Pressures for Stem Cell Profits and Cures: A Case from Japan with Implications for California

A stem cell treatment in Japan for spinal cord injury is raising a ruckus about ethics, efficacy and billion-dollar searches for cures and profits.

The matter involves a therapy called Stemirac and Sapporo Medical University. The treatment is now available to the public in Japan with most of its $140,000 cost covered by Japan's national health insurance program. 

The most recent overview of Stemirac came yesterday on a site called "Undark" in an article written by Amos Zeeberg. In the piece, Arnold Kriegstein, director of the stem cell program at UC San Francisco, called Stemirac  "essentially an unproven therapy."  Bruce Dobkin, a UCLA neurologist, was reported as saying "the results briefly reported in the media may suggest the treatment doesn’t even work."

(Undark's site says it is a "is a non-profit, editorially independent digital magazine exploring the intersection of science and society."  Its publisher is Deborah Blum, a former colleague of this writer at The Sacramento Bee. Blum is now director of the Knight Science Journalism Program at MIT.) 

In the piece yesterday about Stemirac, Zeeberg wrote, 

"It’s arguably the world’s most ambitious approved stem cell treatment and should have been a cause for celebration: a long-awaited breakthrough for the field of regenerative medicine — using modern biological tools to repair the body — and a harbinger of more impressive medicines."

He continued, 

Arnold Kriegstein
UCSF photo

"Instead, the therapy has been met with a heated debate. On one side, many experts have slammed Stemirac’s approval in uncommonly direct terms, saying there isn’t enough evidence to show it is effective or even safe. The treatment went through an expedited approval unique to Japan: After short, small clinical trials that suggest safety and efficacy, regulators can approve stem cell treatments on a conditional basis — allowing use of the treatments for seven years, while sponsors gather additional evidence to support a full approval.

"Critics also say Japan’s approach is far too soft — that early approvals allow patients to take experimental therapies that could be ineffective or dangerous, at a high cost to both patients and insurance providers. 'This is essentially an unproven therapy,' said Arnold Kriegstein, a stem cell researcher at the University of California, San Francisco. 'I’m very surprised this is happening in a country like Japan.'..."

The Undark article continued, 

Bruce Dobkin
UCLA photo

"What’s more, UCLA neurologist Bruce Dobkin told Undark, the results briefly reported in the media may suggest the treatment doesn’t even work. Dobkin pointed to previous trials testing other potential treatments for spinal cord injuries, and the Stemirac findings 'are exactly the results we found in patients in randomized controlled trials — in the control groups,' he said. That is, patients injected with Stemirac seemed to do as well as patients who got placebos in these earlier trials. He says people who have recently suffered spinal cord injuries, like Kusachi, the injured high diver (mentioned in Zeeberg's piece), and the others in the Stemirac trial, often have significant natural improvement over the next several months — exactly the period covered by the trial. It’s possible the patients were simply healing naturally, he says, but without a control group and double-blinding, it is hard to tell."

Undark's article captures many of the issues surrounding the development of stem cell therapies including the pressure to generate results for patients and profits for companies -- not to mention prestige and praise for researchers.

California's $3 billion stem cell program feels that pressure as well. It is running out of cash and would more than welcome a breakthrough in one of its 56 clinical trials -- one that would stimulate California voters to provide more billions for the state's nearly 15-year-old stem cell research effort.

The Search for a Cure for the Bubble Boy Disease: Orchard Therapeutics and the California Stem Cell Agency

Alliance for Regenerative Medicine video

Orchard Therapeutics, a British firm in which the California stem cell agency is directly supporting with $8.5 million, reports that it is "well underway" with its plans for a major facility in the San Francisco Bay area. 

Orchard says that it is on schedule to open the 150,000-square-foot plant in Fremont, Ca., in 2021, according to an article on BioProcess International.  

The move is part of a broad effort by Orchard to commercialize genetic therapies based on research pursued for decades by Donald Kohn of UCLA. California's stem cell research program has pumped $52 million into Kohn's research, which has saved the lives of more than 50 babies in (ADA-SCID) clinical trials.

Kohn has targeted what is often known as the bubble boy syndrome, a rare, fatal immune deficiency disorder (adenosine deaminase-deficient severe combined immunodeficiency -- ADA-SCID).  

UCLA has licensed Kohn's work to Orchard and will receive compensation at some point. CIRM is also slated to receive compensation should a product be developed. Kohn is one of the scientific founders or the Orchard and is a scientific adviser to the firm. 

