Rich Day on the Stock Market for California "Eat Me" Cancer Therapy Firm

Forty Seven went public in June 2018. Here is how its stock has performed.
Google graphic

The stock price of Forty Seven, Inc., the high-flying company with a $15 million link to the California stem cell agency, today closed nine times higher than its all-time low just last October. 

The stock hit $50.00, 19 percent above its close yesterday. Its low last fall was $5.53. The stock took off this morning on the basis of news reports that Gilead Sciences, Inc., was in talks with the company about a possible purchase. Forty Seven is one of the few companies showing gains today as the stock market continued to plummet. 

Forty Seven was identified as "pivotal" investment earlier this month by the stem cell agency. It is one of 60 companies whose clinical trials the $3 billion agency is supporting. Forty Seven aims at fighting cancer by triggering the body's immune system and is known for its "eat me" therapeutic approach.  

The company's web site says, 

"The therapeutic potential of the innate immune system, the first line of defense against cancer, was not well understood and appreciated when Irv Weissman and his colleagues at Stanford University identified CD47-SIRP-alpha as a novel immune pathway. This discovery has the potential to lead to new therapies and empower patients to fight cancer with their own immune cells, in the hopes of one day saving lives."

No new details have emerged as of this writing on a possible Gilead-Forty Seven deal. 

CIRM, as a state agency, cannot profit directly from an increase in the company's stock price. California's state constitution bars the state from owning stocks. However, the state could benefit from royalties from Forty Seven if the company's CIRM-financed work results in profits. 

So far, CIRM-backed investments have generated few royalties despite expectations raised by agency supporters. During the 2004 ballot campaign that created the agency a potential of more than $1 billion in royalties was bandied about. 

The stem cell agency, known formally as the California Institute for Regenerative Medicine (CIRM), declined to comment on the Forty Seven news. But the agency has previously touted the significance of its role in funding the firm with $15.2 million and also backing underlying research by Weissman, who has received $30 million from CIRM. Weissman sits on the company board. 

Also not commenting was Forty Seven and the campaign organization pushing a November ballot proposal that would give financially strapped CIRM an additional $5.5 billion. CIRM is running out of cash and will begin to shut down if the measure fails to make the ballot or win voter approval.  

CIRM points to companies like Forty Seven as evidence of the value that the agency has provided for the people of California and the state's business climate. Forty Seven and other CIRM success stories are likely be ballyhooed often in the upcoming campaign.  

Readers who are not familiar with northern California may be interested in how the stem cell geography works in the Golden State. 

• CIRM is headquartered in Oakland, It is only 42 driving minutes away from Gilead.
• Gilead is located in Foster City, only 20 minutes from Forty Seven.
• Forty Seven is located in Menlo Park, only 19 minutes from Irv Weissman's office at Stanford. 

One caveat on those times and distances: They are only good when the traffic is not too bad.  But the physical proximity does have something to do with the building of a "critical mass" of stem cell enterprises in the Golden State, something that researchers and CIRM find valuable. 

Here is a Forty Seven video discussing the company's "eat me" approach.

California Pumping $20 Million into Stem Cell/Gene Therapy for 'Bubble Boy' Syndrome

June 2016 video from UCLA

Highlights
30 out of 30 cured
$18.2 million in matching funds
Cells to be frozen
UK's Orchard Therapeutics partnering

California's stem cell agency is ready to award $20 million on Thursday to a UCLA researcher to assist in his 30-year search for a widely available cure for what has come to be known as the "bubble boy" syndrome-- severe combined immunodeficiency (SCID).

The California scientist is Donald Kohn, of the Broad Stem Cell Research Center at UCLA, who said today that 30 out of 30 babies have already been cured using his type of therapy. Kohn said that the research involving the extremely rare disease could lead to progress in treating other afflictions ranging from sickle cell disease to cancer.

The progress in treating the "bubble boy" disease is much changed from decades ago when the case of David Vetter captured the nation's attention as the boy who was "born into a world he could not touch."  He ultimately died at the age of 12. (This item continues below video.)

Kohn's proposal for an early stage clinical trial would be co-funded with $18.2 million and would test a stem cell and gene product known as OTL-101. It could replace what the stem cell agency said were the "suboptimal," current treatments for  Adenosine Deaminase Severe Combined Immunodeficiency.

The affliction is extremely rare and occurs in less than one in 100,000 births worldwide, according to Wikipedia. Without treatment, children can die before the age of two.

The agency's application review summary said that reviewers were "highly enthusiastic" about Kohn's proposal during their closed-door session last month. The summary said that reviewers, who are from out-of-state and do not publicly disclose their economic interests, "applauded the move to a cryopreserved product that will allow improved patient access to the therapy." They also noted that the costs of the trial are "exceedingly high."

