California Stem Cell Hooha: Testy Media Exchange Triggered by Criticism of the State's Agency

A sharp exchange erupted this week on a mainstream California media site after the state's $3 billion stem cell agency was taken to task for lobbying the federal government to ease its regulation of research on stem cell therapies.

The flap involved allegations of lies and questionable motives. Along the way certain death was mentioned, and one writer was accused of "stealing hope" from seriously ill persons. Personal animus charges were raised along with questions about ill-informed rhetoric.

The hooha was set off by an op-ed piece by UC Davis stem cell scientist Paul Knoepfler who wrote an op-ed in the San Francisco Chronicle (see here and here). It chastized the agency and its president, Randy Mills, for a risky and "political" effort to change regulations by the federal Food and Drug Administration. Knoepfler said patients could be put at risk.

The piece triggered harsh comments that were carried by the Chronicle at the end of the article. In addition to Knoepfler, individuals involved in the exchange included Jeanne Loring, head of the stem cell program at the Scripps Institute in La Jolla; Judy Roberson, a Sacramento patient advocate for Huntington's disease, and a person identified only as "Jeff." He wrote,

"What's Knoepler's real beef?....Poor Paul is not getting the money from CIRM he used to get. So his attitude is 'screw patients,' I want my lab funded like it used to be. Nauseating!!!"

CIRM is the abbreviation for the formal name of the state stem cell agency, officially known as the California Institute for Regenerative Medicine. Its board includes Jeff Sheehy, who told the California Stem Cell Report that he is not the Jeff commenting on Knoepfler's article.

The anonymous "Jeff" said, 

"Has any of (Knoepfler's) research led to a development candidate that might lead to a treatment in the future? Or is he just a stem cell scientist opining about something he knows very little or nothing about(the FDA)? Maybe he 'heard' something from somebody and that gave him just the hook he needed to attack CIRM and Mills, both of whom he obviously has personal animus towards."

Loring largely sided with Knoepfler. She also wrote,

"Jeff, why are you questioning Paul's motives? What are your motives? Do you work for CIRM? As you know, a person's profession doesn't define his/her sphere of knowledge. If something is important to you, you can research it and gain expertise."

Roberson, who favors the CIRM effort to loosen regulations to bring therapies into widespread use, said patient safety is important. She also said,

"But for patients and their families with a 100 percent fatal genetic disease like Huntington's disease, we can withstand some risk because we are facing a gut-wrenchingly long, gruesome death anyway. We have no chemotherapy, no surgery, no radiation and sadly, no hope. We have NOTHING! And we'll continue to have nothing for many more decades if the FDA continues doing business as usual."

Another reader, William Barnes, said,

"I suggest that Dr. Knoepfler consider how it feels to be suffering and near certain death and be denied a possible cure because Dr. Knoepfler doesn't think it's in their best interest....Let the individual patient decide! It’s their life! Why should the decision about someone’s life, possibly your loved one, be made by a distant and dispassionate academic?"

In addition to his research, Knoepfler produces a blog, The Niche, on stem cell science, regulation and policy. He took up the blog after a nasty bout with prostate cancer when he was in his 40s. Knoepfler is also the author of "Stem Cells: An Insider's Guide," a book aimed at helping patients understand stem cell science. 

The Case of the FDA's $330,000 Stem Cell Pigs

Judy Roberson at podium, Bob Klein, former chairman of the California stem cell agency at left, Claire Pomeroy, former
UC Davis vice chancellor and agency director at right. UC Davis photo

Judy Roberson is a registered nurse from Sacramento, Ca., who has long been active with the California stem cell agency on behalf of patients with Huntington's disease. She lost her husband to the always fatal, inherited brain disease, and members of her family are at risk.

Roberson appeared before the governing board of the $3 billion California Institute for Regenerative Medicine (CIRM), as the agency is formally known, earlier this month to applaud its efforts and those of its CEO, Randy Mills, to persuade the federal Food and Drug Administration to ease its regulation of proposed stem cell therapies. Here is the text of her statement. 

"The Northern California Huntington's disease (HD)  advocacy community says BRAVO to President Randy Mills for his editorial directed at the FDA, "Give Us Our Cures."

"Over 40 HD advocates joined the CIRM Stem Cell Champion campaign in April, promoted by Kevin McCormack (the agency's director of communications), in the hopes that pressure from affected families will prompt the FDA to become open to stem cell therapies and allow the increased risks that naturally go along with new therapies.

"For people with Huntington's disease, which is 100 percent fatal and has zero therapies, we are willing to take on more risk since we're dying anyway.