The BioProcess article last week by Dan Stanton quoted Ran Zheng, Orchard's chief technical officer, as saying, 

“The diseases we target affect patients around the world, which require us to have the infrastructure to deliver gene therapies globally. We are therefore building a commercial-scale manufacturing infrastructure and leveraging technologies that will allow us to deliver our gene therapies globally and in a fully-integrated manner.”

The Fremont facility represents only part of Orchard's presence in California. Ron Leuty of the San Francisco Business Times reported that the firm leases 14,138 square feet in Menlo Park for labs and offices and 4,472 square feet for development labs and offices in Foster City. 

Orchard's stock price closed at $13.67 yesterday. Its 52-week high was $21.64 and the 52-week low was $8.65.

(Editor's note: This item has been altered from an earlier version to be more specific about the number of babies whose lives have been saved in clinical trials involving Kohn's work. The number now exceeds 50.) 

California Approves $72 Million for Stem Cell Commercialization

Directors of the California stem cell agency today approved $72 million to help drive stem cell research into the clinic and commercialization, despite concerns that it would damage the agency's ability to hire a new president.

The total for two concept proposals will consume roughly 14 percent of the agency's remaining cash, leaving only $402 million for future awards.

Director Jeff Sheehy said that the agency is going through money at an "alarming pace" and that approval of the plans would limit the agency's future ability to take advantage of research opportunities. He said the board was basically telling presidential candidates that we want "to hire you to manage the last embers of a dying fire."

The agency is scheduled to run out of cash in 2017.

Other directors were concerned about losing the agency's research momentum. Some said businesses could not wait many months or a year to gain funding.

A motion to delay a decision was rejected on a 7-12 vote. Directors then approved one of the two concept proposals, a $32 million program, on a 14-3 vote with two abstentions.

The proposal will provide up to $32 million for possibly three awards in the agency's business-friendly strategic partnership program ranging from $10 million to $12 million. The objective would be completion of a phase one or phase two clinical trial within three years. Matching funding would be required. Both businesses and non-profits would be eligible with forgivable loans a possibility for businesses.

The largest new proposal will provide up to $40 million for four or five preclinical development awards and was approved on a 19-0 vote. It is aimed both at development activities prior to a phase one clinical trial and at helping to attract future funding. Businesses and non-profits would eligible with businesses possibly taking a forgivable loan.

The posting of a request for applications is scheduled for April and May. Board action on applications would come early next year.

(Editor's note: This item has been revised from an earlier version to reflect action on both proposals and to add new figures on the amount of cash remaining for CIRM.)

Road to Commercialization: California Stem Cell Agency Seeking Top Level Product Development Execs

Looking for a good job at an enterprise that is on the cutting edge of biotechnology?

Nine positions are open at the $3 billion California stem cell agency, headquartered in San Francisco. Some of them could pay more than $200,000 a year.

Several of the new jobs are closely aligned with the agency's fresh focus on commercializing stem cell research and driving therapies into the clinic. Scientists and lawyers are being recruited along with a business development officer. For some of the positions, travel is required.

One new, high-level position is described as a senior development officer. The job posting calls for “expertise in product development for stem cell therapies.” The person would “directly interact with investigators on CIRM’s clinically applicable research programs to help provide product development guidance from preclinical, manufacturing, and first in human to early phase clinical regulatory perspectives.” An M.D. or Ph.D. degree in a biomedical science is required. Pay tops out at $232,891. This person would report to Ellen Feigal, senior vice president for research and development.

A second, high-level position reporting to Feigal is senior medical officer, who would manage the agency's portfolio aimed at commercialization of stem cell research, specifically “focused on IND enabling and clinical development projects.” This also requires an M.D. or Ph.D. and substantial professional experience in development of biomedical research and products. Pay also could run as high $232.891 annually.

A third new job at CIRM is business development officer. That person would help generate “outside investment in stem cell research in California for both CIRM-funded and not currently CIRM-funded programs by biopharmaceutical strategic partners; equity investors (venture capital and others); and disease foundations.” The salary range hits $216,270 annually. It wouldn't be surprising if the person in this job also became involved in developing a funding mechanism for CIRM after it runs out of state cash in 2017 or so. 

This position reports to Elona Baum, general counsel and vice president, business development.

And yet another new position is called director of alliance management. The job deals with the agency's extensive collaborative funding partnerships, many of which are abroad. CIRM wants somebody with a law degree, experience in intellectual property and business law along with strong negotiating skills. The pay range for the post tops out at $232,891 annually. This position reports to CIRM President Alan Trounson.

Other open positions include: deputy general counsel, two science officers and office manager.