THE MARKET FOR CELL THERAPY
MANUFACTURING
Strategies for Cell Therapy Product Pricing, Cost
Control, Reimbursement, Distribution, & More
BioInformant
Worldwide, LLC
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TABLE OF CONTENTS
1. Introduction to Cell Therapy Manufacturing……………………………………….p.4
2. Leading Cell Therapy Companies……………………………………………………p.6
2.1. List of Cell Therapy Companies Worldwide
[Table] List of Cell Therapy Companies Worldwide by Location and Type
2.2. Leading Cell Therapy Companies
2.1.1. ReNeuron
2.1.2. Mesoblast Ltd.
2.1.3. Asterias Biotherapeutics
2.1.4. TiGenix NV
2.1.5. Cellectis
2.1.6. Cynata Therapeutics
2.1.7. Cytori Therapeutics
2.1.8. Astellas Pharma, and Subsidiary Ocata Therapeutics
2.1.9. Gamida Cell Ltd.
2.1.10. Pluristem Therapeutics
3. Approved Cell Therapy Products……………………………………………………p.41
3.1. Apligraf (Organogenesis, Inc. & Novartis AG)
3.2. Carticel (Genzyme)
3.3. Cartistem (MEDIPOST)
3.4. ChrondoCelect (TiGenix NV)
3.5. Cupistem (Anterogen)
3.6. Dermagraft (Advanced Tissue Sciences)
3.7. Epicel (Vericel)
3.8. Hearticellgram-AMI (FCB Pharmicell)
3.9. Holoclar (Chiesi Farmaceutici)
3.10. Osteocel (NuVasive)
3.11. Prochymal (Mesoblast)
3.12. Provenge
3.13. Strimvelis (GSK)
3.14. TEMCELL (JCR Pharmaceuticals Co. Ltd., Licensee of Mesoblast Ltd.)
4. Pricing Analysis for Cell Therapy Products…………………………………………p.60
4.1. Pricing of Approved Cell Therapy Products
[Table] Pricing of Approved Cell Therapies
[Table] Pricing Scale for Approved Cell Therapies, by Type
4.2. Reasons for High Cell Therapy Product Costs
4.2.1. High Cost of Manufacturing
4.2.2. Need to Recoup Developmental Costs
4.2.3. Cash Flow and Quantity of Cash Reserves
4.2.4. Need for Return on Investment (ROI)
4.2.5. High Cost of Delivery
4.2.6. Lack of Comparative Studies as Evidence for Reimbursement Scheme
4.2.7. Lack of Competition
4.2.8. Potential for High Utility Patient Outcomes (Cures)
4.2.9. Small Market Size
5. Cost-Control for Cell Therapy Products...…………………………………………..p.69
5.1. Cost of Goods (COGs) Components
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5.2. Automation as a Cost Control Measure
[Table] Cost Per Million of Clinical-Grade MSCs Expanded by Different Methods
5.3. Effect of Process Development and Process Change on COGs
5.4. Managing Cash Flow
5.5. Role of Cell Therapy CDMOs
6. Time Frames for Cell Therapy Product Development…….………………………..p.80
6.1. Pre-Market Challenges
6.2. Persevering Through Lengthy Developmental Timelines
6.3. Navigating the Regulatory Environment
6.4. Timeline from Phase I to Commercialization
7. Reimbursement of Cell Therapy Products…………………………………..………p.85
7.1. Securing Reasonable Reimbursement
7.2. Encouraging Adoption
8. Distribution Channels for Cell Therapy Products…..……………………………...p.90
8.1. Addressing Distribution Logistics
8.2. Allogeneic vs. Autologous Therapies
9. Market Trend Analysis - Key Trends Impacting the Marketplace……………..…p.93
9.1. Regulatory Issues
9.1.1. FDA Guidelines for HCT/Ps
9.1.2. 21st Century Cures Act)
9.2. Global Trends
9.2.1. Accelerated Approval Pathway in Japan
9.2.2. Prolific Partnering Between Cell Therapy Companies and Japanese
Pharmaceutical Companies
9.2.3. Cell Therapy Products (and Pricing) Resulting from the Japanese Regulatory
Framework
10. Technologies Impacting the Cell Therapy Manufacturing Market…..…………p.109
10.1. Closed-System Manufacturing
10.2. Automation of Cell Therapy Manufacturing Processes
10.3. Automation of Data Management
10.4. Bioreactor Technologies
11. Market Potential for Autologous vs. Allogeneic Manufacturing………………….p.113
[Table] Allogeneic vs. Autologous Product Development Among Leading Cell Therapy
12. Cell Therapy Manufacturing Challenges and Considerations…………………….p.117
13. Conclusions…………………………………………….………………………………p.120
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1. Introduction to Cell Therapy Manufacturing
Cell therapy is the use of cells and tissues to regenerate, repair, and enhance human health.
Traditionally, the modern medical system has relied on a pharmaceutical based approach. This
lead to the rise of the U.S. Food and Drug Administration (FDA) which was founded in 1906,
making it more than one-hundred years old. Unfortunately, our approach to human health has not
experienced a dramatic shift over the past 100+ years, and as a society, we still tend to rely on a
drug-based approach.
Although variations exist, drugs generally work by binding to receptors on the cell surface or by
exerting an enzymatic effect to regulate the rate of an internal chemical reaction.
Pharmaceuticals can frequently modulate the human system with great effect, but rarely do they
have the capacity to regenerate or restore entire tissues or systems within the human body.
In contrast, cell therapy works
because cells are powerful factories
that can exert therapeutic effects
through a wide range of strategies,
including honing to sites of injury,
exerting paracrine effects, and in
some cases, differentiating into new
types of cells and tissues. This
versatility makes cell therapy
extremely powerful and gives it the potential to reverse previously untreatable diseases. Needless
to say, it is an exciting time in history.
For this reason, cell therapy – or more likely, cell therapy in combination with pharmaceuticals –
will be the future of human health.
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One of the major issues with moving cell therapy
products from “bench to bedside” has been
manufacturing bottlenecks. The heterogeneous nature
of cell therapy products has introduced manufacturing
complexity and regulatory concerns, as well as scale-
up complexities that are not present within traditional
pharmaceutical manufacturing.
Furthermore, much of cell therapy manufacturing now involves patient-specific cell therapies,
where cells for an individual patient are processed one batch at a time. Ten years ago, it was a
common belief that making individual batches of a therapy for each patient would never provide
an economical business model. Rather, allogeneic therapies would better align with the
pharmaceutical model, because universal cell populations could be prepared in advance to later
be prescribed to patients in need, much like drug compounds have been administered for
decades.
Nonetheless, clinical data in support of patient-specific therapy has been compelling, so the
pressure is on cell therapy industry to manufacture these therapies on a larger scale. It is now
understood that both autologous and allogeneic cell therapies will contribute important
therapeutic solutions. There are opportunities for developing both autologous and allogeneic cell
therapy products, which vary greatly in their manufacturing requirements, routes for patient
administration, and cost structures.
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2. Cell Therapy Companies Worldwide
This section evaluates cell therapy companies worldwide. The first section considers all cell
therapy companies, including those at all stages of development. The second section considers
leading cell therapy companies with strong clinical pipelines.
2.1. List of Cell Therapy Companies
Below is a comprehensive list of cell therapy companies worldwide. It includes companies
investigating cell therapy products in early-stage programs, as well as those progressing
product pipelines into preclinical and clinical testing programs.
TABLE. List of Cell Therapy Companies Worldwide by Location and Type
Company Name / Website Location Type
Adaptimmune Therapeutics
Abingdon, UK T Cell Cancer Therapy
Adheren Emeryville, CA Cancer Immunotherapy
Adicet Bio Menlo Park, CA Cell Immunotherapies
Adverum Biotechnologies Menlo Park, CA Adeno-Associated Virus Delivery, Gene Therapy
Altucell New York, NY Cell Therapy Treatments for Diabetes
Anagenesis Biotechnologies
Boston, MA Cell Therapy; Small Molecules
Animal Cell Therapies San Diego, CA Veterinary Stem Cell Therapies
apceth Mountain View, CA MSC Therapies
Aposcience Vienna, Austria Treatments Composed of Cytokines, Growth Factors and Other Active Components
Ascend Biopharmaceuticals
South Melbourne VIC , Australia
Immunotherapies
Astarte Biologics Redmond, WA Cell Products
Asterias Biotherapeutics Fremont, CA Pluripotent Stem Cells; Cancer Immunotherapies
Athersys Cleveland, OH Stem Cell Treatments
Avita Medical Melbourn, UK Autologous Skin Cell Treatment, Drug Delivery
AVROBIO Cambridge, MA Cellular & Gene Therapies
AxoGen Alachua, FL Nerve Tissue Processing
Bellicum Pharmaceuticals Houston, TX Cellular Therapy
BioCardia San Carlos, CA Personalized Marrow-derived Cell Therapy
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BioRestorative Therapies Jupiter, FL Autologous Stem Cell Therapies for Neurodegenerative Disorders
BlueRock Therapeutics New York, NY Stem Cell Therapies
Bone Therapeutics Gosselies , Belgium Cell Therapy
BrainStorm Cell Therapeutics
Kiryat Aryeh, Israel Autologous Stem Cell Therapies for Neurodegenerative Disorders
Bullet Biotechnology Redwood City, CA Immunotherapy
Caladrius Biosciences Basking Ridge, NJ Cell Therapies (Owns PCT)
Capricor Therapeutics Beverly Hills, CA Stem Cell Heart Treatments
CardioCell (Stemedica) San Diego, CA Cell Therapy
Celdara Medical Lebanon, NH Cellular therapy, diagnostics
Celixir Cardiff, UK Regenerative Medicine
Cell Cure Neurosciences (BioTime)
Jerusalem , Israel Cell Therapy
Cell Medica London, UK Personalized cellular immunotherapies
Cell2B Cantanhede, Portugal Cell Therapies
Cellect Biosciences Kfar Saba, Israel Regenerative Medicine
Cellectis France / New York, NY Genome editing and cell therapies
CellProthera Mulhouse, France Stem cell transplant for cardiac conditions
CellTherapies East Melbourne, Australia Cellular Therapies
Cellular Biomedicine Group
Palo Alto, CA Cell Therapy
Cellular Dynamics (Fujifilm)
Madison, WI Induced Pluripotent Stem Cells
Celvive New Brunswick, NJ Cell Therapy
Celyad Boston, MA Cell Therapy
Chimera Bioengineering South SF, CA CAR-T therapies
CiMaas Maastricht , Netherlands Cellular Immunotherapy
Cynata Therapeutics Armadale, VIC, Australia iPSC-derived MSCs
Cytori Therapeutics Tokyo, Japan Cryopreservation Systems, Cellular Therapy
DaVinci Biosciences Yorba Linda, CA Cellular Therapies
DiscGenics Salt Lake City, UT Spinal Stem Cell Therapies
Eutilex Seoul, Korea T cell and antibody therapies
F1 Oncology West Palm Beach, FL CAR-T
Fate Therapeutics San Diego, CA Programmed cellular immunotherapies
Fibrocell Exton, PA Autologous cell and gene therapies
Fortuna Fix Laval (QC) Canada Neuronal Cell Therapy (Direct Reprogramming Technology)
Galileo Research Vecchiano, Italy Cell Therapy for Cancer
Gamida Cell Jerusalem, Israel Cell Therapies involving Expansion of HSCs from Cord Blood
GSK Brentford, UK Ex-vivo stem cell gene therapy
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Helocyte (Fortress Bioecth) New York, NY Cytomegalovirus, oncology immunotherapies
Histogen San Diego, CA Regenerative Medicine
Immatics Biotechnologies Tuebingen, Germany Cancer immunotherapy
Immune Therapeutics Orlando, FL Immunotherapy
Immusoft Seattle, WA Autologous B cell-conditioning
Intercytex Manchester, UK Cell-Based Products
International Stem Cell Carlsbad, CA Proprietary Stem Cell Induction
Invitrx Therapeutics Irvine, CA Autologous Stem Cell Therapy, Therapeutic & Cosmetic
InvivoGen Therapeutics Toulouse, France Gene and Immunotherapies
I-stem Corbeil-Essonnes, France Human pluripotent stem cells, of embryonic origin or obtained by reprogramming
Juno Therapeutics Waltham, MA Immunotherapy, CAR-T
Kiadis Pharma Amsterdam, Netherlands Stem Cell Treatment
Kite Pharma Santa Monica, CA Engineered autologous cell therapy (eACT)
Lion Biotechnologies Los Angeles, CA Adoptive Cell Therapy
Living Cell Technologies Auckland, New Zealand Regenerative Medicine
Magenta Therapeutics Cambridge, MA Stem Cell, Bone Marrow Transplant Technology
MBC Pharma Aurora, CO Bone-seeking Treatments
Medeor Therapeutics San Mateo, CA Cellular Immunotherapy
Mesoblast Melbourne, VIC, Australia Adult stem cell research (MSCs)
Metaclipse Therapeutics Atlanta, GA Personalized cancer therapy
MirImmune (Rxi Pharma) Cambridge, MA Cancer Immunotherapy
Molecular Medicine Milan, Italy Biologics, Small Molecules, Cellular Therapy
NantCell Culver City, CA Cellular therapy
Neon Therapeutics Cambridge, MA Vaccines & T cell therapies
Neovii Biotech Rapperswil, Switzerland Stem Cell Therapy, Biologics
Neuralstem Germantown, MD Stem Cell Technology
Neurogeneration San Diego, CA Autologous therapy
Neurona Therapeutics South SF, CA Neuronal stem-cell therapies
Neuronascent Clarksville, MD Small molecules, stem cells
NewLink Genetics Ames, IA Cell Therapy, Small Molecules
NexImmune Gaithersburg, MD Artificially engineered antigen-presenting cells
Nohla Therapeutics Seattle, WA Universal donor cell therapy
OncoMed Pharmaceuticals Redwood City, CA Cancer Stem Cells
Opexa Therapeutics The Woodlands, TX Cell Therapy
Orgenesis Germantown, MD Cell therapy treatments for diabetes
Orthocyte (BioTime) Alameda, CA Cellular Therapies
Osiris Therapeutics Columbia, MD Cellular Matrix Treatments
OvaScience Cambridge, MA Fertility, Mitochondria Transplantation
OxStem Cambridge, UK Stem Cell Drugs
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Pathfinder Cell Therapy Cambridge, MA Cell-based Therapy
Plureon Winston-Salem, NC Pluripotent stem cells derived from amniotic fluid and placenta
PluriCell São Paulo, Brazil iPS Cells
Pluristem Therapeutics Haifa, Israel Placental-derived cell therapies
Promethera Biosciences
Mont-Saint-Guibert, Belgium
Liver disease treatments
Regen BioPharma La Mesa, CA Regenerative Medicine, Cell Therapy, Small Molecule
Regeneus Pymble, NSW, Australia Stem Cell Therapy
Regenicin Little Falls, NJ Autologous skin cell therapy
RegenoCELL Therapeutics Natick, MA Stem Cell Therapy
ReNeuron Bridgend, UK Stem Cell Therapies
RepliCel Life Sciences Vancouver, BC Autologous cell therapies for healing
RhinoCyte Louisville, KY Stem Cell Therapy
Rubius Therapeutics Cambridge, MA Enucleated cell therapeutics
SanBio Co Ltd Mountain View, CA Cellular Therapies
Saneron CCEL Therapeutics (Cryo-Cell International, Inc)
Tampa, FL Cellular Therapy
Semma Therapeutics Cambridge, MA Diabetes Stem Cell Treatments
SpherIngenics Atlanta, GA Cellular Therapies
Stemedica Cell Technologies
San Diego, CA Stem Cell Production
StemGenex La Jolla, CA Stem Cell Therapy
Stemline Therapeutics New York, NY Cancer Stem Cells
Stempeutics Bangalore, KA, India Stem cell based products
Stratatech (Mallinckrodt) Madison, WI Cell Therapy, Tissue Engineering
Taiga Biotechnologies Aurora, CO Small molecules, cell therapies
TaiwanBio Taipei City, Taiwan Allogeneic mesenchymal stem cell therapy
Talisman Therapeutics Cambridge, UK Alzheimer's Stem Cell Model
Targazyme Carlsbad, CA Cell Therapy
TCR2 Therapeutics Cambridge, MA T Cell Immunotherapy
Tigenix Allogeneic Adipose-derived Stem Cell Therapies
Tikomed Viken, SWEDEN Regenerative Medicine
Tissue Genesis Honolulu, HI Adipose Cell Isolation
TissueGene Rockville, MD Regenerative therapies for orthopedic disorders
Trillium Therapeutics Toronto, ON Stem Cell Therapy
TxCell Valbonne , France Personlizes cellular immunotherapies
U.S. Stem Cell Sunrise, FL Cell Therapies & Delivery
Universal Cells Seattle, WA Non-immunogenic cells
Unum Therapeutics Cambridge, MA cellular immunotherapies
Vericel Cambridge, MA Cellular Therapy
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VetStem Biopharma Poway, CA Stem Cell Therapy for Animals
ViaCyte Athens, GA Stem Cell Therapies
VistaGen Therapeutics South SF, CA Stem Cell Technology
Vital Therapies San Diego, CA Extracorporeal Cellular Therapy for Liver Disease
Vor BioPharma Boston, MA CAR-T Stem Cell Therapy
Xcelthera San Diego, CA Stem Cell Therapy
Ziopharm Oncology Boston, MA Cellcular Therapies
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2.2. Leading Cell Therapy Companies
This section profiles ten leading cell therapy companies, all of which have promising cell
therapy products being evaluated in clinical trials. These 10 companies are highlighted,
because they are market leaders, with robust financial funding, novel technologies, and
strong therapeutic pipelines. Meaning, they are having a substantial impact on the cell
therapy industry.
These leading cell therapy companies include:
1. ReNeuron
2. Mesoblast Ltd.
3. Asterias Biotherapeutics
4. TiGenix NV
5. Cellectis
6. Cynata Therapeutics
7. Cytori Therapeutics
8. Astellas Pharma, and Subsidiary Ocata Therapeutics
9. Gamida Cell Ltd.
10. Pluristem Therapeutics
For each company, an overview is provided, as well as a detailed description of its cell therapy
clinical trials and how it is approaching the manufacturing of its cell therapy products.
Interestingly, the majority of these cell therapy companies are using third-party contract
development and manufacturing organizations (CDMOs) to manufacture their cellular
products (6 out of 10). Specifically, ReNeuron, Mesoblast, Asterias, TiGenix, Cellectis, and
Cynata Therapeutics have engaged cell therapy CDMOs. In contrast, Cytori, Astellas,
Gamida Cell, and Pluristem are conducting their own cell therapy manufacturing.
Without exception, the companies doing their own cell therapy manufacturing are
companies that have been specializing in the production of cell products for 15+ years (16 to
23 years, respectively). For example, Cytori was founded in 20001, Astellas’ cell
1 Cytori was created from a 2002 merger between Macropore Biosurgery Inc. (founded in 1996) and StemSource Inc. (founded in 2000).
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technologies were acquired through its acquisition of Ocata Therapeutics (formed in 1994),
Gamida Cell was founded in 1998, and Pluristem was founded in 2001.
Company Year Founded # of Years Old
Astellas / Octata 1994 23
Gamida Cell 1998 19
Cytori 2000 17
Pluristem 2001 16
AVERAGE 1998 18.75
As shown in the table, the top cell therapy companies that do their own manufacturing
are all 15+ years old, with an average company age of almost 19 years.
In contrast, the companies using cell therapy CDMOs tend to be more recently formed. For
example, Mesoblast was founded in 2004, Asterias was founded in 2012, TiGenix was
founded in 2000, and Cynata was formed through a 2013 merger and the acquisition of
proprietary iPS cell technology acquired from the University of Wisconsin.2 The older
companies outsourcing their cell therapy manufacturing needs are ReNeuron (founded in
1997) and Cellectis (founded in 1999).
Company Year Founded # of Years Old
Asterias 2012 5
Cynata 2013 4
Mesoblast 2004 13
TiGenix 2000 17
ReNeuron 1997 20
Cellectis 1999 18
AVERAGE 2004 12.8
As shown in the table above, the top cell therapy companies that use third-party
CDMOs are on average much younger, with an average company age of only 12.8
years.
2 EcoQuest, the forerunner of Cynata was created as an Australian medical hygiene company developing bioengineered health products. In 2013
it merged with the newly formed Cynata and renamed itself. The founding partners identified the opportunity to move into regenerative medicine
and secured the exclusive license to the University of Wisconsin’s patented process via Cynata for establishing and manufacturing for therapeutic
use MSCs from iPSCs, via a key intermediate cell called a mesenchymangioblast (MCA). They changed their original corporate strategy and have since focused on developing the business as a stem cell therapeutics company.
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Importantly, if company is more than 15
years old, it or may not use a cell
therapy CDMO, but if it is less than 15
years old, it is nearly sure to use a cell
therapy CDMO.
This finding is not surprising, because
the companies doing their own cell
therapy manufacturing were founded
before a cell therapy CDMO market existed. Therefore, they were forced to gain expertise in
cell therapy manufacturing and had no other option but to invest in the manufacturing
infrastructure required to support their efforts.
In contrast, recently formed companies are highly likely to seek out a cell therapy CDMO to
support their cell therapy manufacturing needs, because the time required to acquire cell
therapy manufacturing expertise can be 15+ years and the facilities and infrastructure
required to do cell therapy manufacturing can cost tens of millions of dollars to build or
acquire. Additionally, approvals for a GMP cell therapy manufacturing facility can add
several million dollars in costs.
Therefore, an intelligent strategy for cell therapy CDMOs to use to target cell therapy clients
is to approach companies founded in the past 15 years. If the company is less than 10 years
old, its odds of using a cell therapy CDMO will near 100%.
