New York Stem Cell Summit Preview

Using its forepaws, a rat dragged its hind legs across the bed of a box in a grainy, 15 second YouTube video. “This is animal RA1161, ” said the moderator. Animal RA1161’s spinal cord had been nicked by researchers and was paralyzed from middle to tail.

Off-camera, embryonic stem cell derived motor neurons were injected into animal RA1161. At 120 days post-injection, the video resumed and now the rat was shown scampering around the box and almost climbing out using its strong and definitely not-paralyzed hind legs.

That video was uploaded March 22, 2009. That same month the University of California at Irvine uploaded an animated video of a paralyzed mouse and described how Geron’s embryonic stem derived glial cells restored the myelin covering of the spinal cord and, essentially, restored a paralyzed rat to full function.

That year and the next, Menlo Park-based Geron raised $155 million in new equity, bringing their ten-year total from investors to a shade over $450 million.

One clue that this was an unsustainable business model came when the FDA documentation bill rose to $40 million. But never underestimate the power of a paralyzed rat video.

The top stem cell story of 2011, no doubt, is the announcement that Geron’s GRNOPC1 traveling medicine show finally ran out of gas and paved road. On February 2011, Geron’s fired its CEO and head cheerleader, Tom Okarma. On November 11, 2011, Geron ended all efforts to commercialize an embryonic stem cell based product.

On that singular day (11.11.11), Geron’s board stopped drinking Okarma’s Kool-Aid and realized what virtually every stem cell entrepreneur already knew—Geron’s GRNOPC1 project had worse prospects than the rat. Even the FDA had rejected it twice.

But there was one more shoe to drop. Five weeks after Geron got out of the embryonic stem cell business, three new embryonic stem cell lines and more funding for embryonic stem cell research was announced by the National Institutes of Health. Is this the triumph of hope over experience or is it just another pit stop on the long, necessary road to developing some therapy, any therapy, from embryonic stem cells? 

Meanwhile, Back in Texas

Earlier in 2011Presidential candidate Rick Perry received stem cells for back pain using a technique developed by Korean company, RNL Biosystems. Stanley Jones, M.D., associate clinical professor at the University of Texas Medical School at Houston was Perry’s doctor. What makes this story so compelling is that Dr. Jones had first tried the therapy on himself.

In September 2009, Dr. Jones was operating on a very long case when, he says, “My right wrist started to swell and I’d never had such severe pain in my life. I really had no idea what was wrong.” So Dr. Jones asked his wife, who is a nurse, to inject his wrist with cortisone. “Two days later the pain was gone so I thought ‘the cortisone did it! This is great.’” 

But the pain soon returned. “My knee started to swell. I had never had so much pain. Wow, I thought, I had it in my wrist now I have it in my knee.” Dr. Jones immediately went to his rheumatologist and was told that he had autoimmune arthritis.

Recalls Dr. Jones: “He [the rheumatologist] was quite frankly amazed at how much pain I was having. My physician assistant had to carry me into the office the pain was so bad. So I was pretty distressed. I just imagined that my practice in medicine was gone.”

Dr. Jones contacted RNL Bio and signed up for their stem cell therapy program. “We went to our medical spa and we had fat taken from our abdomen, our own fat. Our own fat cells were then sent to Korea and they were put in tissue culture. Two months later, glory be, we were in Japan getting stem cells. I was overwhelmed by how easy it was, by the cleanliness and the professionalism of the hospital in Kyoto. By the middle of October, I had no symptoms at all and I’ve not taken anything since September. Thank God I got well.” 

In late 2011, Texas became the future home for a massive 15, 000 square-foot facility that will be largest adult stem cell lab and bank in North America. Named Celltex, the new lab will be offering clients an advanced culturing process licensed from the Korean firm, RNL Bio, to reproduce mass quantities of healthy cells that can be stored for potential future use. Fees start with an introductory charge of $4, 873 plus an annual fee of $150. Clients can withdraw 50 million stem cells for $1, 759.

Said Celltex Chairman and CEO David Eller, “The Houston area has an international reputation for its willingness to test and develop new ways to help those who are ill. The adult stem cell treatment used at Celltex will prove enormously beneficial to many, many people.”

A typical adult stem cell treatment involves extracting stem cells from a patient's fat tissue. The cells are cultured at a lab like Celltex and then reinjected back into the patient. Treatments are thought to allow stem cells to replace damaged tissue, potentially helping conditions like Alzheimer's disease, diabetes, Parkinson's and multiple sclerosis.

Mesoblast/Lonza Partnership

In 2011, just over a dozen firms were selling either stem cell products or products designed to derive stem cells from the patient in the United States. Revenues last year from the sale of such products exceeded, we estimate, $150 million and since the mid-1990s more than 190, 000 patients have been treated with some form of stem cell.

By 2020, we estimate shipments of stem cell products globally will exceed $6 billion and will have significantly disrupted most every medical implant market.

New capital continues to flow into this sector and several companies formed interesting strategic alliances. Probably the most intriguing of such announcement in 2011 was Lonza Group’s new partnership with Mesoblast Limited.

Lonza is the venerable, Swiss-based multi-billion dollar contract manufacturer for the pharmaceutical and biotech industries. Under the terms of the September announcement, Lonza will supply Mesoblast with all the commercial stem cell product they’ll need globally. Considering the number of clinical studies under way at Mesoblast and the size of the markets they intend to tackle, this could be a huge commitment.

Under the agreement, Lonza may well also construct a purpose-built manufacturing facility exclusively for Mesoblast’s products. In the meantime, Mesoblast will have exclusive access to Lonza’s Cell Therapy facilities in Singapore for the manufacture of allogeneic cell therapy products, subject to certain exceptions.

From our perspective, having access to Lonza’s manufacturing capabilities gives Mesoblast significant commercial advantages globally.

“Lonza is very excited to work under this significant strategic relationship with leading cell therapy company Mesoblast, ” said Stefan Borgas, CEO of Lonza. “The cell therapy market is anticipated to become a major growth industry with the potential to mirror the growth we have seen in monoclonal antibodies over the past 20 years.”

New York Stem Cell Summit

We agree completely. In our view, both Lonza and Mesoblast are positioning themselves to grab a leadership position in the coming multi-billion dollar stem cell industry. Both firms, of course, will be presenting at the New York Stem Cell Summit.

As the range and experience of stem cell companies continues to evolve, the program at the New York Stem Cell Summit also evolves as we seek out the most interesting and promising new companies to present.

While Geron, a three-year presenter, is now off the agenda, 9 inaugural presenters join more than 20 returning companies to form the most comprehensive and educational Stem Cell Summit in the world.

This year’s class of new presenters include:

To see the complete list of presenting companies as well as to reserve your spot on February 21st in New York go to: http://www.stemcellsummit.com/