Arm annual report_2014

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Arm annual report_2014

  1. 1. Regenerative MedicineRegenerative Medicine ALLIANCEfor Regenerative Medicine Annual Industry Report 2014
  2. 2. Table of Contents Letter from the Chairman.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Regenerative Medicine 2014 Geographic Breakdown. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Industry Sector Breakdown. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Clinical Regenerative Medicine and Advanced Therapy Clinical Overview.. . . . . . 4 Primary Cell-Based Therapeutics. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Stem and Progenitor Cell-Based Therapeutics.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Cell-Based Immunotherapies.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Gene Therapies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Clinical Breakdown by Therapeutic Category. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Finance Regenerative Medicine Cell and Gene Therapy Financial Performance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Noteworthy Deals and Acquisitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Noteworthy Financings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Pharma and Large-Cap Biotech Survey The Pharmaceutical and Large-Cap Biotech Perspective on Regenerative Medicine. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Where is Pharma Investing?.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Autologous vs. Allogeneic Cells.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 How Pharma and Large-Cap Biotechs are Organized to Pursue Regenerative Medicine.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Where Pharma Sees Major Therapeutic Opportunities.. . . . . . . . . . . . . . . . . 30 Where Pharma Sees the Major Challenges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 ARM Membership. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Information in this report is from March 2013 through March 2014.
  3. 3. 1 Letter from the Chairman 2014: What a year to be in the Regenerative Medicine space. The field has matured and we believe is now “ready for prime time.” From the wide variety of companies developing innovative medicines and the creation of numerous support and services companies, to the range of indications being researched, to the number of IPOs and major investments in the past 12 months, it is clear that at this point regenerative medicine has reached a level of critical mass. Every year we see compounded successes in the field, and the Alliance for Regenerative Medicine’s (ARM) Industry Annual Report covers many of these accomplishments. This year will see some exciting developments for the field, a few of which I’d like to highlight here. ARM is actively tracking more than 400 of these companies and many are featured in this Report. It’s estimated that there are now more than 700 companies worldwide with a tangible regenerative medicine focus, ranging from divisions of multinational corporations, to smaller firms focused on niche products or platform technologies. Cell-based therapies represent the most mature sub-sector of regenerative medicine, and at this point, hundreds of thousands of patients around the world have been treated with these therapies. As the standard-of-care has now evolved to include FDA- approved cell therapies, new frontiers are also opening. Exciting breakthroughs in cell-based immune therapy and gene therapy have opened new avenues to transform patient care. 2014 is also a big year for regenerative medicine clinical milestones. Starting on page 9, this report highlights the major anticipated clinical events of this year. ARM has also surveyed our colleagues in the pharmaceutical industry, to gauge the level of interest and support Big Pharma has for supporting and developing regenerative medicines. We are pleased to feature the results of ARM’s Pharma Survey, demonstrating the increasing level of investment and activity, starting on page 24. In March, we were thrilled to see the culmination of many years of effort, when U.S. Senators Barbara Boxer (D-CA) and Mark Kirk (R-IL) introduced the Regenerative Medicine Promotion Act to help accelerate the discovery and development of new regenerative medicines. Government regulation can play an important role in either fostering or impairing innovation. We need to promote a rigorous, yet efficient and transparent, CBER regulatory process for cell-based therapies. We also need to advocate for value-based health policy; otherwise we will likely see short-sighted decisions based only around cost controls vs. value creation. The promise of our field is to deliver cost-effective, life- saving or life-enhancing medicines which target the underlying disease, rather than the symptoms. We must ensure that healthcare reform prizes proven innovation, and ultimately changes patients’ lives. This Report is a terrific resource for those who would like to explain our field in more detail. So let’s dive in to 2014 and learn more about what is on the horizon. Geoff MacKay Chairman, Alliance for Regenerative Medicine President and CEO, Organogenesis Inc.
  4. 4. 268 North America 100 Europe 39 Asia 11 Australia & New Zealand Global Breakdown of 418 Leading Companies 2 ARM’s Definition of Regenerative Medicine Regenerative medicine research translates fundamental knowledge in biology, chemistry and physics into materials, devices, systems and a variety of therapeutic strategies, which augment, repair, replace or regenerate organs and tissue. These therapies represents a new paradigm in human health with the potential to resolve unmet medical needs through technologies that are specifically developed to modify diseases and enable tissue regeneration or replacement. This includes cells, biologics, genes or drugs controlling pathways related to disease causation in addition to regulating tissue regeneration, as well as synthetic or natural scaffolds for tissue engineering. Regenerative Medicine Industry 2014 It’s estimated that there are more than 700 companies worldwide with a regenerative medicine focus ranging from divisions of multinational corporations to smaller firms focused on niche products or platform technologies. The Alliance for Regenerative Medicine (ARM) is actively tracking 418 of these leading companies. This report covers the clinical activity and trends of 247 therapeutically-focused regenerative medicine and advanced therapy companies developing cell therapies, gene therapies and gene- modified cellular therapies.