In response to a query by the California Stem Cell Report, Kohn said today via email, 

"Building upon the previous success of our single-site trials for ADA SCID, which have resulted in 30 out of 30 babies cured, our next trial will focus on developing a cryopreserved formulation of the cell product. 

"This has several potential advantages. It will allow the cell product to undergo full testing before the transplant is performed, whereas currently we only have stat viability, sterility and endotoxin assay results, with gene transfer efficiency measurements coming later.

"Additionally, it provides more time to split up the dosing of the conditioning chemotherapy and individually adjust the total dose based on measurement of the individual patient's unique drug clearance activity.

"Finally, this will allow centralization of cell processing, allowing patients to remain at their local hospital for the treatment, with the stem cells traveling to a commercial cell processing site, gene-corrected, frozen and shipped back to their hospital for infusion."

The agency's board is virtually certain to ratify the decision of reviewers at its telephonic meeting on Thursday. It has almost never overturned a positive recommendation by reviewers. 

The agency, formally known as the California Institute for Regenerative Medicine (CIRM), did not release Kohn's name in advance of the Thursday meeting. Its policy, with some notable exceptions, is to withhold that information until the pro forma vote by its governing board. The California Stem Cell Report identified Kohn as the recipient through a number of public documents. The UCLA researcher has already received $32 million from CIRM for his work. 

Kohn has teamed with Orchard Therapeutics Ltd. of Britain, a firm that began operations last May with a $33 million war chest. Kohn is one of the scientific advisors to the company. He said today: 

"This study is being done at the UCLA Broad Stem Cell Research Center in partnership with Orchard Therapeutics Ltd., who have licensed this stem cell gene therapeutic from UCLA and University College London, UK. The general approach of stem cell gene therapy was first done for ADA SCID, which is a highly favorable disease for this treatment. Findings and advances made for this disorder are being applied to many other inherited diseases, such as Sickle Cell Disease, other Primary Immune Deficiencies, Storage and Metabolic Diseases, as well as HIV/AIDS, cancer and leukemia."

The process uses a patient’s own stem cells. Earlier this year, the company said that the cells are "modified with a functioning copy of the missing or faulty gene before being transplanted back into the patient’s body. The use of the patient’s own cells (autologous) removes the need to search for a matching stem cell donor, which can take months or even years," the company said.

Should the treatment emerge successfully from the clinical trials, it will face competition from a rival developed by GlaxoSmithKline that has been approved for use in Europe at a reported cost of $665,000 per patient. Glaxo is expected to seek approval next year for use of the treatment in the United States, which has only about 12 new cases a year, according to the STAT health science news service. However, a document from the U.S. Center for Disease Control places incidence at 40 to 100 new cases each year. 

The public can participate in Thursday's meeting at locations in Oakland, San Francisco, San Diego, Napa, South San Francisco, San Francisco, Beverly Hills, Fresno, Elk Grove, Los Gatos, Sacramento, and Irvine.  It is also being audiocast on the internet. Instructions and addresses can be found on the agenda.

(Editor's note: An earlier version of this item incorrectly reported that co-funding on this award totalled $8.9 million. The correct figure is $18.9 million.)

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. 

California's $30 Million Bet On a Cancer Treatment: New Company Formed to Bring the Therapy to Market

Highlights

Stanford, Weissman involved

Good news for CIRM

Google hooked in

A new stem cell company that targets cancer by unleashing an “eat me” trigger has emerged from a $30 million investment by the state of California.

Creation of the Palo Alto firm, which is called Forty Seven, Inc., was announced this week by its backers and its key researcher, Irv Weissman, director of Stanford University’s stem cell program.

Venture capitalists, including Google, are supporting the enterprise with $75 million. The effort

has two phase one clinical trials underway, the first step in a years-long process of testing potential therapies before the federal government approves their widespread use.

Forty Seven, named after the molecular target of the “eat-me” trigger, is not the first firm to emerge from research funded by the California Institute for Regenerative Medicine (CIRM), as the state stem cell agency is formally known. At least eight others have surfaced over the years.

But this week’s announcement attracted some national attention in a story by Alex Lash on Xconomy, an online technology information service. Lash wrote,

“This is the kind of news CIRM has yearned for in recent years: significant private cash that gives CIRM-funded projects a push to become actual products and to return value to the state…. After a decade of funding buildings, salaries, and early stem-cell related research—not to mention conflict of interest problems that included a past CIRM president and a different company (StemCells, Inc.) with Weissman’s imprimatur—CIRM and its new president acknowledged it needed to show results for the $6 billion taxpayers committed to the agency in 2004.

