What is the most exciting, important, promising, all-around awesome stem cell biotech of 2014? Vote and tell us why in the comments.
Garr: Neuralstem is moving on all cylinders these days on both our cell therapy and small molecule clinical programs. We have just completed all the transplantations of our phase two ALS patients, with the data lock coming early in January, and hopefully the phase2/3 starting early next year; and in September we expect to transplant our first SCI patient at UCSD (chronic thoracic ASI-a patients). We continue to dose phase 1 patients in our stroke trial in China. On the small molecule side, the MGH group presented our 1b data in MDD patients at ASCP this past june and it was frankly, stunning; showing clinically meaningful improvement in all the patients who took the medicine as well as reaching statistical significance in treatment of depression measures, as well as cognitive improvement. It is a first in class neurogenic drug, and we we will be going into a phase two we believe sometime near the end of the first quarter next year.
Garr: The financials are stronger than they have ever been, and the last Q showed roughly $30 million in cash and equivalents. Our burn rate continues to be a fraction of the industry norm thanks to our near virtual model, and generous funding of our ALS trial by the NIH and ALSA.
Garr: We expect to commercialize the cell therapeutics ourselves, certainly in the U.S. With partners world wide in selective markets. We expect to take the small molecule drug through, at least phase two, but ultimately to partner it out. We have a wholly owned subsidiary in China, and a partner with an option on markets in Korea, Vietnam, Malaysia, Indonesia and Singapore, so we see a great deal of our growth also coming in Asia in the long term in cell therapy.
Garr: I don’t know that we are unique, but we are built differently than most. We were built to move our technology forward, in every therapeutic area to which it might apply; we don’t look for other technologies for a particular disease, and we don’t look to expand beyond what we own. So we, from that point of view, we are perhaps more focused than other companies on a particular way of treating diseases. On the cell therapy side, we only have looked at incurable disease from the start; we believe that that is what our technology is capable of, and that has been our goal from the beginning. That is now and has always been the ethos of our company.
Garr: We have always been a much more “patient centric” company than most. And we have always had an intimate relationship with various patient advocacy groups. It is part and parcel of our make up. And yes, that is why I got involved with the RTT movement. There are roughly 30,000 ALS patients, 5,000 newly diagnosed each year; and there is literally nothing our there for them to significantly improve their quality of life or their life span. We believe our ALS therapy is doing both; our trials have not yet been powered to demonstrate that to the level that it meets various existing FDA early access programs, and I think that with the right safeguards RTT can provide a structure to build such programs around. My view of RTT is that it is dependent on, and must work with the FDA. It is built so that it relies on FDA diligence on safety; and I can tell you from our own experience that when you develop treatments for terminal diseases (and the law only applies to terminal diseases) you have spent (at least) tens of millions of dollars before you ever get into a phase one human trial, and you have a great deal of safety data before and after such trials. The law also requires that you be actively engaged in at least a second FDA trial, so these eligible treatments are under the constant villigance of the FDA in order to be eligible. I understand that there are many issues to be worked out in terms of liability and payments to mention just a few; but these are the types of issues this industry deals with every day, this is not peace in the middle east we are trying to solve here. And so when critics of RTT bring up issues with the implementation, to me that is a separate issue from whether or not RTT is the right thing to do; and while those are serious issues, they are “second level” issues. Also, it is a transitory program; that is, it’s only meant to provide access until the drugs are either approved by the FDA and available, or shown not to work. As Ted says, it’s a right to try, not a right to cure. Everyone involved understands that.
Garr: I won’t comment on the ongoing litigation other than to say this; the end will speak clearly for itself. With respect to our IP position, it should be understood that NONE of our patents are being challenged in this litigation, only STEM’s patents are being challenged in this litigation. We have patents issued worldwide which cover both our cell therapy and small molecule platforms.
Garr: I think that social media is an essential part of communication today, with all the stakeholders in a company. I started the blog because of the intense interest in what we are doing from the patient and caregiver communities, and as it has evolved, that has become the main focus. It is complicated by the fact that we are a public company which brings in an entirely new and different set of rules and regulations that inform what you can and can’t say (about ongoing trial data for instance) but those are simply rules that one lives with. Social media is changing the way patients communicate with each other. That’s a genie you can’t put back in the bottle. We see patients in trials blogging about their progress (or lack thereof). They are not like juries where you can quarantine them until they reach a decision. It’s all about community, and patients and their support groups are always looking for more community in these stressful situations, it is a human instinct, and I believe a good one. We reach out to comfort each other, that is what is behind the exponential growth here. The industry is going to have to figure out a way to accommodate the new reality of social media and clinical trials, just like every other industry has had to learn how to adapt to the internet age.