  5. 5. Cell Therapies Primary cell-based therapies represent the most mature sub-sector of regenerative medicine. These therapies are composed of terminally differentiated adult cells isolated directly from human tissue including fibroblasts, keratinocytes, chondrocytes, osteoblasts, myocytes, hepatocytes, leukocytes, lymphocytes and endothelial cells, to name a few. Stem cell and progenitor cell therapies represent the largest therapeutic sub-sector of the regenerative medicine industry. These therapies are based on a variety of different stem cell types including hematopoietic stem cells, mesechymal stem cells, neural stem cells, epithelial stem cells, embryonic stem cells and more recently, induced pluripotent stem cells. First generation cell-based immunotherapy products are based on interleukins, cytokines, chemokines, etc., but an emerging class are cell-based immuno­ therapies that employ lymphocytes, macrophages, dendritic cells, T-cells, natural killer cells and cytotoxic T lymphocytes. Some are autologous, while others are allogeneic, and many are being genetically modified to induce the desired immune response. Gene Therapies Gene therapies address defective or mutated genes needing either correction or improved regulation through the insertion of properly functioning or genetically altered genes into a patient’s cells. The largest segment of gene therapies targets cancer, however regenerative-focused gene therapies are being developed for HIV and other infectious diseases, ocular disease, cardiovascular disease as well as several monogenic diseases. 56% Therapeutics & Devices 19% Tools 13% Banks 12% Services 3 The majority of regenerative medicine companies are therapeutically focused and developing a variety of technologies including cell-based therapies, small molecule and biologic based therapies, gene therapies, tissue-engineered biomaterials and scaffolds and implantable devices. The second largest group of regenerative medicine companies are developing tools such as stem cells for drug discovery and toxicity testing, as well as clinical tools, bioprocessing tools and platforms that include equipment, consumables, reagents and storage systems to support commercialization and clinical applications. The field also incorporates a variety of service companies specializing in clinical trial management, manufacturing, characterization, engineering and quality control, among others. For the purpose of this report we will concentrate on two therapeutic pillars where the majority of clinical activity is occurring—cell and gene therapies. Company Breakdown by Industry Sectors
  6. 6. Cell-Based Immunotherapies Primary Cell-Based Therapeutics Stem Cell and Progenitor Cell-Based Therapeutics Gene Therapies 4 Regenerative Medicine and Advanced Therapy Overview 247Total Therapeutic COMPANIES 466Total Unique Therapeutic PRODUCTS 699Total Preclinical & Clinical Stage TRIALS 91Companies 69 Companies 45Companies 42Companies 154Unique Products 105Unique Products 70 Unique Products 137Unique Products 9Marketed Products 1Approved Product 17 Marketed Products 1Marketed Product 289 Trials 143 Trials 94 Trials 173 Trials uniQure’s Glybera
  7. 7. Other Respiratory Hematology Genitourinary Disorders Immunology Inflammation Gastroenterology Infectious Disease Ophthalmology Endocrine, Metabolic Genetic Musculoskeletal Central Nervous System Dermatology Cardiovascular Oncology64 63 18 101 32 36 35 14 23 27 9 13 9 14 67 38 23 19 19 16 15 14 9 7 5 5 2 2 Approved/Marketed Products 38% Dermatology 30% Musculoskeletal 4% Oncology 4% Cardiovascular 4% Ophthalmology 8% Immunology Inflammation 12% Other Preclinical Phase I Number of Industry- Sponsored Trials by Phase Phase II III 5 Regenerative Medicine and Advanced Therapy Clinical Breakdown by Therapeutic Areas
  8. 8. 45 Companies 70 Unique Products 17 Marketed Products Primary Cell-Based Therapeutic Companies Ophthalmology Hematology Ear Diseases Central Nervous System Respiratory Dental Genitourinary Disorders Gastroenterology Cardiovascular Oncology Musculoskeletal Endocrine, Metabolic Genetic Disorders Dermatology8 2 6 2 13 1 1 0 0 10 1 1 1 18 7 6 5 3 3 3 2 1 0 0 0 0 Preclinical Phase I Number of Industry- Sponsored Trials by Phase Phase II III 6 35 35 14 10 PRECLINICAL PHASE I PHASE II PHASE III 94 Trials
  9. 9. Company Product Indication Avita Medical ReCell Dermatology BioD BioDFence Surgical Protection BioD BioDFactor Wound Healing Educell d.o.o. UroArt Vesicoureteral Reflux Fibrocell Science azficel-T Dermatology Genzyme, a Sanofi Company Carticel, Carticel Plus Cartilage Defects Genzyme, a Sanofi Company Epicel Burns MacroCure CureXcell Wound Healing MiMedx Group, Inc. EpiFix Wound Healing Organogenesis Inc. Dermagraft Diabetic Foot Ulcer Organogenesis Inc. Gintuit Mucogingival Conditions Organogenesis Inc. Apligraf Diabetic Foot Ulcer Orthofix Trinity ELITE/Trinity Evolution Musculoskeletal Defects Osiris Therapeutics Grafix Wound Healing TETEC Tissue Engineering Technologies Novocart Inject, Novocart 3D, Novocart Disc Cartilage Defects TiGenix NV ChondroCelect Cartilage Defects A Sampling of Commercial Primary Cell Therapy and Allograft Products Therapeutic Breakdown of Commercially Available Primary Cell Therapies and Allograft Products 40% Dermatology 28% Musculoskeletal 16% Surgical Dental Other 8% 8% 7
  10. 10. 91 Companies 154 Unique Products 9 Marketed Products Stem and Progenitor Cell-Based Companies and Products 65% Allogeneic 35% Autologous Percent of autologous vs. allogeneic stem and progenitor cell-based products Other Respiratory Hematology Genitourinary Disorders Dermatology Surgery Radiation Injury Ophthalmology Oncology Immunology Inflammation Gastroenterology Endocrine, Metabolic Genetic Disorders Central Nervous System Musculoskeletal Cardiovascular35 15 61 21 12 10 10 17 6 0 4 4 4 6 5 25 13 9 6 6 5 4 3 2 2 1 1 1 1 0 Preclinical Phase I Number of Industry- Sponsored Trials by Phase Phase II III 8 177 69 PRECLINICAL PHASE I 32 PHASE II PHASE III: 11 289 Trials