“This type of follow-on funding is what we’re looking for,” says CIRM spokesman Don Gibbons, who adds that the big financial awards for Stanford were in line with the agency’s mission “to get things moving early when others won’t invest.”

(See here, here and here for more on the conflicts of interest.)

Voters approved the creation of the $3 billion agency in 2004. But no therapies have emerged for widespread use despite the optimism of its early backers and campaign promises. The agency expects to run out of funds for new awards in 2020. One of the possibilities for new funding is another multi-billion dollar state bond issue. State bonds are the only significant source of cash for the Oakland-based agency.

Xconomy reported that CIRM has yet to provide its final $5.1 million to Weissman. And Lash wrote that “Forty Seven is in the process of taking charge of the grant-funded programs.” Asked this morning by the California Stem Cell Report whether the funds would be going directly to the firm, Kevin McCormack, senior director of communications, replied,

“Our grant goes to the principal investigator on the project, in this case it’s both Irv Weissman and his co-PI Ravi Majeti. Both are at Stanford.”

Weissman’s technique uses a monoclonal antibody that attaches to the CD47 protein on cancer cells them from hiding from the patient’s immune system. Lash wrote,

“But cancer cells also produce what Weissman and colleagues call an ‘eat me’ signal from a protein called calreticulin. Normal, healthy cells don’t. By cutting off the CD47 ‘don’t eat me’ signal, Hu5F9-G4 should in theory allow the calreticulin signal to prevail.”

Stanford, which has a member on the CIRM board of directors, is the No. 1 recipient of funds from CIRM. It has chalked up 98 awards totalling $308 million. Weissman has received five awards totalling $36 million. StemCells, Inc., which was co-founded by Weissman, has been awarded $9 million in for three projects.

Aussie Clinical Trial for California Firm's Stem Cell Therapy for Parkinson's Disease

A Southern California firm that repeatedly and unsuccessfully sought funding from the $3 billion California stem cell has received the go-ahead in Australia for human testing of a treatment for Parkinson’s Disease, it was reported today. 

In an article today in the San Diego Union-Tribune, reporter Bradley Fikes described the move involving International Stem Cell Corp. (ISCO) of Carlsbad as appearing to be a “medical first.” The company's stock price jumped nearly 16 percent today on the news.

Fikes wrote,

“If all goes according to plan, doctors will implant replacement brain cells into 12 Parkinson’s patients, probably in the first quarter of 2016, said Russell Kern, the company’s chief scientific officer. These are called neural precursor cells, a slightly immature kind of neuron. The cells will finish maturing in the brain into the kind of neurons destroyed by the movement disorder.

“The neural precursor cells are derived from the company’s parthenogenetic stem cells, which are produced from unfertilized human egg cells.”

International Stem Cell is a publicly traded firm whose researchers pitched proposals with some regularity to the stem cell agency a few years back. It was not known whether any of the applications involved the Parkinson's therapy. The firm’s personnel also attended CIRM board meetings with some frequency. (For earlier items on the company, see here, here, here, here and here.)

The day after Fikes' story appeared, the stem cell posted an item on its Stem Cellar blog about the effort.

Fikes wrote that the firm’s trial will be the first Parkinson’s trial  using replacement brain cells grown from stem cells, according to clinicaltrials.gov. The trial will be conducted by the firm’s Australian subsidiary, Cyto Therapeutics. 

Fikes reported that company’s effort is similar to other research in the San Diego area.

“That’s also the approach Summit for Stem Cell will take, said stem cell scientist Jeanne Loring, a leader of the Summit for Stem Cell project. The cells make proper connections with the brain better when they are still maturing, said Loring, who’s also head of the regenerative medicine program at The Scripps Research Institute in La Jolla.”

Loring is applying for an award from the stem cell agency but her research is at an earlier stage than that of the Carlsbad firm. Fikes wrote,

“Loring said she views ISCO as a partner in fighting Parkinson’s. One of her former students is working for the company, she said….

“ISCO’s choice of Australia for its streamlined regulatory process makes sense, Loring said. Her team, with U.S.-based academics and medical professionals, doesn’t have the same flexibility as ISCO in looking for clinical trial locations, she said.”

The firm’s stock closed at $5.00 today, up nearly 16 percent. Its 52-week high was $12.30 and low was $1.25. Here is a link to the company’s press release on the news today.

(The information concerning the agency posting an item on the San Diego news was added to this item 24 hours after it was first published.)

California Firm Says Anti-abortion Activists Misleading Courts, Endangering its Employees

A California stemcell/human tissue company this morning renewed its efforts to halt distribution of a video by anti-abortion activists that it says will endanger its employees and damage its business.