StemCells, Inc. is a top biotech company developing stem cell-based therapies. They have a deep pipeline that includes already ongoing trials for a variety of diseases. I invited company leadership to do an interview and they graciously accepted.
Below is the interview with CFO Greg Schiffman (picture at left from LinkedIn) including what I thought were some tough questions from me and very detailed answers from Shiffman. Thank you, Greg.
1. Where does the company stand today in terms of product development, capitalization, and such? What are its strengths? What are potential areas for improvement or development?
We currently have three active programs underway two clinical and one pre-clinical. The two clinical programs are in the spine, spinal cord injury (SCI), and in the eye, dry age related macular degeneration (AMD), and the pre-clinical program is in the brain focused on Alzheimer’s disease. Both clinical programs have completed enrollment of the Phase I/II clinical trials and we have plans to initiate controlled proof of concept Phase II studies in both indications in the second half of this year. Both indications have large unmet medical needs. We have released interim results for both of the Phase I/II programs. We have not seen any safety issues associated with the cells. In addition, we have seen preliminary signs of efficacy in both programs. Our pre-clinical efforts are focused on filing an IND for Alzheimer’s disease in 2016 following which we could move this program into the clinic.
We just completed a $20 million gross equity financing. If you include the proceeds from the equity financing and warrant exercises that occurred in the month of July, the company had approximately $37.8 million dollars of cash and marketable securities at the end of June. This provides us with a strong balance sheet to move our programs forward.
We believe that we have a unique platform utilizing our proprietary HuCNS-SC® human neural stem cells that have the potential to address numerous indications affecting the CNS. This would include white matter brain disorders such as leukodystrophies, multiple sclerosis, cerebral palsy and transverse myelitis. Other potential indications could include Alzheimer’s, spinal cord injury, dry age-related macular degeneration and centrally mediated lysosomal storage disorders. We have performed pre-clinical work in many of these indications and we have selected one indication, where there is a large unmet medical need, in each major organ of the CNS the brain, eye and spine to pursue clinically. The cells have shown a very favorable safety profile and all of the pre-clinical and clinical findings have shown signs of efficacy. This is a very exciting time for the Company as we are now rapidly generating a significant amount of clinical data which will help to provide much greater insight into the potential clinical benefit we can bring to patients.
2. What unique challenges does the stem cell/cell therapy/regenerative medicine biotech sector face overall say compared to a pharma company producing a chemical-based drug and how is StemCells, Inc. approaching those hurdles?
Anytime you are pursuing a new therapeutic paradigm you encounter additional regulatory hurdles and scientific scrutiny. StemCells, Inc. has very methodically pursued the science. We have published all of our work so that others can critique the findings. It has taken a significant amount of time and resources pursuing the science to understand the potential of the platform we are building. However, it enabled us to move forward with our clinical programs on a very strong scientific foundation. In addition, given the nature of our cells which engraft into the host, replicate, migrate within the host and differentiate into the cell types associated with the CNS, our early clinical trials faced significant safety hurdles as this was the first time that these cells would be transplanted in humans. The first indications had to be fatal diseases and the subjects were in the most advanced stage of the disease. In addition, we were limited to one surgeon and a single site for patient recruitment. We would treat a patient following which safety data was generated and submitted to the FDA for review. After review we were able to begin looking for the next patient to be transplanted with the cells. The clinical trials moved forward very slowly given these hurdles. However, given the favorable safety profile we have shown in both the spine and eye, as well as the favorable safety profile demonstrated in our previous clinical work in the brain for both Batten disease and Pelizaeus-Merzbacher disease (PMD), we are now able to proceed forward at a much more rapid pace, consistent with other biologic clinical trials, with our Phase II studies. In 2015 we plan to have between 10-15 sites enrolling patients for each of our clinical programs and expect to be able to complete the enrollment in about one year. As we continue to move forward with the clinical efforts, and hopefully to an approved therapeutic, we expect that there will be additional hurdles to overcome including physician and patient education on this new platform of stem cells. This is an exciting opportunity; and we are comfortable in our role as pioneers breaking new ground.