  11. 11. Company Product Indication Expected Filing Date NeoStem VSELs Periodontitis 2Q14 ViaCyte, Inc. VC-01 Insulin-Dependent Diabetes Mellitus 3Q14 ReNeuron Group plc ReN003 Retinitis Pigmentosa 3Q14 International Stem Cell Corporation human parthenogenetic stem cells Parkinson's Disease 3Q14 NeoStem AMR-001 Congestive Heart Failure 4Q14 Q Therapeutics Q-Cells Amyotrophic Lateral Sclerosis 4Q14 A Sampling of IND Filings Expected in 2014 9 A Sampling of Trials with Expected 2014 Clinical Readouts Company Product Indication Milestone Estimated Date Athersys, Inc. MultiStem Ulcerative Colitis Phase II trial result 2Q14 Athersys, Inc. MultiStem Ischemic Stroke Preliminary Phase II trial result 2Q14 Cytomedix ALD-401 Ischemic Stroke Phase II trial result 2Q14 Cytori Therapeutics, Inc. ADRCs Ischemia Phase II trial result 2Q14 Kiadis Pharma ATIR Hematological Malignancies Phase II trial result 2Q14 Neuralstem Inc. NSI-566 Amyotrophic Lateral Sclerosis Phase II trial result 2Q14 NeoStem AMR-001 Myocardial Infarction Phase II trial result 3Q14 StemCells, Inc. HuCNS-SC Spinal Cord Injuries Additional Phase I/II trial result 3Q14 ReNeuron Group plc ReN009 Critical Limb Ischemia Phase I trial result 4Q14 StemCells, Inc. HuCNS-SC Dry Age-Related Macular Degeneration Preliminary Phase I/II trial result 4Q14 Tengion, Inc. Neo-Kidney Augment Chronic Kidney Failure Preliminary Phase I trial result 4Q14 TiGenix NV Cx601 Perianal Fistula Final Phase III trial result 4Q14
  12. 12. 10 42 Companies 137 Unique Products 1 Marketed Products Cell-Based Immunotherapy Companies Company Product Indication Milestone Estimated Date Prima BioMed CVac-CAN-003 Ovarian Cancer Final Phase II trial analysis 2Q14 Northwest Biotherapeutics, Inc. DCVax-Direct Solid Tumors Phase I/II trial result 2Q14 Immunocellular Therapeutics, Ltd. ICT-107 Glioblastoma Multiforme Additional Phase II trial result 3Q14 Argos Therapeutics, Inc. AGS-004 Human Immunodeficiency Virus Infection Phase IIb trial result 3Q14 Northwest Biotherapeutics, Inc. DCVax-L Glioblastoma Multiforme Phase III trial result 4Q14 Adaptimmune Limited NY-ESO-1/LAGE-1 Multiple Myeloma Final Phase I/II trial analysis 4Q14 A Sampling of Trials with Expected 2014 Clinical Readouts 77 54 PRECLINICAL PHASE I PHASE II PHASEIII 30 12 173 Trials Endocrine, Metabolic Genetic Disorders Central Nervous System Immunology Inflammation Gastroenterology Infectious Diseases Oncology72 10 9 12 2 2 56 5 2 2 1 0 Preclinical Phase I Number of Industry- Sponsored Trials by Phase Phase II III
  13. 13. Company Product Indication Milestone Estimated Date uniQure NV Glybera Hyperlipoproteinemia European Launch 3Q14 Taxus Cardium Generx Ischemic Heart Diseases Phase III trial analysis 3Q14 Juventas Therapeutics JVS-100 Cardiovascular Failure Phase II trial result 4Q14 Juventas Therapeutics JVS-100 Critical Limb Ischemia Phase II trial result 4Q14 A Sampling of Trials with Expected 2014 Clinical Readouts 11 69 Companies 105 Unique Products 1 Approved Product: uniQure’s Glybera Gene Therapy Companies 80 37 PRECLINICAL PHASE I PHASE II PHASE III: 6 20 143 Trials 16 10 3 4 18 17 14 5 7 3 3 19 6 4 4 3 2 2 2 1 0 0 Immunology Inflammation Gastroenterology Hematology Musculoskeletal Endocrine, Metabolic Genetic Disorders Central Nervous System Ophthalmology Infectious Diseases Dermatology Cardiovascular Oncology Preclinical Phase I Number of Industry- Sponsored Trials by Phase Phase II III
  14. 14. 12 Regenerative Medicine and Advanced Therapy Clinical Trial Breakdown by Therapeutic Catagory Company Product / Indication Phase I Phase II Phase III Musculoskeletal Bone Therapeutics SA PREOB / Avascular Necrosis, Bone Fracture CellCoTec INSTRUCT / Articular Cartilage Lesion of the Knee Cellular Biomedicine Group ReJoin / Osteoarthritis Co.don AG co.don chondrosphere / Articular Cartilage Lesion of the Femoral Condyle Cytori Therapeutics, Inc. ADRCs / Hamstring Injury DePuy Mitek, Inc. CAIS / Defect of Articular Cartilage Histogenics NeoCart / Articular Cartilage Damage ISTO Technologies DeNovoET / Articular Cartilage Damage ISTO Technologies NuQu / Degenerative Disc Disease Mesoblast Ltd. MPCs / Spinal Fusion Mesoblast Ltd. MPCs / Intervertebral Disc Repair Pluristem Therapeutics Inc. PLX-PAD / Muscle Injury RepliCel RCT01 / Achilles Tendonitis Tissue Engineering Technologies AG Novocart Disc Plus / Lumbar Degenerative Disc Disease TissueGene, Inc. TissueGene-C / Degenerative Arthritis TissueGene, Inc. TissueGene-C / Knee Osteoarthritis A sampling of cell and gene therapy companies in clinical stages of development Musculoskeletal-related conditions in the U.S. account for 132 million visits to physicians’ offices, 29 million visits to emergency rooms, 15 million hospital outpatient visits and cost over $850 billion each year. Further, musculoskeletal injuries in the U.S. cause workers to miss more than 440 million days of work annually. Source: Penn Center for Musculoskeletal Disorders, Overview of the Penn Center for Musculoskeletal Disorders, Perelman School of Medicine website, http://www.med.upenn.edu/pcmd/overview.shtml
  15. 15. 13 Company Product / Indication Phase I Phase II Phase III Amorcyte/NeoStem AMR001 / Myocardial Infarction Athersys, Inc. MultiStem / Myocardial Infarction Bioheart, Inc. LipiCell / Congestive Heart Failure Bioheart, Inc. MyoCell / Congestive Heart Failure Capricor Therapeutics, Inc. CAP1002 / Myocardial Infarction Capricor Therapeutics, Inc. CAP1001 / Myocardial Infarction Cardio3 BioSciences C3BS-CQR-1 / Heart Failure Celgene Corporation PDA002 / Peripheral Arterial Disease Cytomedix ALD201 / Ischemic Heart Diseases Cytomedix ALD301 / Critical Limb Ischemia Cytomedix ALD301 / Intermittent Claudication Cytori Therapeutics, Inc. ADRCs / Myocardial Infarction Cytori Therapeutics, Inc. ADRCs / Ischemia Harvest Technologies Corp. BMAC / Critical Limb Ischemia Juventas Therapeutics JVS100 / Congestive Heart Failure Juventas Therapeutics JVS100 / Crititcal Limb Ischemia Mesoblast Ltd. Revascor / Congestive Heart Failure Mesoblast Ltd. Revascor / Myocardial Infarction Mesoblast Ltd. Autologous MPCs / Ischemia Pharmicell Hearticellgram-AMI / Acute Myocardial Infarction Pluristem Therapeutics Inc. PLX-PAD / Intermittent Claudication Pluristem Therapeutics Inc. PLX-PAD / Critical Limb Ischemia Stemedica Cell Technologies, Inc. Allogeneic Mesenchymal Bone Marrow Cells / Myocardial Infarction TotipotentRX/Cesca Therapeutics Autologous bone marrow derived stem cells / Critical Limb Ischemia TotipotentRX/Cesca Therapeutics Autologous bone marrow derived stem cells / Myocardial Infarction Cardiovascular/Vascular Disease Between 2012 and 2030, total stroke-related costs are projected to triple, from $71.6 billion to $184.1 billion. Source: American Heart Association, Heart Disease and Stroke Statistics—2014 Update, http://circ.ahajournals.org/content/129/3/e28.full#ref-726