"The FDA has delayed the fully enrolled, CIRM funded, first-in-human clinical trial using adult stem cells at UC Davis with Drs. Vicki Wheelock and Jan Nolta. The NIH RAC committee enthusiastically approved their novel therapeutic clinical trial. Then the FDA asked for additional animal studies, this time with three pigs at a cost of over $330,000 plus two years of additional research; costs will approach $1 million.

"One HD family from New York has funded one of the pigs, but this gap in funding has shelved this promising research!

"Devastated patients and their families see this add-on research requirement as a delay from the FDA, which means that this fully enrolled trial, with 24 patients who meet today's criteria will progress and may not qualify in two to four years even if this project later receives FDA approval to begin a phase one trial. FDA delays are killing us!

"We need a new FDA 2.0 because doing NOTHING is doing harm!"

Stem Cells and the FDA: California's Lobbying for Easier Approval Triggers Opposition

The $3 billion California stem cell agency came in for some sharp criticism last week in an opinion piece in the San Francisco Chronicle that was written by a UC Davis stem cell researcher who said the agency is engaged in politicking that "risks doing much more harm than good."

Paul Knoepfler, the scientist who also produces "The Niche" stem cell blog,  wrote,

"The California Institute for Regenerative Medicine (CIRM) has become politically active under its new president, C. Randal “Randy” Mills. Mills is lobbying for a radical departure in how the U.S. Food and Drug Administration (FDA) vets experimental stem-cell therapies, but such politicking risks doing much more harm than good."

Knoepfler wrapped in an attack on federal legislation known as Regrow Act. Knoepfler said the proposal would "force the FDA to conditionally approve still experimental stem cell therapies with relatively little data supporting them."

Randy Mills at left, USC photo

Knoepfler reported that Mills said he was not anti-FDA. Knoepfler also noted that the agency has not taken a position on the Regrow Act.  Knoepfler said the FDA effort and the Regrow Act are part of a larger effort to weaken the FDA, which has been under regular criticism for decades for moving too slowly.

The stem cell agency's attempt to modify the way the FDA approaches potential stem cell therapies has been underway for months. The California Stem Cell Report carried news on the subject as long ago as last winter(see here and here.)

Mills initiated the lobbying effort with the FDA after an informal survey of California "stakeholders" showed that they perceived the FDA as the No. 1 obstacle to making stem cell therapies available for widespread use.

In an item on the agency's blog, The Stem Cellar, last December, Mills said that “patients are dying” because the federal government is “being so careful about safety,"

Yesterday, Knoepfler provided some personal insight -- a "backstory" -- on what led him to write about the all of this. His piece was carried on his blog and emphasized that he is a "big backer" of CIRM and still is. Knoepfler has received $2.2 million from CIRM. The CIRM web site has 60 links to mentions of Knoepfler on its Web site, including this one below. 

Knoepfler wrote,

"Most of the stem cell scientists that I have talked to (admittedly with a few notable exceptions that include some long time stem cell advocates and scholars) are opposed to CIRM’s lobbying on this front, but are uncomfortable speaking out."

Uncomfortable is a rather mild word for it based on the fact that the agency holds the key to a $3 billion vault containing the hopes of funding for the entire California stem cell community.

We should note that lobbying is not new to the agency. Its former chairman, Robert Klein, had a passion for it. At one point in 2009, he engineered the hiring of an exceedingly well-connected lobbyist named Tony Podesta for $200,000.  Mills has not ventured into that sort of game, however.

Knoepfler has much more to say on the subject of regulation, the need for it and the impact on patients and the dubious stem cell clinics that seem to be multiplying throughout the nation, despite the fact that the FDA has never approved a stem cell therapy for widespread use.

The California Stem Cell Report will be visiting the matters surrounding these issues and the California stem cell agency. Look for more here during the next week or so.

The California Stem Cell Agency: A Business with Scientists as Subcontractors?

The following commentary was submitted by a grantee of the California Institute for Regenerative Medicine (CIRM) in response to its $15 million award earlier this week to Quintiles, a clinical research organization. The person who wrote the item asked to remain anonymous.

Comments from readers are always welcome on the California Stem Cell Report.  They can either be filed directly on an item by clicking on "post a comment" at the end of each item or by sending them to djensen@californiastemcellreport.com. Here is the commentary on the direction of the stem cell agency.Scientis

"With the funding of Quintiles the last piece of the puzzle falls into place. Randy Mills is very proud of the fact that he transformed the company Osiris, which was research oriented, into a product-oriented company.

