Cell Therapy Industry: The Roads to Commercial Success

REDONDO BEACH, CA / ACCESSWIRE / February 3, 2016 / A recent panel discussion at the Alliance for Regenerative Medicine State of the Industry Briefing (associated with Biotech Showcase 2016 in San Francisco) raised the issue of bio-manufacturing scale up for cell therapies as a great need for continued development (see webcast here: http://alliancerm.org/event/regenerative-medicine-state-industry-briefing). Among representatives of large pharmaceutical companies, or biotech companies partnered for development with large pharmaceutical companies, there was a general consensus that scaling up manufacturing for production of cell therapeutics was still a work in progress, and after nearly a decade of investment, more expertise and new technologies were required prior to commercialization.

Two regulatory pathways for cell therapy approvals can be taken by a company with a new therapy: one, the use of a patient's own cells (autologous, point-of-care cell therapy) that are minimally manipulated in a medical device. In this case the path for FDA approval would be filed under the Investigational Device Exemption (IDE) and pre-market approval (PMA) process. The IDE/PMA pathway presents a lower threshold and smaller patient populations for clinical trials compared to option two, which is filing for FDA approval under an Investigational New Drug (IND) or Biologics License Application (BLA) pathway. Therapies in which cells are genetically engineered and expanded in vitro would fall under this second pathway, and include strategies such as engineering a patient's own immune cells (engineering of autologous cells, as in CAR-T) or expanding cells from a single donor to seed the growth of a large cell population that could deliver therapy to multiple patients (allogeneic cell therapy). Regulatory approval for a new biologic or drug for IND/BLA approval requires extensive testing in clinical trials before the safety of manipulated cells can be validated, particularly for non-life threatening disease. While both regulatory pathways discussed above are commercially viable, the question of time to market and investment for manufacturing and process development differ significantly.

Critics of autologous stem cell therapies point to the procedure's high costs per patient as a primary drawback, since cells must be harvested, processed and analyzed for each individual, the allogeneic approach is not without significant costs as well. Development of a manipulated biologic requires an enormous initial investment of time and money in manufacturing scale-up compared to autologous, point-of-care therapy. The process for growing cells in a laboratory has historically been designed by small academic labs that produce doses for 10-50 patients enrolled in early phase clinical studies. To achieve patient doses to accommodate hundreds, or thousands of patients requires new protocols, equipment and quality analysis methods to avoid risks associated with growing large cell populations in culture, including genetic drift and epigenetic changes introduced by a formulated growth media. As a result of the requirement for a significant investment in development, large pharmaceutical companies are likely the best candidates for successful launch of allogeneic cell therapies as part of a diverse drug portfolio with a mature revenue stream. Many examples of pharmaceutical companies partnering with academic and biotechnology groups are found in the current development stream, including Novartis' (NYSE: NVS) association with University of Pennsylvania, and Pfizer (NYSE: PFE) partnering with Cellectis (NASDAQ: CLLS) and MD Anderson, both collaborations for CAR-T technology to treat immuno-oncology patients.

And then there are hurdles created by stringent clinical trial requirements for new biologics, generally requiring larger patient numbers and more controls compared to medical device trials. However, Mesoblast (NASDAQ: MESO) announced in December, 2015 that the FDA allowed them to expand their endpoint in a cardiac trial to recurrent events, which reduced the number of patients required in their trial in half, presumably speeding up the trial completion date. In November, 2014, new regulations that accelerated the approval of cell therapeutics for regenerative medicine were instituted in Japan. The new rules enable conditional commercial approval for sales and marketing of new cell therapies while trials are still being conducted. As a result, companies based outside of Japan, including Athersys and Mesoblast, are already partnering with Japanese companies to get their cell products into trials and conditional approval for commercialization in Japan, with the potential to get faster results and some of the costs for the trial covered. While this development may alleviate the costs and speed the results of early phase trials, the time and expense for pivotal trials required for commercialization in the major markets of US and Europe will remain a burden on smaller companies developing new cell therapies. The costs of these trials for new biologics will ultimately be recovered in the patients' costs in order to achieve commercial success. So while the race to market is on for large pharmaceutical companies with advanced cell therapy programs, the access to these therapies for patients and the finish line for the companies' return on investment and profitability may be some distance away.

Cesca's Point-of-Care Approach

Cesca Therapeutics Inc. (NASDAQ: KOOL) has developed a proprietary platform for automating the delivery of autologous stem cells in a point-of-care setting (i.e. treatment room in a hospital or clinic) based on their experience in medical device development and manufacturing for adult stem cells. The SurgWerks(TM) platform is an integrated protocol, disposable, and equipment product that requires less than 2 hours for collection, processing, quality control, and delivery of a patient's own adult stem cells from bone marrow. The first pivotal trial for the SurgWerks-CLI treatment for critical limb ischemia (CLIRST III) is expected to start later this year, potentially paving the way for IDE/PMA approval for commercialization by 2019. The CLIRST III trial will evaluate treatment for Rutherford Category 5, no-option patients facing limb amputation due to advanced peripheral artery disease. Further, the SurgWerks(TM) platform is adaptable and will be integrated into other cardiovascular and orthopedic therapies in Cesca's pipeline.

For investors, Cesca's SurgWerks(TM) platform provides a razor-razorblade business model whereby a hospital purchases the protocol and equipment that requires single-use disposables. With the potential to make autologous stem cell therapies a whole lot easier, and relatively rapid time to market compared to allogeneic approaches, it's a stock worth watching.

Visit the Company's website at: http://cescatherapeutics.com

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Except for the historical information presented herein, matters discussed in this release contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Emerging Growth LLC is not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this release. Emerging Growth LLC may from time to time have a position in the securities mentioned herein and may increase or decrease such positions without notice. For making specific investment decisions, readers should seek their own advice. Emerging Growth LLC may be compensated for its services in the form of cash-based compensation or equity securities in the companies it writes about, or a combination of the two. For full disclosure please visit: http://secfilings.com/Disclaimer.aspx

SOURCE: Emerging Growth LLC

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