  16. 16. 14 Company Product / Indication Phase I Phase II Phase III Adaptimmune Limited Autologous Genetically modified T cells / Multiple Myeloma Adaptimmune Limited NY-ESO-1/LAGE-1 / Metastatic Melanoma, Multiple Myeloma, Ovarian Cancer Aduro Biotech GVAX Leukemia Vaccine / Acute Myeloid Leukemia, Chronic Myeloid Leukemia Aduro Biotech GVAX Pancreatic Cancer Vaccine / Pancreatic Cancer Advantagene, Inc. AdVtk Therapy / Colon Cancer, Malignant Pleural Effusion, Mesothelioma, Ovarian Cancer Advantagene, Inc. AdVtk Therapy / Glioma Advantagene, Inc. ProstAtak / Local Prostate Cancer Advantagene, Inc. PancAtak / Locally Advanced Pancreatic Cancer Argos Therapeutics, Inc. AGS003 / Metastatic Renal Cell Carcinoma Argos Therapeutics, Inc. AGS005 / Chronic Lymphoid Leukemia Argos Therapeutics, Inc. RNA-Loaded Dendritic Cell Vaccine / Melanoma Bellicum Pharmaceuticals, Inc. BPX101 with AP1903 / Hormone Refractory Metastatic Prostate Cancer Bellicum Pharmaceuticals, Inc. BPX501 / Hematological Malignancies California Stem Cell/NeoStem Tumor Stem Cell Specific Dendritic Cell Therapy / Renal Cell Carcinoma Cellerant Therapeutics, Inc. CLT008 / Cancer Chemotherapy Induced Neutropenia Coronado Biosciences CNDO109 / Acute Myeloid Leukemia DCPrime B.V. DCP001 / Acute Myeloid Leukemia Dendreon Corporation Provenge / Local Prostate Cancer Dendreon Corporation Provenge / Prostate Cancer Erytech Pharma GRASPA / Acute Myeloid Leukemia Fate Therapeutics ProHema / Hematological Malignancies Gamida Cell NiCord / Hematological Malignancies Gamida Cell StemEx / Hematological Malignancies Glycostem Natural Killer Cells / Acute Myeloid Leukemia Immunocellular Therapeutics, Ltd. ICT121 / Glioblastoma Multiforme Kite Pharma Engineered Adoptive Cell Therapy / Non-Hodgkin’s Lymphoma Lentigen Corporation LG723 / Melanoma Lentigen Corporation LG740 / Hematological Malignancies Oncology
  17. 17. 15 Company Product / Indication Phase I Phase II Phase III Lion Biotechnologies Contego / Breast Cancer, Colorectal Cancer, Metastatic Melanoma, Ovarian Cancer MolMed S.p.A. HSV-TK / Hematological Malignancies NewLink Genetics, Inc. HyperAcute Melanoma Immunotherapy / Melanoma NewLink Genetics, Inc. HyperAcute Prostate Cancer Vaccine / Hormone Refractory Prostate Cancer NewLink Genetics, Inc. HyperAcute Prostate Cancer Vaccine / Metastatic Renal Cell Carcinoma NewLink Genetics, Inc. HyperAcute Pancreatic Cancer Vaccine / Pancreatic Cancer NewLink Genetics, Inc. HyperAcute Lung Immunotherapy / Non-small Cell Lung Cancer Northwest Biotherapeutics, Inc. DCVax-L / Brain Cancer Northwest Biotherapeutics, Inc. DCVax Direct / Solid Tumors Northwest Biotherapeutics, Inc. DCVax Direct / Metastatic Colon Cancer Northwest Biotherapeutics, Inc. DCVax L Ovarian / Metastatic Ovarian Cancer Northwest Biotherapeutics, Inc. DCVax Prostate / Hormone Refractory Prostate Cancer Oxford BioMedica MetXia with Cyclophosphamide / Breast Cancer, Melanoma, Pancreatic Cancer Oxford BioMedica TroVax / Colorectal Cancer, Hormone Refractory Prostate Cancer, Mesothelioma Oxford BioMedica TroVax / Metastatic Renal Cell Carcinoma Sangamo BioSciences SB313 / Glioblastoma Multiforme SOTIO Dcvac/Pca / Hormone Refractory Metastatic Prostate Cancer, Local Prostate Cancer, Metastatic Prostate Cancer Tengion, Inc. Neo-Urinary Conduit / Bladder Cancer Vical, Inc. Leuvectin / Metastatic Melanoma, Sarcomas Oncology continued Company Product / Indication Phase I Phase II Phase III Infectious Diseases Argos Therapeutics, Inc. AGS004 Calimmune Cal-1 Cell Medica Cytovir ADV Cell Medica Cytovir CMV Sangamo BioSciences SB-728
  18. 18. 16 Cytomedix ALD601 / Lysosomal Storage Disorders Living Cell Technologies Limited DIABECELL / Type 1 Diabetes Mesoblast Ltd. MPCs / Diabetic Nephropathy Mesoblast Ltd. MPCs / Non-Insulin-Dependent Diabetes Mellitus NeoStem Treg Program / Insulin-Dependent Diabetes Mellitus Oxford BioMedica UshStat / Usher syndrome type 1B Promethera Hepastem / Metabolic Disorders Promethera Hepastem / Urea Cycle Disorder t2cure t2c002/t2c003 / Diabetic Neuropathy Company Product / Indication Phase I Phase II Phase III Endocrine, Metabolic and Genetic Disorders Diabetes affects 25.8 million people or 8.3% of the U.S. population. Total direct and indirect medical cost for diabetes care in the U.S. as of 2007 equaled $174 billion—$116 billion of that was direct medical costs. Source: Centers for Disease Control and Prevention, 2011 National Diabetes Fact Sheet, Diabetes Public Health Resource, http://www.cdc.gov/diabetes/pubs/factsheet11/fastfacts.htm Athersys, Inc. MultiStem / Ulcerative Colitis Celgene Corporation PDA001 / Crohn’s Disease Innovacell Biotechnologie AG ICEF15 / Fecal Incontinence Mesoblast Ltd. Prochymal / Crohn’s Disease TiGenix NV Cx601 / Perianal Fistula TxCell SA OvaSave / Crohn’s Disease Company Product / Indication Phase I Phase II Phase III Gastroenterology Company Product / Indication Phase I Phase II Phase III Genitourinary Disorders AlloCure AC607 / Acute Kidney Failure Cook Myosite AMDC / Stress Urinary Incontinence Cytonet Group HHLivC / Urea Cycle Disorders Innovacell Biotechnologie AG ICES13 / Stress Urinary Incontinence Tengion, Inc. Neo-Kidney Augment / Chronic Kidney Failure uniQure NV/Digna Biotech AAV5-PB6D / Acute Intermittent Porphyria
  19. 19. 17 Athersys, Inc. MultiStem / Ischemic Stroke bluebird bio Lenti-D / Adrenoleukodystrophy BrainStorm Cell Therapeutics SC Therapy / Amyotrophic Lateral Sclerosis Cytomedix ALD401 / Ischemic Stroke MEDIPOST Neurostem / Alzheimer’s Disease Neuralstem Inc. NSI567 / Spinal Cord Injuries Neuralstem Inc. NSI566 / Amyotrophic Lateral Sclerosis Neuralstem Inc. NSI566 / Ischemic Stroke NsGene A/S NsG0202 / Alzheimer’s Disease Oxford BioMedica Prosavin / Idiopathic Parkinson’s Disease REGENX Biosciences CLN2 Gene Therapy / Batten Disease ReNeuron Group plc ReN001 / Cerebral Ischemia SanBio, Inc. SB623 / Ischemic Stroke Sangamo BioSciences CERE-110 / Alzheimer’s Disease StemCells, Inc. HuCNS-SC / Batten Disease StemCells, Inc. HuCNS-SC / Pelizaeus-Merzbacher Disease StemCells, Inc. HuCNS-SC / Spinal Cord Injuries uniQure NV AAV2-GDNF / Parkinson’s Disease Company Product / Indication Phase I Phase II Phase III Central Nervous System In 2012, Americans spent and estimated $200 billion to care for those with Alzheimer’s, including $140 billion to Medicare and Medicaid. Unless something is done, the costs of Alzheimer’s in 2050 are estimated to total $1.1 trillion (in today’s dollars). Costs to Medicare and Medicaid will increase nearly 500%. Source: Alzheimer’s Association, March 2012 Fact Sheet, https://www.alz.org/documents_custom/2012_facts_figures_fact_sheet.pdf