"Everything he has done since he became president of CIRM has been strategy to turn it into a product-oriented business.

"From start to finish, Mills is refashioning CIRM as a business. The grant applications have now become 'partnering opportunities,' and the researchers receiving those grants take on a role as subcontractors under  CIRM’s control rather than independent scientists.

"With grantees as partners and subcontractors, the next stage in commercialization is to hire a CRO (contract research organization) to funnel through all of the promising products, taking them out of the grantee’s hands.  Quintiles is a huge organization and the $15 million grant is insignificant for them -- they subcontract for drug companies to run clinical trials.  They have no stem cell experience.

"Subcontracting a CRO is a business strategy to avoid investing in employees and technologies the company needs.  The selection of grantees has also become business-oriented:  CIRM is recruiting companies outside California to fund so they can be added to its corporate profile.  Companies have also become the preferred recipients of CIRM grants, even if they are virtual companies set up by academics for the purpose of obtaining CIRM funding.

"CIRM is morphing into a corporation with centralized control, with the hope that the product pipeline will yield something that makes money.  The question is:  was this the intention of Prop. 71?  If so, why wasn’t it always a corporation?" 

(Editor's note: Prop. 71 is the ballot initiative that created the stem cell agency in 2004.)

California's Latest, $4 Million Effort to Transform Human Stem Cell Research

The California stem cell agency's "great ideas" program is set to give away $4 million next week to 18 researchers to help them pursue fledgling pathways to a new therapy or cures for stroke, bladder injury, eye problems, Parkinson's disease and more.

In its solicitation for applications, the agency said the seed funding was aimed at supporting "exploration of transformational ideas that hold the potential to greatly impact the field of human
stem cell research." The expectation is that these awards will provide more information that will help generate more funding to carry the efforts forward.

"Great ideas" is how Gil Sambrano, the agency's director of portfolio and review, described the round in a slide prepared for the meeting of the governing board of the agency next Thursday. Board approval of the positive recommendations by the reviewers is routine. At that point, the agency will identify the winners but not the unsuccessful applicants.

The field of applicants began at 101 earlier this year and was winnowed down to 60 before the final 18 were selected.

Approval of the applications was performed behind closed doors by the agency's blue-ribbon, out-of-state reviewers. The identities of reviewers in a specific round are not disclosed nor are their professional and economic interests.

None of the awards exceeds $238,000. Researchers will receive only a maximum of $150,000 for "direct costs." The excess goes to the institution or business involved for a variety of overhead costs. Duration of the awards varies.

Here is a link to summaries of the scientific reviews of the applications, including comments scores on both winning and losing applicants.

Financial Terms Approved Today for California's $150 Million, Stem Cell Powerhouse.

Highlights
Likely a major legacy
$75 million loan, 50 percent to be repaid
Convertible notes could sold by CIRM
Changes in application review?

Directors of California's stem cell agency this morning approved financing terms for a proposed, $150 million, public-private company that the agency hopes will accelerate the creation of long-sought stem cell therapies.

The plan to create a stem cell "powerhouse" is likely to be one of the landmark legacies of the state's $3 billion research effort -- for better or worse. Such a partnership would be unique in California history and nationally.

The agency has yet to produce the cures promised to voters in 2004 when they created the research effort and provided the billions in bond funding. Total costs, including interest, will run about $6 billion..

Today's action set the terms for the $75 million in a loan that the agency -- formally known as the California Institute for Regenerative Medicine (CIRM) -- would hand out. The funds would go to a private partner that would also put up $75 million.

A joint committee of the directors approved the terms, with virtually no discussion, on an 8-0 vote during a meeting that lasted only 10 minutes.

The aim of the agency is to "de-risk" development of therapies in order to entice a well-financed and well-managed partner to take CIRM research into the marketplace and make it widely available to the public. The partner would be expected to pay back only 50 percent of the loan plus interest. The new company would also have the pick of the 94 percent of CIRM research that doesn't already have a business partner.

The agency plans to provide the $75 million in three different notes. CIRM would then be able to sell the notes to another investor at time when it would appear to be most profitable. Or the agency could simply hold onto the loans.

The loans would be convertible to stock in the company, although state agencies cannot legally own such stock. However, a possible buyer for the notes might see an opportunity for profit and would be willing to pay the agency more than the value of the loan.

If the company is successful, it could generate royalties to the state's general fund under the provisions of CIRM's rules. Cash from the sale of the loans, however, would go directly to CIRM. The agency has not yet earned any royalties from the research it has funded.