Additionally, the companies doing their own cell therapy manufacturing tend to invest as
heavily into cell therapy manufacturing technologies as they do into the development of cell
therapeutics. For example, Gamida Cell developed a proprietary NAM technology for the
expansion of its cell populations. The system supports the manufacture of a very large
numbers of cells while preserving and even enhancing their functionality. Pluristem
developed a proprietary 3D PLX bioreactor system that allows cells to remain healthy and
potent as Pluristem alters conditions within its bioreactors to create its patented PLX-PAD cell
therapy product. Cytori Therapeutics created a new device to process fat to isolate stem cells
resident in the tissue, with its cell therapy products prepared using the company’s fully
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automated Celution® System. Each of these companies focused heavily on developing cell
therapy manufacturing technologies, and therefore, development of cell therapeutics was a
natural extension of these technologies.
In the case of Gamida Cell and Pluristem, both Israeli companies, they are world-class
leaders in stem cell expansion technologies, using bioreactors to grow their cell populations
to a very large scale. It would be difficult for these companies to find cell therapy CDMOs
that could exceed their level of expertise.
KEY FINDINGS
1) Companies formed in the past 15 years tend to use cell therapy CDMOs
2) Companies doing their own manufacturing invest as heavily into cell manufacturing
technologies as they do into the development of cell therapeutics
3) Companies with extensive expertise in bioreactors technologies are more likely to do
their own cell therapy manufacturing
In the sections below, each of these 10 leading cell therapy companies are profiled in depth.
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2.2.1. ReNeuron (www.ReNeuron.com)
ReNeuron is a clinical-stage stem cell business that is exploring the use neural stem cells for
various disease applications. ReNeuron’s lead stem cell therapeutic candidate (CTX) is a
therapy for disabled stroke patients. It consists of a neural stem cell line which was
generated using ReNeuron’s proprietary cell expansion and cell selection technologies and
then taken through a full manufacturing scale-up and quality-testing process.
Therefore, CTX is a cryopreserved, clinical and commercial-grade cell therapy
product capable of treating all eligible patients. It can be administered as universal, “off-
the-shelf” products to any eligible patient.
CELL THERAPY CLINICAL TRIALS:
CTX was shown to be safe and well-tolerated in its first-in-human UK clinical trial (PISCES
I) in 11 disabled stroke patients who were followed up for at least 2-years post-
treatment. ReNueron recently announced positive efficacy data from a single arm, follow on
Phase II clinical trial (PISCES II) of its CTX therapy in disabled stroke patients. In this
study, patients were monitored on a number of efficacy measures of limb motor function,
disability and dependence and performance in activities of daily living. In total, 15 out of
the 21 patients had a clinically significant response on at least one efficacy measure.
As a result of the positive data from the PISCES II study, ReNeuron intends to apply to the
U.S. and European regulatory authorities to commence a randomized, placebo controlled,
pivotal clinical trial in patients who are living with disability post-stroke. If successful in
late clinical development, its CTX cell therapy candidate will represent a new treatment
option for stroke survivors.
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The second application for ReNeuron’s CTX cells is the treatment of critical limb ischaemia
(CLI). In pre-clinical studies, it demonstrated the potential to restore sufficient blood flow in
the affected lower limb to avoid amputation. The trial is being undertaken through NHS
Tayside at Ninewells Hospital and Medical School in Scotland. In this dose escalation safety
study, the CTX cells will be administered via intramuscular injection into the affected lower
limb of nine patients with peripheral arterial disease. (CLI is the end-stage of this
disease.) ReNeuron has now commenced a Phase I clinical trial with its CTX stem cell
investigational therapy for CLI.
Finally, its human retinal progenitor cell (hRPC) stem cell candidate is for the treatment of
retinitis pigmentosa (RP), a blindness-causing disease of the retina. Preclinical studies
carried out in disease models demonstrated that when transplanted into the retina,
ReNeuron’s retinal progenitor cell technology has the potential to preserve existing
photoreceptors, potentially reducing or halting deterioration of vision. In addition, the
progenitor cells mature into functional photoreceptors that engraft into the photoreceptor
layer, suggesting that restored vision may be possible. Clinical development of this
candidate recently started in the US.
The Phase I/II clinical trial in retinitis pigmentosa patients is now open for enrollment and,
importantly, marks the initiation of clinical trial activity in the U.S. with ReNeuron’s
therapeutic programs. The study is being conducted at Massachusetts Eye and Ear Infirmary
in Boston, a world-renowned clinical center for the treatment of retinal diseases. The trial
design is an open-label, dose escalation study to evaluate the safety, tolerability and
preliminary efficacy of the hRPC stem cell therapy candidate in up to 15 patients with
advanced retinitis pigmentosa (RP). The method of administration of the hRPCs will be a
single sub-retinal injection.
The primary endpoint of the study is safety, with patients being followed up for 12 months
post-treatment with monitoring including measurements of visual acuity. Recruitment and
treatment of the first and second dose cohorts has completed and initial safety and
tolerability data from the study are expected in the first half of 2017.
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Finally, ReNeuron is progressing preclinical development of its exosome nanomedicine
platform. Exosomes are nanoparticles secreted into the culture media during ReNeuron’s in
vitro stem cell expansion. They contain a number of biologically active molecules, such as
proteins and miRNAs which have potential therapeutic benefits.
To summarize, ReNeuron has completed or is executing the following cell therapy
clinical trials:
1) PISCES safety study of CTX cells in the treatment of patients with stable
ischaemic stroke (Phase I) – To test the safety of CTX cells delivered by
injection into the damaged brains of male patients over 60 left moderately to
severely disabled 6 months to 5 years following an ischaemic stroke. The trial has
been completed.
2) Efficacy study of CTX cells in patients with stable paresis of the arm
following an ischaemic stroke (Phase II) - To determine if treatment at a dose of
20m cells improves recovery in use of paretic arm in stroke patients to justify a
larger pivotal study. Data from this trial has been reported.
3) Non-interventional, observational study for patients with stable ischaemic
stroke to document clinical course and establish pool of patients for on-going
trials (Observational) - To build data set in untreated disabled stroke patients
and facilitate on-going clinical trials. The study was completed and data reported.
4) Ascending dose safety study of CTX cells in patients with lower limb
ischaemia (Phase I) – To investigate the safety and tolerability of intramuscular
injections of CTX cells in patients with peripheral arterial disease. The short-term
safety readout is expected in early 2017.
5) Open label prospective study of the safety and tolerability of the human
retinal progenitor cell (hRPC) therapy candidate in the treatment of patients
with retinitis pigmentosa (Phase I/II) - To evaluate the safety, tolerability and
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preliminary efficacy of sub-retinally transplanted hRPCs in up to 15 patients with
advanced retinitis pigmentosa. Initial safety data is expected in early 2017.
CELL THERAPY MANUFACTURING:
Interestingly, ReNeuron has used many different cell therapy CDMOs over the years, as
described below.
In October 2009, ReNeuron signed a contract with Angel Biotechnology Holdings Plc in
Edinburgh, UK, to have Angel manufacture clinical-grade lots of a second-generation
formulation of ReNeuron’s lead CTX stem cell line for preclinical and clinical
applications. ReNeuron used this enhanced CTX cell formulation for multi-centre, proof-
of-concept clinical trials with its ReN001 stem cell therapy for disabled stroke patients, as
well as for late pre-clinical testing and initial clinical trials with its ReN009 stem cell
therapy for peripheral artery disease.
Next, in April 2011, ReNeuron expanded its contract manufacturing arrangements in the
UK by signing an agreement with NHS Blood and Transplant (NHSBT) to develop and
manufacture its CTXcryoTM stem cell product to clinical and commercial grade
standards. Following technology transfer work, NHSBT used its accredited cell
manufacturing facilities to develop and manufacture ReNeuron’s next-generation
CTXcryoTM frozen stem cell product for pre-clinical development work and eventual
clinical use in the Company’s ReN009 program for peripheral arterial disease and in
other future therapeutic programs. The CTXcryoTM cell product is a second-generation
formulation of ReNeuron’s lead CTX stem cell line, the basis of its ReN001 therapy for
stroke.
In March 2013, ReNeuron signed a deal with the Cell Therapy Catapult (now the
Cell and Gene Therapy Catapult) to work together on new cell therapy manufacturing
technologies and assays. The work, completed late 2014, focused on ReNeuron’s lead
CTX stem cell line. This cell line is used in ReNeuron’s ReN001 therapy for stroke and
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its ReN009 therapy for CLI. The collaboration focused on the development and
optimization of the processes required to scale up manufacture of the CTX cell line,
including rapid cell culture techniques, cryopreservation methodologies and the
development of protocols for automated manufacturing processes. ReNeuron and the Cell
Therapy Catapult also work on improved potency assays for the CTX cells.
Then, in September 2013, ReNeuron became the first commercial customer for Roslin
Cell’s new GMP Cellular Therapy Manufacturing Facility in Edinburgh, UK. Under the
contract, Roslin Cells manufactured clinical-grade cell banks of ReNeuron’s CTX cell
product. Roslin Cells did well to land this deal, because its Edinburgh facility had just
secured its license from UK authorities a few months earlier.
Finally, in July 2015, ReNeuron decided to automate processing of its stem cell-based
stroke therapy ahead of planned Phase III trials using a system acquired from Sartorius
Stedim Biotech’s subsidiary, TAP Biosystems. The system, the Cellmate, was used to
make ReNeuron’s CTX stem cell therapy at its clinical and commercial-scale
manufacturing facility in Pencoed, Wales. ReNeuron shared the Cellmate system will
allow staff to seed, culture, and harvest cells while minimizing manual interaction with
the cultures, which it indicated would enable production of a reproducible and consistent
stem cell therapy product.3 According to ReNeuron’s Enginnering Head, Jasmin Kee,
“For our Phase I and II clinical trials, the production of CTX stem cell therapies is a
manual process. As we move into Phase III, we are looking to increase our batch sizes
10-fold while maintaining the quality and reproducibility of our product.”4
3 "Reneuron To Automate Stem Cell Stroke Therapy Production For Phase III Trial". BioPharma-Reporter.com. N.p., 2017. Web. 20 Feb. 2017.
Available at: http://www.biopharma-reporter.com/Downstream-Processing/ReNeuron-to-automate-stem-cell-stroke-therapy-production-for-
Phase-III-trial. 4 Ibid.
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2.2.2. Mesoblast (www.Mesoblast.com)
Mesoblast Limited (ASX: MSB) is an Australian-based regenerative medicine company that
provides treatments for inflammatory conditions, cardiovascular disease and back pain. The
company is led by Silviu Itescu, who founded it in 2004. The company is developing a range
of regenerative products derived from its proprietary mesenchymal lineage cells, including
mesenchymal precursor cells (MPCs) and mesenchymal stem cells (MSCs).
Highly purified and immunoselected MPCs and the culture expanded MSCs give rise to
secrete trophic factors that then exert multiple mechanisms of action. Mesenchymal lineage
precursors have the ability to detect injury and inflammation and respond to local stimuli
and signals from the injured tissue by releasing a wide range of biomolecules (growth
factors, chemokines, enzymes etc.) that induce the body’s own tissue to grow and
regenerate, effectively repairing the injury.
Mesoblast focuses on four major areas with its cell therapy solutions:
2. Immunologic and inflammatory – Cells are administered intravenously to impart
immuno-modulatory effects.
3. Cardiac and vascular – Cells are administered locally with the aim of improving heart
anatomy and function.
4. Orthopedic diseases of the spine – Cells are locally administered to potentially repair
intervertebral discs or generate new bone
5. Oncology - Improving outcomes of bone marrow transplantation in patients with cancer
or genetic diseases.
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CELL THERAPY CLINICAL TRIALS: Mesoblast currently has nine active cell therapy
clinical trials, as shown below.
• NCT02032004 - The Purpose of This Study is to Evaluate the Efficacy and Safety of
Allogeneic Mesenchymal Precursor Cells (CEP-41750) for the Treatment of Chronic
Heart Failure
• NCT02362646 - Safety & Efficacy of Intramyocardial Injection of Mesenchymal
Precursor Cells on Myocardial Function in LVAD Recipients
• NCT01781390 - Safety Study of Allogeneic Mesenchymal Precursor Cell Infusion
in MyoCardial Infarction (AMICI)
• NCT02412735 - Safety and Efficacy Study of Rexlemestrocel-L in Subjects With
Chronic Discogenic Lumbar Back Pain (MSB-DR003)
• NCT02336230 - A Prospective Study of Remestemcel-L, Ex-vivo Cultured Adult
Human Mesenchymal Stromal Cells, for the Treatment of Pediatric Patients Who
Have Failed to Respond to Steroid Treatment for Acute GVHD
• NCT01854567 - P3 Study of Umbilical Cord Blood Cells Expanded With MPCs for
Transplantation in Patients With Hematologic Malignancies
• NCT01851070 - A Multi-center Study a Single IV Infusion of Allogeneic MPCs in
Patients With Rheumatoid Arthritis and Incomplete Response to at Least One TNF
Alpha Inhibitor
• NCT01843387 - A Randomized, Controlled, Dose-Escalation Pilot Study to Assess
the Safety and Efficacy of a Single Intravenous Infusion of Allogeneic Mesenchymal
Precursor Cells (MPCs) in Subjects With Diabetic Nephropathy and Type 2 Diabetes
• NCT00482092 - A Phase III, Multicenter, Placebo-controlled, Randomized, Double-
blind Study to Evaluate the Safety and Efficacy of PROCHYMAL® (ex Vivo
Cultured Adult Human Mesenchymal Stem Cells) Intravenous Infusion for the
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Induction of Remission in Subjects Experiencing Treatment-refractory Moderate-to-
severe Crohn's Disease
CELL THERAPY MANUFACTURING:
To date, Mesoblast has only engaged with one cell therapy CDMO. In September 2011,
Mesoblast and Lonza Group entered into a strategic alliance for clinical and long-term
commercial production of Mesoblast’s off-the-shelf (allogeneic) adult stem cell products.
The alliance provides Mesoblast with certainty of capacity to meet long-term global supply
of its proprietary Mesenchymal Precursor Cell (MPC) products.
Under the agreement, Lonza supplies Mesoblast’s clinical and long-term commercial MPC
product needs globally, allowing Mesoblast exclusive access to its cell therapy facilities in
Singapore for the manufacture of allogeneic cell therapy products, subject to certain
exceptions.
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2.2.3. Asterias (http://asteriasbiotherapeutics.com)
Asterias Biotherapeutics develops proprietary cell therapy programs based on its
immunotherapy and pluripotent stem cell platform technologies. Asterias is focused on
advancing three clinical-stage products to address the fields of neurology and oncology:
AST-OPC1, AST-VAC1, and AST-VAC2.
CELL THERAPY CLINICAL TRIALS:
AST-OPC1 (oligodendrocyte progenitor cells) is currently in a Phase 1/2a dose escalation
clinical trial in spinal cord injury. Asterias’ clinical program is testing the utility of AST-
OPC1 in spinal cord injury patients. A large body of preclinical studies has demonstrated the
safety and efficacy of AST-OPC1 in models of thoracic and cervical spinal cord injury.
These potential indications are now being evaluated through preclinical studies.
Asterias is also developing AST-VAC1 as an autologous cancer vaccine designed to
stimulate patients' immune system to attack telomerase, a protein that is expressed in over
95% of cancers. It is developing AST-VAC1 for the treatment of Acute Myeloid Leukemia
(AML).
AST-VAC1 was previously tested in a multi-center, open-label, Phase 2 clinical trial in
patients with intermediate and high risk AML. The AST-VAC1 treatment was well tolerated
with safety established through both Phase 1 and Phase 2 trials. It is now performing process
development of our AST-VAC1 manufacturing process in preparation for a confirmatory
Phase 2b study designed to reproduce these results in a larger, randomized trial.
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In contrast, AST-VAC2 is an allogeneic cancer vaccine designed to stimulate patient
immune responses to telomerase. This treatment represents a second-generation approach to
the same telomerase loaded, dendritic cell vaccination immunotherapy strategy that has been
tested in two previous clinical trials of its AST-VAC1 product. The use of human embryonic
stem cells, as opposed to patient blood, as the starting material for AST-VAC2 provides a
scalable system for the production of a large number of vaccine doses in a single lot,
reducing manufacturing costs, enabling "off-the-shelf" availability, and ensuring product
consistency.
Its current efforts in the AST-VAC2 program are focused on progressing this product
towards a Phase 1/2a clinical trial in non-small cell lung cancer in collaboration with Cancer
Research UK (CRUK). Under the collaboration, CRUK will conduct the Phase 1/2a trial,
providing the resulting data to Asterias through a license agreement.
CELL THERAPY MANUFACTURING:
In October 2013, Asterias engaged the Cell Therapy Catapult (now the Cell and Gene
Therapy Catapult) to advance development of a large-scale manufacturing processes for
AST-VAC2, Asterias’ allogeneic dendritic cell immunotherapy. As a part of the agreement,
Asterias opened a UK subsidiary and employed staff based in the UK.
The Cell Therapy Catapult is responsible for streamlining and scaling manufacturing
processes for Asterias’ AST-VAC2 and its phase II clinical trial targeting lung cancer. AST-
VAC2 is an allogeneic (non-patient specific) cancer vaccine designed to stimulate patient
immune responses to telomerase, which is expressed in over 95% of human cancers but is
rarely expressed in normal adult cells.
Asterias selected the Cell Therapy Catapult because of the Cell Therapy Catapult’s
experience, location in the UK (a favorable environment for cell therapy product
development), and experience with its own Cell Plasticity Platform Project, which involved
large-scale manufacturing processes for pluripotent cells.
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2.2.4. Tigenix - http://www.tigenix.com
Founded in 2000, TiGenix NV (Euronext Brussels and Nasdaq: TIG) is a European cell
therapy company with a proprietary allogeneic expanded adipose-derived stem cell platform
technology for the treatment of autoimmune and inflammatory diseases and a
commercialized product. TiGenix is based in Leuven, Belgium, and has operations in
Madrid, Spain.
Currently, TiGenix's pipeline portfolio is one the most advanced cell therapy platforms in
Europe, with positive pivotal Phase III data for its lead product candidate and three further
product candidates in Phases II and I and pre-clinical development.
TiGenix has completed, and received positive data in, a single pivotal Phase III trial in
Europe of its most advanced product candidate Cx601, a potential first-in-class injectable
allogeneic stem cell therapy indicated for the treatment of complex perianal fistulas in
patients suffering from Crohn's disease.
Cx601 has been granted orphan designation by the European Medicines Agency in
recognition of its potential application for the treatment of anal fistulas, which affect
approximately 120,000 adult patients in the United States and Europe and for which existing
treatment options are inadequate.
TiGenix also developed and commercialized ChondroCelect, the first cell-based medicinal
product to receive marketing authorization from the EMA, which was indicated for cartilage
repair in the knee.
In July 2016, TiGenix requested the withdrawal of its marketing authorization for
ChondroCelect.
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CELL THERAPY CLINICAL TRIALS:
TiGenix has two products from its adipose-derived stem cell technology platform that are
currently in clinical development:
• Cx601 successfully completed a Phase III for the treatment of complex perianal
fistulas in Crohn’s disease patients. On July 4, 2016, TiGenix entered into a licensing
agreement with Takeda, a large pharmaceutical company active in gastroenterology,
under which Takeda acquired the exclusive right to commercialize Cx601 for
complex perianal fistulas outside the U.S.
• Cx611 completed a European Phase I safety trial and is currently preparing to initiate
a Phase I/II clinical trial in severe sepsis in Europe in the fourth quarter of 2016.
Additionally, effective July 31, 2015, TiGenix acquired Coretherapix, whose lead cellular
product, AlloCSC-01, is currently in a Phase II clinical trial in acute myocardial infarction
(AMI). In addition, the second product candidate from the cardiac stem cell-based platform
acquired from Coretherapix, AlloCSC-02, is being developed in a chronic indication.
CELL THERAPY MANUFACTURING:
In February 2015, Lonza Group and TiGenix entered an agreement for the supply of
TiGenix’s eASC product, Cx601. Under the agreement, Lonza manufactures material for
the Phase 3 trial of Cx601 in the US at Lonza’s cell therapy production facility in
Walkersville, Maryland.
Cx601 is currently in Phase 3 of clinical development in Europe. Following the positive
feedback received at a meeting with the Center for Biologics Evaluation and Research
within the US FDA, TiGenix is moving ahead with the development of Cx601 for the U.S.
market. To supply Cx601 for a Phase 3 trial in the U.S., and potentially for the U.S. market
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when the product has been fully approved, TiGenix chose to partner with Lonza as its
contract manufacturing organization (CMO).
Additionally, when TiGenix sold its Geleen, Netherlands, manufacturing facility to
PharmaCell in June of 2014 for $5.75 million, it also awarded a contract to manufacture
ChondroCelect to PharmaCell. The plant had previously received approval from the EMA
to produce ChondroCelect, which made continuity of manufacturing a priority for TiGenix.
TiGenix’s divestiture of the Geleen facility followed only months after it had licensed
marketing and distribution rights for ChrondroCelect to Swedish Orphan Biovitrium AB
(SOBI), which took over sales of the product in Belgium, the Netherlands, and Spain. As a
result, PharmaCell was responsible for manufacturing ChrondroCelect for Tigenix, while
SOBI was responsible for marketing it. Unfortunately, TiGenix later requested the
withdrawal of its marketing authorization for ChondroCelect in July 2016.
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2.2.5. Cellectis (http://www.cellectis.com/en/)
Cellectis (Nasdaq: CLLS) is a biopharmaceutical company developing immunotherapies for
cancer based on gene edited CAR T-cells (UCART). The approach to this allogeneic therapy
is for T-cells from healthy donors to be genetically edited with its proprietary technology
TALEN®, making them able to seek and destroy cancer cells. This approach could lead to a
drug that would be cost-effective, easily distributed across all geographies and available to
patients who do not have enough T-cells to undergo an autologous CAR-T therapy (based
on the patient’s own T-cells).