3. How important has CIRM funding been for StemCells, Inc.?
StemCells, Inc. has spent over a quarter of a billion dollars pursuing our science. This includes pre-clinical and clinical work as well as building out our manufacturing capabilities. We have completed two Phase I/II clinical trials in fatal childhood brain disorders, PMD and Batten’s disease, have two active Phase I/II clinical trials ongoing in SCI and AMD, and are about to initiate two Phase II controlled studies in each of those indications. All of this has been funded by the Company. We are also working to file an IND in Alzheimer’s disease. This would enable the company to begin clinical trials in this indication. CIRM is funding half of the expected costs for filing the IND in Alzheimer’s in the form of a forgivable loan. The total funding from CIRM for this effort is up to $19.3 million dollars. This investment was important for the Company to be able to pursue this activity in parallel with the other clinical programs we have underway. As a small biotech we need to prioritize investments and without this funding this program would be on hold while we pursued our other clinical programs in spinal cord injury and dry age related macular degeneration. CIRM’s decision to fund half of the costs of the IND is allowing us to pursue this activity today. This accelerates the timeline for a potential therapy for this disease that affects so many people. Should the program be successful, CIRM will see a significant financial return on the investment. However, if you look at the investment that has been made in our platform technology and the ongoing clinical investments we are making, the $19.3 million from CIRM, which is to be disbursed over the next four years, to help fund half of the costs of filing the IND in Alzheimer’s disease is very important to the timing of our Alzheimer’s disease clinical program but not to the overall clinical agenda StemCells is pursuing.
4. Which of your products/programs are closest in the pipeline to getting to patients? What excites you the most?
Our two most advanced programs are the SCI and AMD programs. We are very excited about both of these programs and the potential they may bring to dramatically affect patients afflicted by each indication. We believe that the AMD program is probably the program that will move forward the fastest given the number of people affected by the disease and the nature of the treatment. The interim results we presented at the International Society for Stem Cell Research (ISSCR) showed very promising early signs of clinical benefit. We showed a 70% reduction in the rate of geographic atrophy. Geographic atrophy is the progressive loss of two important retinal tissue layers, the photoreceptors and the retinal pigmented epithelium. Degeneration of the macula is the cause of vision loss in dry AMD. We also saw an improvement in visual acuity in 4 of the 7 patients as evidenced by their ability to detect differences in light and dark referred to as ‘contrast sensitivity.’ These results exceeded our expectations. We will have final results from this study next year and, based upon the strength of both the safety and efficacy findings, we are initiating a Phase II controlled study in AMD later this year.
We are also encouraged by or SCI program. We have seen clinical benefit in our Phase I/II trail where patients are seeing multi-segmental gains and a return of function in the cord in half of the patients. This indicates that something that was not working in the spinal cord, now appears to be working following transplantation. This is even more significant because of the time that has elapsed from the date of injury, which ranges from 4 months to 24 months across the subjects with sensory gains. Our next study in SCI will occur in the cervical or neck region. This is the section of the cord that controls motor function of the upper extremities. The cervical cord directly controls motor function of the upper extremities. Thus, these patients may represent a population in which regaining, or enhancing, upper extremity motor function may be more readily anticipated. Even a gain of one to two motor segments in the cervical spinal cord could allow for additional function in the upper extremities. No one has been able to run a study using stem cells in this patient population previously. Given the safety profile of our cells in the previous SCI study where we recruited patients with thoracic injuries, the FDA is now permitting StemCells to enroll patients with cervical spinal cord injuries. This has the potential to significantly improve the quality of life for victims of SCI and at the same time reduce the overall cost to the healthcare system.
5. Besides HuCNS-SC, do you have other cell products in the works? Does the company have interest in reprogramming and iPS cells? ES cells? Adult stem cells such as MSCs?
All of our current clinical efforts are leveraging our HuCNS-SC human neural stem cells platform. We have performed pre-clinical work using a proprietary platform of human liver stem cells, however, in order to focus our efforts we are not actively pursuing this technology at this point in time. We think our HuCNS-SC cellular platform has tremendous potential and we want to move or AMD and SCI clinical programs forward as rapidly as possible. Nevertheless, we are constantly evaluating new technologies that we think have potential as this remains a constantly evolving field.