  20. 20. 18 Advanced Cell Technology Retinal Pigmented Epithelial therapy / Stargardt’s Disease AGTC AAV2-sFLT01 / Wet Age-Related Macular Degeneration AGTC AAVRPE65 / Leber’s Congenital Amaurosis Avalanche Biotech AVA101 / Wet Age-Related Macular Degeneration Neurotech NT-501 / Retinitis Pigmentosa NightstaRx Limited AAV.REP1 / Choroideremia Oxford BioMedica RetinoStat / Wet Age-Related Macular Degeneration Oxford BioMedica StarGen / Stargardt’s Disease StemCells, Inc. HuCNS-SC / Dry Age-Related Macular Degeneration Company Product / Indication Phase I Phase II Phase III Ophthalmology The estimated annual total financial burden to the U.S. economy of four major adult vision problems (AMD, cataract, diabetic retinopathy and glaucoma), refractive errors, visual impairment and blindness is $35.4 billion. Source: The Economic Impact of Vision Problems: The Toll of Major Adult Eye Disorders, Visual Impairment and Blindness on the U.S. Economy, http://www.preventblindness.net/site/DocServer/Impact_of_Vision_Problems.pdf?docID=1321 (published by Prevent Blindness America, 2007) bluebird bio LentiGlobin / Beta Thalassemia bluebird bio LentiGlobin / Sickle Cell Anemia Cell Medica Cytorex EBV / Lymphoma Gamida Cell NiCord / Sickle Cell Anemia REGENX Biosciences Factor IX Gene therapy / Hemophilia B uniQure NV AMT060 / Hemophilia B uniQure NV/Digna AMT021 / Acute Intermittent Porphyria Company Product / Indication Phase I Phase II Phase III Hematology
  21. 21. 19 Avita Medical ReCell / Burn Scar Avita Medical ReCell / Hypertrophic Scar Celgene Corporation PDA002 / Diabetic Foot Ulcer Fibrocell Science azficel-T / Burn Scar Histogen Inc. Regenica / Androgenetic Alopecia Intercytex ProtoDerm / Skin Ulcers Intercytex Vavelta / Burns, Acne Scars, Contracture Scar, Epidermolysis Bullosa, Wrinkles Juventas Therapeutics JVS100 / Surgical Wound MacroCure CureXcell / Diabetic Foot Ulcer NeoStem VSELs / Wound Stratatech Corporation StrataGraft / Burns Taxus Cardium Genedexa / Diabetic Foot Ulcer Company Product / Indication Phase I Phase II Phase III Dermatology Acorda Therapeutics Ampydin / Guillain-Barre Syndrome Argos Therapeutics, Inc. AGS009 / Systemic Lupus Erythematosus Athersys, Inc. MultiStem / Bone Marrow Transplantation Athersys, Inc. MultiStem / Liver Transplantation Cellerant Therapeutics, Inc. CLT008 / Cord Blood Transplants Kiadis Pharma Reviroc / Bone Marrow Transplantation Kiadis Pharma Rhitol / Graft-Versus-Host Disease MEDIPOST Promostem / Graft-Versus-Host Disease Mesoblast Ltd. Revascor / Bone Marrow Transplantation Opexa Therapeutics, Inc. Tcelna / Secondary Progressive Multiple Sclerosis Pluristem Therapeutics Inc. PLX-BMT / Bone Marrow Transplantation TiGenix NV Cx611 / Rheumatoid Arthritis Company Product / Indication Phase I Phase II Phase III Immunology and Inflammation
  22. 22. 20 Regenerative Medicine Cell and Gene Therapy Financial Performance $4.74 Billion Combined Regenerative Medicine Field Acquisitions Public Offerings Partnerships Grants PIPES Venture Capital and Private Equity$737.7 $530.9 $103.2 $1,954.7 $1,116.2 $297.3 $181.3 Up Front Dollars Raised $437.9 Million Primary Cell Therapy $11.3 0 $0.3 $347.2 $79.1 Public Offerings Partnerships Grants PIPES Venture Capital and Private Equity Dollars Raised $1.872 Billion Stem Cell and Progenitor Cell Therapy $81.4 $367.3 $80.7 $855.9 $352.4 $133.8 $57.4 Up Front Acquisitions Public Offerings Partnerships Grants PIPES Venture Capital and Private Equity Dollars Raised Financings from March 2013 to March 2014.
  23. 23. 21 Deal Type Company(s) Total Deal Value Upfront Payment Date Collaboration Tengion / Celgene $15M $15M 7/1/13 Merger Capricor / Nile Therapeutics NA - 7/8/13 Commercialization Agreement uniQure NV / Chiesi Farmaceutici $39.8M $39.8M 7/9/13 Collaboration Stratatech / BARDA Contract $47.2M - 7/31/13 Acquisition Mesoblast / Osiris Stem Cell Therapeutic Business $100M $50M 10/11/13 Licensing Deal Cytori Therapeutics, Inc. / Lorem Vascular $500M $24M 11/4/13 Licensing Deal Pluristem / CHA Biotech $10.4M $10.4M 12/17/13 Acquisition Intrexon / Medistem $26M - 12/20/13 Collaboration/Licensing Deal Capricor / JJ $325M $12.5M 1/6/14 Collaboration Sangamo / Biogen Idec $320M $20M 1/9/14 Acquisition of Dermagraft Organogenesis Inc. / Shire $300M 0 1/17/14 Acquisition SillaJen / Jennerex $150M - 3/17/14 $580.7 Million Cell-Based Immunotherapy $249.8 $102.4 $4.9 $110.6 $99.5 $13.5 $7.9 Up Front Acquisitions Public Offerings Partnerships Grants PIPES Venture Capital and Private Equity Dollars Raised Noteworthy Deals and Acquisitions $1.85 Billion Gene Therapy $395.2 $61.2 $17.3 $641.0 $585.2 $150.0 $116 Up Front Acquisitions Public Offerings Partnerships Grants PIPES Venture Capital and Private Equity Dollars Raised
  24. 24. 22 03/14/13 Mesoblast Ltd. raises $175.3M in private placement 05/28/2013 Jennerex Biotherapeutics, Inc. raises $21.6M in private placement 06/24/2013 bluebird bio closes $116.1M IPO 08/12/2013 Fate Therapeutics raises $20M in private offering 07/04/13 Cardio3 BioSciences closes $30M IPO 05/15/2013 Kite Phara raises $35M in Series A round 07/01/2013 Tengion, Inc. raises $18.6M 07/10/2013 ViaCyte, Inc. raises $10.6M in private equity 08/26/2013 Argos Therapeutics, Inc. raises $42.5M in a Series E round 08/13/2013 Opexa Therapeutics, Inc. raises $19.3M in public offering 09/04/2013 iPierian secures $30M in venture financing 06/04/2013 StemCells, Inc. secures $30M 07/30/2013 Cellular Dynamics International closes $46.1M IPO 09/23/2013 Sangamo BioSciences raises $74.2M in public offering March 2013 April 2013 May 2013 June 2013 July 2013 August 2013 September 2013 A Sampling of Noteworthy Financings March 2013 through March 2014 “We believe that regenerative medicine is at a critical juncture­­— similar to the position of monoclonal antibodies in the mid to late 90s.”