T-cells, which are cells from the immune system, can be engineered to express a Chimeric
Antigen Receptor or CAR, a molecule that enables them to recognize specific antigens that
are present on the surface of cancer cells. By targeting a protein expressed by tumoral cells,
the CAR leads the immune system towards cancer, which is recognized as harmful. The
immune system is then able to attack cancer cells.
CELL THERAPY CLINICAL TRIALS:
On February 6, 2017, Cellectis received an Investigational New Drug (IND) approval from
the U.S. FDA to conduct Phase 1 clinical trials with UCART123, the Company’s most
advanced, wholly-owned TALEN® gene-edited product candidate, in patients with acute
myeloid leukemia (AML) and blastic plasmacytoid dendritic cell neoplasm (BPDCN).
This marks the first allogeneic, “off-the-shelf” gene-edited CAR T-cell product candidate
that the FDA has approved for clinical trials. Cellectis intends to initiate Phase 1 trials in the
first half of 2017.
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CELL THERAPY MANUFACTURING:
Previously, in June 2014, Cellectis and CELLforCURE, a subsidiary of the
biopharmaceutical group LFB, entered into an agreement for the cGMP manufacturing of
clinical batches of Cellectis’ allogeneic CART cells. Under the agreement, CELLforCURE
is responsible for the manufacturing of cGMP clinical batches for candidates from Cellectis’
UCART product family. The candidates from UCART product family are allogeneic cell
therapy products based on the CAR technology combined with genome engineering.
2.2.6. Cynata Therapeutics (http://cynata.com)
Cynata Therapeutics Limited (ASX: CYP) is an Australian stem cell and regenerative
medicine company that is developing a therapeutic stem cell platform technology originating
from the University of Wisconsin-Madison. Its proprietary Cymerus™ technology addresses
a critical shortcoming in existing methods of production of mesenchymal stem cells (MSCs)
for therapeutic use, which is the ability to achieve economic manufacture at commercial
scale.
The Cymerus™ technology utilizes induced pluripotent stem cells (iPSCs) originating from
an adult donor as the starting material for generating mesenchymoangioblasts (MCAs), and
subsequently, for differentiating the cells into mesenchymal stem cells (MSCs).
The importance of the Cymerus™ technology is that it overcomes major roadblocks that
have traditionally limited the therapeutic use of MSCs, which are donor-to-donor variability
and the sky-high costs of manufacturing MSC products that rely upon multiple stem cell
donors. The Cymerus™ MCA platform provides a source of MSCs that is independent of
donor limitations and provides a potential “off-the-shelf” stem cell platform for therapeutic
product use.
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Importantly, the cost-savings advantages, consistent cellular product, and unlimited
production capacity of the Cymerus™ technology positions Cynata as an attractive partner
for companies pursuing MSC clinical trials.
CELL THERAPY CLINICAL TRIALS:
Cynata Therapeutics is on track to launch the world’s first for allogeneic iPSC-derived cell
therapy. On September 19, 2016, Cynata Therapeutics received approval from the UK
Medicines and Healthcare products Regulatory Agency (MHRA) to proceed with its Phase 1
clinical trial of CYP-001 in patients with steroid-resistant graft-versus-host disease (GvHD).
CELL THERAPY MANUFACTURING:
In November 2015, Cynata hired The Clinical Trial Company Ltd. (TCTC) as the
Contract Research Organization (CRO) for its upcoming Phase I clinical study to investigate
CYP-001 as a treatment for steroid-refractory graft versus host disease (GvHD).
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2.2.7. Cytori - http://www.cytori.com
Cytori Therapeutics, Inc. is a late stage cell therapy company developing autologous cell
therapies from adipose tissue to treat a variety of medical conditions. The company was
created as the result of a 2002 merger between Macropore Biosurgery Inc. (founded in 1996)
and StemSource Inc. (founded in 2000). The joint company operated under the Macropore
name until 2005 when it changed its name to Cytori Therapeutics. Cytori is headquartered in
San Diego, CA, and has operations in Japan and the United Kingdom.
CELL THERAPY CLINICAL TRIALS:
Cytori develops cellular therapeutics formulated for specific diseases and medical
conditions. Clinical development programs are currently targeting impaired hand function in
scleroderma (Phase III clinical), osteoarthritis of the knee (Phase II clinical), and thermal
burn injury (preclinical phase).
Cytori’s cellular therapeutics are collectively known as Cytori Cell TherapyTM, and consist
of different formulations of a heterogeneous population of cells (including stem cells) that
are involved in response to injury, repair and healing. This cell therapy product is prepared
from a patient’s own adipose (fat) tissue using the company’s fully automated Celution®
System that disaggregates adipose tissue and liberates the entrapped stem and regenerative
cells that naturally reside in native adipose. The system formulates a cell therapy product
that is available for delivery to the patient within 1–2 hours of tissue collection.
Cytori’s lead indication is currently in a US phase III, FDA approved, pivotal study, the
STAR TRIAL (ClinicalTrials.gov Identifier: NCT02396238), designed to evaluate one
administration of Cytori’s ECCS-50 in treating impaired hand and finger function from
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scleroderma. The STAR Trial initiated June 2015, completed enrollment of 88 patients in
June 2016 and Cytori anticipates follow up data to be available mid-2017.
The company has also recently completed a US, FDA approved, Phase II study, ACT-OA
TRIAL (ClinicalTrials.gov Identifier: NCT02326961), to examine ECCO-50 safety,
feasibility, and dosing in the treatment for osteoarthritis of the knee. Preliminary data was
released Q2 2016.
CELL THERAPY MANUFACTURING:
Cytori manufactures its own cell products for its cell therapy clinical trials.
However, in August 2007, Cytori Therapeutics did enter into an agreement with Lifeline
Cell Technology, a wholly-owned subsidiary of International Stem Cell Corporation, for the
manufacture of adipose-derived stem cell research products. Lifeline was responsible for
processing and deriving stem cells from adipose tissue provided by Cytori, via a
manufacturing process that yielded batches of frozen vials of stem cells that had been
isolated, purified and expanded from the adipose tissue. The cells were used for research
purposes for studies pertaining to regenerative medicine.
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2.2.8. Astellas Pharma, and Subsidiary Ocata Therapeutics
(https://www.astellas.com/)
Originally established in 1994, Ocata (formerly Advanced Cell Technology until 2014) was
a publicly-traded, biotechnology company. In February 2016, Astellas acquired Ocata for
$379 million and changed its name to Astellas Institute for Regenerative Medicine (AIRM).
Headquartered in Marlborough, Massachusetts and supported by a research team in
Tsukuba, Japan, AIRM is an indirect, wholly owned subsidiary of Astellas and serves as the
Company’s global hub for regenerative medicine and cell therapy research in ophthalmology
and other therapeutic areas. Astellas has prioritized ophthalmology as a new therapeutic area
of research as part of the Company’s strategy for sustainable growth, spearheaded by its
acquisition of Ocata Therapeutics.
Prior to the acquisition, Ocata’s principal laboratory, GMP facility and corporate offices
were also in Marlborough, Massachusetts.
CELL THERAPY CLINICAL TRIALS:
As mentioned, a key goal of AIRM is to develop cell therapies that will address conditions
of the eye, age-related macular degeneration, diabetic retinopathy and retinitis pigmentosa.
Its lead clinical program involves retinal pigment epithelium (RPE) cell therapy for treating
macular degeneration.
The company has four key programs developing cell therapy products for the eye, which
include:
1. RPE Cell Therapy - The company is conducting clinical trials in the U.S. and U.K.
for treating Stargardt’s macular degeneration with the RPE Cell Therapy, and in the
U.S. for treating patients with dry age-related macular degeneration. In September
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2015, Ocata announced that the first patient has been enrolled in its Phase 2 clinical
trial using its proprietary RPE cells in patients with dry age-related macular
degeneration (AMD). The purpose of the trial was to evaluate safety and explore
efficacy as compared to a parallel control group.
2. Photoreceptor Progenitor Cell Therapy - It is developing a Photoreceptor
Progenitor Cell Therapy which it intends to be used for treating a wide variety of
retinal degenerations in diseases where photoreceptors malfunction or die.
3. Ganglion Progenitor Cell Therapy - Its Ganglion Progenitor Cell Therapy is a
preclinical candidate program. In animal models of glaucoma, the injection of these
cells protects against damage of existing nerve cells as well as forms new ganglion
nerve cells.
4. Corneal Endothelial Cells - The company is also developing therapeutic platforms
using Corneal Endothelial Cells for use in treating corneal blindness.
CELL THERAPY MANUFACTURING:
In December 2010, Ocata Therapeutics (at the time called “Advanced Cell Technology”),
entered into a Memorandum of Understanding with Roslin Cells Ltd. to work together to
establish a bank of GMP-grade human embryonic stem cell (hESC) lines using ACT’s
proprietary “single-ceblastomere” technique for deriving embryonic stem cells without
damage to the embryo. The collaboration provide for hESC lines to be created and stored
using protocols that meet the regulatory standards of the EMA and FDA.
Althought Ocata/ACT established this early relationship with Roslin Cells, it did not engage
Roslin Cells Therapies for production of its clinical-grade products entering clinical trials.
Instead, Ocata Therapeutics, now part of Astellas Institute for Regenerative Medicine
(AIRM), does its own cell therapy manufacturing at its GMP laboratory in Marlborough,
MA.
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2.2.9. GAMIDA CELL (http://www.gamida-cell.com)
Founded in 1998 and headquartered in Jerusalem, Israel, Gamida Cell Ltd. is a leader in
cellular and immune therapy. The company develops novel curative treatments for orphan
hematological diseases and malignancies using stem cells and NK cells. Gamida Cell’s
therapeutic products are allogeneic and do not involve genetic manipulation.
For cell therapy manufacturing, Gamida Cell utilizes its proprietary platform NAM
technology for robust, cost-effective, and efficient commercial production. Gamida Cell’s
NAM technology lets it manufacture a large number of cells, while preserving and even
enhancing their functionality. One of the biggest challenges in developing cell-based
products is manufacturing a large number of cells without having the cells lose functionality.
One of the strengths of Gamida Cell’s NAM technology is that it not only preserves, but
enhances, the functionality of expanded cells.
Gamida Cell’s technologies and products are protected by worldwide patents and numerous
patent applications. Gamida Cell owns all worldwide rights to all products in development
and is supported by a group of investors including: Novartis, Elbit Imaging, Clal
Biotechnologies Industries, Israel Healthcare Venture, Teva Pharmaceutical Industries,
Denali Ventures and Auriga Ventures.
At its core, Gamida Cell is both a cell therapy company and a company with extensive stem
cell manufacturing expertise.
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CELL THERAPY CLINICAL TRIALS:
The company’s flagship product Nicord® is a novel graft modality for bone marrow
transplantation for patients with high risk leukemia and lymphoma. NiCord can be available
to all patients without the need for full tissue matching, and has the potential to double the
number of patients treated. Gamida Cell will soon begin an international, registration,
randomized-controlled, Phase 3 clinical trial of NiCord.
Based on positive clinical data from the pilot and Phase 1/2 studies and because it can be
rapidly available to all patients in need, NiCord could become the graft of choice for blood
cancer patients indicated for bone marrow transplantation, but who have no sibling fully
matched donor. NiCord also presents pharmacoeconomic advantages such as shorter
hospital stays and improved resource utilization in treating the patients. These create
incentives to hospitals and payers to use NiCord. Gamida Cell’s other pipeline products in
development include CordIn and an NK cell product.
CordIn® is in development as a curative treatment for a variety of non-malignant orphan
diseases. CordIn is being studied in a Phase 1/2 clinical trial for patients with sickle cell
disease or thalassemia. A Phase 1/2 study of CordIn as a treatment for aplastic anemia
will also commence soon. Gamida Cell’s NK cell product is an experimental immune
therapy for the treatment of blood cancers refractory to chemotherapy. Phase 1/2 clinical
trials are planned to begin in early 2017.
CELL THERAPY MANUFACTURING:
Gamida Cell is a cell therapy manufacturing powerhouse with extensive expertise in stem
cell production and expansion within large volume bioreactors. Due to this expertise and
GMP compliant manufacturing facilities, Gamida Cell manufactures its own cell therapy
products.
As shared by Gamida Cell’s CEO, Dr. Yael Margolin, “Gamida Cell was founded in 1998
and now has almost 20 years of experience with taking a product from an early-stage
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technology in a lab and growing into a manufacturing process that is robust under GMP
conditions and cost effective to manufacture.”5
5 Phone Interview with Dr. Yael Margolin, CEO of Gamida Cell. Interview conducted by BioInformant’s President/CEO, Cade Hildreth on
September 1, 2016. Available at: https://www.bioinformant.com/gamida-cell-yael-margolin-ceo/.
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2.2.10. Pluristem (http://www.pluristem.com)
Pluristem Therapeutics is an Israeli company engaged in the development of
human placental adherent stromal cells for commercial use in disease treatment. Pluristem is
in the process of clinically testing the use of its PLX (PLacental eXpanded) cells to
treat peripheral arterial disease (PAD).
Early in its development as a company, Pluristem identified the need to develop a tightly
controlled, completely automated, efficient and scalable cell manufacturing technology in
order to produce high quality cell therapy products on a commercial scale. Therefore, it
developed a proprietary bioreactor system which provides a 3D micro-environment for cells
that resembles the environment in the human body, allowing Pluristem’s cells to expand
rapidly and remain healthy and potent as conditions within the bioreactors are altered to
transform the cells into unique, patented cell therapy products.
Pluristem’s advanced manufacturing technology can generate cell products on a mass scale
with batch-to-batch consistency, making them true commercial products.
Using this bioreactor technology, Pluristem’s goal is to provide patients and doctors
worldwide with standardized, easy to use, and highly effective PLX cell products that need
no genetic or tissue matching prior to administration. Part of its clinical development
strategy has been to achieve product approval through rapid regulatory pathways wherever
possible. So far, its clinical development program for PLX-PAD in Critical Limb Ischemia
(CLI) is progressing via advanced regulatory opportunities in Europe and Japan.
Pluristem also intends to partner with pharmaceutical companies to complete regulatory
approval and marketing of PLX-PAD in CLI in the U.S., Europe and Japan, and anticipate
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building on the significant results of its successful Phase II trial in muscle injury to advance
development of PLX-PAD for an orthopedic indication in collaboration with a partner.
Finally, PLX-R18 is in development for Acute Radiation Syndrome, in collaboration and
with the support of the U.S. National Institutes of Health’s National Institute of Allergy and
Infectious Diseases (NIAID). Pending successful completion of a dose selection trial and a
pivotal trial by the NIAID, and approval by the FDA, it intends to commercialize this
product independently for this indication.
CELL THERAPY CLINICAL TRIALS:
In April 2012, Pluristem announced that the U.S. FDA authorized Phase II clinical trials for
its PLX-PAD treatment appertaining to intermittent claudication. On October 27, 2014, it
was reported that Case Western Reserve University would conduct a preclinical study of
PLX-RAD cells in umbilical cord blood transplants for the treatment of blood cancers and
genetic diseases. The USFDA has conferred orphan drug status on Pluristem's PLX cells for
the treatment of Buerger's disease (2011) and aplastic anemia (2013).
In January 2016, the U.S. FDA gave Pluristem Therapeutics approval to proceed with its
treatment for hematopoietic disorders, allowing it to begin its Phase I trial of PLX-R18 cells
to treat incomplete hematopoietic recovery following hematopoietic stem cell
transplantation (HSCT). Later in 2016, Pluristem announced it had partnered with Japan's
Fukushima Medical University to test its placental-derived cellular therapy for radiation
treatment and has been asked to join the United States National Institute of Allergy and
Infectious Diseases program.
CELL THERAPY MANUFACTURING:
Similar to Gamida Cell, Pluristem is a cell therapy manufacturing powerhouse with
extensive in-house expertise. In July 2011, Pluristem Therapeutics Inc. announced that its
wholly owned Israeli subsidiary, Pluristem Ltd., entered into an agreement with MTM-
Scientific Industries Center Haifa Ltd., for the leasing and construction of a new state-of-
the-art GMP manufacturing facility.
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The facility is located near Pluristem’s headquarters and existing facilities in MATAM Park,
Haifa, Israel and supports the manufacturing of Pluristem's PLX (PLacental eXpanded) cell
product candidates.
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3. Approved Cell Therapy Products
When assessing the market for cell therapy manufacturing, it is important to consider cell
therapy products that have made it to market. While there are thousands of cell therapy products
being explored in clinical trials worldwide, only a few have received regulatory approval.
This list includes cell therapy products that have been reviewed and approved by
internationally-recognized regulatory agencies, as well as products brought to market in
the U.S. with FDA approval.
3.1. Apligraf (Organogenesis, Inc. & Novartis AG)
Apligraf is a bioengineered allogeneic skin substitute and wound healing product used to treat
venous leg ulcers and diabetic foot ulcers. Apligraf was developed by Organogenesis, which
was founded in 1985 as a spinoff from the Massachuetts Institute of Technology. Appligraf
received FDA approval for the treatment of venous leg ulcers in 1998 and for the approval of
diabetic foot ulcers in 2000.
Although Apligraf continues to be developed by Organogenesis, the company’s path and
product’s finances have not been smooth. Organogenesis went public in 1986, partnered with
Novartis, and ultimately filed for bankruptcy protection in 2002. These financial troubles
arose in part from the high production costs of Apligraf. Ultimately Organogenesis rebuffed
multiple takover offers, emerged from bankrupcy as a private company, and grew Apligraf
into a successful product over the next decade.
Apligraf has been used in more than 250,000 patients.6
Apligraf is supplied as a circular disk approximately 7.5 cm in diameter and is intended for
single-use. Depending on the wound size, the cost of Apligraf is $1,500 to $2,500 per use7.
6 Apligraf, Company Homepage. Available at: http://www.apligraf.com. Accessed February 1 2017. 7 "Apligraf, Payment Rate Sheet. Available at: http://www.apligraf.com/professional/pdf/PaymentRateSheetHospitalOutpatient.pdf. Accessed February 17, 2017.
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According the Fetterolf, et al., the average cost per use is $1,806.8 It has qualified for
insurance reimbursement, with 2017 Medicare and Medicaid Service rates shown in the table
on the next page.
Source: Apligraf, Payment Rate Sheet. Avaialble at:
http://www.apligraf.com/professional/pdf/PaymentRateSheetHospitalOutpatient.pdf. [Accessed April 1, 2017.]
Unfortunately, Apligraf’s commercial success has been challenged recently by reimbursement
changes announced in 2013 and implemented in 2014 by the Center for Medicare and
Medicaid Services (CMS), the federal agency that sets reimbursement levels for federally
funded healthcare and guides reimbursement decisions made by private insurers. This
reduction in reimbursement levels forced Organogenesis to restructure its Apligraf business,
and as of January 2014, the company had laid off more than 25% of its employees.
The ability of Apligraf and similar cell-based wound healing projects, such as Dermagraft, to
survive under this new reimbursement regime remains unknown. On the upside, Apligraf is
still available commercially and insurance coverage exists, albeit at substantially lower levels.
8 Fetterolf, et al. “An Evaluation of Healing Metrics Associated with Commonly Used Advanced Wound Care Products for the Treatment of
Chronic Diabetic Foot Ulcers.” Available at:
http://www.mimedx.com/sites/default/files/posters/23%20EP291.001%20Fetterolf%20SAWC%20Fall%202014%20Poster.pdf. Accessed Feb 17, 2017.
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3.2. Carticel (Genzyme)
Carticel is an autologous cellular product indicated for the treatment of knee cartilage defects
in patients who have not responded well to previous surgical repairs. The treatment involves
two minor surgical procedures – the first to retrieve a tissue biopsy and the second, following
cell processing, to insert the transplant. Autologous chrondocyte transplantation was
pioneered in Sweden in the late 1980s and early 1990s and the technology was
commercialized by Genzyme in the United States.
The regulatory approval process for Carticel was atypical, but quick. Genzyme first
provisionally marketed Carticel in the United States as an unregulated device in early 1995,
before FDA regulations for autologous cell therapies were finalized. Later in 1995, the FDA
informed Genzyme that it would not regulate Carticel at that time. The FDA later reversed
this decision and Genzyme responded by filing a biologics license application with the FDA
for Carticel in 1996.
Genzyme received accelerated approval under FDA’s new cell therapy guidelines in 1997.
This approval relied on existing patient registry data, rather than a clinical trial and required
that Genzyme conduct follow-up studies, including a double-blind, placebo-controlled trial to
assess Carticel’s efficacy. As of 2007, Genzyme reported that more than 13,000 patients had
received Carticel implants in the United States.
Carticel has followed the same acquisition pattern as Epicel. Following its initial
commercialization by Genzyme, it was produced by Sanofi from February 2011 to April 2014
and then sold to Aastrom in 2014. Aastrom was renamed Vericel in November 2014, and
Vericel currently produces and markets Carticel. enzyme reports that the price of the Carticel
graft and procedure is between $17,000 and $38,000.9
9 "CARTICEL® (Autologous Chondrocyte Implantation, Or ACI)". www.PainScience.com. N.p., 2017. Web. 25 Feb. 2017.
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3.3. Cartistem (MEDIPOST)
CARTISTEM® is an allogeneic stem cell based treatment that is available in South Korea by
Dong-A Pharmaceuticals Co., Ltd. It has been approved by the Korean FDA (KFDA) and has
also received U.S. FDA clearance to conduct Phase I/IIa clinical trials in the United States.