The firm, StemExpress LLC of Placerville, said in court filings that it was only seeking to stop the distribution of the video, not the information contained within it.

It said that the activists, the Center for Medical Progress of Irvine, Ca.,  and David Daleiden, have misled the judge in the case. The firm said the activists want to distribute the video to “inflame” the public against the company and provoke a “hostile reaction.” The company has already received death threats against its president.

StemExpress also said its request for a preliminary injunction does not violate the First Amendment of the Constitution.

The firm argued that such orders have been upheld in other cases “where anti-abortion protesters were constitutionally enjoined not in what they wanted to say, but how, where, and when they wanted to say it.  Such injunctions are simply not subject to strict constitutional scrutiny.”

The activists have argued that they did not violate state law barring recording the conversations without the permission of all parties because the discussions involved a crime -- “harvesting and killing live babies for resale.”

StemExpress noted that the activists did not report any alleged crimes to authorities during a two-year investigation.

The court filing said the activists’ belief that StemExpress is

“…‘harvesting and killing live babies for resale’ is neither objectively reasonable nor credible from a subjective standpoint.  First, abortion before viability is not murder in California…. While defendants may wish that abortions were illegal and constitute murder, that is simply not the law.  This alone precludes defendants’ purported ‘defense’ of their illegal conduct.  Second, defendants have no evidence that would even remotely support the claim that plaintiffs participated in any abortion procedure involving a viable fetus.  To state the obvious, StemExpress does not perform abortions.  And contrary to Daleiden’s hearsay statements, StemExpress has never received a living, fully-intact fetus from an abortion clinic.”

Here is the full text of this morning's filing.

  StemExpress filing 8-21-15 for preliminary injunction

'Best of Times, Worst of Times' -- A Tale for Stem Cell Fans

Highlights:

Sinking stock prices vs. $40 billion market

Profits drive therapies

Test for the California stem cell agency

During the past week, followers of the stem cell world have been treated to sharply contrasting perspectives on the likely success of therapies involving regenerative medicine.

One perspective was bleak; the other robustly optimistic.

One borrowed slightly from the “Tale of Two Cities,” with a headline that said “Tale of seven stem cell stock woes….”

The other carried a headline that said “global stem cell market predicted to reach $40 billion in five years….”

One was a story about hard-eyed investors backing away from stem cell research. The other was about a bright, near-term future for the field.

Don Gibbons, chief communications officer at California’s stem cell agency, wrote about that bright global market on his agency’s blog. He said that the $40 billion figure was generated by the worldwide consulting firm Frost and Sullivan, which was promoting its study of the field. The 2014 report is going for as much as $7,500, a price tag that helps illustrate one of the features of the stem cell field: It needs a lot of cash.

Indeed, Gibbons noted that Frost and Sullivan cautioned that funding for early stage, clinical stem cell work is not abundant.

Which brings us to Paul Knoepfler’s tale of stem cell stock “woe.” He is a stem cell researcher and blogger at UC Davis, which has benefited mightily from cash from the $3 billion California stem cell agency.

He wrote,

“Lately, stem cell companies have not been doing so well financially to put it mildly and their stock prices have generally been going down, down, and down further. A lower stock price and market capitalization are not just a headache for investors and bad for the companies, but they also strongly interfere with the progress of the clinical science.”

And he asked,

“To be blunt, why are their stocks doing so miserably?”

Knoepfler did not really attempt to answer that question. However, it is clear that stem cell stock prices are down because nobody wants to buy them. The reason? Investors do not expect to make money any time soon by purchasing shares in those firms, which struggle perennially to raise cash.

That is a financial reality that the $3 billion California stem cell agency needs to fully integrate into its plans for spending its last $800 million, which is slated to run out in less than five years.

The agency’s goal is to produce a stem cell therapy as promised to California voters 11 years ago when they approved creation of the agency, which will cost the state about $6 billion, including interest, before the effort expires.

Without backing of industry, there will be no therapies. But the priorities of a business are not necessarily the same as the agency’s. Profits necessarily come first with a business. Otherwise it will vanish into a financial abyss. Witness the dumping of the nation’s first hESC clinical trial by Geron, in which the agency invested $24 million only three months before the trial was summarily terminated by the company for financial reasons. 

The California stem cell agency’s president, Randy Mills, should understand the vagaries of all this better than most. He made his career as a biotech business executive, not as a researcher. Over the last year, he has done much to sharpen the focus of the agency and begin to create a clear path for emergence of a therapy, a “radical” change he has dubbed CIRM 2.0.

