Two Rounds of Transplants, 70 Drugs: An Advocate's Journey into Stem Cell Safety

Lukas Wartman
Science magazine, Whitney Curtis photo

The California stem cell agency today related a compelling story concerning a physician named Lukas Wartman who received "a life-saving stem cell treatment that is now threatening his health."

The headline on the item on the agency's blog, The Stem Cellar, said,

"One man’s journey with leukemia has turned into a quest to make bone marrow stem cell transplants safer"

Karen Ring, a scientist herself and overseer of social media at the California Institute for Regenerative Medicine (CIRM), wrote about the case after she read an article by Jon Cohen in Science Magazine concerning Wartman. He is a physician at the Washington University School of Medicine. Ring wrote,

"He was first diagnosed with a type of blood cancer called acute lymphoblastic leukemia (ALL) in 2003. Since then he has taken over 70 drugs and undergone two rounds of bone marrow stem cell transplants to fight off his cancer."

The first transplant came from his brother but the second round was from an unrelated donor and was different. Ring said, 

"While the second transplant and cancer-fighting drugs have succeeded in keeping his cancer at bay, Wartman is now suffering from something equally life threatening – a condition called graft vs host disease (GVHD). In a nut shell, the stem cell transplant that cured him of cancer and saved his life is now attacking his body."

Ring discussed the currently available treatments and continued, 

"Another promising therapy is called Prochymal. It’s a stem cell therapy developed by former CIRM President and CEO, Dr. Randy Mills, at Osiris Therapeutics. Prochymal is already approved to treat the acute form of GVHD in Canada, and is currently being tested in phase 3 trials in the US in young children and adults.

"While CIRM isn’t currently funding clinical trials for GVHD, we are funding a ($20 million) trial out of Stanford University led by Dr. Judy Shizuru that aims to improve the outcome of bone marrow stem cell transplants in patients. Shizuru says that these transplants are “the most powerful form of cell therapy out there, for cancers or deficiencies in blood formation” but they come with their own set of potentially deadly side effects such as GVHD."

Ring said that Wartman's battle with the disease has made him "one of the strongest patient voices advocating for new treatments" for his affliction. Ring said Wartman is an inspiration to funding agencies and other scientists. She said,

"We don’t want these patients to suffer quietly. Wartman’s story is an important reminder that there’s a lot more work to do to make bone marrow transplants safer – so that they save lives without later putting those lives at risk."

A Scripps Scientist Deflates Cancer-Stem Cell Nexus

The sky is not falling, says a Scripps Research Institute scientist, despite headlines that seem to link "mutation" and "cancer" and "stem cells."

That comes from Jeanne Loring, head of the stem cell program at Scripps, who was writing on the blog of UC Davis stem cell researcher Paul Knoepfler. Loring said,

"'Mutation' and 'cancer' are eye-catching words for a headline; add 'stem cells' and there is a good chance that a lot of people will hear about it. These words have been liberally used in the press to describe the results of a recent publication: 'Human pluripotent stem cells recurrently acquire and expand dominant negative P53 mutations.'"

Loring said she has been on a soapbox on this issue since 2000.  She said, 

"Every time a scientific report suggests that human stem cells are dangerous, I feel the need to reassure both scientists and non-scientists that we should not panic.  The sky is NOT falling (contrary to Henny Penny), and pluripotent stem cells remain valuable for cell replacement therapies."

Loring went into the rather technical reasons for her position as well as identifying issues having to do with not knowing enough about the cells used in research. She also provided some tools for researchers to use to identify cells with "functionally important mutations."

Loring's bottom line to researchers:

"Don't panic! Check your cells instead."

StemCells, Inc., 'Winding Down' Its Business; Shareholders Could Be Left in Cold

StemCells, Inc., a publicly traded firm that once held close ties to the $3 billion California stem cell agency, this morning said that it was going to close its doors and that its shareholders may not receive a dime in the liquidation.