Cartistem is a stem cell product that adds an additional step to microfracture, a longstanding
but relatively effective method for treating cartilage defects. It is indicated for the treatment of
articular cartilage defects of the knee caused by degenerative disease or repeated trauma in
osteoarthritic patients and is administered to defect sites surgically or arthroscopically.
It contains mesenchymal stem cells obtained from umbilical cord blood, which have the
unique characteristic of not provoking an immune response when administered into another
individual. Its prescribed dosage is 2.5 x 106 cells/500㎕/cm2 (based on cartilage defect size).
Cartistem is an expensive treatment that is not yet covered by insurance companies. Pricing is
approximately USD $19,000-21,000 (19,000,000-21,000,000 KRW) for the standard
treatment and an additional $10,000 for every extra treatment that is required on a patient-by-
patient basis. This price is only for one knee and does not include the hospital stay of about
one week that is required, airplane tickets, or anything else that might come up.
The Cartistem procedure is only available in South Korea.
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3.4. ChrondoCelect (TiGenix NV)
ChondroCelect is a suspension for implantation that contains cartilage cells. It is a type of
advanced therapy medicine called a “tissue engineered product.” This is a type of medicine
containing cells or tissues that have been manipulated so that they can be used to repair,
regenerate or replace tissue. It is used in adults to repair damage to the cartilage in the knee
when there is a single defect in the cartilage of the femoral condyle that is causing symptoms.
ChondroCelect is an autologous treatment that must be administered by a qualified surgeon in
a hospital. First, a biopsy is taken from the patient’s cartilage in the knee. The cartilage cells
are then grown and expanded in the laboratory to provide enough cells to make up a
suspension of cells that can be used to treat the cartilage defect. During surgery on the knee,
the suspension is placed into the defect in the patient’s cartilage. A biological membrane is
then used as a seal to keep the cells in place while the cartilage repairs.
The European Commission granted a marketing authorization valid throughout the European
Union for ChondroCelect on October 2009, and the product entered the commercial market in
2011. Because ChondroCelect is an advanced therapy medicine, it was assessed by the
Committee for Advanced Therapies (CAT). Based on the assessment performed by the CAT,
the CHMP decided that ChondroCelect’s benefits are greater than its risks and recommended
that it be given marketing authorization. The CHMP considered that ChondroCelect was
shown to be effective at treating defects in the knee cartilage between 1 and 5 cm2 in size, and
that the safety profile was acceptable. However, knowledge on the long-term effect of the
medicine is limited. During its marketing approval, the medicine could only be obtained with
a prescription.
While it was on the market, ChondroCelect was priced at approximately €20,000.10
In April 2014, TiGenix sold license the marketing and distribution rights of ChondroCelect to
to the international specialty healthcare company, Swedish Orphan Biovitrum AB (Sobi).
Unfortunately, reimbursement of Chondrocelect was declined in several key countries, and in
10 Bravery, Christopher. “Are Biosimilar Cell Therapy Products Possible?” Available at: http://advbiols.com/documents/Bravery-
AreBiosimilarCellTherapiesPossible.pdf. Accessed Feb 9, 2017.
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July 2016, Sobi came to an agreement with TiGenix for the early termination of their existing
commercial relationships that returned the distribution rights for ChondroCelect to TiGenix.
TiGenix subsequently withdraw the product from the market as of November 30, 2016.
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3.5. Cupistem (Anterogen)
Cupistem is an autologous adipose derived mesenchymal stem cell treatment to treat anal
fistula in Crohn’s disease. The fistulous opening closed completely for 27 of the 33 patients
who were injected with Cupistem in a clinical trial. About 10,000 to 15,000 patients suffer
from Crohn’s disease in Korea. About 20 to 40% develop the Crohn’s anal fistula
complication.
It was approved for marketing by South Korea’s Food and Drug Administration in July 2012.
Medipost’s Cartistem and Anterogen’s Cupistem were the world’s second and third
authorized stem cell procedures. The first came in July 2011 when FCB-Pharmicell’s
Hearticellgram-AMI won approval from the KFDA to become the world’s first stem cell
treatment for heart attack victims. S. Korea officially embraced stem-cell therapy as an
important future industry when President Lee Myung-bak pledged a series of regulatory
reforms to ease clinical and licensing requirements and an investment of about 100 billion
won ($89 million) in stem cell research in 2012 alone.
Pricing for Cupistem is approximately USD $3,000-5,000 per treatment. The product is not
yet covered by insurance and must be paid out-of-pocket by the patient.
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3.6. Dermagraft (Advanced Tissue Sciences)
Dermagraft is a skin substitute consisting of allogeneic cells, an extracellular matrix, and a
bioabsorbable mesh scaffold that is indicated to help improve closure of diabetic foot ulcers.
The product was first commercialized by Marrow-Tech, which was founded in 1986. The
company was founded in the New York suburbs as a spinoff of work at the New York
University Medical Center and Hunter College School of Health Sciences, but later moved to
San Diego and was renamed Advanced Tissue Sciences.
Through the 1990s, Advanced Tissues Sciences invested more than $300 million to develop
Dermagraf. In 1996, the company formed a marketing partnership with Smith & Nephew. In
late 2001, Advanced Tissue Sciences received approval to market Dermagraft for the
treatment of diabetic foot ulcers from the FDA.
Despite this success, Advanced Tissue Sciences was unable to turn Dermagraft into a
commercially successful product and filed for bankruptcy in 2002.
Following this bankruptcy, control of
Dermagraft was transferred to Smith
& Nephew, which attempted to
commercialize the therapy itself,
before selling Dermagraft to
Advanced BioHealing in 200.
Advanced BioHealing benefitted from
an improved reimbursement environment and turned Dermagraft into a successful product
before Advanced BioHealing itself was bought by Shire for $750 million in 2012.
Shire had hoped to make Dermagraft a key part of its new focus on regenerative medicine,
but, following the reimbursement change discussed above, sold the product to Organogenesis
for up to $300 million. Shire did not receive any upfront payment as part of this sale and will
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only receive payment if Dermagraft sales meet certain targets by 2018. The firm recorded a
$650 million loss on the product it had purchased only three years earlier.
Dermagraft has received insurance reimbursement, and the average price per application is
approximately $1,700.11 Dermagraft is only available with a prescription.
11 Fetterolf, et al. “An Evaluation of Healing Metrics Associated with Commonly Used Advanced Wound Care Products for the Treatment of
Chronic Diabetic Foot Ulcers.” Available at:
http://www.mimedx.com/sites/default/files/posters/23%20EP291.001%20Fetterolf%20SAWC%20Fall%202014%20Poster.pdf. Accessed Feb 17, 2017.
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3.7. Epicel (Vericel)
Epicel is a skin graft grown from a small biopsy of the patient’s healthy skin that can provide
skin replacement for patients with deep dermal or full thickness burns. The product grew out
of the work of James Rheinwald and Howard Green, who demonstrated in 1975 that human
epidermal keratinocytes could be isolated and serially cultured in vitro in their lab at the
Massachusetts Institute of Technology. This work with epidermal cells led to the creation of
an autologous cultured skin graft. By 1980, two patients with third degree burns had received
this skin replacement therapy. In mid 1983, the therapy was successfully applied on two boys
who had burns over 97% of their bodies. The resources necessary to produce this cell therapy
for human application were beyond the capacity of a university lab, so Dr. Green founded the
company Biosurface Technology for skin graft production in 1986.
Biosurface Technology developed and commercialized this skin graft technology under the trade
name Epicel in the mid-1980s to treat severe burn victims, and in 1988, Epicel became the first
cell-based product for tissue repair commercialized in the USA. In 1994, Genzyme acquired
Biosurface Technology. Epicel was developed prior to the development of FDA regulation on cell
therapies; therefore from 1988 to 1997, Epicel was used as an ‘unregulated device’.
In 1998, the FDA first designated Epicel as a medical device and then, later the same year, as
a humanitarian use device. In 1999, Genzyme submitted a humanitarian device exemption
application to the FDA and in 2007, FDA approved this application, granting Epicel market
access without requiring clinical trial data demonstrating effectiveness.
Genzyme continued to produce Epicel until February 2011, when Sanofi bought Genzyme for more
than $20 billion. In April 2014, Aastrom bought Sanofi’s cell therapy and regenerative medicine
portfolio and manufacturing centers for $6.5 million. Aastrom which was renamed Vericel in
November 2014, continues to produce Epicel and market this product worldwide.
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The cost of the Epicel procedure can range from $6,000 to $10,000 per 1% total body surface area.12
12 Sarah Schlatter, “Epicel Skin Grafts.” Biomedical Engineering, University of Rhode Island. Available at:
http://www.ele.uri.edu/Courses/bme281/F08/Sarah_1.pdf. Accessed Feb 6, 2017.
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3.8. Hearticellgram-AMI (FCB Pharmicell)
On July 2011, Pharmicell received NDA approval from the Korean Food and Drug
Administration (KFDA) for Hearticellgram-AMI. Hearticellgram-AMI is an autologous bone-
marrow derived mesenchymal stem cell (MSC) therapy prepared using bone marrow blood
extracted from the patient.
Stem cell replacement and muscle regeneration strategies for repairing the damaged heart
offer new hope to patients suffering from serious cardiovascular disease. In the United States,
congestive heart failure afflicts 4.8 million people, with 400,000 new cases each year.
Hearticellgram-AMI takes somatic stem cells extracted from the patient's own bone marrow
that are then cultured and directly injected into the damaged heart. The autologous stem cell
medication, if injected into coronary arteries, helps the damaged cells regenerate and recover
function.
In the company's clinical trials conducted from 2005 to 2011, patients showed a near 6%
improvement in heart function six months after one dose of the injection. Hearticellgram-AMI
costs approximately USD $19,000 per surgical operation.
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3.9. Holoclar (Chiesi Farmaceutici)
In February 2015, the European Commission granted a conditional marketing authorization,
under Regulation (EC) No 726/2004, to Holoclar®, an advanced therapy based on autologous
stem cells and capable to restore the eyesight of patients with severe cornea damage.
Holoclar® is manufactured by Holostem Terapie Avanzate (Holostem Advanced Therapies),
a spin-off of the University of Modena and Reggio Emilia, at the Centre for Regenerative
Medicine “Stefano Ferrari” (CMR) of the same University.
Holoclar® was the result of more than twenty years of research conducted by a team of
renowned scientists in the field of epithelial stem cell biology aimed at clinical translation.
European Directive 1394/2007 substantially equalizes advanced cell therapies to medicines
and imposes that cell cultures have to be manufactured exclusively in GMP-certified facilities.
Thanks to the investments of Chiesi Farmaceutici, the Centre for Regenerative Medicine in
Modena certified as GMP compliant for Holostem production.
This therapy was experimentally applied for the first time in humans in the 1990’s, designated
as orphan drug in 2008, granted a conditional marketing authorization in 2016, and obtained
final registration in 2016. It is now available to European patients who have suffered cornea
damage due to burning. Because of the approval was recently granted, the commercial success
of this product it not yet known.
What is known is that only around 1,000 people annually Europe will be eligible, burns
victims who have become blind, but whose eyes have not been too extensively destroyed.
Pricing for Holoclar has not been disclosed.
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3.10. Osteocel (NuVasive)
Osteocel, now produced and marketed by NuVasive, is a cellular bone allograft that is
intended for the repair, replacement, and reconstruction of skeletal defects and used primarily
as an alternative to autografts – the use of the patient’s own bone – as part of spinal fusion
surgery. Osteocel was originally developed by Osiris Therapeutics and was launched
commercially in the United States in 2005. It was the first commercial product in the United
States containing allogeneic mesenchymal stem cells. Because the product was classified as a
tissue transplant rather than a drug under FDA rules, it did not require pre-market approval
from the agency.
Starting in 2005, Blackstone Medical licensed Osteocel from Osiris and distributed it under
the trade name Trinity, while Osiris distributed the product under the Osteocel name. In 2006,
Orthofix bought Blackstone Medical for $333 million, giving it access to the Osteocel
product, which it continued to market under the Trinity label.
This situation continued until 2008 when Osiris sold licensing rights to Osteocel to NuVasive
for $35 million in upfront payments as part of a deal worth up to $137 million. Orthofix was
unsuccessful in its legal efforts to block this transaction and ultimately lost its ability to sell
the product. As of early 2015, NuVasive continues to market Osteocel and indicates that
Osteocel grafts have been used in more than 140,000 patients since 2005. The price for
Osteocel is approximately $650 per cc.13
13 "Osteocel: Eliminate Need For An Autograft Due To Unique Properties? | Osseonews". Osseonews.com. N.p., 2017. Web. 25 Feb. 2017.
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3.11. Prochymal (Mesoblast)
Prochymal, originally developed by Osiris Therapeutics, is a human mesenchymal stem cell
product formulated for intravenous infusion. Osiris was founded in 1992 in Cleveland to
commercialize research on human mesenchymal stem cells led by Arnold Caplan (the
“Grandfather of MSCs”) at Case Western Reserve University. The company later moved to
Baltimore in 1995 and moved Prochymal into clinical trials for a variety of indications
including graft vs. host disease (GvHD), Crohn’s Disease, chronic obstructive pulmonary
disorder, diabetes and cardiac repair. Despite promising preclinical data, Osiris struggled to
successfully bring Prochymal to market.
Prochymals clinical results to date have been discouraging. For example, in 2009 the
company warned with respect to its Phase 2 trial of Prochymal in chronic obstructive
pulmonary disease, "Pulmonary function in patients receiving Prochymal was not
significantly improved compared to those receiving placebo." Similarly, regarding its Phase 2
trial of Prochymal for diabetes, in January, 2012 the company announced that "No significant
differences in the rates of disease progression, as measured by stimulated C-peptide levels at
the one year time point, have been observed" when comparing diabetics treated with
Prochymal to those receiving placebo.
In its ongoing heart attack trial, it made no mention of patients’ responses to Prochymal as
reflected by the parameters the trial was employing as measures of success or failure (left
ventricular end systolic volume, eft ventricular ejection fraction, and infarct size).
Thankfully, Isiris did have success with the use of Prochymal for GvHD. Osiris received
approval to offer Prochymal to a subset of patients with acute GvHD in 2005 under the FDA’s
compassionate use program. The company also received approval to market Prochymal in
Canada and New Zealand for the treatment of acute GvHD in 2012, based on a subset of data
from a larger clinical trial. Canadian regulators indicated that the efficacy data was not
conclusive and required Osiris to conduct a follow-up trial within five years. The price tag for
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Prochymal is high at $200,000 for a single course of treatment, but its patient population is
concerningly small. For example, Health Canada estimates the incidence of pediatric aGvHD
in Canada at just fifty cases annually.14
Osiris funded its twenty-year quest to bring Prochymal to market through a variety of
approaches, including venture funding, partnerships with larger pharmaceutical companies
(including Novartis and Genzyme), a contract with the U.S. Department of Defense, and, in
2006, an initial public offering. In 2013, Osiris sold Prochymal to Mesoblast for up to $100
million. As of early 2015, Mesoblast is continuing efforts to commercialize Prochymal for
GvHD and Crohn’s Disease in both the US and, through a partnership with JCR
Pharmaceuticals, the Japanese market.
14 LLC, Busa. "Counting Coup: Is Osiris Losing Faith In Prochymal? | SCSI Stem Cell Stock Index". Busaconsultingllc.com. N.p., 2017. Web.
24 Feb. 2017.
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3.12. Provenge (Dendreon / Valeant)
Provenge is approved by the U.S. FDA as an autologous cellular immunotherapy for the
treatment of advanced prostate cancer. The treatment involves taking white blood cells from
the patient’s body, processing them in vitro to more actively attack cancer cells and then
transferring them back to the patient. The commercialization of Provenge dates to 1992 when
Activated Cell Therapy was spun out of Stanford University. By 1995, the company had been
renamed Dendreon and new leadership pushed Provenge into clinical trials.
Dendreon continued to develop Provenge throughout the 1990s and early 2000s. Promising
clinical trial data followed, but Provenge had a difficult road to FDA approval. In 2007, a
FDA advisory panel recommended its approval, but in an unusual and controversial move, the
agency ignored its advisory panel’s advice and required Dendreon to provide additional
evidence about the treatment. Three years later, in 2010, the FDA approved Provenge under
Section 351 of the Public Health Safety Act. This marked the first time a so-called “cancer
vaccine” had been approved and, although Provenge offered only modest survival benefits, its
approval was hailed as a major advance that might open the door to other therapies that
harness the immune system to fight cancer.
Provenge was hailed as breakthrough for the cell therapy industry, but ultimately a
combination of manufacturing and marketing challenges, combined with the emergence of
more affordable and less complicated competition led it to underperform expectations.
Dendreon filed for bankruptcy in late 2014 and Dendreon’s assets (including Provenge) were
purchased by Valeant Pharmaceuticals for $495 million in February 2015. The extent to
which Valeant can turn Provenge into a commercial success remains an open question, but the
company is expected to focus its efforts on cutting production costs and improving marketing
to physicians. Provenge is priced at approximately $93,000 per treatment.15
15 "Dendreon: Provenge To Cost $93K For Full Course Of Treatment | Fiercebiotech". Fiercebiotech.com. N.p., 2017. Web. 25 Feb. 2017.
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3.13. Strimvelis (GSK)
Strimvelis is the first ex-vivo stem cell gene therapy to treat patients with a very rare disease
called ADA-SCID (Severe Combined Immunodeficiency due to Adenosine Deaminase
deficiency), a rare disorder caused by the absence of an essential protein called adenosine
deaminase (ADA), which is required for the production of lymphocytes. Children born with
ADA-SCID do not develop a healthy immune system, which results in severe and life-
threatening illness. Without prompt treatment, the disorder often proves fatal within the
child’s first year of life. ADA-SCID is estimated to occur in approximately 15 patients per
year in Europe.
The treatment was initially developed at San Raffaele Telethon Institute for Gene Therapy
(SR-Tiget) and developed by GlaxoSmithKline (GSK) through a strategic collaboration
formed in 2010 with Fondazione Telethon and Ospedale San Raffaele (OSR). Within the
collaboration with GSK, working with the biotechnology company MolMed S.p.A, has
applied its expertise in product development to optimize, standardize and characterize a
manufacturing process that was previously only suitable for clinical trials into one that was
demonstrated to be robust and suitable for commercial supply.
In April 2016, a committee at the European Medicines Agency recommended marketing
approval for its use in children with adenosine deaminase deficiency, for whom no matched
HSC donor is available, on the basis of a clinical trial that produced a 100% survival rate; the
median follow-up time was 7 years after the treatment was administered. 75% of people who
received the treatment needed no further enzyme replacement therapy.
Strimvelis was approved by the European Commission by May 2016. As of now, the only site
approved to manufacture the treatment is MolMed.
Interestingly, GSK offers a one-time treatment with Strimvelis backed by a money-back
guarantee. Priced at 594,000 euros ($665,000), it is among the most expensive therapies in the
world. However, it is also a cure for severe immunodeficiency stemming from a lack of
adenosine deaminase (ADA-SCID), rather than an ongoing treatment as other rare disease
drugs are.
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3.14. TEMCELL (JCR Pharmaceuticals Co. Ltd., Licensee of Mesoblast
Ltd.)
In February 2016, Mesoblast Limited announced that its licensee in Japan, JCR
Pharmaceuticals Co. Ltd., launched its mesenchymal stem cell product TEMCELL® HS Inj.,
for the treatment of acute graft versus host disease (aGVHD) in children and adults in Japan.
TEMCELL is the first allogeneic cell therapy to be fully approved in Japan.
The Japanese Government’s National Health Insurance set reimbursement for TEMCELL at
¥868,680 (approximately US$7,700) per bag of 72 million cells. In Japan, the average adult
patient is expected to receive at least 16 or up to 24 bags of 72 million cells.
On this basis, Mesoblast expects a treatment course of TEMCELL in an adult Japanese patient
to be reimbursed at a minimum of ¥13,898,880 (approximately US$123,000) or up to
¥20,848,320 (approximately US$185,000).
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4. Pricing Analysis – Why is the Price for Cell Therapy Products So
High?
This section analyses pricing of cell therapy products. Major reasons for high prices of cell
therapy products are highlighted as an introduction to discussion on reimbursement and
widespread clinical adoption. Compared to pharmaceutical drugs, prices for cell therapy products
are much higher.
4.1. Pricing of Approved Cell Therapy Products
The topic of pricing cell therapies is a heated one, because the price tags for the most
approved cell therapy products are high and there is no one simple solution to address their
reimbursement and adoption.
While the world’s most expensive drug is not a cell therapy, it is a gene therapy drug
(Glybera). At the time of its launch, Glybera captured a lot of attention, because it was the
first gene therapy approved in the Western world, launching for sale in Germany at a cost
close to $1 million per treatment.16 The record-breaking price tag got revealed in November
2014, when Uniqure and its marketing partner Chiesi, filed a pricing dossier with German
authorities to launch Glybera. Clearly, this announcement inspired a lot of pricing and
reimbursement discussion among professionals, pertaining to both cell and gene therapies.
On the next page, price tags are shown for the approved cell therapy products that have
reached the market (prices in USD $) and for which there is standardized market pricing.
16 $1-Million Price Tag Set For Glybera Gene Therapy : Trade Secrets". Available at http://blogs.nature.com/tradesecrets/2015/03/03/1-million-
price-tag-set-for-glybera-gene-therapy. Web. 21 Feb. 2017.