Whether he can successfully put together the needs of business and the needs of science and medicine is perhaps the key question for the California stem cell agency between now and 2020. 

$124 Million Deal for Keirstead's California Stem Cell, Inc.

California Stem Cell, Inc., founded by the UC Irvine researcher made famous eight years ago by showing a once paralyzed rat apparently walking on national television, was sold this week in a deal reportedly worth at least $124 million in stock and cash.

NeoStem, a New York city-based firm, announced the acquisition yesterday in a move that sent its stock to $6.64 this morning, up roughly 6 percent from last Friday. Its 52-week high is $9.00 and low $5.00.

Gen News reported that the deal “will add a late-stage technology to the acquiring company’s pipeline. Through the deal, NeoStem will take over development of CSC’s Melapuldencel-T, an autologous melanoma initiating (stem) cell immune-based therapy intended to eliminate the tumor cells capable of causing disease recurrence, beginning with the launch of a pivotal Phase III trial.”

Hans Keirstead
UC Irvine photo

The president of the privately held California Stem Cell, Inc., is Hans Keirstead, who was a key figure in the 60 Minutes news show on Feb. 23, 2006. CBS reported that “if paralyzed people are ever going to walk again, it might be because of the scientist (Keirstead) in this story.” 

The piece said he had injected the rats with embryonic stem cells. Keirstead, however, has not taken that research into a clinical trial for human beings.

NeoStem's interest in the Irvine firm did not appear to involve a possible spinal therapy.

While the company's stock price jumped as a result of the acquisition, one view of the future of the NeoStem was not optimistic. The Street Web site is recommending a “sell” on the firm's stock. It said yesterday. The Street said,

“This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow and poor profit margins.”

UC Davis stem cell scientist and blogger Paul Knoepfler, however, called the deal good news for the stem cell field.

Possible Buyers for Geron's Stem Cell Business: BioTime, Pfizer, Celgene

The mainstream media is climbing all over the Geron story today with more analysis and a  discussion of firms that might snag the San Francisco area firm's orphan stem cell business.

Reporter Peter Loftus of the Wall Street Journal mentioned Pfizer, which is involved an hESC project with researcher Peter Coffey, who was lured from the UK this fall to UC Santa Barbara. Among the incentives was a $4.9 million grant from the California stem cell agency, which also financed Geron to the tune of $25 million.

Matthew Perrone of The Associated Press had this to say about buyers:

"Analysts say Geron's stem cell business could be acquired by Alameda, Calif.-based BioTime, a company founded by former Geron scientists. Other potential acquirers could include larger pharmaceutical companies like Celgene Corp., Pfizer Inc. and Teva Pharmaceuticals, which have dabbled in stem cells without making major investments."

BioTime's shares were up 7 percent today, closing at $4.52. Geron's shares were down as much as 28 percent and hit a five-year low. It closed at $1.71, down 22 percent.

The AP also wrote,

"Joseph Pantginis, an analyst with Roth Capital Partners, said it would have taken five to ten years before Geron's lead stem cell product reached the market.

"'This is still very much a fledgling space and some people would even consider stem cells to be a science experiment, so there's still a long way to go,' said Pantginis.

"University of Wisconsin professor Alta Charo said Geron's move 'may suggest that a different business model is needed, one with a longer timeline for return on investment.'"

Charo had close ties early on with the $3 billion California stem cell agency, which loaned $25 million to Geron just six months ago. The loan was part of an aggressive effort to produce clinical results that will help extend the agency's life beyond 2017, when funds are expected to run out. Currently CIRM is financed through California state bonds, which will need to be approved by voters again if CIRM is to continue.

Here are more excerpts from today's coverage.

Gretchen Vogel of Science magazine wrote,

"Some observers had reservations about the trial from the start, worrying that the animal results were not strong enough to justify a human trial. But many had been pulling for the company nonetheless. 'It's with a sense of loss that I see this news,' says Roger Pedersen of the University of Cambridge in the United Kingdom, who was one of the researchers to receive funding from Geron in the mid-1990s to attempt to derive hES cells. He says the company may be reacting not only to the long timeline to bring cell therapies to the clinic, but also to a possible weakening of its intellectual property portfolio. The development of induced pluripotent stem (iPS) cells, which are adult cells genetically reprogrammed to resemble embryonic ones, means that Geron's exclusive licenses may be worth less. 'Advances in the stem cell field are disruptive innovations that have the potential to supercede earlier innovations, hES cells being one of those. I don't know if Geron looks at it that way, but I do,' Pedersen says."

Ben Hirschler and Kate Kelland of Reuters reported:

"A decision by one of the biggest names in stem cell research to throw in the towel will not stop other pioneering work that could yet produce cures for blindness and help mend broken hearts.

