California's $72 Million Diabetes Wager: ViaCyte Announces Major "Firsts" for Its Stem Cell Therapy

Vox Pop video/Viacyte

One of California's bigger stem cell bets -- $72 million -- turned up this morning with a strong positive report that included a couple of "firsts" in its search for a virtual cure for diabetes.

The announcement came from ViaCyte, Inc., of San Diego. The California stem cell agency has pumped $72 million into the company, making the firm the top for-profit recipient of state stem cell largess. 

The news comes as the agency, known formally as the California Institute for Regenerative Medicine (CIRM), is running out of funds and hoping that voters will give it $5 billion more. A major research score would be a big plus for that ballot initiative effort. 

The agency's president, Maria Millan, described the ViaCyte announcement as important and encouraging. 

ViaCyte is developing a tiny device that is implanted in a person's body and that generates insulin as needed. It is aimed primarily at type one diabetes, which afflicts more than one million Americans 

ViaCyte issued a news release on the developments at major, national stem cell conference in Carlsbad, Ca. The headline on the release said, 

"First demonstration of insulin production in patients from a stem cell-derived islet replacement therapy"

The release said,

"Preliminary data show that implanted cells, when effectively engrafted, are capable of producing circulating C-peptide, a biomarker for insulin, in patients with type 1 diabetes."

Paul Laikind, CEO and president of the firm, declared,

“ViaCyte is the first and only company in human clinical trials with a stem cell-derived islet replacement therapy candidate, and we are now the first to demonstrate production of C-peptide in patients receiving implanted stem cell-derived islets. These data show that our PEC-01 cells are functioning as intended when appropriately engrafted. “While there is still more work to be done, this is an important milestone. We plan to present additional data in the near future.”

Laikind continued,

“ViaCyte has achieved a number of firsts in this field. Now with the first demonstration of insulin production in patients who have received PEC-Direct, we are confident we can be the first to deliver an effective stem cell-derived islet replacement therapy for type 1 diabetes.”

Asked for comment, CIRM's Millan said,

"This is encouraging news. We are very aware of the major biologic and technical challenges of an implantable cell therapy for Type 1 Diabetes, so this early biologic signal in patients is an important step for the ViaCyte program."

ViaCyte is scheduled to present its findings later today at the Cell & Gene Meeting on the Mesa. That session can be seen live on the Internet 1:45 p.m. PDT. 

(An earlier version of this item contained a slightly different quote from Millan. CIRM re-submitted the latest quote, which adds information.)

Update on California's $72 Million Bet on a Diabetes Cure: Gene Editing Holds Promise

Viacyte video

A San Diego stem cell firm fueled by $72 million from the state of California this week announced an "important step" in its search for a diabetes cure in collaboration with a Massachusetts gene-editing enterprise.

The California business is ViaCyte, Inc., a privately held company that has received more funding from the California stem cell agency than any other business. 

It ranks 9th on the list of all recipients of cash from the California Institute for Regenerative Medicine (CIRM), as the agency is formally known. The ranking places it ahead of such highly regarded research institutions as Salk in La Jolla and Gladstone in San Francisco.

The East Coast firm is CRISPR Therapeutics, AG, a publicly traded firm that aims at "developing transformative gene-based medicines for serious human diseases."

CRISPR and Viacyte announced on Tuesday that their research is now showing that ViaCyte's "CyT49 pluripotent stem cell line, which has been shown to be amenable to efficient scaling and differentiation, can be successfully edited with CRISPR. The CyT49 pluripotent stem cell line is currently being used to generate islet progenitors for clinical trials."

Paul Laikind, CEO of ViaCyte, said in a news release that the latest news brings the firms "potentially one step closer to a transformational therapy for patients with insulin-requiring diabetes through the development of an immune-evasive gene-edited version of our technology."

Laikind described the gene editing result as "an important step" in achieving "yet another first, the development of an immune-evasive cell replacement therapy as a potential cure for type one diabetes."

In 2017, CIRM gave ViaCyte $1.4 million for work on the CyT49 line. Maria Millan, president of CIRM, said at the time,

“Development of an immune-evasive cell therapy would increase the chances of engraftment and durable effect of a cell replacement therapy for diabetes."

Investors were not energized by the CRISPR/ViaCyte announcement. CRISPR's stock price closed at $49.40 today, down from a $49.67 close on Monday, the day prior to the announcement. The 52-week high for the firm is $53.97. The low is $22.22. 

CRISPR and ViaCyte announced their $15 million collaboration a year ago. Here is a 2018 overview of Viacyte by Bradley Fikes of the San Diego Union Tribune.  

No. 54: Counting California Stem Cell Agency's Clinical Trials, This One for Diabetes

The California stem cell agency has awarded $11 million to help treat type one diabetes, an affliction that affects 1.25 million persons nationally.

The award brings to $194.6 million the amount given to UC San Francisco (UCSF) since 2005 by the California Institute for Regenerative Medicine (CIRM), as the agency is formally known. 

UCSF has held a seat on the governing board of the $3 billion agency since it was created by voters in 2004. About 90 percent of its funding has gone to institutions with ties to board members. They are not allowed to vote on awards involving their institutions, but the board can create or eliminate funding programs. 

