufacture. This is an idea that the FDA itself has said is critical to its product review process. Other ideas could include expedited approval programs. Such a program was recently created in the U.S. to support development of antibiotics.
The question is whether the kinds of programs that already exist can be applied or adapted to regenerative medicine, cell therapy and gene therapy products. I think you're more likely to see changes in existing U.S. policy, rather than copying Japan's policy or copying what other countries are doing.
TLSR: What do you think will be the motivating factor for policymakers to accelerate cell therapy development?
MW: There is more recognition that this sector could, potentially, cure diseases that have gone untreated or have been deemed incurable. In diseases like stroke or heart disease, we are basically treating symptoms. We are certainly helping people, but we are not actually curing disease. We're not getting people all the way back to health.
I think there's a greater recognition on the part of policymakers, as well as others, that regenerative medicine—and we use that term very broadly—is where cures and treatments are going to reside. Therefore, you're starting to see more acknowledgment of that. The U.S. government needs to make sure there are policies in place that will allow this industry to thrive.
TLSR: Morrie, you and Michael are going to be at the Biotech Showcase in San Francisco. What will you and ARM members be doing for attendees?
MR: One of the things we're doing, at the kick-off for the showcase at 8 a.m. on Monday, Jan. 12, is presenting our Regenerative Medicine and Advanced Therapies State of the Industry Briefing. This will be our fifth briefing at the Showcase. In the two-hour briefing, we will provide information on the performance of the sector. We will look back at 2014 and 2013, highlighting the progress made in the sector. Then we will look forward to what we anticipate to be major milestones and major events over the coming two years.
TLSR: Will there be an emphasis on any particular topic, or will it be a very broad briefing?
MR: We will be talking about several different things, but we plan to spend a lot of time talking about the progress being made in the gene therapy sector and genetically modified cell therapies.
When we talk about advanced therapies in regenerative medicine, we are being inclusive of all the companies working in the in vivo and ex vivo gene therapy areas, whether that's cancer immunotherapy, or CAR (chimeric antigen receptor) T-cell receptors, or other strategies being employed to harness the immune system to attack cancer. This will be a big part of the briefing. We will also look forward to a number of the major data events that we anticipate in 2015, in a number of indications, including stroke, cardiovascular disease and a number of neurodegenerative disorders.
TLSR: Thank you both for your insights.
Morrie Ruffin has more than 20 years of experience in the biotech and healthcare industries. He is a founder and managing director of the Alliance for Regenerative Medicine, the global organization representing the interests of the regenerative medicine community. Ruffin is also the managing partner of Adjuvant Partners, a boutique regenerative medicine and advanced therapies business consulting firm. Prior to joining Adjuvant Partners, he was the chief executive officer of LifeTech Innovations LLC (LTI), a business development consulting firm. Prior to his position at LTI, he was executive vice president of capital formation and business development at the Biotechnology Industry Organization (BIO), the largest trade organization representing the biotech and drug development industries. Prior to joining BIO, Ruffin worked for U.S. Senator Arlen Specter for five years as his senior legislative assistant. He received his master's degree in international studies and economics from the Johns Hopkins School for Advanced International Studies and his bachelor's degree from the University of Virginia.
Michael Werner is a partner in Holland & Knight's Washington, D.C. office. He has almost three decades of healthcare law, lobbying, regulatory, reimbursement and policy development experience in Washington. He is also is the cofounder and executive director of the Alliance for Regenerative Medicine, a Washington, D.C.-based organization whose mission is to advocate for federal funding, regulatory and reimbursement policies that will advance regenerative medicine research and product development. Before joining Holland & Knight, Werner was president of The Werner Group, a Washington, D.C.-based firm that provided lobbying, regulatory, and bioethics consulting services for biotechnology and pharmaceutical companies, physicians, health plans, investors, and patient advocacy groups. Prior to founding The Werner Group, he was chief of policy for the Biotechnology Industry Organization (BIO), representing over 1,000 biotechnology companies in the U.S. and other countries. Werner is also a founding member of the Board of Directors of the Coalition for the Advancement of Medical Research. He was senior healthcare advisor to U.S. Senate Majority Leader George Mitchell, a congressional investigator for the U.S. Senate Special Committee on Aging, and senior advisor to Maryland Governor William Donald Schaefer. Werner is a frequent media commentator and has appeared in the Wall Street Journal, Science, Scientific American, the Washington Post, BIOWorld, Congressional Quarterly and the Baltimore Sun, as well as on many TV and radio news programs. In 2013, he was named one of the Top 50 Global Stem Cell Influencers by Total BioPharma.
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