Scientists were shocked by U.S. biotech company Geron Corp's decision on Monday to quit embryonic stem cell research -- a move it blamed on a lack of money and the complexities of getting regulatory approval....

"Robert Lanza, chief scientific officer of ACT, is not giving up hope on the embryonic front but said Geron's exit put more pressure on his firm to succeed.

"'Of course, it's the second mouse that often gets the cheese,' he said."

Sarah Boseley of The Guardian in the UK wrote:

"The dream of Superman actor Christopher Reeve and others of paralysed people being able to walk again after injections of stem cells has receded, following the announcement by biotech company Geron in the US that it is to abandon the first-ever human trial of its kind."

Jef Akst of The Scientist magazine wrote:

"'It’s certainly going to have a very chilling effect,' said Robert Lanza, chief scientific officer at Advanced Cell Technology, the only other company currently engaged in clinical trials involving hESCs. 'There’s a lot of exciting potential here in this field, and it would just be a real shame for this not to move ahead full steam.'...

"One thing working in the field’s favor is the fact that Geron helped pave the regulatory way for other stem cell therapies, said Sheng Ding, a stem cell biologist at the Gladstone Institutes and the University of California, San Francisco. 'Geron’s past efforts had cleared out a FDA path for pluripotent stem cells,” he wrote in an email to The Scientist."

The Financial Times of London altered its original story by Andrew Jack without notifying its readers that the story was changed or why. The old version began.

"Geron, the pioneering stem cell therapy company, has dealt a powerful blow to one of the most hyped areas of medicinal research by withdrawing entirely from the field."

The new version, posted at least 12 hours later, begins:

"Geron, the Californian biotech company, is abandoning its pioneering embryonic stem cell work, after concluding that the costs and length of further development were too great."

Matthew Herper of Forbes published a comment from Jamie Thomson of the University of Wisconsin, whose hESC discoveries were financed in part by Geron. Thomson wrote,

"Geron’s decision to discontinue their stem cell work reflects how genuinely difficult it is to build a business around embryonic stem cell-based transplantation therapies. They also chose a particularly challenging target for the first therapeutic application. They are to be commended, however, for blazing a trail that others can follow in getting the first clinical trial approved by the FDA, as such approvals should be easier in the future."

Herper continued,

"Thomson initially shied away from the idea of building businesses around embryonic stem cells or their successors, induced pluripotent stem cells, which don’t involve destroying embryos. (He told me three years ago, 'I really believe personally that the value of these cells is not in transplantation,' and that '90% of the value of these cells will be in things that don’t make the front pages.') When Thomson did decide to become an entrepreneur, it was through a Madison, Wisconsin-based startup called Cellular Dynamics International, which uses the cells to create better ways of testing the safety and effectiveness of experimental drugs. Drug giants including Roche, Pfizer, and AstraZeneca have taken their own steps toward embracing stem-cell-based research. This field is slowly gaining steam just as the one Geron is abandoning its own attempts to heal the lame."

Brian Orelli on the MotleyFool investment web site wrote,

"Geron is giving up on stem cells. That's like Krispy Kreme Doughnuts without glazed treats, or Apple without Macintosh."

Adam Feuerstein on thestreet.com wrote:

"Geron's  decision to shut down its embryonic stem cell research programs is a blow to the controversial research field and a painful reminder that only dreamers and fools invest in embryonic stem cell stocks....But does anyone believe that Geron would jettison stem-cell research if the ongoing clinical trial in spinal cord injury were helping patient recover neurological or motor function?"

High Level Changes at iPierian, a Firm With Deep Roots in California Stem Cell Effort

The South San Francisco stem cell firm, iPierian, which has a special and early connection to the California stem cell agency, has been undergoing major changes in the past few months.

 The latest came last week when it announced it has hired a new CEO, Nancy Stagliano, who was replaced Aug. 11 as CEO at another South San Francisco firm, CytomX Therapeutics.

Luke Timmerman of the Xconomy website wrote on Sept. 7 that Stagliano was named to the iPierian post after the firm "prioritized the company’s efforts over the past several months toward using its (ips) stem cell technology to help discover drugs for neurodegenerative disorders like Alzheimer’s, amyotrophic lateral sclerosis (ALS), and spinal muscular atrophy."

 Last May,  iPierian unloaded most of its executive team. A few weeks later, the board chairman, Corey Goodman, quit. With Stagliano's arrival, interim CEO Peter Van Vlasselaer will become executive chairman of the board.