  25. 25. 23 01/13/13 Juno Therapeutics, Inc. raises $145M in a Series A round 02/12/13 Voyager Therapeutics raises $45M in Series A round 10/08/2013 StemCells, Inc. raises $18.6M in public offering 10/09/2013 NeoStem raises $40.3M in public offering 11/20/2013 TiGenix NV raises $16.2 million in private placement 10/22/13 Spark Therapeutics launches with $50M capital commitment 12/13/2013 Stem Cell Therapeutics raises $31.13 in private placement 02/27/13 Celladon Corporation closes $50.6M IPO 11/25/13 Editas Medicine raises $43M in a Series A round 10/04/13 Fate Therapeutics closes $46M IPO 11/06/2013 Lion Biotechnologies raises $23.3M in private placement 03/19/2014 Sangamo BioSciences raises $100M in public offering 02/10/2014 uniQure NV closes $91.8M IPO 01/10/2014 AGTC closed $50M IPO 12/12/13 MiMedix raises $34M in public offering 01/10/2014 Athersys, Inc. raises $20.5M in direct offering 11/25/2013 Northwest Biotherapeutics, Inc. raises $27M in public offering 02/20/2014 Argos Therapeutics, Inc. closes $45M IPO 01/04/14 Bellicum Pharmaceuticals, Inc. raises $14.7M in Series B Round October 2013 November 2013 December 2013 January 2014 February 2014 March 2014
  26. 26. 24 The Alliance for Regenerative Medicine’s Science and Technology Committee began a project in the summer of 2013 to survey the RD, product development and business development leadership in top pharma and biotech companies regarding their strategic perspectives of regenerative medicine. The primary objective of the survey was to engage pharma and biotech executives to speak candidly and openly about their views of the sector—highlighting opportunities and the therapeutic potential of the technologies while also addressing concerns regarding major regulatory and commercial hurdles yet to be overcome. The summary that is provided herein is a compilation of their responses that provides an unprecedented look into the thought process used by large companies to evaluate regenerative medicine opportunities. Survey Respondents Allergan, Amgen, Baxter, Biogen Idec, Boehringer Ingelheim, Celgene, Eli Lilly, GSK, Johnson Johnson, Merck Serono, Novartis, Novo Nordisk, Pfizer, Roche, Sanofi-Genzyme, Shire Pharmaceutical and Large-Cap Biotechnology Survey “Our working definition of regenerative medicine includes a broad range of products that leverage the body’s intrinsic abilities to heal itself.” “Regenerative medicine is the use of cells or entities that stimulate cells to repair or replace damaged tissues.” “We define regenerative medicine broadly. We include all technologies that are regenerative including cells, antibodies, gene therapies, small molecules, biologics, biomaterials, etc. Our company also considers stem cells for drug screening and safety toxicology testing as regenerative medicine. Immunotherapy is not positioned within our regenerative medicine group.” How Pharmaceutical and Large-Cap Biotech Companies Define Regenerative Medicine “Our team views ‘cell-based immunotherapy’ as regenerative medicine with a large focus on oncology.” “Regenerative medicine means any therapy that will repair or restore cells and physiology leading to improved function.” “We view the field of regenerative medicine in the same way ARM does. In fact, our group was part of the team that came up with ARM’s definition of regenerative medicine.” “Within our venture group we don’t have a specific definition, but from our understanding it can include a range of technologies including small molecules, biomaterials, cell-based therapies and stem cells. We would also include gene therapy.” re•gen•er•a•tive med•i•cine
  27. 27. 25 Pharmaceutical and Large-Cap Biotechnology Survey The Pharmaceutical and Large-Cap Biotech Perspective on Regenerative Medicine “We are actively looking for a partner in the cell therapy business and are open to any relationship from partnership to divestiture.” “We realize it’s a frontier technology beyond a five year time horizon and we don’t want to miss the boat. Our company is engaged in various levels and resources are internally devoted.” “We are engaged in the Alliance for Regenerative Medicine because we want expertise, we want to be at the right place at the right time.” Of the 16 pharmaceutical and large-cap biotech companies interviewed, the detailed discussions revealed each of them is investing in some aspect of regenerative medicine and view the sector as a potential paradigm shift in the development of breakthrough medicines. One hundred percent of the companies interviewed also indicated that they are closely monitoring both preclinical and clinical stage technologies and 40% of these companies are in active pursuit of therapeutic opportunities. In addition to having some level of investment in the industry, a recurring message that echoed throughout each interview is that pharma does not want to miss this opportunity; they are monitoring the space diligently and methodically assessing the key questions to commercialize and bring these products to market. Lastly, not one company representative stated that they were not interested in this burgeoning field. 100% Investing With Programs Underway 100% Monitoring 44% Actively Pursuing Opportunities 0% Not Interested Pharma and Large-Cap Biotechs Engagement in Regenerative Medicine
  28. 28. 26 Where is Pharma Investing? “We’re just beginning to understand the potential for regeneration. As this unfolds the potential for endogenous repair is going to accelerate.” “We are not currently interested in devices alone. Combination products are a future area of interest.” “We would like to invest early, close to proof of concept. We will continue to invest in the areas of stem cells, gene therapy and other regenerative medicine venture investments.” “Our internal investment in regenerative medicine is probably upward of 10% of the overall RD budget.” 69% 64% 56% 31% 31% Endogenous Activation Beyond cell-based therapies, the interviews revealed a core group of pharma and large-cap biotechs, especially those focusing on specific neurodegerative disease indications, to have teams of cellular biologists in place studying endogenous stem
cell microenvironments. The common goal of these groups is to discover small molecules and/or biologics that can activate dormant cells and down regulated cellular pathways, thus restoring the body’s natural ability to regenerate certain tissues. Gene and Gene-Modified Cell Therapies As previously mentioned, 31% of the pharma companies interviewed expressed moderate to significant interest in gene therapies and gene-modified cell therapies for a variety of disease indications. The highest level of interest was in the area of monogenic disease. The companies focused on these indications saw potential for these therapies since the mechanism of action is clear—a single nucleotide mutation resulting in the manifestation of the disease. Cell Therapies On the cell-based therapeutic front, 69% of the companies have already invested in cellular-based regenerative medicine products outside their company and 31% of them had made, or were making, investments in gene-modified cell therapy programs. Drug Discovery Of the interviewed companies, 88% considered the use of stem cells for disease modeling, drug discovery and toxicology testing as regenerative medicine, and of those companies, 64% are actively working with stem cells as key drug discovery tools. Furthermore, several of those companies mentioned that stem cells represent a paradigm shift in drug discovery. Combination Products Fifty-six percent of the companies’ surveyed expressed moderate to significant interest in combination products that include a tissue engineered scaffold/device component.