The $11 million phase one clinical trial award last week went to Peter Stock of UCSF and was his first for a trial from the agency.  It is the 54th investment by the agency in a clinical trial. CIRM said in a news release:

"Transplantation of beta cells, contained in donor pancreatic islets, can reverse the symptoms of diabetes. However, due to a poor islet survival rate, transplants require islets from multiple donors. Furthermore, since islet cells are transplanted directly into the vessels that enter the liver, it is extremely difficult to monitor and retrieve these cells should the need arise.

"Dr. Stock’s clinical trial at UCSF aims to address these limitations. The trial will be using parathyroid glands to aid in the success and viability of the transplant procedure."

CIRM's review of Stock's application (CLIN2-11437) noted that questions had been raised about commercialization of his research. It said, 

"If efficacious, the proposed therapy could lead to US regulatory approval for islet transplantation and clear the commercialization path for this and future diabetes treatments in a field that needs innovation. Overall, the enthusiasm from clinical experts for the potential of a new approach outweighed commercialization concerns and the panel recommended the application for funding."

California's $72 Million Diabetes/Stem Cell Bet: A New Partner from Massachusetts

CRISPR Therapeutics is the latest firm to become involved in a California-
backed stem cell research effort. It uses gene-editing techniques to devise cures.

The California stem cell agency has invested $72 million in a San Diego firm that is pursuing a a functional cure for diabetes and which announced this week it was moving to dodge a major obstacle facing its potential therapy. 

The firm is Viacyte, Inc., a privately held enterprise that has received more funding by far than any other state-backed stem cell firm. It announced on Monday that it had hooked up with publicly traded CRISPR Therapeutics, Inc., of Cambridge, Mass., to collaborate on a gene-editing treatment that would evade the body's immune response to earlier Viacyte therapies.

In a Q&A with UC Davis researcher Paul Knoepfler, Paul Laikind, CEO of Viacyte, said,

"The advantage of an islet cell replacement therapy that has been gene-edited for immune evasion is simply that patients would not need to take immunosuppressive drugs, which can have side effects. Our main mission is to improve the lives of patients with insulin-requiring diabetes by delivering transformative new therapeutic options. The work we are doing on PEC-Direct, PEC-Encap, and now an immune-evasive approach, known as PEC-QT, are all a part of that mission."

The treatment is principally aimed at type 1 diabetes, which afflicts 1.25 million persons in this country, the stem cell agency said in a piece on its blog about the new collaboration.

Viacyte was one of the earliest firms to receive cash from the agency, officially known as the California Institute for Regenerative Medicine (CIRM). The awards began with only $48,950 in 2008 when Viacyte was known as Novocell.

The arrangement with CRISPR will provide more funding for Viacyte, $15 million from its new partner and possibly another $10 million in the form of a convertible promissory note.

CRISPR's stock closed at $48.99 yesterday, down from $55.36 last Friday. Its 52-week high was $73.90 and its 52-week low $16.16.  The firm announced on Wednesday that it was planning to sell $200 million in common stock.  (Here is a detailed presentation on the firm's strategy and research. Here is a link to one analysis of the firm as an investment.)

In the piece on Knoepfler's blog, Laikind also provided an update on Viacyte's other related research. He said,

"(T)he PEC-Encap (also known as VC-01) product candidate has a bright future! We remain enthusiastic regarding the prospects of PEC-Encap, and are actively working on it. In June, two-year data from ViaCyte’s STEP ONE clinical trial were presented at ADA 2018. Although consistent and robust engraftment has been limited in this study to date, results showed that when engraftment does occur, viable mature insulin-expressing endocrine islet cells can be formed. In some cases, insulin-expressing cells have persisted for up to two years after implantation, the longest time point investigated in the study.

"Building on insights gained during the STEP ONE study, ViaCyte is working with W.L. Gore & Associates, one of the world’s top materials science companies with expertise in medical device development and drug delivery technologies, to modify the Encaptra Cell Delivery System and improve the potential for long-term engraftment. This work has yielded positive results in non-clinical models that, based on clinical experience, have been selected to reflect the response in patients. If the progress continues as expected, we plan to resume STEP ONE trial enrollment in 2019.

"As for PEC-Direct (also known as VC-02), the Phase 1/2 clinical evaluation of that product candidate is also continuing. We are now evaluating patients in the second cohort of the trial. As you know, PEC-Direct has the potential to help the patients with type 1 diabetes with the greatest need."

Embedded in a Stem Cell Lab: Melton, Diabetes and Keeping Cells Happy

Yi Yu, a research assistant at the Melton lab at Harvard with flasks containing
human embryonic stem cells -- Photo Chloé Hecketsweiler/Undark

From a "mouse house" to growth cocktails, a web site called Undark has it all in a piece headlined "A Month in the Life of a Stem Cell Lab."

The photo essay was prepared by Chloé Hecketsweiler, a Paris-based journalist with Le Monde. She recorded events and people during six weeks this year in the laboratory of Douglas Melton at the Harvard Stem cell Institute.