Major investors in iPierian, including John Doerr of Kleiner Perkins Caufield & Byers of Menlo Park, contributed nearly $6 million to the 2004 campaign for Prop. 71. The figure was 25 percent of the total contributed to the campaign, which was run by former CIRM Chairman Robert Klein, a real estate investment banker. As far as we know, no other biotech firm can claim to have that sort of early linkage to the $3 billion California stem cell agency.

CIRM has awarded $7.2 million to iPierian. One grant amounted to about $1.5 million with Berta Strulovici as the principal investigator. The other was for about $5.7 million with Michael Venuti as the PI.

The firm has a cast of stem cell luminaries associated with it, including Shinya Yamanaka of Kyoto University and the Gladstone Institute, along with  George Daley of Harvard University. Daley is a co-founder of iPierian. He also was a member of the blue-ribbon review panel that analyzed CIRM's activities last fall and is a current member of the CIRM grants review group.

Deepak Srivastava of UC San Francisco and Gladstone is also a co-founder and scientific adviser to the firm. He holds $6.6 million in CIRM grants. Other scientific advisers include CIRM grant recipients Benoit Bruneau, UCSF-Gladstone, $2.8 million, and Bruce Conklin, UCSF-Gladstone, $1.7 million.

Kevin Eggan, Amy Wagers and Chad Cowan, all of Harvard, are scientific advisers to iPierian as well as members of the CIRM grant review group.

Members of the CIRM grant review group are barred from taking part in the discussions or voting on grants on which they have conflicts of interests. Reviews are conducted behind closed doors.

Yamanaka said in an iPierian news release earlier this year,

“Many of my colleagues at The Gladstone Institute, UCSF and Harvard are already actively involved with iPierian, and I am delighted to join them in guiding iPierian’s industrialization of iPSC technology for drug discovery and development.”

Here is a link to the iPierian press release on the new CEO and a related story in the San Francisco Business Times.

StemCells Inc. to Sell Real Estate to Raise Cash

StemCells Inc.'s impending bid for $20 million from the California stem cell agency is taking on greater weight as the company battles to keep its finances flowing.

Esha Day of Reuters reported today that the Newark, Ca., company, co-founded by Stanford researcher Irv Weissman and two other well-known scientists, is hoping to raise $2 million to $3 million by selling "some of its real estate and other non-core assets to buy time until it has more conclusive data from initial trials of its innovative therapy."

 StemCells Inc. is in a much different situation than its early days. Reuters said that the company is burning cash at a rate of $1.5 million a month and will run out in April without a fresh infusion. The company's stock closed at $2.52 today, a far cry from a high of $188 in 1992. The company's shares have lost nearly 80 percent of their value since the beginning of this year, Reuters said, because of skepticism about its ability to raise cash. 

Last month, the board of the $3 billion California stem cell agency awarded a $100,000 planning grant to StemCells in the first stage of the competition in a $240 million disease team round. Winners could receive up to $20 million, most likely in the case of businesses in the form of loans. (A summary of reviewer comments on the StemCells' application can be found here. The name of the firm is typically withheld by CIRM in such summaries.)

Weissman sits on the board of directors of the firm. He is also a scientific advisor to the business, along with Fred Gage of the Salk Institute and David Anderson of Caltech. Gage and Anderson were also co-founders of the firm.

Here is another take on the firm from SmallCapNetwork.

Geron Stock Soars 20 Percent on Approval of Clinical Trials

Today is a big, big day for California's Geron Corp., which has received federal approval to begin "the world's first study of a treatment based on human embryonic stem cells."

The Associated Press covered the basics of the action. An early version of its story said said,

"The company gained federal permission this week to inject eight to 10 patients with cells derived from embryonic cells, said Dr. Thomas Okarma(see photo), president and CEO of Geron Corp. of Menlo Park, Calif.

"The patients will be paraplegics, who can use their arms but can't walk. They will receive a single injection within two weeks of their injury.

"The study is aimed at testing the safety of the procedure, but doctors will also look for signs of improvement like return of sensation or movement in the legs, Okarma said."

Andrew Pollack of the New York Times provided a nuanced, comprehensive piece. He reported on the political and scientific implications and quoted Robert Klein, chairman of the California stem cell agency, on the move.

Klein said the FDA approval was tied to the Obama Administration although that was denied by an FDA spokesman and Geron.

Geron's stock rose 20 percent early this morning, hitting $6.26 at 9:47 a.m. EST, close to its 52-week high of $6.55.

Here are links to the Geron press release and other stories about the much-delayed trial: Geron (includes video), Wall Street Journal , AFP and Financial Times.

Coverage of the Cloning of the Cells of Sam Wood

While CIRM was advancing its $262 million lab grant program this week in Burlingame, about 490 miles to the south in La Jolla, a tiny firm called Stemagen was making international headlines with its news about cloning human embryos.