  29. 29. 27 “We view iPSCs as very important tools for modeling monogenic diseases.” “iPSCs for drug discovery, toxicology and modeling is our core focus in regenerative medicine. This technology not only enhances drug discovery, it is a paradigm shift in drug discovery.” “We’re getting more used to using stem cells for modeling and discovery. We have a group that’s very focused on genetics and genetic variants that cause disease. For this group cellular models make a lot of sense.” “Stem cells are a tremendous resource for high-throughput screening and toxicology testing, they allow for efficient screening and it gets around animal models.” “Our team is a major proponent of stem cells for drug discovery, modeling and toxicology studies.” “We use iPSCs and embryonic stem cells for modeling disease. High throughput screening is also fantastic use for these cells.” Pharma and Large-Cap Biotechs’ Level of Interest in Stem Cells for Drug Discovery, Modeling and Toxicology Testing 50% Very Important 19% Important 13% Neutral 6% Somewhat Important 6% Not at all Important 6% N/A
  30. 30. 28 “The most successful products to date have been autologous and though they are very challenging, manufacturing costs amongst other challenges, we think they are very promising.” “The most promising cell types are allogeneic MSCs and ESCs.” “Autologous versus allogeneic is a tough question…historically there has been concerns around using non-autologous systems but proof is in the data—relatively agnostic. Unmet medical needs are wide open for autologous products.” “We are working with both autologous and allogeneic stem cells­—clinical data will be what’s most important.” “Autologous is difficult because of logistical challenges but at the end of the day it’s all manageable if it can impact patients.” “We have some concerns about autologous therapies because of manufacturing and logistics. But there is also concern about allogeneic as there could be an immune response—this seems to be getting less risky. We will certainly look at all different approaches.” Autologous vs. Allogeneic Cells as Therapeutic Modalities The responses from the interviews were diverse and open-minded around autologous and allogeneic cell therapies. Very few of the companies interviewed had a strong preference toward one model versus
the other, despite the logistical challenges and potentially higher costs linked to patient-specific or autologous cellular therapeutics. Of the 16 companies interviewed, 50% of them are already investing in patient-specific autologous cellular therapies. Investment in off-the-shelf allogeneic cell therapies was virtually the same with 56% of the participants declaring projects and investments under way. The findings clearly illustrate that, for the most part, pharma does not believe there is a dominant technology. This was evident as 50% of the participants stated that their company remains agnostic toward the two therapeutic modalities. Percent of Companies Focused on Investing or Developing Autologous and Allogeneic Cell Therapies Allogeneic Autologous Agnostic 58% 50% 50%
  31. 31. 29 “In the next 5-10 years a lot will be done here through external partnerships. Our expertise is regulatory, manufacturing and commercialization, the rest will be done with partners.” “We have several validated programs with academic labs. It’s important for an independent entity to look at the data.” “Our company is tracking stem cell partnerships through science focus groups and companies in areas of interest. We’ve also in-licensed technology from universities and we’re funding research projects at several external academic partner laboratories.” “Most of our effort in regenerative medicine would be through partnerships…we want to be working with the experts.” How Pharma and Large-Cap Biotech Companies Are Organized to Pursue Regenerative Medicine Of the four major group types, the most common organizational structure was through vertically integrated regenerative medicine RD units. The interviews revealed that 69% of the companies already have regenerative medicine focused teams established, each with unique strategies and therapeutic targets. External regenerative medicine partnerships were also highly common among the participating companies. Several of them considered partnerships a critical component of success within the regenerative medicine industry. Pharma generally agreed that they are not experts in cell-based therapies and must rely on the experts in industry and academia to successfully co- develop regenerative medicine products. The common message that resonated through the majority of interviews was that pharma cannot do this alone and will need to rely on a variety of external partners to advance their regenerative medicine programs. Focused Research Development Units Disease Teams or Therapeutic Divisions Business Development Teams Venture Groups 69% 44% 44% 25% Top Four Business Strategies Focused on external investments outside the company’s core areas of expertise
  32. 32. 30 Where Pharma Sees Major Therapeutic Opportunities Here and Now Opportunities The majority of participants, 63%, stated that regenerative medicine technologies for wound healing are here now and will continue to constitute the nearest term therapeutic opportunity. Other therapeutic areas just over the horizon included cell-based therapies for musculoskeletal conditions, bladder and autoimmune disorders such as GvHD and Crohn’s Disease and adoptive T-Cell therapies to treat hematological malignancies. Near-Term Opportunities In the nearest-term—within the next five years—treating cardiovascular and ischemic-related diseases with autologous and allogeneic stem cell based technologies received the most comments from the participants. Interviewees also clearly identified cell and gene-based therapies for ocular diseases, such as age-related macular degeneration, to be a near-term opportunity for the field. Each of the six companies engaged in this space considered ocular disease to be a key therapeutic opportunity for regenerative medicine and strongly believed that these technologies will show clear clinical efficacy and could represent a major advancement in standard of care. Another disease area that garnered interest of big pharma is the monogenic disease space. Of the three pharma companies that expressed significant interest in monogenic disease, they each believed that this area of regenerative medicine is a wide-open opportunity and achievable in the near term. Long-Term Opportunities Neurodegenerative diseases were viewed as the greatest longer-term opportunity for regenerative medicine, especially as several of these indications affect millions and treatment options are highly limited. The 25% of companies that viewed diabetes as a major opportunity for regenerative medicine were extremely passionate about their reply and highly committed to the therapeutic area. The companies interested in targeting diabetes also stated that despite the difficulty in under- standing
the science behind the disease, they believe that there will be a major breakthrough within the next 10 years and the opportunities to treat the disease with regenerative therapies for beta cell replacement and other insulin regulating mechanisms will be tremendous. The dominant technology strategy for each of the four companies was predominantly cell-based, testing a variety of multipotent and pluripotent cell types, both patient specific and off-the-shelf cell. Additionally, there was interest expressed in regenerative gene therapies for diabetes. “Most promising areas of regenerative medicine include the ischemic space/ cardiovascular, autoimmune/UC/IB/GVHD, skin and musculoskeletal related injury and disease.” “In the next five years we will see progress in the areas of oncology and cardiovascular. The cardio space will see the most progress in the next 10 years.” “The disease area that holds the greatest promise is the monogenic disease space.” “The most promising areas for regenerative medicine in the next 5-10 years include cardiovascular, ischemia and immunology.”
  33. 33. 31 “We have a large effort currently taking place in gene-modified HSCs for several rare diseases. Focusing on rare diseases allows us to test transformative platforms on small patient groups with lower regulatory boundaries.” “We believe that monogenic disease is where you can focus and be successful because there’s no other therapeutic option. We can also be successful in this area because the MOA is 100% clear. Large indications are tough because we don’t really understand the disease.” “Mesenchymal stem cell trials for GvHD, cardiovascular and other indications will read out— potentially transformative one way or the other. Regardless, they will definitely be safe and find their place in medicine. The skin is where cell-based therapy is now.” 63% 56% 44% 38% 37% 32% 25% 25% 25% 19% 19% 13% 13% Spinal Cord Injury Stroke Monogenic Disease Vascular Disease Oncology Diabetes Metabolic Disorders Musculoskeletal Cardiovascular Disease Ocular Disease Autoimmune Neurodegenerative Wound Burns Percent of Companies that Consider the Therapeutic Area as Highly Opportunistic for Regenerative Medicine
  34. 34. 32 Where Pharma Sees Major Challenges Lack of Predictable and Clear Regulatory Guidance Of the 10 areas of challenge examined, the lack of predictable and clear regulatory guidance received the lowest amount of concern from the participants— indicating that these companies feel that regenerative medicine products have the ability to succeed within current regulatory constructs. 15% 8% 77% Lack of Predictable and Clear Regulatory Guidance No Concern Marginal/Moderate Concern Significant/High Concern “Cost of goods is a very low concern. Scientific and technical challenges must be determined up-front. Safety and efficacy defines the risk benefit. Regulatory pathway defines if the technology can be successful.” “The key questions we’re considering are mostly centric around business models and regulatory pathways.” “Disagreement amongst regulatory agencies adds to the challenge.” “Lack of geographic harmonization is not a unique issue and true of all drug development.” Manufacturing and Scale-Up The common message from the participants around manufacturing and scale-up was that cell-based therapeutics, combination products and other advanced therapies will be more complex in manufacturing design than current drugs,
and therefore will confront significant development challenges. However, these are engineering questions that companies will undoubtedly solve; similar to the way manufacturing and scale-up challenges were solved for biotechnology products such as proteins and antibodies in the early- to mid-1990s. 8% 46% Manufacturing/scale up No Concern Marginal/Moderate Concern Significant/High Concern 46% “People over estimate CMC as an issue. Although it is a significant hurdle, we believe if the therapy shows a significant benefit and the data is robust, companies will figure out how to address CMC issues. Science is the main challenge.” “We manufacture all of our products on our own, but we don’t have any cell therapy manufacturing capabilities.”