Directors of the agency approved the concept for the new company -- minus today's finance terms -- at a meeting in December. Maria Millan, senior director for medical affairs, told them that the goal is "to create a therapeutic powerhouse that increases the likelihood of getting stem cell therapeutics to the patients."

Today's action set the stage for final preparation of a request for interested parties to apply for the $75 million for what it calls ATP3 (short for Accelerating Therapeutics through Public-Private Partnerships). CIRM has said the partner could be an existing company, a new one or some sort of combination. The agency said it consulted with companies, lawyers and venture capitalists to prepare the financing terms.

Under the current timetable, the application request would be posted in the third quarter of this year, according to Kevin McCormack, senior director for CIRM communications. The proposals would be reviewed the agency's grant reviewers behind closed doors during the first quarter of next year. In nearly all cases over the last 11 years, favorable decisions by the reviewers are routinely ratified by CIRM directors. The directors are expected to take their formal vote in early summer of 2017.

The blue ribbon reviewers come from out-of-state. The identities of reviewers on specific applications are withheld by the agency. Their professional and economic interests are not publicly disclosed, although agency asks for the information and asks the reviewers to recuse themselves if they (the reviewers) see a conflict.

CIRM Director Steve Juelsgaard, former executive vice president of Genentech, said the award is more about business than science and needs reviewers who understand what makes a business successful. CIRM officials said they would brief the joint committee on review procedures for the award when they are more developed.

McCormack confirmed to the California Stem Cell Report that proposal is unique. He said,

"CIRM diligently scoured the landscape for inspiration for its ATP3 model. This effort confirmed that ATP3 is a novel response to a unique set of challenges not commonly encountered in CIRM’s field. A given component of the program may be inspired by one example or another, but the design of ATP3 as a whole is custom tailored to CIRM’s environment."

McCormack also said that the state governor's, treasurer's and controller's offices have all been briefed on the plan. However, under the ballot initiative that created the agency, no state officials, including the legislature, have legal control of the agency policies or research funding.

Here are links to the presentation today, a CIRM staff memo on the loan terms and the term sheet. Here is a look at the risk-benefit analysis by CIRM, and a look at how the intellectual and royalty rights would work. Other background can be found here and here.

Risk and Reward from California's $150 Million Plan to Create a Stem Cell Company

The California stem cell agency has identified a number of risks and benefits that are associated with its $150 million plan to create a public-private company to advance stem cell therapies. 

Risks and rewards were laid out in its spending/strategic plan for the next five years, which was approved by directors last December. The discussion of risks in the plan and other proposals as well is a hallmark of the administration of CIRM CEO Randy Mills, who joined the agency about two years ago. Prior to his arrival, the agency's staff did not formally offer risk assessments for its proposals. 

The $150 million proposal has been dubbed ATP3 -- short for Accelerating Therapeutics through Public-Private Partnerships. The financing for the deal is up for approval tomorrow by CIRM directors. 

CIRM's List of Benefits From ATP3

"The aggregation of a basket of otherwise unpartnered CIRM projects offers the successful applicant 'multiple shots on goal.' This increases the probability of successfully developing and commercializing a stem cell treatment and makes significant industry investment in stem cell technology more attractive."  

Benefits to researchers: "continued funding for the advancement of their CIRM
project"

Benefits to universities: "demand creation for the out-licensing of CIRM-funded
technologies with a greater opportunity to achieve a financial return due to the aggregation of risk"

Benefits to citizens of California: "the creation of an industrial stem cell treatment powerhouse that expands the tax base, adds high quality jobs, and increases the likelihood of the commercialization of stem cell treatments for patients with unmet needs"

A CIRM memo last week also identified possible financial benefits to the state or CIRM via royalties and/or sale of the state's interest in the company. 

CIRM's Evaluation of Risk

"Investors may be uninterested in stem cell treatments" is what the agency's strategic plan said in December 2015.

It continued:

"To date, venture capital and the pharma and biotech sectors have been unwilling
to make substantial investments in stem cell research. The lack of a track record of
success, coupled with the regulatory uncertainty discussed above, have dissuaded
them from making a substantial commitment to the field. This has exacerbated the
challenges posed by the so-called 'valley of death' between discovery and clinical
translation where funding has traditionally been scarce.

"Although California voters made a substantial investment in CIRM when they approved Prop. 71, CIRM, by itself, does not have the funding necessary to translate the many discoveries made
by researchers it has funded into treatments. Indeed, the costs of developing a single drug are estimated to be $2.6 billion.