The announcement was buried deep in a press release focusing largely on the termination of the firm's spinal cord injury trial, which the California company said was not showing sufficient benefit to patients to continue. The news release continued,

"The company also announced that, in light of the decision to terminate the Pathway Study, the company’s available strategic alternatives and its current cash position, the board of directors approved a plan to wind down the company.  As part of this process, the company will evaluate opportunities to monetize its intellectual property, including data collected in its studies and trade secrets, as well as the transfer of its proprietary HuCNS-SC cells and other assets through a potential sale. The company will not proceed with its earlier plans to conduct a rights offering, for which it had filed a registration statement with the SEC.

"As of May 31, 2016, the company had cash and cash equivalents of approximately $5.5 million. The company cannot determine with certainty the amount of any liquidating distribution to its stockholders and it is possible that there will be no liquidating distribution to stockholders. The amount of any cash distributed to its stockholders will depend upon, among other things, the company’s current liquid assets offset by its known and unknown liabilities as well as operating expenses associated with the wind down."

StemCells, Inc., was co-founded by Irv Weissman, a Stanford stem cell researcher. It was the only company to be awarded $40 million in a single round by the California stem cell agency. The awards followed vigorous lobbying by the former chairman of the agency, Bob Klein,

StemCells, Inc., also appointed Alan Trounson to its board just days after he left his post as president of the agency, triggering a controversy about conflicts of interest. 

The California Stem Cell Report will have more on the closure of StemCells, Inc., later. 

A "Chicken in Every Pot" -- Stem Cells and the Latest Warnings About Hype

Let's face it, folks, without some hype, California's $3 billion stem cell research effort would not exist.

That's because it is a creature of a popular vote in 2004, and the Golden State's voters needed to be persuaded to pony up their billions for something that they were told would pay off and pay off relatively quickly.

Old news, right? But not entirely. Last week the world's foremost stem cell research organization, the International Society for Stem Cell Research (ISSCR), issued stern warnings about "communications" involving stem cell research. "Circumspect and restrained" were the watchwords from the more than 4,000-member group. Seek "timely corrections" of misleading information in the media, the world's stem cell researchers were told, among other things.

All of which is interesting coming from the ISSCR, which loaned its considerable clout in 2004 to the $36 million effort to convince Californians to create the state's stem cell agency with billions borrowed by the state. The effort was also endorsed by a host of individual, top researchers. The campaign is widely regarded as over-promising results on an unrealistic timetable. (See here and here.)

That said, electoral campaigns are not science. Think about promises of a "chicken in every pot," and you will have a good idea of what needs to be said to win an election. And there's the rub.

To generate cash from citizens, it is necessary to create some excitement. Otherwise, it is ho-hum time. One Canadian writer, Kelly Crowe, put it this way in a piece on the public relations guidelines from the ISSCR,

"Would you read a story if this was the headline: 'New study raises questions about an experimental treatment that might not work and won't be ready for a long time.'"

Beyond public perceptions, there is the small matter of stimulating business interest in turning stem cell research into cures, the mission of the California stem cell agency. Businesses are often portrayed as daring innovators bringing fresh, exciting stuff to all of our homes. The reality is that businesses are more often timid, unwilling to take risks that might affect their financial well-being.

So they too must be shown the stem cell light by the agency and its backers so that industry will cough up the considerable cash necessary to bring a stem cell therapy to market and fulfill the promises made to voters 12 years ago.

Just how far should stem cell advocates go in promoting their cause? The ISSCR has its new guidelines. Others may disagree. One person's hype is another person's honest belief. It is unlikely that the ISSCR guidelines will settle the questions.

Little doubt exists that stem cell hype is rampant, some of it from the scientific community and some from enterprises offering untested procedures and treatments. The hype has a natural audience. The public tends to want to believe in scientific and medical miracles, and stem cells smack of miracles.

Randy Mills, the president of the California Institute for Regenerative Medicine (CIRM), as the agency is formally known, regularly brings the facts of "risk" to his dealings at the agency. It is one of his finer innovations.

Last year, his plan for the agency's next five years contained three pages of "risks," including inadequate health benefits, foot-dragging by the federal regulators and safety issues.