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TABLE. Pricing of Approved Cell Therapy Products
Apligraf (Organogenesis & Novartis AG) in USA = $1,500-2,500 per use 17
Carticel (Genzyme) in USA = $15,000 to $35,000 18
Cartistem (MEDIPOST) in S. Korea = $19,000-21,000 19,20
Cupistem (Anterogen) in S. Korea = $3,000-5,000 per treatment 21
ChondroCelect (Tigenix) in Europe ~ $24,000 (20,000 euros) 22,23
Dermagraft (Advanced Tissue Science) in USA = $1,700 per application 24,25
Epicel (Vericel) in USA = $6,000-10,000 per 1% of total body surface area 26
Hearticellgram (FCB-Pharmicell) in S. Korea = $19,000 27
Holoclar (Chiesi Framaceutici) in EU = Unknown (very small patient population)
Osteocel (NuVasive) in USA = $600 per cc 28,29
Prochymal (Osiris Therapeutics/ Mesoblast) in Canada = ~ $200,000 30,31
Provenge (Dendreon/ Valeant Pharma) in US = $93,000 32,33
Strimvelis (GSK) = $665,000 (One of world’s most expensive therapies) 34,35
Temcell (JCR Pharmaceutical) in Japan = $115,000-170,000 36,37 - Pricing is $7,600
(868,680 ¥) per bag, with one bag of 72m cells administered twice weekly and 2m
cells/kg of body weight required per administration.38
17 2017 Apligraf ® Medicare Product and Related Procedure Payment, Organogenesis. Available at:
http://www.apligraf.com/professional/pdf/PaymentRateSheetHospitalOutpatient.pdf. Web. 3 Mar. 2017. 18 "CARTICEL® (Autologous Chondrocyte Implantation, Or ACI)". Available at: https://www.painscience.com/articles/cartilage-repair-with-carticel-review.php.
Web. 3 Mar. 2017. 19 Cartistem?, What. "What Is The Cost Of Cartistem?". Available at: http://www.stemcellsfreak.com/2015/01/cartistem-price.html. N.p., 2017. Web. 3 Mar. 2017. 20 "Cartistem". Kneeguru.co.uk. Available at: http://www.kneeguru.co.uk/KNEEtalk/index.php?topic=59438.0. Web. 3 Mar. 2017. 21 Stem Art, Stem Cell Therapy Pricing. Available at: http://www.stem-art.com/Library/Miscellaneous/SCT%20products%20%20Sheet%201.pdf. Web. 3 Mar. 2017. 22 Are Biosimilar Cell Therapy Products Possible? Presentation by Christopher A Bravery (PDF). Available at: http://advbiols.com/documents/Bravery-
AreBiosimilarCellTherapiesPossible.pdf. Web. 3 Mar. 2017. 23 "Why Price For Cell/ Gene Therapy Products Is So High?". Available at: celltrials.info/2016/09/06/pricing/. Web. 3 Mar. 2017. 24 Artificial Skin, Presentation by Nouaying Kue (BME 281). Available at: www.ele.uri.edu/Courses/bme281/F12/NouayingK_1.ppt. Web. 3 Mar. 2017. 25 Allenet, et al. “Cost-effectiveness modeling of Dermagraft for the treatment of diabetic foot ulcers in the french context.” Diabetic Metab. 2000 Apr;26(2):125-32.. 26 Epicel Skin Grafts, Sarah Schlatter, Biomedical Engineering, University of Rhode Island. Available at: http://www.ele.uri.edu/Courses/bme281/F08/Sarah_1.pdf. Web. 1 Mar. 2017. 27 "Why Price For Cell/ Gene Therapy Products Is So High?". Available at: http://celltrials.info/2016/09/06/pricing/. Web. 3 Mar. 2017. 28 “What is the cost of osteocel plus by nuvasive,” by Dr. Russ, Board Certified Physician. Available at: http://www.justanswer.com/medical/5k42z-cost-osteocel-
plus-nuvasive.html. Web. 1 Mar. 2017. 29 Skovrlj, Branko et al. "Cellular Bone Matrices: Viable Stem Cell-Containing Bone Graft Substitutes". The Spine Journal 14.11 (2014): 2763-2772. Available at:
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4402977/. Web. March 2, 2017. 30 Hiltzik, Michael. "Sky-High Price Of New Stem Cell Therapies Is A Growing Concern". Available at: http://www.latimes.com/business/hiltzik/la-fi-hiltzik-20151010-column.html. Web. 1 Mar. 2017. 31 "Counting Coup: Is Osiris Losing Faith In Prochymal?, Busa Consulting LLC. Available at:
http://busaconsultingllc.com/scsi/organelles/counting_coup_prochymal.php. Web. 3 Mar. 2017. 32 "Dendreon Sets Provenge Price At $93,000, Says Only 2,000 People Will Get It In First Year | Xconomy". Available at:
http://www.xconomy.com/seattle/2010/04/29/dendreon-sets-provenge-price-at-93000-says-only-2000-people-will-get-it-in-first-year/. Web. 3 Mar. 2017. 33 "Dendreon: Provenge To Cost $93K For Full Course Of Treatment | Fiercebiotech". Available at: http://www.fiercebiotech.com/biotech/dendreon-provenge-to-cost-93k-for-full-course-of-treatment. Web. 3 Mar. 2017. 3434 "GSK Inks Money-Back Guarantee On $665K Strimvelis, Blazing A Trail For Gene-Therapy Pricing | Fiercepharma". Available at:
http://www.fiercepharma.com/pharma/gsk-inks-money-back-guarantee-665k-strimvelis-blazing-a-trail-for-gene-therapy-pricing. Web. 3 Mar. 2017. 35 Strimvelis". Wikipedia.org. Available at: https://en.wikipedia.org/wiki/Strimvelis. Web. 3 Mar. 2017. 36 "Why Price For Cell/ Gene Therapy Products Is So High?". Available at: http://celltrials.info/2016/09/06/pricing/. Web. 3 Mar. 2017. 37 "Mesoblast’S Japan Licensee Receives Pricing For TEMCELL® HS Inj. For Treatment Of Acute Graft Versus Host Disease". Mesoblast Limited, GlobeNewswire News Room. Available at: https://globenewswire.com/news-release/2015/11/27/790909/0/en/Mesoblast-s-Japan-Licensee-Receives-Pricing-for-
TEMCELL-HS-Inj-for-Treatment-of-Acute-Graft-Versus-Host-Disease.html. Web. 3 Mar. 2017. 38 “TEMCELL® HS Inj. Receives NHI Reimbursement Price Listing,” JCR Pharmaceuticals Co., Ltd. News Release, November 26, 2015. Available at: http://www.jcrpharm.co.jp/wp2/wp-content/uploads/2016/01/ir_news_20151126.pdf. Web. 3 Mar. 2017.
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As shown in the list above, wound care products tend to have the lowest cell therapy pricing,
typically costing $1,500 to $2,500 per use. For example, Apligraf® is created from cells
found in healthy human skin and is used to heal ulcers that do not heal after 3-4 weeks
($1,500-2,500 per use), and Dermagraft is a “skin substitute” that is placed on your ulcer to
cover it and to help it heal ($1,700 per application). Interestingly, Epicel is a treatment for
deep dermal or full thickness burns comprising a total body surface area of greater than or
equal to 30%. It has higher pricing of $6,000-10,000 per 1% of total body surface area,
because it is not used to treat a single wound site, but rather used to treat a large surface area
of the patient’s body.
Next, cartilage-based cell therapy products tend to have mid-range pricing of $15,000 to
$35,000. For example, Carticel is a product that consists of autologous cartilage cells
(pricing of $15,000 to $35,000), CARTISTEM is a regenerative treatment for knee cartilage
(pricing of $19,000-21,000), and ChondroCelect is a suspension for implantation that
contains cartilage cells (pricing of $24,000).
The next most expensive cell therapy products are the ones that are administered
intravenously, which range in price from approximately $90,000 to $200,000. For example,
Prochymal is an intravenously administered allogenic MSC therapy derived from the bone
marrow of adult donors (pricing of $200,000), Provenge is an intravenously administered
cancer immunotherapy for prostate cancer ($93,000), and Temcell is an intravenously
administered autologous MSC product for the treatment of acute GVHD after an allogeneic
bone marrow transplant (pricing of $115,000-170,000).
Finally, many of the world’s most expensive cell therapies are gene therapies, ranging in
price from $500,000 to $1,000,000. For example, Strimvelis is an ex-vivo stem cell gene
therapy to treat patients with a very rare disease called ADA-SCID (pricing of $665,000).
Although these generalizations do not hold true for every cell therapy product, they explain
the vast majority of cell therapy pricing and provide a valuable model for estimating cell
therapy pricing and reimbursement. This information is summarized in the following table.
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TABLE. Pricing Scale for Approved Cell Therapies, by Type
TYPE OF CELL THERAPY PRICE RANGE ($ USD)
Wound Care $1,500 - $2,500 per use
Cartilage Product $15,000 - $35,000
Intravenously Administered $90,000 - $200,000
Cell-Based Gene Therapies $500,000 - $1,000,000
One additional point of reference is very valuable. The RIKEN Institute launched the world’s
first clinical trial involving an iPSC-derived product when it transplanted autologous iPSC-
derived RPE cells into a human patient in 2014. While the trial was later suspended due to
safety concerns, it resumed in 2016, this time using an allogeneic iPSC-derived cell product.
The research team indicated that by
using stockpiled iPS cells, the time
needed to prepare for a graft can be
reduced from 11 months to as little
as one month, and the cost, currently
around ¥100 million ($889,100), can
be cut to one-fifth or less.39
39 "Riken-Linked Team Set To Test Transplanting Eye Cells Using Ips From Donor | The Japan Times". The Japan Times. N.p., 2017. Web. 23 Feb. 2017.
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4.2. Reasons for High Cell Therapy Product Costs
This information in the previous section raises the question, why are cell therapy products
are so expensive? Below is a summary of the major reasons for high pricing of cell
therapeutics.
4.2.1. High Cost of Manufacturing
The cost of manufacturing a cell product cannot be compared with small molecule
products manufactured by pharmaceutical companies or biomolecules produced by
biotechnology companies. Cell therapies are costlier to develop, with autologous cell
products commanding the highest price tags. In general, the manufacturing cost of
autologous cell product is many times higher than that of an allogeneic product and this is
reflected in the market pricing. Prior to the development of cell therapies, the concept of
“one production run for one patient” was unfamiliar, and there was no such thing as
autologous therapeutics.
While all of the factors below contribute to high pricing associated with cell
therapies, the single most important factor that affects the pricing of a cell therapy
product is the price of continuously manufacturing the product. To continue
product, manufacturing costs of must be covered and a profit margin achieved.
For example, Dendreon developed Provenge throughout the 1990s and early 2000s.
Promising clinical trial data followed, but Provenge had a difficult road to FDA approval.
In 2007, a FDA advisory panel recommended its approval, but in an unusual and
controversial move, the agency ignored its advisory panel’s advice and required Dendreon
to provide additional evidence about the treatment. Three years later, in 2010, the FDA
approved Provenge under Section 351 of the Public Health Safety Act. Provenge was
hailed as breakthrough for the cell therapy industry, but ultimately a combination of
manufacturing and marketing challenges, combined with the emergence of more
affordable and less complicated competition led it to underperform expectations.
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Dendreon filed for bankruptcy in late 2014 and Dendreon’s assets (including Provenge)
were purchased by Valeant Pharmaceuticals for $495 million in February 2015.
The extent to which Valeant can turn Provenge into a commercial success remains
unknown, but the company is expected to focus its efforts on cutting production costs, as
well as improving marketing to physicians.
4.2.2. Need to Recoup Developmental Costs
Similarly, after investing a lot of time (often 10 to 20 years for the development of a
single cell therapy product), as well as enormous quantities of money to build
manufacturing facilities, secure regulatory compliance, hire qualified personnel, and
conduct clinical trials, cell therapy developers are need to recoup research and
development expenses as quickly as possible. The costs associated with cell therapy
manufacturing are often exorbitant, although they can frequently be lowered by partnering
with an experience cell therapy CDMO.
For example, one reason for Dendreon’s struggles in its efforts to commercialize Provenge
was the debt it assumed, in part, to finance its production facilities. This investment
proved detrimental to the company when Provenge approval and adoption lagged and the
company was left with expensive but underutilized production facilities.
4.2.3. Cash Flow and Quantity of Cash Reserves
Cell therapy companies work hard to get through the clinical trial period, often called the
“Valley of Death.”40 As they emerge at the end of the clinical trial process, they are often
highly leverage with debt and short on cash reserves. Therefore, pricing is sometimes
dictated by the need to profitably commercialize a product, before the company goes
under.
40 The transition from laboratory success to human clinical trials has become so difficult that former NIH Director Elias Zerhouni has dubbed it
the "valley of death."
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For example, throughout the 1990s, Advanced Tissues Sciences invested more than $300
million to develop Dermagraf. In 1996, the company formed a marketing partnership with
Smith & Nephew. In late 2001, Advanced Tissue Sciences received approval to market
Dermagraft for the treatment of diabetic foot ulcers from the FDA. Despite this success,
Advanced Tissue Sciences was unable to turn Dermagraft into a commercially successful
product and filed for bankruptcy in 2002.
4.2.4. Need for Return on Investment (ROI)
While most traditional drugs are developed internally by pharmaceutical companies, the
large majority of cell therapies go through a tech transfer processes from an academic
center to a business. This tends to require investors to pool the capital needed to acquire
and develop the technologies of interest. Having long-term investors means that cell
therapy companies need to go after a ROI once the product reaches the commercialization
stage. For example, Cynata Therapeutics’ CymerusTM technology was acquired from the
University of Wisconsin, Madison, a world leader in stem cell research. Gamida-Cell is
based on technology for stem cell expansion licensed from Hadassah University Medical
Center in Jerusalem, Israel. Pluristem was founded in 2001 by Shai Meretzki of the
Technion, who made use of stem cell patents he had developed with colleagues from the
Weizmann Institute of Science. This trend can be observed across most of the cell therapy
industry.
4.2.5. High Cost of Delivery
Cell products are fragile biologics with a complex supply chain. For “fresh products”
(Holoclar, Provenge, and others), short shelf life is associated with a high risk of potential
product loss. For cryopreserved products, cold chain logistics and multi-site distribution is
very costly and associated with its own risks. Overall, the cost of storage and shipment of
cell therapy products is much higher than for conventional drugs. High cost of delivery
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adds to manufacturing cost and eventually gets embedded into the price tag.
4.2.6. Lack of Comparative Studies as Evidence for Reimbursement Scheme
Most approvals of cell and gene therapy products in U.S. and Europe are relatively recent
and were obtained in the last 7-8 years. Due to few years on the market, studies of cost-
effectiveness, which can compare new approved products with a predecessor or analog,
are not available. Because these studies are lacking, payers do not know how to reimburse,
and often confused by high price tag, perform health technology assessments or negotiate
pricing with the manufacturer.
4.2.7. Lack of Competition
Currently, only few dozens of cell products have achieved regulatory approvals
worldwide. Most of them are serving small market niches with few competitors. Because
of the lack of competition, manufacturers can set any price that the market can bear.
Obviously, as new generation (better) products enter the market, competition will drive
prices down.
4.2.8. Small Market Size
The recent trend, at least in Europe, is approvals for rare (orphan) diseases, with an
obvious example being Strimvelis. Strimvelis is the first ex-vivo stem cell gene therapy to
treat patients with a very rare disease called ADA-SCID (Severe Combined
Immunodeficiency due to Adenosine Deaminase deficiency). An orphan disease means
the market size is small. Blockbuster sales are not derived from going after rare disease
indications. Often, approvals for orphan diseases position manufacturers into pricing
predicament where it is difficult to serve the patient population while turning a profit.
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4.2.9. Potential for High Utility Patient Outcomes (Cures)
One of the strongest argument in justification of high pricing is delivering a cure or
“potential cure” to the patient in need. Some cell therapies can deliver a cure with a single
treatment. Many patients are willing to pay higher price tags, even out of pocket, to
achieve a restored physiological state. Indeed, one of the reasons to purse development of
cell therapies is because they can offer distinct advantages over conventional drugs or
biologics. In reality, very long-term observational studies are required to determine the
how to value curative properties of a medicine. For example, CAR T-cell therapy is
promoted by many developers as “curative,” in which case, high prices could be justified.
However, more than 30% of patients with B-cell malignancies will relapse one year after
receiving CD19-CAR T-cells. Although Glybera is a gene therapy and not a cell therapy,
it provides a great example. Following analysis six-year outcome data, uniQure had to
change its promotional language from saying that Glybera provided a “cure” to saying that
it provides “long-term benefit” and could be “potentially curative”.
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5. Cost Control
Autologous cell therapies offer a new and exciting challenge for process scalability, where the
manufacturing process must be scaled out to produce one batch per patient. The unique challenge
of scaling out patient-specific cell therapy manufacturing processes is reducing the cost per dose,
given that there are currently few economies of scale to exploit. Reducing the cost of these patient-
specific therapies must therefore be achieved by advances in engineering and manufacturing
technology to reduce the number of labor-intensive and open-process steps that are routine in cell
therapy production. Similarly, allogeneic cell therapies also require careful cost control.
The ideal cell therapy manufacturing process should be scalable, robust, consistent, simple, cost-
effective, well-defined and regulatory friendly. As a result, important trends in cell therapy cost
control are scalability, automation and optimization/integration.
5.1. Cost of Goods Components
Cell therapy manufacturers are under constant pressure from physicians, payors and the
public for products to be low cost.
According to RoosterBio’s Founder and COO, Dr. Jon Rowley, cost of goods (COGs)
include at least 4 categories41:
1. Facility
2. Raw materials
3. Labor
4. Quality control
“COGs is a critical step toward
building a sustainable cell product,
it should be considered in early stages,” says Rowley. Mark McCall of Loughborough
University (UK), who earned PhD working on COGs in cell therapy, developed a
41 Interview with Dr Jon Rowley, Founder and CEO of RoosterBio. Interview conducted by BioInformant’s President/CEO, Cade Hildreth, on
February 6, 2017. Available at: https://www.bioinformant.com/roosterbio/.
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methodology that allows to calculate and estimate COGs for different bioprocesses.42 In a
talk he presented at IBC Cell Therapy Bioprocessing Conference 2014, he emphasized that
the “possibilities to change your cost as you move in development is limited”. Importantly,
his work shows that “manufacturing + consumables + labor” is not the biggest part of COGs.
Facility maintenance, shipping of cell products and some other drivers of COGs are
undervalued.43
42 To learn more about McCall’s work and to request his tool for Cell Therapy Manufacturing COGs analysis, contact him by phone
at: +44(0)1509 564 826 or by email at [email protected]. 43IBC Cell Therapy Bioprocessing Conference. Presentation by Mark McCall of Loughborough University (UK).
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5.2. Automation as a Cost Control Measure
Automation is one effective way to bring cost of cell manufacturing down. According to Stefan
Miltenyi, Founder & President of Miltenyi Biotec, “Cell processing has to become less
expensive.”44 He thinks that “automation is able to resolve many critical issues, related to
manufacturing of autologous cell therapy products.” His company did a lot for development of cell
processing automation, including the most recent multifunctional device CliniMACS Prodigy.
Jon Rowley of RoosterBio uses the term “democratization of cell technologies.” To him, that
phrase means making cell technologies accessible to everyone across the scientific
community including cell manufacturing technologies. He also provides a great example of
lowering cost of mesenchymal stem cells (MSCs) by implementation of automation:45
TABLE. Cost Per Million of Clinical-grade MSCs Expanded by Different Methods
Expansion Method Cost
T-flast $100-500
Multi-Layer Vessels $10-50
Suspension Bioreactors $1-5
Source: Dr. Jon Rowley, RoosterBio. World Stem Cell Summit 2015 Presentation.
The problem of growing “high cell mass” at low cost is significantly amplified in research
labs, which build prototypes of tissues and organs for preclinical studies. Such labs need to
grow billions of MSCs and pay large sums for it (for example, one billion MSCs may cost
$100k to produce in a T-flask versus $10k in CellSTACKs). If such tissue constructs will
work, the only way to go to clinic is automation using suspension bioreactors.
There is good progress in development of suspension bioreactors and using microcarriers for
MSCs expansion. For examples, PBS Biotech was able to achieve concentration of 3 million
per ml in their vertical wheel bioreactors. Increasing cell concentration without
compromising quality of the product allows developers to cut media usage and shorten the
time of culture. Li Ren from Celgene also reported successful generation of 1.2 trillion
44IBC Cell Therapy Bioprocessing Conference. Presentation by Stefan Miltenyi, Founder & President of Miltenyi Biotec. 45 Dr. Jon Rowley, Founder and COO of RoosterBio. World Stem Cell Summit Presentation, 2015. Presented December 7, 2016 in Atlanta, GA. Conference hosted by the Regenerative Medicine Foundations. Attended by BioInformant’s President/CEO, Cade Hildreth.
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allogeneic placental MSCs per one process, using microcarriers in bioreactor.46 While
unverified, if that number is true it represents a phenomenal accomplishment. As Jon Rowley
also says, “We are in a phase of rapid advancement of cell manufacturing technologies.
Market participants should take advantage of these advances to bring the costs of
manufacturing down.”47
46 Li Ren, Associate Director of Celgene. The BioProcessing Summit 2016. Attended by BioInformant Team Members. 47 Interview with Dr. Jon Rowley, Founder and COO of RoosterBio. Interview conducted by BioInformant’s President/CEO, Cade Hildreth on
February 6, 2017. Accessible at: https://www.bioinformant.com/roosterbio.
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5.3. Effect of Process Development and Process Change on COGs
Process development and process change are important topics that affect COGs for cell therapy
manufacturing New exciting technologies are released all the time and cell therapy manufacturers
want to utilize and adapt them to their products. However, as Robert Deans of Athersys indicated,
“Developers cannot keep up with all new technologically advanced tools available today.”48
In terms of scalability, the field is progressively moving from 2D flat surfaces to suspensions in
bioreactors. In addition to developing bioreactors, TerumoBCT (Quantum), ATMI (Xpansion),
and GE Healthcare (WAVE) have all moved onto the next step of exploring how cell process
characterization occurs within these bioreactors. Lye Theng Lock from Lonza has shared
fascinating data comparing suspension microcarrier-based culture of mesenchymal stem cells
(MSCs) in different bioreactors.49 The key finding from her data is that the same cells can behave
very differently in different bioreactors on different microcarriers.