Melton is digging into diabetes. A firm he co-founded, Semma Therapeutics, is the recipient of a $5 million award from the California stem cell agency, formally known as the California Institute for Regenerative Medicine.

About Melton's lab, Hecketsweiler wrote,

"I watched their experiments, learned about the complex science of stem cells, and talked with the researchers about their work and hopes. I was allowed to take pictures, and for this photo essay I tried to pick out moments and details that I found revealing, although scientists may see them as business as usual."

Her photos are first-rate, her reporting personal and the presentation strong. One member of Melton's team, Maria Keramari, told her,

"You have to keep the cells happy before you keep yourself happy."

It echoed an axiom from America's old family farming days when livestock was fed and cared for as the sun rose, long before before the family sat down for breakfast.

Another Melton researcher, Ornella Barrandon, said,

"We spend so much time on our projects, they are like our babies."

Hecketsweiler's work tells a science story in a way not regularly seen. It is a good example of making stem cell research accessible to a wide audience and leaving them wanting more.

Diabetes to Arthritis: California Awards $33 Million for Clinical Stage Stem Cell Work

The California stem cell agency today approved nearly $33 million for clinical stage research projects testing treatments for type 1 diabetes, arthritis of the knee, ALS and an immunodeficiency affliction.

The awards were quickly approved with little discussion during a meeting at the Oakland headquarters of the California Institute for Regenerative Medicine or CIRM, as the agency is formally known.

The award likely to have an impact on the most people -- if it is successful -- is a relatively small, $2.3 million award to the Cellular Biomedicine Group,  a Chinese firm with operations in Cupertino, Calif. The stem cell agency by law only finances work in California. The research would also be supported by $572,993 in co-funding.

The project is aimed at treating osteoarthritis of the knee. More than 51 million people in the United States suffer from arthritis, which is particularly common in the knee.

The goal of the research is to regenerate knee cartilage through the use of a mesenchymal progenitor cell treatment, according to the agency's application review summary. The funding would go to manufacture the product and complete work to secure Food and Drug Administration approval for a phase one safety trial. A treatment for the public would likely be years in the future.

Here are the other winners today of California stem cell cash with links to the summaries of the reviews.

Caladrius Biosciences of New Jersey won $12.2 million for a clinical trial for young people ages 12-17 for newly diagnosed type 1 diabetes. The firm plans to use regulatory T cells from the patients themselves to treat the disease. Caladrius has a California location in Mountain View. (Caladrius' press release can be found here.)

St. Jude's Research Hospital in Memphis, Tenn., was awarded $11.9 million for a phase one/two trial to treat infants with X-linked severe combined immunodeficiency. The trial would aim at enrolling at least six patients suffering from the catastrophic affliction. The treatment would use the patients own bone marrow stem cells after the cells were specially handled. The agency said in a press release that St. Jude's is working with UC San Francisco. (St. Jude's press release can be found here.)

Cedars-Sinai Medical Center in Los Angeles was awarded $6.2 million for a phase 1/2A trial to test a treatment for ALS, which has no treatment or cure. The CIRM review summary said a "huge unmet need" existed. About 20,000 persons in the United States suffer from the affliction.

CIRM's press release did not identify the researchers involved in any of the awards.

The agency is on a push to support more clinical trials, which are the last and most expensive research prior to the possibility of winning federal approval for widespread use of a therapy.

Currently the agency is participating in 27 trials and is planning on adding 37 more in the next 40 months. The agency is expected to run out of funds for new awards in June 2020 and has no source of future financing.

The awards were previously approved behind closed doors by the agency's out-of-state reviewers, who do not disclose publicly their economic or professional interests. The agency's directors rarely overturn a positive decision by the reviewers.

All of the winners have links to two or more members of the 29-member CIRM governing board. Those members are not allowed to vote on applications where they have conflicts of interest.
About 90 percent of the funds awarded by the board since 2005 have gone to institutions that have ties to members of the board, past or present, according to calculations by the California Stem Cell Report.

(Editor's note: An earlier version of this item incorrectly said the total amount of awards was $37 million.)

The $50 Million, Semma-Melton Quest: Looking for a Cure for Diabetes

An eminent Harvard stem cell researcher who is searching for a cure for an affliction that plagues 29 million Americans stood on a San Francisco stage this week and spoke of "things we don't understand."

Doug Melton, photo Harvard Gazette/B.D. Colen

The scientist is Doug Melton, who is on a deeply personal quest for a cure for diabetes. Both of his children have the disease. And the state of California is helping out on his search with $5 million.

The occasion for Melton's remarks was the presentation of the Ogawa-Yamanaka Stem Cell Prize, a $150,000 award for his work in cellular reprogramming.

Here is how Hannah Robbins of the Harvard Gazette described the results of Melton's research:

"As a pioneer in programming insulin-producing beta cells from stem cells, Melton’s lab can now generate therapeutic quantities of functional, stem cell-derived beta cells, which Melton hopes will someday soon replace the life-saving yet painful daily insulin injections for diabetics."