Mills exudes excitement for stem cell research and its potential, but at the same time he has a keen eye for the obstacles. It could be called realism. Unless you see the obstacles, you cannot hurdle them. Nor can the public be expected to be patient if it is oversold and under-delivered. 

(A final note: Kelly Crowe's piece is a dandy and involves much more than stem cell research. The headline: "It's not just stem cell research that's overhyped— medical science spin is a widespread problem.")

$150 Million 'Powerhouse:' California Discloses Financing Details on New Stem Cell Company

CIRM graphic

Highlights
A California first
De-risking therapy development
Selling off the notes
Possible IPO

California's stem cell agency this week unveiled details of a far-reaching and unique proposal to create a $150 million, public-private company to speed commercialization of stem cell therapies and bring them into widespread use.

The proposal by the California Institute for Regenerative Medicine(CIRM), as the $3 billion agency is formally known, is believed to be a first in California history in terms of its size and scientific scope. It goes well beyond any such stem cell efforts involving other states.

The agency hopes to lure business into its stem cell game with a $75 million loan with invitingly lenient terms. CIRM's private partner would have to repay only 50 cents on each dollar of the loan. However, the partner would be required to match the loan with its own $75 million contribution.

Randy Mills, president of the agency, says the goal is to create a "powerhouse" company that would step up development of stem cell therapies that have been slow to emerge. It would "de-risk" the effort because of the state contribution.  The CIRM proposal also envisions the possibility of the enterprise issuing publicly traded stock, which could mean huge profits for initial investors, such as CIRM would be.

The project -- dubbed ATP3 -- comes before a special panel of CIRM's governing board directors next Friday at a meeting in Oakland. The panel is expected to review and approve a proposed term sheet for the financing so that the agency can post a request for applications very soon.

The meeting is public. The agency normally also has teleconference locations elsewhere in the state available for public participation along with a listen-only, toll-free audiocast.

In a memo to the committee, Neil Littman, the agency's business development officer, said,

"The overarching objective of ATP3 is to encourage industry involvement in cell therapy through the creation of public-private partnership that advances existing high quality CIRM-funded stem cell technologies toward commercialization. 

"Our main objective in structuring the terms of the award was to strike a balance between ensuring a financial return to CIRM and thus the citizens of California while at the same time ensuring the attractiveness of the award to encourage industry participation.... Although CIRM is not a venture capital firm or a traditional investor and is willing to bear significantly higher levels risk, the risk should be commensurate with the potential reward. Thus, if we are successful in creating a valuable stem cell enterprise in the State of California, it is appropriate that CIRM and the citizens of California participate in the financial upside."

The loan would be issued in the form of convertible notes that the agency could convert to stock if that seems more profitable than a loan. Littman wrote,

"This award is unique, and provides for the establishment of a new, for-profit California-based entity, which if successful, may command a significant future valuation."

Littman continued,

"A convertible note financing is commonplace in the biotechnology and venture capital community, and allows the note holder to participate in the upside should the issuer become a valuable entity. On the downside, the note holder is protected by the debt portion of the instrument, and could choose not to convert should the issuer perform poorly."

Structuring the investment as a convertible loan prevents the agency from violating a law that prohibits the state from owning stock in a private company.  The agency could sell the note to another investor that could be willing to pay more than the amount owed on the note because it can be converted to stock.

The proposed terms also stipulate that the loan would be issued in three separate notes. Each note could be transferred or sold separately, providing more opportunities for the state to profit.

The plan to create the new company also strikes at another issue that CIRM's Mills has spoken about repeatedly -- the reluctance of private companies and investors to engage in stem cell therapy development. In December, he told directors that only about 6 percent of the CIRM-financed research programs (totaling roughly $2 billion) has private partners. The reason, he said, is that the private sector is put off by the financial risks involved in stem cell development.

The new effort would also allow the private partner to pick through the CIRM portfolio to select research that would be potentially profitable -- excluding research that already has a private partner.

Here are links to the presentation slides on the proposal, Littman's memo and the proposed term sheet. For earlier items on the initial discussion of the plan last December, see here and here.

Watch for more coverage of this plan next week here on the California Stem Cell Report.