Therefore, process development teams
should do comparability work early on in
order to determine the best process for a
specific product in particular indication.
A good bioreactor can solve problems
related to both scalability and automation.
Other smart devices can offer solutions to
both integration and automation, for
example, the CliniMACS Prodigy by Miltenyi Biotec and Sepax2 by BioSafe.
Another critical topic in process optimization is whether to switch to serum- free, xeno-free
cell culture. An increasing number of developers, particularly in cell and vaccine
manufacturing applications, are moving to animal component free media formulations
because of the benefits associated with it. These benefits include removal of potential
4848 Robert Deans was the Executive VP of Regenerative Medicine at Athersys when he shared this thought at the IBC Cell Therapy
Bioprocessing Conference. He is now the CTO at BlueRock Therapeutics. 49 IBC Cell Therapy Bioprocessing Conference. Presentation by Lye Theng Lock, Scientist at Lonza. Dr. Lye Theng Lock is now Director of
Product & Process Development at RoosterBio, Inc.
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contaminants and improved consistency in both performance and quality. However, this
usually raises the question of how to implement changes to an already defined process, often
one developed during preclinical stages of development. According to Joyce Frey-
Vasconcells, a Cell and Gene Therapy Regulatory Consultant, “Changes are inevitable and
you have to answer two critical questions when implementing it. How does it affect (1) safety
and (2) quality of your product.”50 Cost should also be considered in comparability studies.
50 Dr Joyce Frey-Vasconcells is a Cell and Gene Therapy Regulatory Consultant based in Skyesville, Maryland. F ey-Vasconcells Consulting
provides is headed by Dr. Joyce Frey, a FDA regulatory expert for the regulation of cell therapies with12+ years of FDA experience.
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5.4. Managing Cash Flow
Both scale up and distribution contribute
to a key manufacturing issue – keeping
costs low enough that a therapy can prove
a commercial success.
While the ultimate financial success of a
cell therapy product depends both on
price and cost considerations, cost is
largely under the control of the firm producing the therapy while pricing reflects the
(sometimes unpredictable) reimbursement decisions of government, as well as the
competitive environment.
These concerns highlight the financial complexity cell therapy companies face as they scale-
up production and try to reduce their costs of goods. Such choices involve substantial upfront
investment in equipment, such as bioreactors, as well as, in some cases, specialized GMP
production facilities. In some cases, a company cannot supply the market without these
facilities, but if the facilities are overbuilt or completed too soon, a company may not be able
to afford them and such investments can burden a firm and leave it in a desperate financial
position.
Indeed, one reason for Dendreon’s struggles in its efforts to commercialize Provenge was the
debt it assumed, in part, to finance its production facilities. This investment proved
detrimental to the company when Provenge approval and adoption lagged and the company
was left with expensive but underutilized production facilities.
It is, of course, easy to diagnose these missteps in retrospect. However, cell therapy
companies are often making estimates based on incomplete information and projections of
future sales, which leaves to delicately balance the risk of overbuilding their production
facilities versus having insufficient supply to meet demand for an otherwise profitable
product.
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For many cell therapy developers, contracting with a cell therapy CDMO can reduce costs
and risks associated with cell therapy product development by distributing capital
expenditures over time.
Multiple KOLs interviewed by
BioInformant suggested that
operating in a capital efficient
manner is critical to success in the
cell therapy field. As a solution,
several suggested that partnerships
with cell therapy CDMOs can
represent a valuable approach to
delaying investment in large production facilities, limiting employee payroll obligations, and
controlling capital expenditures.
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5.5. Role of Cell Therapy CDMOs
As stated by Jon Rowley, Founder and CTO of RoosterBio, “To date there has been
substantial cell therapy product innovation. It is now time for the industry to focus on cell
therapy manufacturing process innovation.” Among cell therapy companies, the pressure for
manufacturing process innovation has incentivized them to seek third-party partners who
possess technical, manufacturing, and regulatory expertise in cell therapy development and
manufacturing, such as cell therapy CDMOs.
A contract development and manufacturing organization (CDMO) is a company that
serves cell therapy companies on a contract basis. Common cell therapy CDMO services
include cell therapy product development, manufacturing, clinical trial support, and
commercial supply.
New market entrants have been gradually moving into the cell therapy CDMO field. Key
market players include WuXi PharmaTech (and its subsidiary WuXi AppTec), Lonza Group,
PCT (a Caladrius company), MEDINET, Cell and Gene Therapy Catapult, Brammer Bio,
KBI Biopharmaceuticals, PharmaCell, Roslin Cell Therapies, apceth Biopharma, and many
more. As a result of these market forces there will be growing opportunities for cell therapy
CDMOs in 2017 and beyond.
CDMOs allows cell therapy companies to outsource aspects of their business, which can
support:
1. Scalability
2. Speed to market
3. Adding technical expertise without overhead costs
4. Cost efficiencies
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Over the past several years, the
biopharmaceutical industry has
witnessed an increasing number
of contract suppliers taking on
the CDMO (contract
development and manufacturing
organization) acronym to identify
their ability to assist at the development stage of drug manufacturing. The CDMO acronym
indicates that a company is interested in differentiating their abilities from contract
manufacturing organizations (CMOs) focused solely on large-scale manufacturing projects.
This has been true within the cell therapy CDMO market, as well as within the broader
biopharmaceutical CDMO market.
The best-positioned cell therapy CDMOs tend to take one of two approaches. They either
position themselves to outspend and out-build the competition (e.g. WuXi’s massive global
expansion), or they compete at the opposite end of the spectrum by specializing in specific
manufacturing technologies and cell types.
For example, a cell therapy CDMO may develop extensive expertise in T-cells, commonly
used within immunotherapies, or mesenchymal stem cells, the most common stem cell type
being explored in clinical trials worldwide. This positions cell therapy CDMOs to attract
future clients based on their expertise with specific cell types. Alternatively, a cell therapy
CDMO may specialize in specific manufacturing technologies, such as closed-system
bioreactors, which allows for rapid for scale-up of cell populations.
Today, many cell therapies are manufactured in cleanrooms, but closed-system bioreactors
will be the future of cell therapy manufacturing. Closed systems mitigate the risks of cross-
contamination and therefore allow concurrent processing of multiple batches, which gives
enormous savings in terms of facility efficiency, as well as labor costs.
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With lower-cost international manufacturers trying to capture a growing percentage of the
market, specialization provides an effective hedge against loss of market share for smaller
players within the cell therapy CDMO market.
Currently, cell therapy CDMOs operating worldwide include:
• MasTHerCell, Acquired by Orgenesis
• PCT, a Caladrius Company (Previously Neostem)
• WuXi PharmaTech, Including Subsidiary WuXi AppTech, Inc.
• Cell and Gene Therapy Catapult
• KBI Biopharma (Acquired Opexa Assets, February 2017)
• Brammer Bio (Formed through Merger of Brammer Biopharmaceuticals and Florida
Biologix)
• Roslin Cell Therapies, a Subsidiary of Roslin Cells
• apceth Biopharm
• Cognate Bioservices, Inc.
• MEDINET Co. Ltd.
• PharmaCell, B.V.
• The Clinical Trial Company (TCTC)
• Miltenyi Bioprocess, the Contract Manufacturing Business of Miltenyi Biotec
• Lonza Group, Cell Therapy Manufacturing Unit
• Praxis Pharmaceutical
• Cellular Therapeutics Ltd. (CTL)
• CTI Clinical Trial and Consulting
• Eufets GmbH
• Fraunhofer Gesellschaft
• Cellforcure SASU
• Molmed S.p.A.
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6. Time Frames
This section considers time-frames for cell therapy product development.
6.1. Pre-market challenges
The pre-market phase has traditionally received the most attention, with the term “valley of
death” used to describe the clinical trial phases during which a cell therapy company
typically operates at a loss.51 The challenge of this phase is to generate sufficient evidence of
safety and efficacy to attract funding to push the company through to commercialization.
For pre-market challenges, two key challenges exist:
1) Lengthy developmental timelines
2) Navigating the regulatory environment
These two challenges are closely related, because the regulatory environment can contribute
to lengthy developmental timelines.
6.2. Persevering through Lengthy Developmental Timelines
Product histories indicate that cell therapy companies should be prepared to survive for 10+
years before successfully bringing a product to market. For example, Osiris Therapeutics
brought Osteocel to market in 2005, 13 years after the company was founded in 1992. Also,
Osteocel had a smoother path to market than many other cell therapy products, because it did
not require pre-market approval from the FDA.
Prochymal, another product developed by Osiris, only gained conditional market access in
Canada and New Zealand in 2012, some 20 years after the company was founded. Similarly,
51 The transition from preclinical success to human clinical trials has become so difficult that former NIH Director Elias Zerhouni dubbed it the
"valley of death."
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Apligraf gained market access more than 15 years after Organogenesis was founded, and
Dermagraft was granted pre-market approval 16 years after Marrow-Tech was founded.
These examples illustrate that early stage cell therapy companies must be prepared to raise
sufficient capital to survive as they navigate a long and uncertain path to market. Review of
cell therapy product histories raises serious concerns pertaining to lengthy developmental
timelines. Strategies that cell therapy firms can use to address this challenge include angel
and venture funding, partnerships with larger companies, and the public markets. In addition,
some cell therapy companies are able to develop secondary products, often with lower
regulatory hurdles, to generate a source of positive cash flow during the pre-market period.
Without question, acquiring the funding to survive the therapy development process is the
single biggest challenge facing cell therapy companies.
Funding availability can be affected by broader financial trends, as well as cell therapy
specific considerations. The complexities and challenges of funding early stage cell therapy
companies are intensified by the funding being needed for a long, but uncertain period of
time, and by the fact that most funding strategies available to early-stage cell therapy
companies are dilutive. Repeated use of dilutive funding mechanisms lowers the founders’
ownership stake, and can also hinder a company’s ability to control its own operations or
raise additional funding. Financing clinical development and commercialization pose a
serious challenge for cell therapy companies, with bankruptcies occurring shortly after
market entry in the commercialization of Provenge, Dermagraft and Apligraf. Additionally,
other companies commercializing cell therapy products, including Tengion (2014), Garnet
BioTherapeutics (2010) and MicroIslet (2008), also went bankrupt during the pre-market
phase.52,53,54
Companies that avoid this fate may still face challenges reflecting the choices they make to
acquire funding. Partnerships with pharmaceutical firms, while often a key step in the
52 George J. Regenerative medicine company with local ties files for bankruptcy. Philadelphia Business Journal. 2014 December 30. 53 Somers T. MicroIslet seeks bankruptcy shelter, will continue research. San Diego Union-Tribune. 2008 November 12. 54 George J. Garnet puts forth plan to get out of bankruptcy. Philadelphia Business Journal. 2011 May 13.
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development of a successful cell therapy product, can complicate operations if the cell
therapy companies and its partners disagree about commercialization strategies or the most
promising indications to pursue. Going public provides another source of capital for some
firms, but places a new set of expectations and reporting requirements on companies. These
additional requirements can be problematic for companies in the pre-clinical and clinical
research stages that with little to no revenue.
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6.3. Navigating the Regulatory Environment
The regulatory environment is a factor contributing to the lengthy developmental timelines.
When cell therapies were first emerging, the FDA struggled to regulate them, limited by
regulations tailored to pharmaceutical drugs and not cells. Additionally, there remains an
evolving and uncertain regulatory environment for cell therapy products to this day.
One of the key ambiguities regarding FDA regulation of cell therapies is the distinction
between a “Section 351” and “Section 361” cell therapy. Some products fall under Section
351 of the Public Health Service Act (PHS Act) while others fall under Section 361 of the
PHS Act.55 This is a key distinction, because Section 351 requires pre-market approval
typically via the clinical trial pathway, while Section 361 provides a shorter path to market.
Some products fall clearly into one of these two categories, but others are in a gray area
where the appropriate classification is not certain.
55 Halme DG, Kessler DA. FDA regulation of stem-cell-based therapies. N Engl J Med. 2006;355(16):1730–5
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6.4. Timeline from Phase I to Commercialization
Cell therapy product development can generally be divided into phases. The first is the
preclinical phase, which usually takes 3 to 4 years to complete. If successful, this phase is
followed by an application to the FDA as an investigational new drug (IND).
After an IND is approved, the next steps are clinical phases 1, 2, and 3, which require
approximately 1, 2, and 3 years, respectively, for completion. Importantly, throughout this
process the FDA and investigators leading the trials communicate with each other so that
issues such as safety are monitored. The cell therapy manufacturer then files an application
with the FDA for approval. This application can either be approved or rejected, or the FDA
might request further study before making a decision.
Following acceptance, the FDA can also request that the manufacturer conduct additional
post-marketing studies. For pharmaceutical drugs, this entire process has traditionally taken
between 8 to 12 years.56 For cell therapies, the product development timeline lasts an
average of 10-12+ years, because of the FDA has demonstrated even greater caution with
cell based therapeutics than it has with pharmaceutical drugs. For obvious reasons, the
boundaries and historical reference points are clearer for pharmaceutical drugs than for cell-
based products.
For example, the BLA files that Dendreon submitted to the FDA for their first cell therapy
(Provenge) shows a 3-year gap between the first submission and approval, because Dendreon
had to implement an electronic laboratory information management system (LIMS) after the
FDA expressed concerned about Dendreon’s potential to mix up cell samples for QC testing.
The concern was based on the fact that Dendreon would be operating at 10 times the scale of
the clinical trial, which increased the risk of mix-ups substantially. Prochymal, another
product developed by Osiris, only gained conditional market access in Canada and New
Zealand in 2012, some 20 years after the company was founded. Similarly, Apligraf gained
market access some 15 years after Organogenesis was founded and Dermagraft was granted
pre-market approval 16 years after Marrow-Tech was founded.
Clearly, regulatory timelines for cell based products are extensive and can last 10+ years.
56 Heilman RD. Drug development history, "overview," and what are GCPs? Quality Assur 1995;4:75-9.
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7. Reimbursement
This section considers reimbursement issues related to cell therapies.
7.1. Securing Reasonable Reimbursement
In addition to pre-market challenges, several post-market challenges affect the development
of cell therapies. Some of these challenges have their origins in pre-market decisions
regarding research approaches or commercialization strategies, but they do not manifest until
after a cell therapy product gains market access.
These challenges include:
1) Securing reasonable reimbursement
2) Encouraging adoption
Challenges securing and maintaining a reasonable reimbursement level are a frequent issue
for cell therapy products. The key point here is straightforward, it does not matter how good
a cell therapy product is if no one is going to pay for it. If reimbursement levels do not at
reach and exceed the cost of production, it will be difficult to build a successful business
around the cell therapy product. Additionally, there is great uncertainty regarding
reimbursement decisions, particularly given the novel and expensive nature of cell therapies,
combined with ongoing pressures to reduce health care costs. With only a few cell therapies
reaching commercialization, product developers cannot assume set price points and
reimbursement schemes based on existing industry precedence.
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This situation makes it difficult for
companies to make strategic decisions
about which indications to pursue and
how to optimize their operations. Not
fully considering the cost-benefit
calculation and its impact on
reimbursement can lead to investments
into cell therapies that are unlikely to
have clinical or market impact and lead
to squandered investments in “nonviable” cell therapies.
As an example, reimbursement was a key challenge for Dendreon as it commercialized
Provenge, as well as for both Advanced Tissue Sciences and Organogenesis as they
attempted to successfully commercialize their wound healing products.
In contrast, improved reimbursement was an
important reason that Advanced BioHealing
was able to turn Dermagraft into a
successful product, and it helped
Organogenesis as it recovered from its 2002
bankruptcy and commercialized Apligraf.
Unfortunately, after several years of market
success, a reimbursement change by the
U.S. Centers for Medicare and Medicaid
Services (CMS) raised questions about the
viability of these products going forward. In December of 2013, CMS changed all the
codings for wound healing products, cutting the reimbursement by 60%, which resulted in
Organogenesis laying off over 50% of its work force.
As this case illustrates, challenges can emerge not only in the early stages of market access
when a product’s initial reimbursement levels are established, but later in the product life
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cycle. These challenges can result from changes to a cell therapy product’s reimbursement
scheme, the introduction of competitive products by other suppliers, pressures from
government to reduce health care costs, introduction of technologies that would make the
treatment obsolete, and other factors. Although changing reimbursements levels are a
challenge for many medical products, they pose an even greater risk to cell therapies, because
of the complicated and expensive manufacturing processes that are involved.
To date, cell therapies that have received reimbursement tend to be ones that:
1. Demonstrate substantial benefit in comparison to existing treatments -
Reimbursement agencies and healthcare groups are more likely to approve cell
therapy treatments that provide a substantial benefit over the status quo.
2. Address conditions for which there are no good treatment alternatives – If no
treatment alternatives exist for patients, cell therapy reimbursements are more likely
to occur.
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7.2. Encouraging Adoption
A second post-market challenges is that of promoting physician and patient adoption of new
cell therapies. It is not enough to produce a product that is superior to its competitors and
navigate the regulatory process to gain market access. Given the complexity of cell therapies
and the differences between administering cell therapies and more traditional treatments,
getting physicians to actually use a novel therapy can be difficult. One KOL explicitly
discussed how ease of administration could affect physicians’ treatment choices:
“[Cell therapy is] difficult for most physicians, even specialists, to envision
administering, and if there’s an easier way to administer almost the same kind of
efficacy, they’ll jump at that every time because it’s easier to give a pill. It is easier to
give a patch. It is easier to give even an injectable that they are accustomed to
delivering than cells, because they are different. They are more finicky to administer,
to manage, and to process.”
Adoption of a cell therapy product is a marketing problem that requires understanding the
end customer and how the product fits within the business model of the clinics that will use
it. The physician adoption hurdle depends on both the nature of the therapy and its
competitors in the healthcare marketplace. Autologous interventions, such as Provenge, face
particular challenges because they typically require multiple coordinated interactions with the
same patient, complicating the treatment process.
The severity of the adoption hurdle also varies by indication, as well as by the improvement a
cell therapy an offer over the existing “standard of care.” Physicians are more likely to
expend the effort to master and use more complicated treatments when there is substantial
benefit over the status quo.
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Finally, identifying and beginning to work
with the appropriate physician population
early in the development of a novel cell
therapy is an important best practice. This
early clinician involvement can help steer
companies toward products that can more
easily surmount the adoption hurdle and
reach patients.
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8. Distribution Channels
This section considers the distribution channels involved with cell therapy development and
manufacturing, including:
• Routes to Market
• Allogeneic vs. Autologous Therapies
• Key Players Affecting Distribution Channels
8.1. Addressing Distribution Logistics
Cell therapies are promising, because they contain living cells. However, the living nature of
cell therapies greatly complicates the process of getting these treatments to patients. Most
cell therapies will not remain viable at ambient temperature over an extended period of time,
and will require more complicated distribution strategies than typical small molecule
therapeutics.
These distribution challenges apply to both allogeneic and autologous cell therapies but are
typically more acute for autologous interventions, as the products often involve moving
patient cells to the processing facility and sending the processed therapeutic cells back to the
patient’s physician for treatment. The extent to which a cell therapy can be frozen and
thawed and maintain its activity impacts distribution decisions, as does the length of the
product’s stability at various temperatures.
Although both pose challenges, a product with a shelf life of only two days poses
substantially greater logistical issues than a product that remains stable for a week. One
interviewee described the challenge for an autologous therapy as follows:
“Often you procure starting material from a patient…It is shipped to a manufacturing
site. Manufacturing is conducted under GMP and then final product is shipped back
to that patient. Getting the right product back to the right patient is important issue.
Keeping control of that cold chain during the procurement and the distribution is…a
complicated issue with cell therapies, which often have…a very short shelf life.”
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Firms are exploring various models to tackle these distribution challenges, including shipping
products both frozen and thawed. In addition, some companies create multiple manufacturing
facilities to allow production to occur closer to patients, thereby reducing transit times. Some
companies working on having a cryopreserved supply chain. Other companies thaw the
product onsite and then reconstitute it into a new formulation. Both options present
challenges for stability of the cell product.
The technical difficulties that affect scale-up efforts also complicate distribution. For
example, in the absence of a good potency assay, it is hard to know how distribution
processes are affecting a cell therapy product. Sorting out distribution logistics is an
important issue for several reasons. For example, it may be the case that a cell therapy is
effective in an early-stage clinical trial when manufacturing occurs on-site and distribution is
not required, but once later-stage clinical trials require product distribution, the product
becomes less effective or fully ineffective.
Key players affecting distribution include the commercial provider of the cell therapy and the
patient, as well as cold chain transport teams, hospital and administrative staff, the physician
administering the cells, and medical team responsible for follow-up care.
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8.2. Autologous versus Allogeneic Therapies
With centralized manufacturing of cell therapies, what are the key considerations in
managing the movement of a patient’s cells from the clinic or hospital through to the
manufacturing facility and then back into the patient?
Two major considerations apply to both transport directions – the requirement to keep the
cells in the proper environment (usually at ultra-low temperatures at all times) and a reliable
automated tracking system to ensure proper allocation and distribution of the right therapy to
the right patient. A chain-of-custody mix-up would be disastrous and must be avoided at all
cost, so sample tracking needs to be virtually error-proof. Tracking and secondary labelling
systems, must unequivocally verify the source and chain of custody of every sample in the
therapy manufacturing process. In addition, standardized quality assurance programs must be
implemented.