6. There has been quite a bit of discussion in the media and on social media about former CIRM President Alan Trounson joining the board of StemCells, Inc. shortly after departing from CIRM. Can you comment on this situation and perhaps clarify the realities of this situation as there has been a fair amount of speculation about this?
We are not prepared to provide any additional information beyond the public comments the Company has already made, except to say Dr. Trounson is a very accomplished leader in the stem cell field and we are delighted to have him join us as a director.
7. A former employee of StemCells, Inc. has filed suit against the company and made certain allegations. I am not going to ask you about that suit specifically (unless it is something you want to discuss), but I wanted to give you an opportunity to talk about the steps the company takes for handling its cells and products, quality assurance, GMP practices, and such. Can you please tell us some of the ways by which the company maintains standards for its products? How confident are you in your products?
We are very focused on the processes we use to manufacture our products. You should know, the elements of manufacturing practices that concerned Mr. Williams were immediately and carefully reviewed by the Company. The Company’s primary concern has always been, and will continue to be, the safety and tolerability of stem cell transplantation in its clinical trials. Over the years, we have consulted with multiple experts in the field and we believe our processes, procedures and controls, as fully described in our regulatory filings, are appropriate for a company at our early stage of clinical development and comport with applicable guidelines and regulations.
8. Can you tell us some about the IP portfolio of the company? Are there elements that you are particularly excited about? What is the situation with Neuralstem in a nutshell on the IP front?
We have established a strong base of intellectual property surrounding human neural stem cells. In addition, in 2013 we further strengthened our patent portfolio with the outright acquisition of previously licensed patents from Neurospheres Holdings in addition to the acquisition of a number of patents from NsGene which complement our portfolio. The patent portfolio from Neurospheres, which was based upon the groundbreaking research by Samuel Weiss and Brent Reynolds at the University of Calgary, has repeatedly been recognized as the seminal intellectual property pertaining to purified populations of human neural stem cells. Today, we believe we have the broadest and deepest IP portfolio of any company in the neural stem cell space.
StemCells has been engaged in a long-standing patent infringement suit against Neuralstem, Richard Garr and Karl Johe. Our suit alleges infringement of six patents, owned by StemCells, claiming populations of human neural stem cells, their proliferation and their use, inventions arising from the groundbreaking work of Drs. Samuel Weiss and Brent Reynolds while at the University of Calgary.
We are pleased that recently the judge in the case denied Neuralstem’s motion for summary judgment and moved us one step closer to a final resolution in the case by scheduling the first part of the trial to begin this December. It is certainly welcome news that our case will finally have its “day in court.” In light of the judge’s rulings, we can anticipate trial on the merits next year and, I sincerely hope, a speedy and final resolution of our various patent and business tort claims against Neuralstem.
It is important to understand why we filed this lawsuit in the first place. Over the years, StemCells has made a considerable investment in its patent portfolio, which now consists of dozens of issued patents worldwide. Both the Company’s Reynolds and Weiss patents and its other patents, whether owned or exclusively licensed by StemCells, have been licensed out, on a non-exclusive basis, to several companies for sizeable licensing revenues in return for freedom to operate. Our SEC filings describe these patents and our licensing activities in detail. The Company’s proprietary cells, the HuCNS-SC cells, are protected by multiple patent families held by the Company. This lawsuit is not about StemCells’ freedom to operate, there are no claims of infringement against STEM; but it is challenging Neuralstem’s freedom to operate and we seek injunctive relief and substantial damages from them. We contend that Neuralstem has willfully infringed our intellectual property and we owe it to our shareholders to do everything in our power to protect the investments we have made, on their behalf, in this groundbreaking neural stem cell technology. We look forward to the prospect of presenting our evidence and our arguments to the judge and jury.