"For CIRM to succeed in its mission, CIRM must partner with other investors to bring treatments to market and deliver them to patients. CIRM plans to address this concern by continuing to champion CIRM - funded project to potential partners and investors and by creating a demand for CIRM -funded projects through public-private partnership designed to accelerate treatment development, described in section 7 of this plan."

Other general risks are identified in three pages of risk laid out in the strategic plan, including insufficient "meritorious treatments," safety concerns, FDA reluctance and inadequate health benefits from stem cell treatments.

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.

California Stem Cell Agency Alters Grant Rules to Hasten and Improve Basic, Translational Research

A key committee of the governing board of the $3 billion California stem cell agency this morning approved changes in its grant rules in an effort to speed basic and translational research and attract higher quality applications.

The Science Subcommittee sent the changes to the full board on an 8-0 voice vote with no discussion and no public comment. The full board is expected to ratify the proposals at its Jan. 19 meeting.

The action came as the agency continued its new effort to provide more public access to important policy discussions and actions by the board's key committees. Today's meeting was accessible live on the Internet and by audiocast. For the past decade or so, only the meetings of the full board were available live on the Internet.

The new rules will cover hundreds of millions of dollars in awards for basic and translational research as well as educational training.  Hundreds of California researchers could be affected.

The proposals were based on earlier changes in clinical award rules. They are expected to strengthen the agency's ability to terminate research when milestones are not being met and establish a researcher's past performance on agency awards as a criteria for future funding. Also to be altered are rules about use of funds not spent during the award period.

The regulations are being enacted on an interim basis and will be subject to change as they wend their way through the official state regulation process.

Here is a staff memo on the rules and the full text of the agency's grant administration regulations. 

Inside the Story of Cesca Therapeutics, the California Stem Cell Agency and its Kibosh of an $11 Million Proposal

The Sacramento Bee today carried a story taking a longer look at Cesca Therapeutics, Inc., its travails with the California stem agency and the firm’s application for $11 million to help finance a phase three clinical trial.

The freelance article was written by the publisher of this blog, David Jensen. Here is the full text of the story.

  Rancho Cordova firm comes up empty in bid to win $11 million from stem cell agency _ The Sacramento Bee

Cesca Stock Plunges 50 Percent in Wake of California Stem Cell Agency News

The stock price of Cesca Therapeutics yesterday plummeted about 50 percent after it reported bad news about its application for $10 million from the California stem cell agency.

The stock closed at 30 cents a share in relatively heavy trading, compared to its close of 59 cents the previous day. Over the last 52 weeks, the stock has ranged from 29 cents to $1.24.

On Monday, the company, which is based in the Sacramento suburb of Rancho Cordova, announced that it had withdrawn its application from the $3 billion state-funded agency until it assessed critical reviewer comments. Cesca’s proposal involves a roughly $20 million, phase three clinical trial to test a product aimed at critical limb ischemia.

The firm had raised financing for the trial that was contingent on CIRM approval of a grant.  

In its Monday press release, company president Robin Stracey said,

“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.”

California to Nix $6.8 Million for Parkinson's Research, Flawed Proposal Cited

Directors of the California stem cell agency are scheduled to meet Thursday to reject a $6.8 million application to finance late stage research to develop a therapy for Parkinson’s Disease.

Twelve of the agency’s blue-ribbon, scientific reviewers last month voted unanimously against the proposal, declaring it was “flawed” and should not be resubmitted to the agency. Directors of the agency almost never overturn negative decisions of its reviewers.

This week’s meeting focuses unusual attention on the application. It is the only one scheduled to be considered at the meeting, which is part of the fast-track funding efforts this year by the stem cell agency. In the past, final approval or rejection of applications usually involved a number of applications. Reviewers’ decisions against funding have been rubber-stamped with no discussion. Scores on the rejected applications were not disclosed.

One of the goals of the agency’s “CIRM 2.0” effort, in addition to speeding funding, is to improve grant applications. It may well be that the agency is attempting to reinforce, via the application review summary, its message to researchers to step up the quality of their proposals for millions of dollars in taxpayer support.

The review summary found considerable fault with the rationale of the proposal. It said the data presented was “insufficient.” The dosage involved was “not clearly described.” Timelines may be “unrealistic,” the document declared.

The summary also said,

“It is not clear whether the focus of the applicant is an embryonic (ESC) or induced pluripotent stem cell (iPSC) derived product.”

