California Stem Cell Agency First: Big Pharma Hook Up

BURLINGAME, Ca. – For the first time, a Big Pharma company has hooked into the $3 billion California stem cell agency, a move that the agency described as a “watershed” in its efforts to commercialize stem cell research.

The involvement of GlaxoSmithKline comes via a partnership with ViaCyte, Inc., of San Diego, Ca., in a clinical trial, partially financed with a $10.1 million grant today from the stem cell agency. The trial involves a human embryonic stem cell product that has “the potential to essentially cure patients with type 1 diabetes and provide a powerful new treatment for those with type 2 disease,” ViaCyte said. Scientific reviewers for the agency, formally known as the California Institute for Regenerative Medicine(CIRM),  “characterized the goal of the proposed therapy as as the 'holy grail' of diabetes treatments.”

CIRM Director Jeff Sheehy, who is co vice chair of the agency's grant review group, said the ViaCyte product could be manufactured on a large scale and basically involves “taking (small) pouches and popping them into patients.”

The stem cell agency's award triggered arrangements between ViaCyte and Glaxo that will bring in financial and other support from Glaxo. The exact amount of cash was not disclosed. CIRM said Glaxo will “co-fund and, assuming success, conduct the pivotal trial and commercialize the product.” Under the terms of the grant, Glaxo and ViaCyte will have to meet CIRM milestones in order to secure continued funding. 

Following board approval, Jason Gardner, head of the Glaxo stem cell unit, characterized the arrangement as a partnership. He told the board that the company intends to develop a “sustainable pipeline.”

Gardner credited CIRM President Alan Trounson with being instrumental in helping to put the arrangement together, beginning with their first meeting three years ago. Trounson said the deal will resonate not only in California but throughout the world.

Paul Laikind, president of ViaCyte, also addressed the board, stressing the importance of CIRM's financial support for his company over past years. It has received $26.3 million (not including the latest grant) from California taxpayers at a time when stem cell funding was nearly dried up. He noted that small companies such as ViaCyte do not have the resources to carry a product through the final stages of clinical trials and subsequent production. Gardner also said,

“When the commercial funding avenues have become much more risk averse, CIRM support (has ensured) that promising, innovative cell therapy technologies are fully explored.”

In comments to the California Stem Cell Report, Elona Baum, CIRM's general counsel and vice president for business development, described the award as a “watershed” for the eight-year-old agency, linking the agency with Big Phama for the first time. Much of CIRM's current efforts are aimed at stimulating financial commitments from large companies, which are necessary to commercialize stem cell research.

Arrangements between Big Pharma and small companies are not unusual and can vanish quickly. However, the CIRM-ViaCyte-Glaxo deal sends a message to other Big Pharma companies and smaller ones, perhaps clearing away concerns that have hindered other deals that could involve the stem cell agency.

The stem cell agency is pushing hard to fulfill the promises of the 2004 ballot campaign that created CIRM. Voters were led to believe that stem cell cures were virtually around the corner. None have been developed to date.