9. The stock has had a bit of tough month in terms of PPS. What would you say to the average shareholder out there?
There is always a lot of noise when you are pioneering breakthrough new technologies. We think that there are areas investors should look at carefully to help guide their investment decisions. First, StemCells has attracted a world-class team of professionals, with the experience and expertise needed to drive success. Second, our clinical trials have attracted partnerships with world-leading researchers, hospitals and institutions. Third, StemCells holds a wealth of valid patents that protect our technology. Fourth, we are rapidly accruing clinical data that validates the findings of our preclinical models. Two of our clinical programs addressing major medical conditions (SCI and AMD) are rapidly advancing towards controlled Phase II trials. Risk decreases with each regulatory milestone reached. Fifth, StemCells has a sound balance sheet and a strong cash position. Sixth, our diversified clinical program addresses multiple major medical conditions affecting large populations, two of which (AMD and Alzheimer’s), target aging populations that are rapidly increasing around the world. There is short term volatility in micro-cap stocks, often associated with noise unrelated to clinical progress and clinical outcomes. We believe that we are well positioned and have a very exciting platform technology that has the potential to address many conditions of the CNS that have not been able to be addressed by traditional approaches. Should we be successful in moving one or more of these programs forward, we believe that there is significant value creation potential for our shareholders.
10. What’s your outlook on the future for the company? Are you optimistic? Where do you see StemCells, Inc. in say 5 and 10 years?
I am very optimistic about the potential for StemCells, Inc. We have spent over 15 years pursuing the science and early stage clinical trials. This has been done very methodically, which was important to establish a strong foundation for our late stage clinical work. We are now at a stage where we will quickly generate significant amounts of clinical data providing much greater insight into the potential of our platform technology. Over the next five years we would expect to have final results from our ongoing Phase I/II studies in SCI and AMD as well as final results from the Phase II studies we plan to initiate later this year. In addition, if we continue to see results consistent with our interim clinical findings, we should be well underway with our pivotal Phase III registration studies. This is truly an exciting and transformative period for the Company. If the technology is successful in the Phase III studies, in 10 years we could have multiple approved clinical products on the market. The Company would actively be pursuing additional clinical programs, using our HuCNS-SC platform, to address other unmet medical needs in the CNS. It would also be pursuing some of the other exciting technologies that we are investigating today.
This is Part 2 of my interview with ALS and stem cell advocate, Ted Harada.
You can read Part 1 on where things stand today with ALS, the FDA, and the Ice Bucket Challenge.
What’s your opinion of the “Right To Try” law in Colorado and the concept more generally? It seems to have the potential to speed innovation, but also put patients at risk. How will this be balanced out?
Ted: I am a strong advocate for Right To Try. I even wrote an Op – Ed that ran in the Atlanta newspaper in support of it. Even when we declared our independence as a nation it was written that people have the right to life, liberty and the pursuit of happiness. So what I see the Right To Try doing in addition to speeding up innovation is giving terminally ill patients the right to try and keep living. As I stated in my Op-Ed I appreciate that the FDA is the Gold standard of drug safety, however perhaps if you are out of options you are willing to settle for the silver standard. It can take 10 – 15 years and sometimes nearly a billion dollars to complete a drug trial. Those dying do not have the luxury of waiting that time.
As far as patient risk with Right To Try the law stipulates that the patient has to have informed consent just as if you were involved in a trial. Plus I believe that the monolithic and paternalistic approach taken by the FDA actually pushes patients into taking even greater risks such as the stem-cell tourism that I referred to earlier. Another important safe guard of Right-To-Try is that the treatment has to have completed an FDA phase I portion of a trial and been approved for phase II which means in the small sample size of the first phase it showed it was safe. This is a much higher standard of safety then many patients have afforded to them when they take risks on untested treatments overseas.
One other thing I would like to point out is that it is not called the right to a cure. It is called the right to try it. It is not a promise that it will help you but if you are interested and have a Doctors and Bio or Drug companies support you have the Right To Try.
Perhaps ultimately this law may push the FDA to update the regulatory practices they themselves referred to as outdated.
What’s your view of how NeuralStem is doing? Are there other companies out there that you support and/or are excited about related to ALS?