The $5 million from California is a grant made last March by the state's $3 billion stem cell agency, formally known as the California Institute for Regenerative Medicine (CIRM).

The cash is going to a firm in Cambridge, Ma., called Semma Therapeutics, Inc., which Melton co-founded and which is named after his two children, Sam and Emma. Melton now serves on the firm's board of directors. The business is only two years old, but has raised roughly $50 million to translate Melton's work into actual treatments.

His grant application to CIRM in March was titled simply "Personalized Cell Therapy for Diabetes." The proposal (application number TRAN1-08561) received a score of 90 out of 100 from the agency's scientific reviewers who are from out-of-state. A summary of the closed-door review said the proposal was "strong, well-­designed, feasible. and high impact." The research "has excellent product development plans and great regulatory support," reviewers said.

The stem cell agency is limited to funding only work that is done in California. Semma announced earlier this month that it has set up arrangements with UCLA, Cedars-Sinai and the City of Hope in the Los Angeles area to generate "suitable clinical grade" cells from patients and "to establish a path leading to the transplantation of these cells back into patients in a clinical trial."

Peter Butler, chief of Endocrinology, Diabetes and Hypertension at UCLA, will be dealing with patient selection. Dhruv Sareen of the Induced Pluripotent Stem Cell Core Facility at Cedars-Sinai will direct derivation and analysis of pluripotent stem cells from each patient’s blood. The cells will be transferred to the City of Hope for manufacture of products for clinical trials.

Overseeing the entire project is Felicia Pagliuca, principal investigator on the CIRM grant. She is also scientific co-founder of the firm, the vice president of Cell Biology Research and Development and a lead on the original research in Melton's lab.

Felicia Pagliuca and Robert Millman
 photo Boston Globe/Dina Rudick

The financial backers are led by MPM, a venture capital firm with offices in South San Francisco and Cambridge, Mass. Robert Millman, formerly of MPM, is CEO of Semma. Other investors include Medtronic, Novartis, Fidelity Biosciences, Arch Venture Partners and the Juvenile Diabetes Foundation.

Semma is still hiring and has openings listed for five positions on its web site, ranging from scientists to a director of device development and manufacturing.

Here is a video recording of the award ceremony in which Melton discusses his research and "the things we don't understand" in the science.

(Editor's note: An earlier version of this story contained an inaccurate description of the roles of Cedars-Sinai and the City of Hope involving the CIRM-funded work.) 

Search for a Diabetes Cure: California Stem Cell Agency Hits $60 Million Mark with ViaCyte

The California stem cell agency next week is slated to award  an additional $4 million to ViaCyte, Inc., a San Diego firm that is working with the agency to develop a "virtual" cure for diabetes.

ViaCyte has already received $56 million over the years from the California Institute for Regenerative Medicine(CIRM), as the agency is formally known. The latest award will be used to help prepare for a clinical trial for a new treatment for the highest risk diabetes patients.

In response to a query this morning from the California Stem Cell Report, Paul Laikind, president and CEO of ViaCyte, said that the new product, PEC-Direct, will deliver the same biologic component as used in the firm's current product, which is now in a clinical trial.

Laikind said PEC-Direct will allow direct vascularization, which "is expected to allow for a very robust engraftment and cellular performance."

Because the new device will require chronic immune suppression, Laikind said,

"It is being developed to treat patients with type 1 diabetes that are at high risk for acute complications such as severe hypoglycemic events associated with hypoglycemia unawareness syndrome."

(The full text of Laikind's remarks and research update can be found here.)

The agency's summary of the closed-door review of the Viacyte proposal said,

"There are over 100,000 people in the U.S. with type 1 diabetes so severe that they are at constant risk of hospitalization and/or death. Within months after administration, this product could naturally restore those patients’ blood sugar to normal healthy levels and save their lives." 

In addition to the $4 million, ViaCyte is putting up $994,343 of its own cash.

CIRM's blue-ribbon panel of scientific reviewers has already approved the award, which is part of a $30 million package of applications coming up next Thursday.  The governing board of the agency will ratify the approvals at its meeting next Thursday during a one-hour telephonic meeting.

The largest award, $10 million, will go to Humacyte, Inc., of North Carolina,  to produce an artificial vein for use in hemodialysis as reported yesterday on the California Stem Cell Report. More details of all the applications and review summaries can be found on the meeting agenda.

The session will be audiocast and carried on the Internet on a listen-only basis. Interested parties can participate in the meeting from telephonic locations throughout the state.

The main site for the meeting will be at the Sanford consortium in San Diego. Other locations include the agency's headquarters in Oakland and sites in Davis, South San Francisco(2), Napa, Los Gatos, Sacramento, Irvine, San Francisco and Los Angeles. For specific addresses and instructions for online access, see the agenda.

Text of ViaCyte's Statement on its New Proposed Diabetes Product

The California Stem Cell Report this morning queried Paul Laikind, the CEO of ViaCyte, Inc., of San Diego, about the company's upcoming $4 million award from the California stem cell agency and the award's relationship to the ViaCyte product known as VC-01. Here is the text of his response.