Prior to transporting harvested cell material from the clinic to the cell therapy manufacturing
site, these programs should establish that all pertinent tests for diseases have been performed
and that processing steps such as leukapheresis have resulted in adequate enrichment and/or
removal of the desired cells without contamination. Quality assurance after therapy
manufacturing involves tests for essential biological parameters of the therapy product such
as cell viability, biological function, proliferative capacity, and differentiation potential.
Cell therapy relocation from the manufacturing site to the point-of-care facility requires
additional considerations that concern proper storage of the therapy in the hospital and
correct handling of the therapy immediately before administration it to the patient. The latter
includes thawing procedures, prevention of contamination, and a final verification procedures
at the patient’s bedside to authenticate sample origin and quality.
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9. Market Trend Analysis - Key Trends Impacting the Marketplace
This section considers key trends impacting the Cell Therapy CDMO Market.
9.1 Regulatory Issues Affecting the Cell Therapy CDMO Market This sub-section considers regulatory issues impacting the Cell Therapy CDMO Market.
9.1.1. FDA Guidelines for HCT/Ps
On September 12-13th, 2016, the FDA hosted a public hearing to review draft guidances
pertaining to the FDA regulation of stem cells at the campus of the NIH, in Bethesda,
Maryland. Specifically, the hearing
addressed the regulation of human cell
and tissue-based products
(HCT/Ps), defined by the FDA in §
1271.3(d) as “articles containing or
consisting of human cells or tissues that
are intended for implantation,
transplantation, infusion, or transfer into
a human recipient.”
The event was widely attended, with
nearly 500 of individuals attending the
event and thousands more watching the live stream. There were also 90 speakers at the
event.
The four FDA draft guidances pertaining to human HCT/Ps are:
1. “Same Surgical Procedure Exception under 21 CFR 1271.15(b)
2. “Minimal Manipulation of Human Cells, Tissues, and Cellular and Tissue-Based
Products; Draft Guidance for Industry and Food and Drug Administration Staff”
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3. “Human Cells, Tissues, and Cellular and Tissue-Based Products (HCT/Ps) from
Adipose Tissue: Regulatory Considerations; Draft Guidance for Industry”
4. “Homologous Use of Human Cells, Tissues, and Cellular and Tissue-Based
Products; Draft Guidance for Industry and FDA Staff”
Over two days, presenters shared a range of different perspectives on the FDA regulation
of stem cells. However, there were also a lot of points of agreement. Specifically, everyone
agreed that human cell and tissue-based products (HCT/Ps) should be allowed for patient
use when there is robust scientific evidence to support it and a strong safety profile. As Dr.
Weissman of the FDA stated in his Keynote Address, “For cell therapies, gathering of
scientific evidence is of paramount importance.”
As Dr. Weissman of the FDA pointed out in his Keynote Address, the term “stem cell” is
often misused, often being used to describe “mixtures of cells.” This is a key point, because
the mechanism of action of a single cell type may vary substantially if the cell population
also includes a range of other cell types. Similarly, Dr. Arnold Caplan, widely regarded as
the “Grandfather of MSCs”, urged the FDA and the scientific community at large to stop
referring to MSCs as “mesenchymal stem cells” and instead identify them as “medicinal
signaling cells.” This language change is meant to recognize the ability of MSCs to have
strong medicinal effects, while identifying that they not exert their effects by regenerating
tissue, but rather by leveraging sensory capabilities, positively affecting the
microenvironment, and being sentinels for injury. As he accurately stated, “Almost every
cell in the body is paracrine in nature.”
Dr. Joanne Kurtzberg, who represents the Cord Blood Association (CBA), has a similar
opinion. Her perspective is that autologous cord blood cells that are administered
intravenously for the treatment of cerebral palsy (CP) in pediatric patients should be
designated by the FDA as “homologous use.” Her reasoning is that cord blood cells exert
their medicinal effects through paracrine signaling, with the function of paracrine
signaling being the same in both the donor and the recipient. Dr. Kurtzber’s point further
identifies the difficulty of limiting biological tissues to one “primary” function.
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Similarly, speakers at the hearing acknowledged that the use of amniotic tissue products in
wound healing is a case of non-homologous use, unless the definition of paracrine
signaling and cell-to-cell regulation is allowed. One of the key issues with the FDA
defining the terms “minimal manipulation” and “homologous use” by tissue source is that
a tissue classification framework is inherently unable to recognize the complex nature of
human cells and tissues and the mechanisms through which cell-to-cell communication
occurs. In all likelihood, the most effective way to address these points raised by Dr.
Caplan and Dr. Kurtzberg would be to broaden the definition of the term “homologous
use” to include paracrine function. Another other approach would be to remove the
requirement that a cell-based product perform the “same primary function” in both the
donor and the recipient.
Several presenters also pointed out that the FDA’s current draft guidances are not
“biologically sound.” The clearest example was that the FDA currently defines the primary
function of the breast as lactation, instead of as a secondary sex organ. Numerous
presenters, including those from the American Society of Plastic Surgeons, noted that the
breast’s primary function cannot be lactation, because many women are not of child
bearing age, among women who do give birth breast feeding occurs for a limited time,
women who never give birth never lactate, and there is fat tissue naturally present in the
breast, which would make use of autologous fat grafting for breast reconstruction
a homologous use.57
There is also a lot of controversy surrounding the FDA’s use of “structural” and “non-
structural” distinctions. Adipose-tissue has many structural uses, including to support and
contour tissues. However, adipose-tissue also has a diverse range of non-structural uses,
including that it acts as a critical store of energy, regulates body metabolism (brown
adipose tissue), and secretes cell signaling proteins, such as adipokines. Therefore, adipose
tissue clearly has both structural and non-structural uses, making it “biologically
57 Because the FDA currently defines the primary function of the breast as lactation, autologous fat grafting for breast reconstruction would
currently be defined as a non-homologous use.
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unsound” to limit the definition of adipose tissue to one application. Subsequently, the
FDA may need to broaden its use of adipose-tissue to include both structural and non-
structural uses. Not surprisingly, those involved with the use of human cells for wound
healing applications find the FDA’s use of “structural” and “non-structural” distinctions to
be inadequate as well. Indeed, tissue products have more than one function and to restrict
them to one function is clinically and scientifically incorrect.
Finally, under the FDA’s proposed draft guidances, it would be regulating the practice of
physicians for the first time in history, an area which has traditionally been outside the
scope of FDA jurisdiction. Currently, there are no FDA approved surgical procedures, but
the FDA’s draft guidances are now regulating how physicians can use human cells and
tissues in a surgical context, thereby (either intentionally or unintentionally) introducing a
new layer of complexity into the practice of medicine.
Additionally, there, there continues to be great controversy as to how time should play into
the FDA regulation process. As mentioned, the FDA does not regulate same-day stem cell
procedures where the cell product is “minimally manipulated.” Under the regulatory
framework for HCT/Ps, “minimal manipulation” of cells or nonstructural tissues is defined
as “processing that does not alter the relevant biological characteristics of cells or
tissues” (21 CFR 1271.3(f)(2)). (See full FDA definition here.)
Finally, it is imperative to note that the four FDA guidances are only that, guidances and
not laws. The purpose of the guidances are to provide cell therapy industry stakeholders
with language and tools through which they can assess their compliance. As such, the
FDA’s draft guidances must adhere to existing law and it is unclear whether they do so.
Additionally, cell therapy industry stakeholders are putting enormous pressure on the FDA
to consider the use of a conditional approval pathway and anonymous patient registry to
track outcome parameters. Public supporters of this approach have been Dr. Arnold Caplan
of Case Western Reserve, Janet Marchbroda of the Bipartisan Policy Center (BPC), and
Leslie Miller of Alliance for the Advancement of Cellular Therapies (AACT), among
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others. As stated by Janet Marchbroda of the Bipartisan Policy Center (BPC) at the
September 12th FDA Public Hearing, “We need to find a middle ground between no
regulation and $1B and 12 years for approval.”58
Dr. Randall Mills of the California Instititute for Regenerative Medicine (CIRM) also
confirms this point. In a recent CIRM post, he identified an unintended consequence of our
current regulatory paradigm stating, “We have a regulatory paradigm that only provides
two pathways to put a cell therapy onto the market. One pathway is the most intense
regulatory requirement anywhere in the world for any product — the biologics license
application through the FDA, which takes 10 to 20 years and costs over $1 billion. The
other is through the exemptions the FDA has made, which require absolutely no pre-market
approval whatsoever. You can be on the market in days, with no data. The regulatory
burden associated with one is massive and the other is almost nonexistent.”59
Clearly, the FDA is still working to figure out how it will regulate human cell and tissue-
based products (HCT/Ps). Depending on how the FDA decides to draw its regulatory
boundaries, development of cell therapies may be easy or challenging, as compared to
traditional pharmaceutical drugs.
58 BioInformant’s President/CEO, Cade Hildreth, attended the FDA’s September 12-13th Public Hearing discussing the draft
guidances pertaining to Human Cell and Tissue Products (HCT/Ps). 59 “New FDA Rules for Stem Cells Won’t Fix the Problem,” Randy Mills, President of CIRM. Available at:
https://blog.cirm.ca.gov/2016/09/14/cirms-randy-mills-new-fda-rules-for-stem-cells-wont-fix-the-problem/. Accessed Feb 19,
2017.
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9.1.2. 21st Century Cures Act
On December 13, 2016, President Barack Obama signed the 21st Century Cures Act,
which passed Congress with bipartisan support. Details of the act and its impact on the Cell
Therapy CDMO Market are highlighted below.
REGROW Act (S. 2689, H.R. 4762)
Sponsor: Sen. Kirk, Rep. Coffman
Cosponsors: Sen. Collins, Sen. Manchin, Rep. Takai, Rep. Griffith, Rep.
Rohrabacher, Rep. Sensenbrenner
Senator Kirk, who suffered from a stroke, sponsored this bill designed to accelerate the
development of new regenerative medicine treatments by providing “clarity for companies
and doctors developing breakthrough regenerative medicine products by codifying an
approval process that will make the system work better and faster.”
It would have permitted the FDA to approve stem cell treatments conditionally, without a
large, final-stage clinical trial that is usually required. Although this pathway would have
allowed regenerative medicine products to enter the market much more quickly, REGROW
was highly controversial due to concerns of allowing potentially dangerous or ineffective
drugs to enter the market before the sponsor provided sufficient evidence on safety and
efficacy.
The “REGROW Act” did not pass, however, the 21st Century Cures Act (H.R.34), the
broad healthcare spending bill signed into law in December 2016, included several
provisions pertaining to stem cell therapy research and clinical approval. The bill does not
mandate the significant changes to the regulatory approval of stem cell therapies expressed
in REGROW, but it does incorporate several sections designed to allow a greater number
of regenerative therapies to come to market. The growing movement to expand the
adoption and implementation of regenerative medicine is reflected in this legislation.
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Key relevant provisions within the 21st Century Cures Act include:
● Does not allow new regenerative medicine products, which include stem cell
therapies, to skip the Phase 3 clinical trials. However, it does permit FDA to grant
them accelerated approval if they show that surrogate endpoints might indicate that
the therapy works, subject to further evaluation. Regulators can approve a therapy
without waiting on a demonstrated clinical benefit.
○ Example: a clinical study that proves a therapy shrinks a tumor could be
used for approval, rather requiring a study with the more onerous endpoint
of improved survival.
● Mandates the NIH, in coordination with FDA, award $10 Billion in each of FY18-
20 for “grants and contracts for clinical research to further the field of regenerative
medicine using adult stem cells, including autologous stem cells” contingent on
matching contributions from recipient.
● Requires FDA consult with stakeholders and the National Institute of Standards and
Technology to facilitate an effort to establish standards, to support the development,
evaluation, and review of regenerative medicine and advanced therapies products.
○ Such standards are expected to play a large role in advancing this nascent
industry. Shaping the industry through changes such as creating FDA-
recognized standards, eliminating the need for companies to create and
validate their own.
○ This is an opportunity to weigh in on the future of regenerative therapies,
and influence the regulatory and clinical environment.
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9.2. Global Trends
This section considers global trends impacting the Cell Therapy Manufacturing Market.
9.2.1. Accelerated Approval Pathway in Japan
New regulations accelerating the approval of regenerative therapeutics in Japan took
effect November 25, 2014. The significance of these regulations is that they allow
companies to receive conditional marketing approval and commercialize regenerative
medicine products while clinical trials continue through later stages. The accelerated
commercialization of cell therapies is part of the economic revitalization plan initiated by
Prime Minister Shinzō Abe. Under Shinzō Abe, Japan has been pursuing regenerative
medicine and cellular therapy as key strategies to the Japan’s economic growth. Japan’s
Education Ministry also indicated that it is planning to spend 110 billion yen ($1.13
billion) on induced pluripotent stem cell research during the next 10 years, and the
Japanese parliament has been discussing bills that would “speed the approval process and
ensure the safety of such treatments.”60
Although regenerative medicine is a huge priority for Japan, regenerative medicines have
been limited because of the difficulty getting through Japan’s Pharmaceuticals and
Medical Devices Agency (PMDA), with only two approved allogenic cell therapy
products and fewer than 15 clinical trials as of May 2014.61
TWO NEW REGENERATIVE MEDICINE LAWS IN JAPAN
In late 2014, Japan exercised two new acts: One is the Act on the Safety of Regenerative
Medicine (Law 85/2013) and the other one is the Pharmaceuticals and Medical Device
(PMD) Act (Law No. 84/2013). The aim of the first act was to accelerate the clinical
application and commercialization of innovative regenerative medicine therapies. It
60 Dvorak, K. (2014). Japan Makes Advance on Stem-Cell Therapy [Online]. Available at:
http://online.wsj.com/news/articles/SB10001424127887323689204578571363010820642. Web. 8 Apr. 2015. 61 Thomas Heathman, M. (2017). Current and Future Scale-Out Needs in Cell Therapy Manufacturing. [online] Pctcelltherapy.com. Available at: http://www.pctcelltherapy.com/pct-pulse/current-and-future-scale-out-needs-in-cell-therapy-manufacturing [Accessed 23 Jun. 2017].
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covers clinical research and medical practice using processed cells and specifies the
procedure required for clearance to administer cell procedures to humans. These
guidelines are very important to the use the cells within clinical stages.
Similarly, the PMD Act introduces a specific regulatory framework for regenerative
medicine products. Under the PMD Act, conditional and time-limited marketing approval
can be given to a regenerative medicine product after exploratory clinical trials have
demonstrated probable benefit and proven safety. Under these new laws, once a company
has demonstrated safety and basic efficiency data in humans and has the cell product
manufactured to the standards described within the Pharmaceutical and Medical Devices
(PMD) Act, the cell therapy can be given conditional approval for up to seven years. This
allows for commercial use with data reporting requirements and potential for national
insurance coverage.
The intent of the laws is to accelerate the commercialization of cell therapeutics within
Japan by allowing companies to benefit from conditional marketing authorization.
Therefore, cell therapies that show safety and probable efficacy during Phase I and Phase
II trials can get conditional approval for up to seven years, during which time:
1) Larger-scale, later-stage clinical trials are performed
2) Revenue from the cell therapy is pursued within the Japanese market.
During the seven-year conditional approval period, companies must continue filing
clinical trial data, either applying for final marketing approval (the equivalent of a BLA
[Biologic License Application]) or withdrawing the product within seven years.62
This safety data can subsequently be used by non-Japanese participants, which is a
massive benefit to foreign companies, such as those located in the United States. The
regulatory environment in Japan provides companies with the unique opportunity to “fast
62 Ibid.
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track” a clinical trial and seek approval of a new cell therapy product within the Japanese
market.
As Kaz Hirao, CEO of Cellular Dynamics International, recently told BioInformant’s
President/CEO Cade Hildreth, “This has made Japan a ‘gate country’ for developing
innovative cell therapies with the potential to address major unmet medical needs.”63 This
has provided a strategic opportunity to American companies, because they can benefit
from fast track applications through doing clinical testing within Japan and subsequently
developing its cell therapy across the rest of the world. Numerous American and
Australian companies are pursuing this strategy, as well as other companies from other
countries worldwide.
63 Interview with Kaz Hirao, CEO of Cellular Dynamics International (CDI), a FUJIFILM Company. Conducted by BioInformant’s President/CEO, Cade Hildreth on January 29, 2017.. Available at: https://www.bioinformant.com/cellular-dynamics-cdi-kaz-hirao/.
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9.2.2. Prolific Partnering Between Cell Therapy Companies and
Japanese Companies
Another major trend impacting the cell therapy companies, and therefore the Cell
Therapy CDMO Market at large, is the rush of recent partnering that has happened
between cell therapy companies and Japanese pharmaceutical companies. Cell therapy in
Asia has been gathering momentum over the past several years. Japan accelerated its
position as a hub for regenerative medicine research, largely driven by support from
Prime Minister Shinzo Abe, who identified regenerative medicine and cellular therapy as
key to the Japan’s strategy to drive economic growth. China, South Korea, and other
Asian nations have also taken measures to support cell therapy development within their
borders.
While North America, led by the U.S., is the largest market for stem cell therapies, cell
therapy in Asia is becoming the fastest growing market.
The drivers for rapid growth of cell therapy in Asia include:
• Mounting government and private investment
• Establishment of accelerated approval pathways
• An aging population with increasing healthcare needs
While large pharmaceutical companies will serve the Asian market, biotech companies
from outside of Asia that focus on developing innovative cell therapies may play a
pivotal role by bringing their technologies to these growing markets. They will likely do
this through various forms of partnering and joint ventures with local companies.
Strategic Partnerships and Joint Ventures in Asia
Partnering activities in Japan for cell therapy companies has been prolific, with recent
deals impacting Pluristem, Mesoblast and Athersys, and a list of other cell therapy
companies. Israel-based Pluristem Therapeutics, a late-stage biotech and a leader in
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clinical development and manufacturing of stem cell therapies, has two products, PLX-
PAD and PLX-R18, that are in or are entering into late stage trials.
Pharma companies and VCs in Japan, South Korea and China have taken notice.
Pluristem announced that it has signed a term sheet for a joint venture in Japan with Sosei
CVC, the venture capital arm of Japanese biopharma company Sosei Group.
Pluristem had already been very active in Japan, receiving agreement from Japan’s
Pharmaceuticals and Medical Devices Agency (PMDA) for its PLX-PAD cells to be
developed under an accelerated regulatory pathway for regenerative medicine.
In South Korea, Pluristem has a strategic partnership with CHA Bio. CHA is to perform
and fund multiple clinical trials in South Korea with PLX cells and a JV is to be
established upon commercialization; CHA is already recruiting for an ongoing Phase 2
trial in intermittent claudication. China’s Innovative Medical Management, a healthcare
focused VC fund, is looking to invest $30 million in Pluristem, based on a binding terms
sheet signed by the parties in November 2016.
Pluristem is an interesting case study for how to partner and align with Asian partners for
purposes of optimizing global market potential.
As Colin Lee Novick, Managing Director at CJ Partners told BioInformant’s
President/CEO, Cade Hildreth, “Japanese players are now aligning themselves with their
MSC biotech of choice.”
This is extremely true, as MSC biotechs that have partnered with Japanese
companies include:
• Mesoblast with JCR Pharmaceuticals Co. Ltd. – December 3, 2015
• Pluristem with Sosei CVC – December 20, 2016
• Athersys with Healios – January 8, 2016
• TiGenix with Takeda – July 5, 2016
• Cynata Therapeutics with FUJIFILM Corporation – September 5 2016
• Steminent with ReproCELL – November 22, 2016
• Regeneus with AGC Asahi Glass – December 29, 2016
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Most of these deals were recently inked, with six of the seven occurring during the 2016
calendar year and the seventh signed in December of 2015.This was greatly facilitated by
the Japanese government passing the “Act on the Safety on Regenerative Medicine” and
making revisions to the “Pharmaceutical and Medical device Act” in late 2014, which
was a major boost for cell therapy in Asia. Specifics of agreements between MSC
companies and Japanese players are detailed below.
On December 3, 2015, Mesoblast entered into an agreement with its licensee in Japan,
JCR Pharmaceuticals Co. Ltd., to launch its mesenchymal stem cell (MSC) product for
the treatment of acute graft versus host disease ( acute GVHD) in children and adults in
Japan.
On December 20, 2016, Pluristem signed a term sheet for a joint venture in Japan with
Sosei CVC, the venture capital arm of Japanese biopharma company Sosei Group.
Pluristem also has a strategic partnership with CHA Bio in South Korea, and China’s
Innovative Medical Management is looking to invest $30M in Pluristem, based on a
binding terms sheet signed by the parties in November 2016.
On January 8, 2016, Athersys entered into a partnership with Healios, a Japanese fund that has
previously partnered with Japanese pharma and academic institutions to develop cell therapies.
The partnership was formed to develop Athersys’ product to treat ischemic stroke and other
potential indications using accelerated regulatory pathways for regenerative medicine.
On July 5, 2016, TiGenix NC entered into a partnership with Takeda Pharmaceutical
Company for an “exclusive ex-U.S. license, development and commercialization
agreement for Cx601, a suspension of allogeneic adipose-derived stem cells (eASC)
injected intra-lesionally for the treatment of complex perianal fistulas in patients with
Crohn’s disease.” This is a lucrative deal, because TiGenix received an upfront cash
payment of €25M and could qualify for additional regulatory and sales milestone
payments up to €355M. Takeda executed its option to opt into the Canada and Japanese
markets very recently as “add-ons” to the original deal that they signed back in July.
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On September 5, 2016, Cynata Therapeutics executed a term sheet with FUJIFILM
Corporation of Japan for the “development and commercialization of certain Cynata
technology, including Cynata’s lead induced pluripotent stem cell (iPSC) derived
therapeutic mesenchymal stem cell (MSC) product, CYP-001.” FUJIFILM is one of the
world’s leading companies investing in the development of regenerative medicine
therapies, making this a major deal for the Australian start-up, Cynata Therapeutics.