Terri Somers of the San Diego Union-Tribune had one of the first stories on the matter. The paper also had a piece by Sandi Dolbee on the ethics of the issue. The blog of the American Journal of Bioethics has a roundup of links to coverage elsewhere.

The Center for Genetics and Society in Oakland also raised questions about the propriety of the research, which involved the cells (see Stemagen photo on right) of Stemagen's president, Samuel Wood (see Stemagen photo on left) and an anonymous investor in the firm.

Whatever your take on this, along with all the other news on stem cell research in the last few months, it will generate substantially more attention on the field from investors, scientists, supporters and foes.

Monkey Business, BioTime and the Search for Science

WARF and BioTime --California's BioTime Inc. has hooked up with WARF and signed a licensing agreement to use some of its patents on human embryonic stem cell research. The Emeryville firm said the WARF patents will allow it to manufacture and commercialize human embryonic stem cell-derived cell types and related products for scientists to use in research and in drug discovery. As part of that effort, the company plans to develop and commercialize a collection of research tools for stem cell research. Here is a link to a Wisconsin story on the subject, and here is a link to the company press release.

Monkeys and the American Psyche -- Scientific American says the reprogramming of adult rhesus monkey (see photo) stem cells into embryonic stem cells is one of the top 25 scientific stories of 2007, but that doesn't mean much to the public. The overwhelming majority of Americans has never heard of the research. So says the first poll taken since the announcement of the research results in November. According to the survey by the Virginia Commonwealth University, only 38 percent of those polled had heard of the reprogramming results. The implications for stem cell advocates? They have a long way to go before this stuff is entrenched in the American psyche.

Finding The Worthy – The topic of stem cell research grants to businesses came up recently in the Biopolitical Times, a blog produced by the Center for Genetics and Society. Jesse Reynolds wrote that the California stem cell agency should resist efforts by businesses to lower revenue-sharing requirements that might be linked to grants to the private sector. He also wrote:

"Although there is likely not enough current stem cell research capacity in California to warrant $300 million in grants per year, there's no effective mechanism to prevent as much money going out the door as possible, regardless of the research's quality. The CIRM's governing board is dominated by representatives of grant recipients - from the public, nonprofit, and corporate sectors alike."

Nearly three years, one anonymous writer from the world of academic science in California expressed a similar reservation about whether there is enough good stem cell science worthy of funding in California. More recently some on the Oversight Committee have expressed concern about maintaining the quality of the research that is being funded. However, this is not a subject likely to be discussed freely in public by folks at CIRM. To do so could appear to be casting doubts on the agency's mission.

NIH to ACT: Nyet!

A California-based firm, Advanced Cell Technology, says it has created human embryonic stem cells without harming the embryos from which they were derived.

The company said the results "have the potential to end the ethical debate surrounding the use of embryos to derive stem cells."

The NIH, however, says that isn't good enough. According to Rick Weiss in the Washington Post, the head of the NIH stem cell task force, Story Landis, said,

"(T)he only way to prove that the technique does not harm embryos would be to transfer many of them to women's wombs and see if the resulting babies were normal. But it would be unethical to do that experiment, she said, so the question cannot be answered."

That doesn't make Robert Lanza(see photo), the chief scientific officer at ACT, happy, Weiss wrote,

"That standard has Lanza fuming. By all scientifically recognized measures, he said, the embryos -- currently frozen in suspended animation because they were donated for research and not to make babies -- are normal, he said.

FDA Calls April Meeting for Stem Cell Testing Advice

Clinical trials for therapies using human embryonic stem cells seem to be creeping closer with the latest news coming from the US Food and Drug Administration.

The FDA Tuesday announced a meeting April 10 to seek advice concerning "scientific considerations for safety testing" of such therapies. Two California firms, Geron and Advanced Cell Technologies, say they plan to send representatives to the meeting. Both have also indicated they hope to begin clinical trials next year.

Luke Timmerman and Rob Waters of Bloomberg News reported that Reni Benjamin, an analyst with Rodman and Renshaw in New York, said the FDA meeting is unusual because "the agency typical seeks advice on whether to approve a tested drug, not on how to proceed."

According to the two reporters:

"Geron has communicated extensively with FDA reviewers over the design of the first human trial using embryonic stem cells, partly to convince the agency that putting the cells into people won’t result in the growth of abnormal cell clusters called teratomas, Thomas Okarma, Geron’s chief executive officer, said in interviews with Bloomberg."

Bloomberg said that ACT plans to submit a clinical trials application in the first half of 2008 for a treatment using retinal cells.