"ViaCyte is continuing development of VC-01 (what we now call PEC-EnCap).  PEC-EnCap is the first encapsulated allogeneic cell therapy to enter the clinic where the device is designed to protect the cells from the host adaptive immune system.

 "We have early clinical demonstration of the feasibility of the PEC-EnCap approach; the Encaptra Drug Delivery Device appears to be functioning as designed and we have shown engraftment and differentiation to beta cells is achievable at 12 weeks.  However, work is continuing to ensure a robust and consistent engraftment before we move to the second cohort of patients and seek to demonstrate efficacy.

 "We can’t overemphasize enough the importance the clinical results we are obtaining, not only for the further development of PEC-EnCap but for the stem cell-derived cell therapy field in general. This important work has, of course, received important support from CIRM. "In parallel with the development of PEC-EnCap we are preparing to initiate clinical development of VC-02 (PEC-Direct).  PEC-Direct delivers the same biologic component as PEC-EnCap, PEC-01 pancreatic progenitor cells, but does so in a device that allows direct vascularization.  This direct vascularization, based in part on what we have learned with PEC-EnCap during the clinical evaluation, is expected to allow for a very robust engraftment and cellular performance.

"Given the open nature of the device, patients implanted with PEC-Direct, as with other transplants, would require chronic immune suppression.  Thus it is being developed to treat patients with type 1 diabetes that are at high risk for acute complications such as severe hypoglycemic events associated with hypoglycemia unawareness syndrome.

 "This high risk patient population is the same population that would be eligible for cadaver islet transplants, a procedure that has been demonstrated as very effective but suffers from a severe lack of donor material and high cost.  PEC-Direct is expected to overcome these limitations by providing an unlimited supply of cells for transplant and a safer more optimized route of administration.

"ViaCyte remains committed to the development of PEC-EnCap which we view as a potentially transformational therapy for the majority of insulin utilizing patients with diabetes, both type 1 and type 2.  PEC-Direct represents a potentially nearer term therapy for the patients at the highest risk."

"All In' -- Good News for California's $56 Million Investment in Search for Diabetes Cure

A $56 million bet by the state of California on a diabetes cure is showing additional promise that it will ultimately pay off.

The latest indication came last week when Big Pharma’s Johnson & Johnson went “all in” on ViaCyte, Inc., which has received $56 million from the California stem cell agency during the last 11 years, surpassing the amount that UC Berkeley has been awarded during the same period.

J&J has already pumped $20 million into the San Diego firm, which is conducting a clinical trial for a virtual cure for type 1 diabetes. The effort is showing promising results, according to the stem cell agency.

Last week, in a sign that ViaCyte has was moving along nicely,  J&J turned over its Janssen BetaLogics group to ViaCyte.

BetaLogics was a competitor to ViaCyte and a hedging ploy by J&J.  Business columnist John Carroll of Fierce Biotech described the merger of the two as a major commitment by Johnson. He wrote: 

“J&J goes all in with ViaCyte.”

Carroll reported,

"'We needed to hedge our bet to make sure that we would be the leaders in this space,' says Diego Miralles, J&J's global head of innovation in San Diego. ‘It's clear that ViaCyte has pulled ahead.’”

Randy Mills, president of the $3 billion stem cell agency, said in a news release that “the latest clinical data from ViaCyte are very encouraging and a clear sign of progress.”

The company has been working for years on its product, which is based on human embryonic stem cells. The treatment involves insertion of a tiny device beneath the skin of a patient to produce  insulin when needed.

Linda Johnson of The Associated Press wrote,

"'This one is potentially the real deal,' said Dr. Tom Donner, director of the diabetes center at Johns Hopkins University School of Medicine. 'It's like making a new pancreas that makes all the hormones' needed to control blood sugar.

"Donner, who is not involved in the research, said if the device gives patients normal insulin levels, 'it's going to prevent millions of diabetics from getting dangerous complications.'"

Paul Knoepfler, a stem cell researcher at UC Davis, wrote on his blog that the J&J move was “great news” for ViaCyte. He said the folding of BetaLogics and recent results from the phase one clinical trial “solidify ViaCyte’s leadership.” Knoepfler also is not involved with the ViaCyte research.

Before the therapy can be marketed widely, it must clear both a phase two and phase three trial, which could take a few years.

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

Scrum or Duel? Canadian Researcher Prefers Broader Perspective on Diabetes Research

A Canadian scientist this week took issue with treatment on this Web site of stem cell diabetes research as a Massachusetts-California duel.

James Johnson, a primary member of the Diabetes Research Group at the University of British Columbia, referred to an item yesterday on the California Stem Cell Report.

James Johnson, UBC photo

In an exchange of emails this week with this writer, Johnson said “there are at least 25 large groups working in this sphere, not two.”

One of those groups is the Diabetes Research Group in British Columbia, whose research is backed by a subsidiary of Johnson & Johnson.

In a follow-up email, Johnson said, 

“My point was that I think portraying it as a race between 2-3 groups misrepresents what is a global effort.” 

He added,

 “Personally I doubt Harvard or ViaCyte (a San Diego firm) will be the first to market such a therapy.” 

