Plug Pulled on Cancer Clinical Trial: Sudden End for $18 Million Push by California Stem Cell Agency

Caladrius stock price plummets -- Google graphic

California’s ambitious, $18 million effort to develop -- in relatively short order -- a stem cell therapy for a deadly form of skin cancer collapsed abruptly last week, apparently the victim of “excessively long development timelines.”

Caladrius Biosciences, Inc., the recipient of the California funding, terminated the late stage clinical trial, declaring that other treatments have outpaced its approach and that it is no longer “optimally leverage(d).”

The award last May marked a big advance for California’s $3 billion stem cell research program. It was the first phase three clinical trial for the agency, known formally as the California Institute for Regenerative Medicine(CIRM).  A phase three clinical trial is the last step needed before federal approval for widespread use of a treatment. The award came as the agency is entering what could be the last years of its life and is pushing hard to fulfill the promises of the 2004 ballot initiative campaign that led to its creation.

CIRM, which is based in Oakland, Ca., is scheduled to run out of cash for new awards in 2020. The agency expects to intensify its efforts this year at developing a plan to replace the state bonds that it has used since 2004.

The $18 million award to Caladrius was made last spring with considerable ballyhoo. Jonathan Thomas, chairman of the agency’s governing board, said at the time that the  treatment had “the greatest chance of success for the people of California that we have funded.”

After the Caladrius announcement, Randy Mills, president of the agency, said in a news release,

“Ultimately this program suffered from the excessively long development timelines common in cell therapy, a fact that further underscores the need for CIRM to work hard to create faster development pathways as called for in our new strategic plan.”

CIRM’s statement also said,

“Only $3 million of the $17.7 million awarded by our governing board had been distributed to Caladrius, which matched that money with $3 million of its own. CIRM will now make the unused $14.7 million portion available to other applicants for investment into projects that accelerate stem cell therapies to patients with unmet medical needs.”

In a document filed with the Securities and Exchange Commission, Caladrius, formerly known as NeoStem, said the end of the trial would lead to layoffs for about 40 employees in Irvine, Ca., the home of what once was California Stem Cell, Inc. That firm was acquired by Caladrius in 2014 for $124 million. It  was founded by Hans Kierstead of UC Irvine, who is senior vice president for research and chief science officer of Caladrius.

The company’s SEC filing said,

“The treatment paradigm in metastatic melanoma was transformed during the course of 2015 by the accelerating adoption of multiple immune checkpoint inhibitors used as monotherapy and in combination treatments. These new drugs have significantly improved outcomes in metastatic melanoma and therefore have altered the opportunity for a monotherapy such as CLBS20 in a landscape that is quickly converting to combination therapies. Therefore, we have concluded that, as designed, our current program in metastatic melanoma will not optimally leverage this asset..."

Cancellation of the phase three trial led to a sharp drop in Caladrius’ stock price. It closed at $1.08 on Jan. 6, the day prior to the announcement. Today, the stock closed at 65 cents. The 52 week high for the stock was $4.26 and the low 40 cents. The chair of Caladrius, Robin Smith, resigned on Dec. 23.

California’s stem cell agency is now participating in only one phase three trial, which is not yet recruiting patients. That effort involves a brain tumor program with ImmunoCellular of Calabasas, Ca. The agency is currently participating in a total of  15 clinical trials at various stages.

The California Stem Cell Agency Celebrates a First

The California stem cell agency today marked a signal event in its most advanced clinical trial by declaring: 

“Some things never get old. Like watching the sunset over the Grand Canyon. Listening to a baby laugh. Watching the San Francisco Giants win the baseball World Series. Now you can add to that list learning that one of the clinical trials we are funding has just treated their first patient.”

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The piece by Kevin McCormack, senior communications director for the agency, referred to Caladrius Biosciences, Inc., which in May was awarded nearly $18 million by the agency. (Caladrius was formerly known as NeoStem.)

The money is going into a phase three trial for a treatment of metastatic cancer, the most lethal form of skin cancer. It is the first phase three trial in which the agency has participated.

McCormack wrote,

“Caladrius’ approach is a personalized one. They use the patient’s own tumor cells to create a therapeutic vaccine called (for now at least) CLBS20. It’s designed to engage the patient’s own immune system and destroy the cancer.

“This first patient was treated at Thomas Jefferson University Hospital in Philadelphia. Altogether Caladrius hopes to enroll some 250 patients at more than 40 sites worldwide, for the trial. Seven of those sites are here in California; that’s the portion of the project we are funding.”

Caladrius, which is headquartered in New York City, also issued a press release in which David Mazzo, CEO of the firm, described the enrollment of the first patient as a “milestone.”

Caladrius recently announced that it had “entered into a material transfer agreement with the University of Southern California and the California Institute of Technology, concerning next-generation strategies for its core cancer technology.”