I obviously am very partial to what Neuralstem is doing. I find them to be a very unique organization that while they understand their fiduciary obligations to their investors they want to balance that by also doing what is best for patients. Richard Garr the CEO has taken the ice bucket challenge and attends and personally donates to ALS charities. He attends the MDA night of Hope Gala, he flew to Atlanta last year and participated in my walk to defeat ALS team “Tread for Ted” in addition to donating. Their Chief Scientific Officer Dr. Karl Johe attends every surgery and sits in the waiting room during the 5 hour surgery until he knows the procedure was completed safely. It is a very different type of company. I believe they truly want to make a difference. I know Brainstorm a company from Israel has shown some preliminary positive results using a patient’s own bone marrow stem cells in an ALS trial and will be starting a trial here in the U.S. soon. That seems to hold some promise. I also know that Biogen, Knopf and Sanofi have all invested significant capital into ALS research. I am sure there are others I am forgetting.
How are you doing? (if you don’t mind me asking)
Honestly I am doing very well. I have received the stem cells twice and both times it helped me. I still have ALS but my situation is very stable as of now. This is why I am so passionate about being the best advocate possible for the ALS community. I am inspired by all of the people that are living with ALS and their caregivers I want everyone to have the same opportunity that I have had. To whom much is given, much is expected. As long as I can I will fight for the ALS community. Here is the link to my Op – Ed http://www.myajc.com/news/news/opinion/afflicted-have-the-right-to-try/nfrq2/#ba9fdfe9.3836379.735460
Ted Harada is a wonderful patient advocate for the stem cell field and for the development of safe and effective stem cell products to treat ALS. Ted has ALS and received stem cell-based treatments for it with surprising, very encouraging results. The Harada family is pictured at left with Ted, his wife Michelle as well as their three children Ted, Jordan, and Ashleigh.
Ted was a finalist for this blog’s Stem Cell Person of the Year Award last year and he achieves a great deal by doing his homework and working very hard.
I just invited Ted to do an interview about whether things stand on ALS today.
Below you can find Part 1 of my interview with Ted including his perspectives on the Ice Bucket Challenge.
Part 2 will follow soon including Ted’s thoughts on Neuralstem, Right To Try laws, and how Ted’s doing these days.
What are the most important things the public needs to know about ALS?
Ted: ALS is 100% fatal. There are no survivors. There is no known cause and no known cure. Every 90 minutes in this Country someone is diagnosed with this insidious disease and every 90 minutes someone dies from ALS.
Where do you see things today overall for the prospect of using stem cell-based therapies to treat ALS? Hopeful? Discouraged? In the middle? Why?
Ted: Honestly all of the above. I am obviously hopeful, how can I not be hopeful with the results I had that were supported with empirical data. That being said a few things frustrate me. Cases like mine lead to what I believe are less than ethical stem cell clinics that pop up around the globe and even in our own Country. People who are dying are willing, understandably willing to try almost anything and pay a lot of money for it. So preliminary success definitely leads to I believe what the industry refers to as stem cell tourism.
The other thing that I am waiting with baited breath for is more documented stories like mine. I believe what really complicates all treatments for ALS stem cells or otherwise is that ALS is really a syndrome. So there are most likely many forms of ALS therefore as my Neurologist has said to me I may have found what can help your form of ALS but I have no idea what your form is or anyone else’s form.
I once heard a Neurologist give the example of saying a patient has ALS is like saying every time a radio breaks the radio has radio disease. We know there are many reasons why the radio stopped working. Therefore if you took 100 radios and put them in a trial where you were going to change all of their speakers logically we know that only a small percentage of those radios will be fixed by changing the speakers.
That being said I want to reiterate in the big picture I 100% believe that stem cells or perhaps a combination of stem cells and drugs hold the most promise for the future of finding a treatment for ALS.
The Ice Bucket Challenge has drawn some great attention to the ALS advocacy arena. Can you tell us more about it? Do you support it?
A young man that I have had the pleasure to meet Pete Frates a former Boston College baseball player who has ALS saw this novel concept on the internet but it was not tied to a specific charity. He took the idea named it the #ALS #icebucketchallenge and started challenging athletes he knew from Boston College from ice hockey and football and baseball etc and the phenomenon has obviously become a viral sensation that has done more to raise awareness and funding in just a few short weeks than has been done in the 75 years since Lou Gehrig gave his famous speech retiring from Baseball due to the fact that he was being killed by ALS. I am a huge supporter of it, I have participated in it twice and as of 8/20/14 the challenge has raised $31 million for the ALS association. Hopefully all this money will lead to a cure but in the meantime the disease while no less devastating today is certainly a lot less lonely. Please continue reading on Page 2!