Johnson makes a good point concerning the worldwide effort on diabetes. The search for a stem cell cure or therapy for diabetes goes well beyond California and Massachusetts.

A “duel” existed, nonetheless, between them as the result of an article in the MIT Technology Review and an item on the blog of UC Davis stem cell researcher Paul Knoepfler.  In the MIT piece, Harvard researcher Doug Melton commented critically on the ViaCyte effort. Paul Laikind, CEO of the San Diego firm, defended his project on the Knoepfler blog.

The California Stem Cell Report, which focuses almost entirely on California stem cell matters and the $3 billion state stem cell agency, was particularly interested in all this because the agency has pumped $55 million into ViaCyte. It is the largest amount that the state has invested in a single company.

Additionally, ViaCyte’s clinical trial is also the only diabetes clinical trial in the United States based on human embryonic stem cells, which, of course, generate far more controversy than adult stem cells.

As for the worldwide state of diabetes stem cell research, perhaps it could be described as a global scrum, the grunting and heaving moment in rugby when multiple players tussle to control the ball.

Transcontinental Diabetes Duel: The Search for a Stem Cell 'Cure'

Paul Laikind

Doug Melton,

One might call it a California-Massachusetts stem cell face-off. The tussle is over a stem cell cure of sorts for diabetes.

The players are Doug Melton of Harvard and Paul Laikind, CEO of ViaCyte in San Diego.  

Recently in separate forums, the men critiqued each other’s approaches to diabetes.

Most recently it was Laikind three days ago on the blog, ipscell.com, of UC Davis researcher Paul Knoepfler. Laikind was responding in a Q&A carried by Knoepfler.

Knoepfler asked about Melton’s comments in the MIT Technology Review last month. Melton was described in an article as being “worried” that ViaCyte’s technology, now in a first stage clinical trial, would not work. The California stem cell agency has invested $55 million in the firm's approach.

Knoepfler continued,

“(Melton) raised concerns more specifically about the Encaptra capsule, for example, functionally becoming fibrotic and mentioned worries about your cells being immature and taking a long time to mature. Any response on capsule and cells? He also has suggested that his beta cells will be a better option.” 

Laikind replied,  

“Dr. Melton’s work on the beta cell is very interesting. As to the cells, we made the choice to use the pancreatic progenitor cells. An important consideration is that when you first put in cells, they are in a hypoxic environment. Beta cells are sensitive to low oxygen levels, which can negatively affect their survival and function. Beta cells typically exist in a mature highly vascularized organ. The pancreatic progenitor cells that we use undergo an organogenesis-like process, more similar to how they behave in nature, and thus we believe they should be better able to handle low oxygen. They also are believed to release angiogenic and other factors to promote vascularization.

“In regards to the capsule, we do expect there to be a foreign body reaction in patients after implantation, which will generate a fibrotic capsule. In fact, we see a thin fibrotic capsule around the device in mice. But in the mouse model this capsule around the device is very well vascularized. The vasculature is right up against the device membrane on the outside, allowing for oxygen and nutrient diffusion to the cells inside.”

Knoepfler also asked about the diabetes effort in Canada involving BetaLogics Venture, a subsidiary of Johnson & Johnson, which also made a $20 million investment in ViaCyte last summer.

Laikind said situation involving Melton and BetaLogic was “healthy competition.”

He continued,

“There’s room in this area for multiple efforts and we aren’t especially concerned with competition. Yet we do feel we are ahead of others and we have substantial intellectual property that they will need to navigate (~50 patents issued in the United States, and a couple hundred pending patent applications, including international). At ViaCyte we view the real competition as the biology rather than with the efforts of others as we seek to cure this devastating disease.” 

Laikin had more to say about his firm’s product and Melton’s comments.  He also discussed ViaCyte’s clinical trial, which now has four patients with a goal of 40. He said the initial evaluation of efficacy could occur by late 2016. Within five years, he hopes to see “success” with the product and “be moving to market.”

Responding to a question about “product placement,” Laikin said the firm is currently inserting its tiny device in the lower back of patients. Laikin said,

“The reason for that placement is that while the device can withstand the impact of a 60 mph baseball (based on cadaver testing), a needle could go right through it, so we want to put it where patients don’t typically inject insulin.” 

Concerning Melton’s views on ViaCyte, the Feb. 12 MIT Technology Review piece said,

“Douglas Melton, a biologist at Harvard University who has two children with type 1 diabetes, worries that the ViaCyte system may not work. He thinks deposits of fibrotic, scarlike tissue will glom onto the capsules, starving the cells inside of oxygen and blocking their ability to sense sugar and release insulin. Melton also thinks it might take immature cells up to three months to become fully functional. And many won’t become beta cells, winding up as other types of pancreatic cells instead.

“Melton says the ‘inefficiency’ of the system means the company ‘would need a device about the size of a DVD player’ to have enough beta cells to effectively treat diabetes. ViaCyte says it thinks 300 million of its cells, or about eight of its capsules, would be enough. (Each capsule holds a volume of cells smaller than one M&M candy.)    Last October, Melton’s group announced it had managed to grow fully mature, functional beta cells in the lab, a scientific first that took more than 10 years of trial-and-error research. Melton thinks implanting mature cells would allow a bioartificial pancreas to start working right away.”