“Reviewers....encouraged the (applicant) team to carefully consider feedback in any earlier stage application.”

The name of the applicant was not disclosed in keeping with the agency’s longstanding practice of withholding such information. Responding to a question, an agency spokesman said the application came from an academic institution. One Parkinson’s researcher who has been mentioned in the news in recent months, Jeanne Loring of Scripps, told the California Stem Cell Report that the application did not involve her. 

The rejection would be only the second in the CIRM 2.0 program, according to Kevin McCormack, senior director of communications for the agency. 

The public can weigh in on any subject during Thursday's meeting at teleconference sites in Beverly Hills, San Diego, South San Francisco, Napa, Irvine,, Los Gatos, Elk Grove, Redwood City, San Francisco and two in Sacramento. Specific addresses can be found on the agenda.

Multimillion Dollar Clinical Trial Proposal Hits Roadblock at California Stem Cell Agency

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.”

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.

Stock of California Firm Jumps 17 Percent on News of Golden State Award

Google chart

ImmunoCellular Therapeutics’ stock price shot up 17 percent today in the wake of formal approval of a $20 million award from the California stem cell agency for a clinical trial involving a rare brain cancer.

The price has been climbing since last week when the California Stem Cell Report first disclosed that the company was set to secure the funding for the phase three clinical trial, the last step before widespread commercialization.

In an interview today, Andrew Gengos, president of the Calabasas, Ca., firm, confirmed that the trial is expected to cost $40 million to $50 million. The company has said it will add $34.4 million to the $20 million from the California Institute for Regenerative Medicine (CIRM), as the agency is formally known.

Gengos said the five-year trial is expected to get underway in November with the enrollment of the first patients. He said it will probably start in the United States with expansion to Canada and Europe. About 400 patients are expected to participate.

ImmunoCellular has not had any revenues since 2010. Asked about the source of the $34 million, Gengos said the company had $31 million on hand at the end of June with no debt. He added that the company can access additional cash through the sale of more stock.

In reponse to a question, Gengos said he first became aware of the possibility of funding the clinical trial with the help of CIRM as the result of a conversation with a colleague at the J.P. Morgan health care conference in San Francisco last January.

Gengos followed up by asking an ImmunoCellular co-worker to look into the process. As the result, the company made its initial application which CIRM sent back with suggestions for improvement. In the second review, reviewers voted 9-0 to fund the project.

Gengos told the CIRM board today that the trial would take five years to complete.

“Frankly, this time period is outside the interest of most public market investors in terms of their investment horizon and therefore, in their eyes, handicaps our project compared to other projects that can execute in a shorter time frame.

“The result is that investment capital is hard to come by for these types of promising and highly innovative therapies when the investment horizon is long, and a small company without product revenues is at the helm.”

Gengos continued,

“I do not think it is an overstatement to say that without CIRM’s support, this program would not go forward. California’s innovative biotechnology community needs institutions like CIRM. Clearly – we need CIRM. Brain cancer patients need CIRM.”

Here is the text of the company’s press release today.

Here is the text of Gengos statement to the CIRM board.

   Statement by CEO of ImmunoCellular to CIRM board Sept. 24, 2015

California Stem Cell Agency Backs Calabasas Firm with $20 Million in Search for Brain Cancer Therapy

Directors of the California stem cell agency today unanimously approved a $20 million award to help boost into the marketplace a therapy for a rare brain cancer known as glioblastoma.

The funds will go to ImmunoCellular Ltd, a tiny, publicly traded firm based in the Los Angeles suburb of Calabasas, which has close ties to Cedars-Sinai Medical Center.

Andrew Gengos, president of the firm, told the directors,

"Without (the agency's) support this program would not go forward. Brain cancer patients need CIRM."

It is the second, phase three clinical trial for the agency, formally known as the California Institute for Regenerative Medicine (CIRM). The $3 billion research enterprise is pushing to develop a commercial therapy before funds for new awards run out in about four years.  (See here for the CIRM  press release on the award.)

CIRM is also proposing to award $400 million over the next four years to support clinical level research and participate in 65 clinical trials.

The ImmunoCellular trial is expected to produce preliminary results by the end of 2019.  The trial will involve 414 patients and  begin recruiting in November of this year. (See here for recruitment and other information.)

Despite some caveats, the agency’s blue ribbon reviewers concluded that the proposed therapy “could become a new standard of care and extend survival of glioblastoma patients.” Other firms, however, are competing in the field, the reviewers noted. Earlier this year, reviewers approved the award during closed door proceedings on a 9-0 vote, an action that virtually assured formal approval today.

