In a refreshing bit of candor, a California regenerative medicine firm yesterday said it was having little luck with its funding pitch to the state’s $3 billion stem cell agency and was withdrawing its proposal.
The firm is Cesca Therapeutics, which is based in the Sacramento suburb of Rancho Cordova and also has offices in India. The publicly traded enterprise researches and develops cell-based therapeutics.
In a press release today, the firm reported the bad news about its application for funding
“aimed at supporting implementation of its FDA approved Phase III pivotal clinical trial for critical limb ischemia.”
The announcement said,
“The company anticipated CIRM's evaluation of its application to be concluded during the second half of the month of November. However, preliminary feedback provided in advance of a formal funding decision has cast significant doubt over the prospects for a positive outcome and, as a result, the company has withdrawn its current application.”
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| Robin Stracey, Cesca photo |
Robin Stracey, Cesca’s CEO, said,
"We feel compelled to revisit those elements of our plan that appear to have given CIRM reviewers cause for concern.
"Given that we are in the process of gearing up a significant number of sites to begin enrolling patients in a trial that would cost over $20 million to conduct, we need to quickly digest the feedback and address the questions raised. We expect to spend the next several weeks re-validating and/or amending select elements of our plan, with a particular focus on the anticipated rate of patient enrollment, the overall timetable and the design of the statistical plan. Having said that, we remain very excited by the prospects for our program. We believe the science to be sound and the clinical results so far very compelling. Nevertheless, there may be opportunities to refine our approach. It is imperative that we get it right."
The decision by Cesca fits with the CIRM 2.0 effort launched by Randy Mills, president of the California Institute for Regenerative Medicine (CIRM), as the stem cell agency is formally known. Mills initiated the program in an effort to speed money to researchers and to boost the quality of applications. That means that applications are examined rigorously early on and often sent back for more work, a significant departure from past practices.
It is unusual for publicly traded companies to announce financial difficulties involving their projects, even though federal law says public firms must disclose major financial events that investors should know about.
The review process at CIRM is conducted behind closed doors. The agency does not release information about issues raised at this stage and also withholds the names of applicants for taxpayer cash.
The firm’s stock price closed at 59 cents today, up six cents. The 52-week range runs from 48 cents to $1.24.
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