The Web site, diaTribe, last fall carried an analysis of all three approaches.

ViaCyte's hESC Diabetes Effort Examined, Critiqued in MIT Publication

The ViaCyte device -- photo San Diego U-T

The state of California has invested $55 million in a San Diego firm that last week attracted some East Coast attention for its efforts to develop a “virtual” cure involving Type 1 diabetes.

The firm is Viacyte, which is in a stage one clinical trial involving its therapy. The MIT Technology Review looked at the potential product on Feb. 12.

In a piece headlined “A Pancreas in a Capsule,” writer Brian Alexander said,

“In October, a San Diego man had two pouches of lab-grown pancreas cells, derived from human embryonic stem cells, inserted into his body through incisions in his back. Two other patients have since received the stand-in pancreas, engineered by a small San Diego company called ViaCyte.

“It’s a significant step, partly because the ViaCyte study is only the third in the United States of any treatment based on embryonic stem cells.” 

All three of those trials involve California. A spinal cord injury treatment is being tested by Asterias Biotherapeutics of Menlo Park, Ca. It has received $14.3 million from the California stem cell agency. The other trial is for macular degeneration and is being conducted at UCLA by Steven Schwartz for Ocata Therapeutics of Massachusetts, formerly known as Advanced Cell Technology. The firm applied multiple times for California funding but was rejected.

Viacyte, which has received more funding from the stem cell agency than any other company, began its efforts optimistically years ago. Alexander wrote,  

“'When I first came to ViaCyte 12 years ago, cell replacement through stem cells was so obvious. We all said, ‘Oh, that’s the low-hanging fruit,’” says Kevin D’Amour, the company’s chief scientific officer. 'But it turned out to be a coconut, not an apple.'” 

 (Robert Henry at UC San Diego is conducting the  trial on behalf of ViaCyte.)

  

Alexander continued, 

“Douglas Melton, a biologist at Harvard University who has two children with type 1 diabetes, worries that the ViaCyte system may not work. He thinks deposits of fibrotic, scarlike tissue will glom onto the capsules, starving the cells inside of oxygen and blocking their ability to sense sugar and release insulin. Melton also thinks it might take immature cells up to three months to become fully functional. And many won’t become beta cells, winding up as other types of pancreatic cells instead. 

Doug Melton -- Harvard photo

“Melton says the ‘inefficiency’ of the system means the company ‘would need a device about the size of a DVD player’ to have enough beta cells to effectively treat diabetes. ViaCyte says it thinks 300 million of its cells, or about eight of its capsules, would be enough. (Each capsule holds a volume of cells smaller than one M&M candy.)  Last October, Melton’s group announced it had managed to grow fully mature, functional beta cells in the lab, a scientific first that took more than 10 years of trial-and-error research. Melton thinks implanting mature cells would allow a bioartificial pancreas to start working right away.”

The piece in the MIT Technology Review is a plus for the California stem cell agency, which is seeking to raise its profile.  The agency's president, Randy Mills, is making a push to draw interest from non-California enterprises that might find funding from California attractive even with restrictions that it be used in the Golden State.

California Bets $55 Million on 'Teabag' Diabetes Treatment

BERKELEY, Ca. -- California today beefed up its investment in a “teabag” therapy for diabetes, bringing the total to $55 million in an effort to develop a “virtual cure” for an affliction that affects 347 million people worldwide.

It is believed to be the largest direct investment that the state has ever made in a company. The therapy also involves the most controversial of stem cell treatments, ones derived from human embryonic stem cells(hESC). 

The impact of the potential therapy could be far-reaching.  About 70,000 persons die each year in this country from diabetes. It is the 7th leading cause of death in the United States.

Forty-three-year-old Maria Torres, who lives in the Sacramento area, is hoping for a positive outcome on the therapy.

Maria Torres
CIRM photo

 “I have three kids, and I know they could have the same thing I have. If they find a cure, for me, that’s peace of mind.”

Torres was featured in a blog post yesterday by the California Institute of Regenerative Medicine(CIRM), the state’s nearly 10-year-old, $3 billion stem cell research program, which is providing the taxpayer funding.

Meeting here today, directors of the agency approved, on an 8-0-1 vote, $16.6 million in awards to Viacycte, Inc., of San Diego, Ca., to advance its work on the therapy.  Over the last six years, the agency has pumped $38.5 million into the company, which has received by far the greatest amount of cash from the agency of any business. A subsidiary of Johnson&Johnson as well recently invested $20 million in Viacyte.

The firm’s treatment is scheduled to begin clinical trials this year. UC San Diego has begun enrolling patients, Viacyte CEO Paul Laikind told CIRM directors this morning.

The therapy involves several, porous, teabag-like packages that are inserted beneath the skin. An individual device is about the length of a credit card but half the width. The firm plans to work on a larger device for single insertion. 