On November 11, 2016, Steminent Biotherapeutics entered into a partnership with
ReproCELL to “develop and commercialize Steminent’s allogeneic stem cell therapy
product, Stemchymal, in Japan.” Based on the terms of the agreement, ReproCELL will
get exclusive rights for the development and commercialization of Stemchymal for
treating Spinocerebellar ataxia (“SCA”) in Japan and have right of first negotiation for
the use of Stemchymal in other disease indications.
On December 29, 2016, Regeneus entered into a partnership with AGC Asahi Glass
(AGC), a major Japanese manufacturer of glass, chemicals, high-tech materials and
biopharmaceuticals, for “exclusive manufacture of Progenza stem cell technology for
Japanese market.” According to Regeneus, the Progenza product is generated from
expanded MSCs extracted from the adipose tissue and includes secretions from MSCs
that enhance the viability and functionality of the cells during the freezing/thawing
process. Regeneus will form a 50/50 joint-venture (JV) with AGC as part of their deal,
and this JV will be in charge of finding a pharmaceutical company to provide the
commercialization of the Progenza product in Japan.
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9.2.3. Cell Therapy Products and Pricing Resulting from the Japanese
Regulatory Framework
In 2014, Japan has passed a new law for regulation of Regenerative Medicine. Under this
law, the regulatory pathway for commercial cellular products is significantly accelerated by
skipping of typical “Phase 3 trial” and allowance of marketing authorization after
demonstration of safety and some (minimal) signs of efficacy (Phases 1/2). Under this
accelerated regulatory framework, cell therapy candidates can be available to patients faster
and company will able to generate profit and survive.
It is important to keep in mind that this accelerated approval is conditional. In the next few
years after market authorization, company-developer obligated to provide clinical data on
efficacy. If there is strong evidence for the efficacy, the product gets to stay on the market.
Two years later, in September of 2015, the new Regenerative Medicine law yielded the first
results – two cell products were approved on Japanese market. The first product is TemCell
(by JCR Pharmaceuticals) – allogeneic mesenchymal stromal cells for GVHD. The second
product is HeartSheet (by Terumo) – autologous skeletal muscle cells for heart failure.
Two months after market authorization, both products have received price tag and
reimbursement decisions. TemCell is priced ~ $115,000 – $170,000 USD (depending on total
number of doses infused) and HeartSheet is priced ~ $120,000 USD. Depending on insurance
plans, Japanese patients will still pay out of pocket anything between 5% to 30% of the
product price.
Also, there are few countries which pioneered the system of conditional approvals a long
time before Japan. South Korean KFDA was the first to implement regulatory conditional
approval system for cell products more than a decade ago (even thought, not exclusively for
cellular products). Since 2001, S. Korea approved ~18 cell products on the market, most of
them conditionally. Brazil, Canada and Europe also have accelerated conditional approval
systems in place. For example, dendritic cell-based cancer vaccine Hybricell was
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conditionally approved in Brazil in 2005. Stem cell drug Prochymal was conditionally
approved in Canada in 2012.
Finally, European EMA has a condition market authorization option. All these conditional
approval systems are very similar. During S. Korea’s 15+ year history of conditional
approvals, 18 cell therapy products were conditionally approved. Among those, there is only
one clear example of the product not making it to final approval.64 Inno-LAK, a lymphokine
activated killers product by Innomedisys, was approved conditionally by KFDA in 2007 for
lung cancer, but the company failed to provide additional clinical data and product was
pulled from the market in 2012. Right now we are witnessing unique experiment where
several different countries are simultaneously testing different regulatory frameworks for
cell-based products
64 It is difficult to search for information on S. Korea companies, because very little of the information is in English. This number is believed to
be accurate, but further study would be needed to verify its accuracy.
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10. Technologies Impacting the Cell Therapy Manufacturing Market
This section considers technologies impacting the Cell Therapy Manufacturing market.
10.1. Closed-System Manufacturing
There are four criteria that impact successful cell therapy manufacturing:
1. Consistently high product quality
2. Reasonable cost of goods
3. Production of quantities that meet demand
4. Sustainable capability through commercialization of a product
Most cell therapies today are manufactured
in cleanrooms, but closed systems will play
an increasingly important role in future of
cell therapy manufacturing. Closed systems
mitigate the risks of cross-contamination
and therefore allow concurrent processing of
multiple batches, which gives enormous
savings in terms of facility efficiency as
well as labor costs.
Every one hour of labor saved in a patient-specific process is one hour saved on every single
dose you manufacture, because each batch is made for one patient. By contrast, if you save
one hour of costs in a large-scale bioreactor process that is making a product for 10,000
patients, the cost savings per person will be that one hour’s cost divided by 10,000.
Another consideration for scaling cell therapy manufacturing is the tradeoff between clean
room space and ongoing commercial supply as patient numbers increase from clinical
development to commercial production. For an autologous therapy if a company was
treating, for example, 100 patients in a typical 2-week process for a Phase III clinical trial,
they would likely require four clean room facilities in order to separate each patient lot,
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assuming that the process is not entirely closed and therefore each lot must be segregated to
avoid cross contamination.65
The issues then arise if the product is successful and commercial production is carried out
using the same process for say 1000 or even 10,000 patients per year, where the clean room
and personnel requirements increase 10-fold or 100-fold respectively, making the product
cost-prohibitive at this scale. This will drive the development of expansion platforms that
are fully closed, so that multiple patient lots can be manufactured in the same facility,
greatly reducing fixed and operating costs as the product moves toward commercial
production.
10.2. Automation of Cell Therapy Manufacturing Processes
Moving away from manual labor means that automation and integration will play an
important role in the future of cell therapy manufacturing. Computers used to be large in
size, because each function had to be contained in a separate modules, but the functions have
been progressively integrated into smaller, integrated pieces of equipment. The same thing is
happening in cell therapy manufacturing industry. The different steps involved in cell
therapy will gradually become integrated so that a single, closed unit can execute multiple
operations.
10.3. Automation of Data Management
Another technology that will impact cell therapy manufacturing will be the automation of
data collection and management. Over time, paper-based systems will be eliminated and all
information management will be electronic, including the tracking of cells to avoid the risk
of the patient receiving the wrong cells (which could be life threatening). However, humans
currently conduct visual comparisons of labels at different steps in the process, to ensure a
chain of identity back to the patient is maintained.
65 The translation of cell-based therapies: clinical landscape and manufacturing challenges,” Heathman et al. January 2015 ,Vol. 10, No. 1, Pages 49-64 , DOI 10.2217/rme.14.7. Available at: http://www.futuremedicine.com/doi/full/10.2217/rme.14.73.
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This manual system works for companies that are manufacturing products for a few patients
per week, but once they expand operations to make making thousands of patient-specific
batches per year, the risk for confusion between batches escalates substantially. The future
of cell therapy manufacturing will manage those risks using machine-readable technologies
such as bar code systems or RFID.
For example, the BLA files that Dendreon submitted to the FDA for their first cell therapy
(Provenge) shows a 3-year gap between the first submission and approval, which was
caused at least in part, by Dendreon needing to implement an electronic laboratory
information management system
(LIMS). This activity resulted after
the FDA expressed concerned about
Dendreon’s potential to mix up cell
samples for QC testing. The concern
was based on the fact that Dendreon
would be operating at 10 times the
scale of the clinical trial, which
increased the risk of mix-ups
substantially.
10.4. Bioreactor Technologies
Another area that will see further development is bioreactor design for cell culture steps, in
particular, for the steps needed to expand cells to the required dose. Historically, bioreactor
design has focused on the needs of large-scale culture of mammalian cell lines that are at the
heart of the biotech industry (e.g., hybridomas to produce monoclonal antibodies, CHO cells
to produce recombinant proteins).
For patient-specific therapy, the needs are quite unique and challenging: dealing with the
inherent batch-to-batch culture variability of primary human cells, harvesting the cells as the
product instead of what the cells secrete, working with very small process scales (clinical
scale and commercial scale are the same small scale – one patient), and automation of steps
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that have previously not made sense to automate such as priming, inoculating, and
harvesting of the bioreactor. Bioreactors are certain to play a major role in the future of cell
therapy manufacturing. Several companies are innovating in this area, including Pall
Corporation, RoosterBio, GE Healthcare, Miltenyi Biotec, Octane, and others.
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11. Market Potential for Autologous vs. Allogeneic Manufacturing
To determine the percentage of the cell therapy market that is contributed by allogeneic versus
autologous manufacturing, we again reviewed the ten leading cell therapy companies profiled in
Section 7.2. While these companies do not representative the entire cell therapy marketplace, they are
ten of the largest, most important cell therapy companies competing in it. With several cell therapy
product candidates in late-stage clinical trials, these leading cell therapy companies also represent
companies with large-scale manufacturing needs.
Therefore, the breakdown of autologous versus allogeneic cell therapy manufacturing among
these ten market leaders is important to consider and reflective of broader trends across the cell
therapy marketplace.
As shown below, allogeneic cell therapy manufacturing is much more common among leading
cell therapy companies. Among the ten leading cell therapy companies analyzed below, eight
focus exclusively on allogeneic cell therapy product development, one develops both autologous
and allogeneic cell therapies products, and one is developing autologous cell therapies.
TABLE. Allogeneic vs. Autologous Product Development Among Leading Cell Therapy
Companies
Company Autologous vs. Allogeneic Cell Therapy Development
Cell Therapy Product(s) in Clinical Trials
Astellas Pharma, and Subsidiary Ocata Therapeutics Allogeneic RPE Cells
Cellectis Allogeneic UCART123
Cynata Therapeutics Allogeneic CYP-001
Gamida Cell Ltd. Allogeneic NiCord, CordIn
Mesoblast Ltd. Allogeneic MPCs / MSCs
Pluristem Therapeutics Allogeneic PLX Cells
ReNeuron Allogeneic CTX Cells
TiGenix NV Allogeneic Cx601, Cx611 AlloCSC-01
TOTAL # OF COMPANIES (Allogeneic Only) 8
Asterias Biotherapeutics Autologous and Allogeneic
AST-VAC1 (Autolgous) AST-VAC2, ASTOPC1 (Allogeneic)
TOTAL # OF COMPANIES (Allogeneic & Autologous) 1
Cytori Therapeutics Autologous ESCCS-50
TOTAL # OF COMPANIES (Autologous Only) 1
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Over the next five years, it is estimated that more than 80% of all cell therapy manufacturing will be for
allogeneic cell products, with a rise in that percentage over time. Within 10 years, that number is
expected to rise such that 85-90% of all cell therapy manufacturing will be for allogeneic products.
There are seven key reasons that support this projected increase in allogeneic cell therapy
manufacturing, including:
1. Limited Use for Autologous Cell Therapies: Autologous therapies can only be used to
treat disease conditions where the patient’s cells are not affected. This requires a healthy
patient and limits the disease conditions which autologous cell therapies can address.
2. Time and Cost of Sourcing Autologous Cell Therapies: Autologous therapies can
delay the time to treatment, because cells from the patient typically need to be harvested,
purified/prepared, and re-administered. While some technologies, like Cytori’s fully
automated Celution® System can disaggregate adipose tissue to product a cell therapy
product for administration within 1–2 hours of tissue collection, not all autologous cell
extraction procedures can occur that quickly. Furthermore, additional physician time is
often required for the step of harvesting stem cells prior to autologous cell therapy
treatment, adding both cost and complexity to the procedure.
As an example, RIKEN transplanted the world’s first iPSC-derived cell therapy product to
a patient in 2014 (an autologous retinal transplant), but later suspended the trial due to a
gene abnormality found in the iPS cells. When the trial resumed in 2016, the study team
led by Masayo Takahashi stated that they intended to use an allogeneic iPS cell product in
the resumed trial, citing that using autologous iPS cells was “time-consuming and
costly.”66
3. Sourcing of Some Autologous Cell Types is Difficult: Not all types of autologous stem
cells can be readily sourced. For example, neural stem cells (derived from neural tissue in
66 "Riken To Resume Retinal Ips Transplant Study In Cooperation With Kyoto University | The Japan Times". The Japan Times. N.p., 2017.
Web. 22 Feb. 2017. Available at: http://www.japantimes.co.jp/news/2016/06/07/national/science-health/riken-resume-retinal-ips-transplantation-cooperation-kyoto-university/#.WK3_xVUrLIV.
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the brain) do not easily lend themselves to an autologous cell therapy approach.67
Additionally, the quantity of many types of stem cells present within the human body
declines with age.
4. High Cost of Autologous Cell Therapies: The cost of autologous cell therapies can
often be exorbitant, because each dose must be prepared on a patient-by-patient basis.
5. Growing Utilization of Allogeneic iPS Cell Therapies: Induced pluripotent stem cell
(iPS cell) therapies will play an increasing role in cell therapy development over the next
10 years. As the safety hurdles related to the clinical use of iPS cells get addressed, iPS
cells represent a cell population from which companies can derive virtually limitless
quantities of an allogeneic cell therapy product. For example, Cynata’s CymerusTM
technology represents the first time in history that an allogeneic iPSC-derived cell product
(CYP-001) can be manufactured in unlimited quantities, in uniform batches, from a single
donor, and at low cost.
6. No Room for Error: When manufacturing an autologous cell therapy, it is critical to
manufacture it “right first time,” otherwise the patient does not get treated. The technical
and manufacturing processes for autologous therapies must be fail-proof.
There is also a greater need for patient sample tracking systems and software with
autologous cell therapies. For example, the BLA files that Dendreon submitted to the FDA
for their first autologous cell therapy (Provenge) shows a 3-year gap between the first
submission and approval, which was caused at least in part, by Dendreon needing to
implement an electronic laboratory information management system (LIMS). This activity
resulted after the FDA expressed concerned about Dendreon’s potential to mix up cell
samples for QC testing. The concern was because Dendreon would be operating at 10
times the scale of its clinical trial, which increased the risk of mix-ups substantially
67 For these situations, a logical autologous approach would be to use either directly reprogrammed cells or autologous induced pluripotent stem
cells (iPSCs). However, there are only two clinical trials underway worldwide that involve implantation of iPSC-derived cell products into
humans, being conducted by RIKEN Center for Developmental Biology and Cynata Therapeutics, respectively.
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7. Growing Interest and Investment in Bioreactor Technologies: Finally, bioreactor
technologies will play an increasing role in cell therapy manufacturing over the next 10
years, allowing allogeneic cell therapies to be manufactured on a very large scale.
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12. Cell Therapy Manufacturing Considerations and Challenges
There are currently challenges facing the Cell Therapy Manufacturing Market, particularly
regulated to the manufacture of cell therapy products under GMP conditions. Conventional
bioprocesses use cells to produce therapeutic agents, which can then be isolated and purified
without the need to recover the cell. For the manufacture of cell-based therapies, retention of cell
function and quality is of primary importance to preserve product efficacy. This consideration is
particularly important, because a number of these cell types are adherent, meaning that they must
be detached or harvested from a culture substrate, prior to downstream processing.
Effective manufacture is reliant on measuring these critical quality attributes and establishing the
allowable deviation of these product characteristics from a predetermined set point. The use of
potency assays are then required to provide a batch release test that validates whether the cell
product is consistent, stable and of sufficient quality for therapeutic use, as well as providing a
comparability metric to validate process changes.68 Stringent safety assays must also be
considered for cell-based therapies as many current processes use animal-derived products
during culture, which could lead to pathogen transfer or immune complications once infused into
the recipient.69
Additionally, the use of pluripotent stem cells brings a new set of safety challenges within
downstream purification, ensuring that the unlimited growth potential of these cells is not
transferred to the patient.70 The requirement for high levels of process and product
characterization results in significant direct costs in all process stages, from establishment of a
master cell bank (for allogeneic products), to final product testing. Finally, cell-based therapies
are complex biological products that are sensitive to their environment and display intrinsic
variability within a tightly regulated industry.
68 Review of the requirements for defining and measuring the quality of cell-based therapies, which is a key step in their successful manufacture.
Bravery CA, Carmen J, Fong T et al. Potency assay development for cellular therapy products: an ISCT review of the requirements and
experiences in the industry. Cytotherapy 15(1), 9–19 (2013). 69 Moll G, Hult A, Von Bahr L et al. Do ABO blood group antigens hamper the therapeutic efficacy of mesenchymal stromal cells? PLoS ONE 9(1), e85040 (2014). 70 Rayment EA, Williams DJ. Concise review: mind the gap: challenges in characterizing and quantifying cell- and tissue-based therapies for
clinical translation. Stem Cells 28(5), 996–1004 (2010).
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Variation in a cell therapy product can come from two sources:
1) Process Input Material
2) Process Conditions
For allogeneic cell therapies, where cells from one patient can be given to many patients, this
input variability can be reduced by careful selection of comparable input material to the process.
Alongside this, the variability in process conditions can be managed in part by automating the
manufacturing process allowing for increased control and process capability. This allogeneic or
‘off-the-shelf’ business model for cell-based therapies is far more similar to current
biopharmaceuticals, where the product is constructed to maintain long-term stability.
In contrast, autologous cell-based therapies, where cells are taken from a patient and returned
to the same patient, represents a different manufacturing challenge, because patient populations
must be stratified to control this input variation. Issues surrounding the quality test burden and
logistics of personalized (services based) medicine add to the complexity for large scale
production and delivery of a cost effective autologous cell-based therapy.71
Additionally, delivery of autologous cell-based products can be complex due to the short-term
preservation methods used for transport and delivery, for example the shelf life of Provenge, an
autologous peripheral blood mononuclear cell-based therapy suspended in Lactated Ringer's
Injection solution is only 18 h at 2–8°C.72
Several allogeneic therapies in development are also shipped to clinical delivery sites in a non-
cryopreserved format. This results in the need to maintain a constant level of production, even
when clinical demand may vary greatly, as non-cryopreserved products typically have a shelf life
on the order of days and significant product waste can occur. This increases overall product cost
and requires larger batch sizes to be produced.
71 Mason C, Dunnill P. Assessing the value of autologous and allogeneic cells for regenerative medicine. Regen. Med. 4(6), 835–853 (2009). 72 European Medicines Agency. European Public Assessment Report: Provenge (2013). Available at: www.ema.europa.eu/ema/index.jsp?curl=pages/medicines/human/medicines/002513/human_med_001680.jsp&mid=WC0b01ac058001d124
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Considering the range of potential cell-based therapies, multiple manufacturing models must be
carefully designed to fill the need of both universal (“scale-up”) and personalized (“scale-out”)
therapies and control the biological variation in order to achieve a consistent product.
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13. Conclusions
This report has focused on understanding opportunities and challenges that affect the Cell
Therapy Manufacturing Market. For cell therapy companies, the technical difficulties associated
with cell therapy product development can be numerous. First, there are challenges associated
with acquiring sufficient funding to support product development. Second, cell therapy
companies must navigate a complicated and uncertain regulatory environment. Third, even when
market access is achieved, acquiring and maintaining sufficient reimbursement for a cell therapy
product is far from certain, as physician adoption cannot be assumed.
Table. Summary of Key Challenges for Cell Therapy Companies
For cell therapy companies, it is vital to focus on the efficient use of capital during product
development and manufacturing scale-out. Because of the difficulties that cell therapy companies
face as they bring cell therapies to market, contract development and manufacturing organization
(CDMOs) can offer important strategic and cost-advantages, such as delaying investment in
facilities, limiting employee payroll obligations, and controlling capital expenditures. Among
cell therapy CDMOs, some specialize in cell therapy CDMO services, some are hybrid
companies that offer both cell therapy CDMO services and develop cell therapy products, and
some offer a wide range of CDMO services for biopharmaceuticals, biologics, and ATMPs.
Additionally, there are academic and medical centers that offer GMP compliant cell therapy
manufacturing services, although their production capacity is usually limited and best suited to
support early stage needs.
Key Challenges
• Pre-market: Persevering through lengthy developmental timelines and navigating the regulatory environment
• Post-market: Securing reasonable reimbursement and encouraging adoption
• Manufacturing: Scaling up production, addressing distribution logistics, and managing cost of goods sold
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Table. Key Benefits of Cell Therapy CDMOs to Cell Therapy Companies
In an analysis of ten leading cell therapy companies, it was identified that nearly all recently
formed cell therapy companies (younger than 15 years) prefer to use cell therapy CDMOs. Most
of cell therapy companies that perform their own cell therapy manufacturing either formed
before the Cell Therapy CDMO market existed, and were therefore forced to acquire cell therapy
manufacturing expertise, or specialize in technologies related to cell therapy manufacturing,
often large-scale bioreactor production of therapeutic cell types.
Although this analysis has identified difficulties associated with cell therapy product
development, cell therapies represent a breakthrough technology that could forever change the
landscape of human health. Positive forces impacting the Cell Therapy Manufacturing Market
include the need for innovative therapies to serve an aging global population, the potential to
reverse and repair disease, the ability of cell therapies to replace invasive surgeries, and an
improving regulatory framework for cell therapies with Japan, South Korea, the United States,
and Brazil, and other countries worldwide. Clearly, the future of the Cell Therapy Manufacturing
Market is bright.
Key Benefits
• Cost Reduction for Cell Therapy Companies
• Cash Flow Management for Cell Therapy Companies
• Limit Facilities Investment for Cell Therapy Companies
• Provides Skilled Workforce with Cell Therapy Manufacturing Expertise
• Provides Regulatory and Reimbursement Guidance
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About BioInformant.com BioInformant is the first and only market research firm to
specialize in the stem cell industry.
BioInformant research has been cited by prominent news
outlets that include the Wall Street Journal, Nature
Biotechnology, Xconomy, and Vogue Magazine.
Serving Fortune 500 companies that include Pfizer,
Goldman Sachs, and GE Healthcare, BioInformant is your
global leader in stem cell industry data.
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