Immunocellular’s closing stock price has risen 13 percent since the California Stem Cell Report disclosed on Sept. 17 that the firm was set to receive the $20 million award. Today, the stock opened at 48 cents. At the time of this writing today it stood at 52 cents.

Information presented to the CIRM board today did not indicate potential cost of therapy to consumers. Nor did the information discuss the financial condition of the company other than to state that it would provide $34.4 million in co-funding. There was little discussion this morning of the application by the CIRM board. 

The company’s filings with the Security and Exchange Commission show that the firm has reported no revenues since 2010 and a loss of $9.4 million in 2014. It reported that it had $23.2 million in cash or cash equivalents in 2014. In February of this year, it reported raising $14.6 million from Roth Capital Partners, LLC.

Sabby Healthcare Master Fund, Ltd. and Sabby Volatility Warrant Master Fund, Ltd., both registered in the Cayman Islands, hold 9.22 percent of the company’s stock, according to company documents.

Capital Ventures International, another Cayman Island firm, owns 5.54 percent. John S. Yu, chairman and chief scientific officer of the ImmunoCellular and a neurosurgeon at Cedars-Sinai, owns 6.65 percent. The CIRM governing board has one member from Cedars-Sinai who was not permitted to vote on the award.

ImmunoCellular has six fulltime employees, Gengos said today.

The public summary of the review said,

“In the initial review of this application, reviewers were enthusiastic as glioblastoma represents a serious unmet medical need. Additionally, the applicant presented strong preclinical and clinical data to support the proposed Ph3 registration trial and there was a reasonable plan to obtain regulatory approval of the proposed therapeutic. However, reviewers had feasibility concerns regarding the applicant’s ability to enroll the trial and maintain the reagent supply chain to support manufacturing of the product.

“Reviewers also had concerns with the trial design, which centered around selection of the patient population targeted in the registration trial and the lack of immune monitoring proposed in the trial. The applicant was provided the opportunity to address these concerns in a revised application, and their responses and modifications to the proposal reassured reviewers that the applicant could enroll and conduct the Ph3 trial as proposed and that, if endpoints are met, the trial design could support licensing approval by FDA.”

Parkinson's and the California Stem Cell Agency: Advocates Cite 'Overwhelming' Need to Air Unhappiness

The California stem cell agency has posted a letter online from Parkinson’s patient advocates that says that an emotional outpouring at a July stem cell meeting grew out of an “overwhelming” need to protest agency delays in funding research.

The letter was signed by Sherrie Gould and Jenifer Raub, leaders of Summit4StemCell, a San Diego group, and was sent to the agency's board. Gould and Raub wrote about the July 23 meeting of the board during which the patients protested after they learned that no funding for the research they were backing would be available until about 2017. (See here for full text of the protest.)

The link to the Aug. 2 letter is part of the agenda for this Thursday’s teleconference meeting of the directors of the $3 billion research effort. It said, 

“Our group at Summit4StemCell (has) been regularly attending the CIRM meetings for the past 18 months. Out of respect for Jeanne Loring PhD, we have typically shown up in ‘silent solidarity’ but this meeting was different and many of us had an opportunity to speak publicly about our project, our progress and our desperate need for funding.

“The outpouring on Thursday (July 23) was spontaneous and unexpected. We at Summit feel strongly that we communicate with all board members that our presence at any of the CIRM board meeting is not orchestrated by Jeanne Loring, Dr. Melissa Houser (of the Scripps Clinic) or anyone from the Loring lab.

“We are a passionate group of dedicated Californians that believe strongly in the probability of success of this research using pluripotent stem cell technology. Dr. Loring has always counseled respect and brevity. We believe she would prefer that we be the face of the issue and not the strident voice.

“When confronted with the possibility that there could be no help (or hope) for over a year, the need to speak and be heard was overwhelming. We sincerely believe that you and the board heard us and will do all you can to find an exception or some way to help.” 

The reference to Loring, who is head of the stem cell program at the Scripps Research Institute in La Jolla, has to do with the Summit group’s support of her research. It also seems to be linked to an anonymous comment filed on the California Stem Cell Report’s account of the July protest.

The writer indicated that Loring had submitted an application earlier that was scored unfavorably by the agency, based on a conversation that the writer had overheard at the Oakland meeting. In response, Loring said no such conversation took place. She said an earlier application in another round did not meet CIRM criteria and was withdrawn. The agency does not publicly comment on such grant review processes, which are conducted in secret. It also does not release the names of unsuccessful applicants. (See Loring's and the writer's complete comments at the end of this item.)