The company’s stock today closed at $2.00, down 3.85 percent. Its 52 week low is $1.82. The 52-week high is $7.22.

California Hits Its Mark on Faster Delivery of Cash for Stem Cell Research

• Caladrius to get first installment on nearly $18 million 
• Agency President Randy Mills Pleased with CIRM 2.0 Overhaul

 SAN FRANCISCO -- The California stem cell agency may not be faster than a speeding bullet, but it is running way more quickly than it was a year ago.

For researchers and patients, that means the agency’s millions are moving more rapidly into development of therapies and cures with the goal of beginning to save lives sooner rather than later.

The signal event came last week when the agency, formally known as the California Institute for Regenerative Medicine(CIRM), signed off on a contract with Caladrius Biosciences, Inc., of New York.

As soon as Caladrius signs the agreement, it will receive a check for $3 million, the first installment on a nearly $18 million award that was approved by directors less than a month ago. 

Randy Mills

CIRM President Randy Mills was delighted last Friday when he told the California Stem Cell Report about the action on the Caladrius award. (Caladrius was formerly known as NeoStem.)

Mills, who has been head of the agency for only a little over a year, mentioned the news during a 45-minute conversation in his office at CIRM headquarters.

It was the first award paid out under Mills’ new, CIRM 2.0 program, an effort designed to speed cash to researchers and improve the quality of applications. It is also the first CIRM award in a stage three trial, the last step in the process of winning government approval for widespread public use of a therapy.

The agency approved the actual Caladrius contract last Thursday, 21 days after the directors’ approval. Mills’ goal was to act on the contract within 45 days.

CIRM’s 2.0 clock shows Caladrius’ application for the melanoma therapy coming in at the end of February, 113 days ago. Mills’ goal is to have action completed on an application within 120 days from the time it officially enters the 2.0 system -- instead of up to two years as in the past. 

The firm offered its initial application at the end of January, but it was sent back for improvement. 

Next up in the first round of CIRM 2.0 awards is final action on a $5 million award to Shaomei Wang of Cedars-Sinai that was also approved on May 21 by CIRM directors.

Mills said last Friday that CIRM 2.0 has not been perfect and that in some cases implementation required "brute force." But he is pleased overall. Later this year, Mills and his team plan to apply CIRM 2.0 to basic and translational awards, all of which will mean significant changes for hundreds of California scientists. 

NeoStem's New Name, Backed by $29 Million in New Cash

The caladrius at work

Say hello to the latest recipient of nearly $18 million from the California stem cell agency -- Caladrius Biosciences, Inc.

It is also a firm that is $29 million richer -- on top of the $18 million -- than it was when the $3 billion state research enterprise awarded the firm the money on May 21.

Caladrius is the new name for NeoStem, Inc., of New York, N.Y.  It is also the name of a video game once described by the Giantbomb web site as a “A 2013 bullet hell shooter from Moss.”

Caladrius has a longer history, however, than the video game. According to The Medieval Bestiary web site, the caladrius is an all-white bird – sort of a mythological diagnostic tool – that would refuse to look into the face of patients who were going to die. But the caladrius could also draw out the disease from the sick person and fly away with it.

David Mazzo, president of the firm, said yesterday,

“With the same objective of patient recovery, we, now as Caladrius Biosciences, are committed to bringing significant life-improving therapies to market, driving the evolution of the cell therapy industry and generating industry-leading growth through our innovation and executional excellence.” 

Caladrius sold more than 14 million shares of its stock earlier this month, raising nearly $29 million to help pay for the third stage clinical trial that has been backed by the stem cell agency. The firm is using the proceeds for, among other things, to meet the required match of the California state funding. The four-year trial is aimed at metastatic skin cancer. 

In his letter to shareholders yesterday, Mazzo laid out the future direction of the firm. He also cited the acquisition of an “asset” a year ago that provided the therapy now being funded by California. Mazzo said,

“Given that we acquired this asset approximately one year ago and, in the ensuing months, much of the external focus on our company was on our ischemic repair Phase 2 program, we believe that the market has not yet integrated the full potential of this mature immuno-therapy asset into the value of our company.”

Mazzo referred to the $124 million acquisition of California Stem Cell, Inc., of Irvine, Ca. Hans Keirstead, the president of that firm, is now senior vice president, research, and chief science officer of Caladrius.

Caladrius’ stock closed at $2.21 a share today, down from $2.30 on May 20, the day before it was awarded the California money. The stock has ranged from $2.03 to $7.23 over the last 52 weeks, but it jumped dramatically the day following the award and then fell back.

The Caladrius video game figure is markedly different than the bird depicted by medievalists(see below). For a review of the game, see here.  

Caladrius Blaze, the video game figure