In the CIRM blog post yesterday, Anne Holden, Web content and social media manager for the agency, said the device contains cells that “sense blood sugar levels and produce insulin to reduce them.”  That “allows transfer of blood sugar, insulin, oxygen, and other molecules but keeps (other) cells out, thus avoiding the possible attack and rejection by the patient’s own immune system.”

Regular use of the treatment is years away because of the series of clinical trials that must be run. Additionally, only about one out 10 traditional drugs entering clinical trials reach the marketplace. No therapies involving human embryonic stem cells (hESC) have successfully run the clinical trial gauntlet in the U.S. and secured approval for widespread use.  

Viacyte’s therapy is derived from those controversial cells and is the first hESC trial backed by CIRM.   Some religious groups and others believe the use of the cells is tantamount to murder. Opposition to hESC research has subsided in recent years because of the focus on the possible use of reprogrammed adult stem cells. However, it flared up again in recent weeks because of a flap over the so-called Ice Bucket Challenge, which raised funds for ALS research, some of which involves hESC.

The California stem cell agency, ironically, owes its existence to the opposition to hESC research. Former President George Bush restricted federal funding for hESC research because of the religious concerns. The ballot campaign in 2004 to create the agency relied heavily on Bush’s action to demonstrate the need for continuing research into the promising field. 

Here is a link to the CIRM press release on the awards. 

California Edges Forward with $39 Million Stem Cell Diabetes Effort

California’s $39 million bet on a new stem cell therapy for diabetes today moved a notch ahead today with word that the treatment's developer has received federal approval to begin a clinical trial.

“Very encouraging news” was how the new president of the state stem cell agency, Randy Mills, described the announcement by Viacyte, Inc. “Exciting” was the word used by Jonathan Thomas, chairman in a pressrelease from the California Institute of Regenerative Medicine (CIRM), as the $3 billion agency is formally known. CIRM began financing Viacyte six years ago.

The go-ahead by the FDA was for an early stage trial aimed at testing safety and preliminary efficacy for treatment for type 1 (juvenile) diabetes. While the move is a good sign, only one out of any 10 potential therapies that begin a trial emerges as a full-blown treatment.  That statistic is for ordinary treatments – not therapies based on human embryonic stem cells (hESC). No hESC therapy has ever been commercialized, and they face unique regulatory and financial obstacles.

CIRM’s press release described the treatment like this:

“ViaCyte’s approach uses a thin plastic pouch, containing an immature form of pancreatic cells, to mimic the blood glucose regulating function of the pancreas. When the device is implanted under the skin these cells are designed to become insulin-producing and other cells needed to regulate blood glucose levels. It is believed that these cells will be able to sense when blood glucose is high, and then secrete insulin to restore it to a healthy level.” 

In addition to the news release, the stem cell agency ran a blog item on the announcement, which is useful, since there is more than one audience for the news. The agency did not link to the press release from Viacyte, which noted that the Juvenile Diabetes Research Foundation also supported the research.

Paul Laikind, president of Viacyte, said in his press release that he was “pleased” by the FDA action.  That was the most ebullient word in the company’s announcement, which focused on the more technical aspects of the potential therapy.

In news coverage, Bradley Fikes of the San Diego U-T wrote that the company has said the treatment could serve as a “virtual cure” for type 1 diabetes, which afflicts more than two million persons in the United States.

California-funded Stem Cell Diabetes Treatment Edges Forward

CIRM video

The California stem cell agency’s $39 million investment in a possible therapy for diabetes moved forward this week with the announcement that the treatment could enter clinical trials as early as next month.

ViaCyte, a San Diego, Ca., firm, and the agency announced yesterday that the firm has applied with the FDA to start the testing to determine whether the product is safe in human beings. The Juvenile Diabetes Research Foundation, which is also funding the ViaCyte product, said the therapy was “potentially transformative.”

Randy Mills, president of the $3 billion stem cell agency, said in a press release,

“This is good news for ViaCyte and is a clear sign of the progress they are making. Filing for an IND is a crucial step along the path to bringing a stem cell treatment to patients. CIRM will be working with them and supporting them every step of the way to try and make this happen as quickly, and as safely, as possible.”

The agency described the treatment like this:

“Viacyte’s approach uses a thin plastic pouch, containing an immature form of pancreatic cells that, when implanted under the skin, are designed to mature and become insulin-producing and other cells needed to regulate blood glucose levels. These cells are able to sense when blood glucose is high, and then secrete insulin to restore it to a healthy level. In effect this is designed to mimic the glucose regulating functions of the pancreas, which, in people with T1D(type one diabetes), no longer works. This approach was shown to be effective in extensive preclinical testing in models of the disease.”

Paul Laikind, president of ViaCyte, told Bradley Fikes of the San Diego U-T that if “all goes smoothly” the initial stage of the clinical trials could begin next month or in September. Fikes also quoted the first chairman of the stem cell agency, Robert Klein, whose son has diabetes, as saying,

"This is an exciting day for the father of any son or daughter who has Type 1 diabetes."

The therapy, which is based on human embryonic stem cells, could take years to successfully complete all of the necessary clinical trials. Only one out of 10 possible therapies that enter clinical trials enters the marketplace.