Summit4StemCell is also not happy with teleconference nature of this week’s meeting. Earlier this month, they said their voice was “diminished” because of the inability to speak to the governing board face-to-face.

The California Stem Cell Report item on the teleconference/Parkinson’s flap is the most widely read post this month, exceeding the readership of the item dealing with the agency’s announcement concerning its $32 million stem cell bank. 

Brain Cancer Targeted: Calabasas Biotech Firm Set to Win $20 Million in California Stem Cell Funding

John S. Yu, chairman, ImmunoCellular -- Cedars-Sinai video 

Highlights

Second CIRM bet on phase three trial

$34 million in co-funding

Application initially rejected

California’s stem cell agency next week is expected to award $20 million to a tiny California firm to help finance a phase three clinical trial of a therapy for a rare brain cancer.

The move would be the $3 billion agency’s second investment in a phase three clinical trial, the last major hurdle before a therapy can be offered for widespread public use. The first was an $18 million bet this spring on NeoStem, Inc., now known as Caladrius.

The two trials offer the best likelihood of fulfilling -- in relatively short order -- the 2004 campaign promises made to voters when they created the Golden State's stem cell research effort. 

The firm involved is ImmunoCellular Therapeutics, Ltd., a publicly traded enterprise headquartered in Calabasas, Ca., a suburb northwest of Los Angeles.  Calabasas is better known for its entertainment personalities, such as the Kardashian family, than biotech.

In addition to the state funds, the trial would be backed by $34.4 million in co-funding, according to the California Institute for Regenerative Medicine(CIRM), as the agency is formally known. Earlier this year, ImmunoCellular estimated the total cost of the trial could be about $50 million.

The firm's proposed therapy targets glioblastoma, a fast-moving cancer that CIRM said is “resistant to current standards of care."  It has a survival rate of slightly more than one year. Immunocellular said that about 10,000 new patients are diagnosed each year in the United States.

The treatment is called ICT-107. Immunocellular reported on its Web site that the treatment is “an autologous (patient-derived) dendritic cell immunotherapeutic that targets six different antigens (peptides that are tumor markers) associated with glioblastoma.”

The CIRM summary of reviewer comments said that the phase one trial for the treatment produced a “tremendous survival response.” The summary said,

“Though the survival response observed in the Ph1(phase one) trial was not fully replicated in the Ph2 trial, results are supportive of continued clinical development and of the Ph3 trial as designed.”

ImmunoCellular has been around with its current focus since 2006 when it acquired its cellular-based technology from Cedars-Sinai in Los Angeles. John S. Yu, director of surgical neuro-oncology at Cedars, is listed as the founder of the firm. He is now chairman of the board and chief scientific officer.

The firm has four full-time employees and four part-time, including Yu, according to February 2015 filings with the Securities and Exchange Commission. The firm said,

“We have a number of consulting agreements for clinical development, regulatory affairs, investor relations and business development. We outsource all of our drug discovery research, process development, manufacturing and clinical development to third parties with expertise in those areas."

ImmunoCellular reports no revenues for the past several years. CIRM said, however, the firm has promised $34.4 million in co-funding for the clinical trial.

In an August closed-door session, CIRM’s scientific reviewers scored the ImmunoCellular application as having “exceptional merit” on a 9-0 vote. 

Ratification of that decision will occur in public next Thursday in a teleconference meeting of the agency’s 29-member governing board, which includes one representative from Cedars-Sinai.

The board almost never rejects a positive recommendation from its reviewers. The agency also does not release the names of successful applicants in advance of a board vote. The California Stem Cell Report identified ImmunoCellular through other means.

The firm's original application was deemed by CIRM reviewers to need improvement on a 1-9-2 vote and was sent back to ImmunoCellular for revision. The August review summary said,

“(R)eviewers had feasibility concerns regarding the applicant’s ability to enroll the trial and maintain the reagent supply chain to support manufacturing of the product. Reviewers also had concerns with the trial design, which centered around selection of the patient population targeted in the registration trial and the lack of immune monitoring proposed in the trial.

“The applicant was provided the opportunity to address these concerns in a revised application, and their responses and modifications to the proposal reassured reviewers that the applicant could enroll and conduct the Ph3 trial as proposed and that, if endpoints are met, the trial design could support licensing approval by FDA.”

The price of ImmunoCellular stock closed at $0.425 today, up nearly one cent. The 52-week high of the stock was $1.03 and the low 35 cents.

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