  35. 35. 33 Uncertain Financing Environment Despite the variation gathered from the quantitative survey, the comments made throughout the interviews were quite homogenous. Each of the 16 companies interviewed mentioned that lack of access to capital is causing companies to run scaled-down, inadequately powered clinical trials with poorly understood end- points—a major concern of pharma. Small-cap companies struggling to run high quality clinical trials due to lack of capital was the most frequently mentioned concern. Several participants even men- tioned that the science and technology behind many of the regenerative medicine companies may, in fact, be sound, but without well-designed trials generating quality clinical data, it will be very difficult for pharma to measure the opportunity and the clinical value of these technologies. The bottom line message is that the lack of access to capital may be forcing companies to run poorly designed clinical trials, therefore resulting in questionable clinical data—the single most influential factor for pharmaceutical investment. 15% 54% Uncertain financing environment No Concern Marginal/Moderate Concern Significant/High Concern 31% “We always focus on data and our strategy evolves based on the data.” Uncertain Reimbursement Environment Throughout the interviews, pharma consistently mentioned that reimbursement is a challenge, but not one specific to regenerative medicine. Companies focusing on indications such as diabetes, incurable neurological disorders, rare diseases or other indications with a high level of unmet medical need displayed less concern around reimbursement than companies targeting therapeutic areas with higher product competition, i.e., wound healing and orthopedic conditions. Of the participants, 15% considered reimbursement to be no concern or challenge; 23% marginal concern or challenge; 23% moderate concern or challenge and 39% considered this to be a significant concern or challenge. 15% 46% Uncertain reimbursement environment No Concern Marginal/Moderate Concern Significant/High Concern 39% “Reimbursement would be layered in the discussion very early, and more and more so that is the case. Public perception is not an issue. Scale-up and manufacturing is a secondary situation.” “Companies are going to reinvest once they see clinical success and marketed products. Mechanism of action is important but not critical, we’ve had products on the market without knowing the mechanism of action.” “Government funding would help get small companies through some of the valleys. There are lots of gaps in the preclinical work, early trial and experiments due to shoestring budgets.” “The finance environment is very difficult. It’s causing companies to run poor trials with poor clinical endpoints.”
  36. 36. 34 Potency Assay Validation The quantitative survey revealed 43% of participants found potency assay development to be a more than moderate concern. Additionally, potency assay validation was often the first challenge or concern mentioned during the interviews. These top
-of-mind concerns may mirror where we are as an industry, and may be especially reflective of the clinical development challenges facing the leading companies—many of which are now moving past safety trials and entering later stage efficacy and dosing trials. Potency assay validation is a here-and-now issue and something with which pharma is grappling with. The good news is that no companies viewed potency assay validation as a highly significant concern and only 23% considered this to be a significant concern. Instead, potency assay validation is considered to be a somewhat new and unique issue that cell-based regenerative medicine companies are actively facing. 8% 69% Potency assay validation No Concern Marginal/Moderate Concern Significant/High Concern23% “Potency assay development and validation is an issue. Cell characterization on the other hand is getting much better with a pretty good roadmap at this time.” Cost of Goods After reviewing the interviews and the quantitative results it was evident that a fair amount of disparity existed around the level of concern regarding cost of goods for regenerative medicine therapies. Despite the range of concerns, 61% of the participants responded within the no concern to moderate concern brackets— a positive sign for the regenerative medicine industry. The remaining 39% viewed cost of goods to be a significant concern. 39% 15% 46% Cost of goods No Concern Marginal/Moderate Concern Significant/High Concern “Development costs and unproven business models are not major concerns. Areas of high concern include lack of standards and geo regulatory harmonization.” “We want to use regenerative medicine technologies where there is clear benefit over drugs on the market.” “Potency assay development and validation is a concern—it’s a necessity for the end-user and of course important from a regulatory standpoint.” “Potency assay development and validation is also very difficult as it’s hard to say that a given marker indicates a particular clinical outcome.” “Dosing of cell therapies is an area of concern. Cell characterization is not as risky as cell potency as it’s more objective.”
  37. 37. 35 Product Consistency and Standards Results from the quantitative survey and the personal interviews revealed that product consistency and lack of standards is possibly the single greatest challenge facing the field. Of the companies interviewed 92% rated this to be area of moderate-to- significant concern. The interviews also illustrate how young the regenerative medicine industry still is, despite the excitement and number of companies in the space, and that time is still needed for the industry to mature and become more standardized. It was mentioned by several participants however, that the issue around standards has improved when compared to 10 or even five years ago. 8% 46% Product consistency/standards No Concern Marginal/Moderate Concern Significant/High Concern 46% “Lack of standards has been problematic, but the situation is improving.”
 “Areas of high concern include lack of standards and geo regulatory harmonization.” Clinical Adoption and Medical Expertise Sixty-two percent of the respondents believed that clinical adoption and medical expertise is a marginal to moderate concern. Of the remaining survey participants, 15% considered clinical adoption to be of no concern while 23% considered clinical adoption to be significant concern. Lastly, none of the participants considered this to be a highly significant concern. 15% 62% Clinical adoption/medical expertise No Concern Marginal/Moderate Concern Significant Concern23% Supply Chain Logistics Supply chain logistics were not considered to be a significant or highly significant challenge facing the field. In fact, the majority of participants, 77%, considered supply chain logistics to be a moderate concern or less. A handful of participants mentioned that shipping and storage of cell-based therapies will be significantly more challenging than shipping and storage of chemical and protein-based drugs. Several participants additionally mentioned that with recent advances in quality control systems and the available expertise from supply chain focused service partners, supply chain and logistical concerns will not be a major hurdle for regenerative medicine technologies. Regardless, supply chain logistics is something that should not be dismissed and will be a marginal to moderate challenge facing the field. 8% 69% Supply chain logistics No Concern Marginal/Moderate Concern Significant/High Concern23% “Cells will be the ‘easy’ part—the engineering and delivery will be the complex part.” “Scalability, development costs, risk of lot failure, unproven business models and COGs are concerns. Other logistical challenges include shipping conditions for live cells.”
  38. 38. 36 Membership Regenerative MedicineRegenerative Medicine ALLIANCEfor Companies Aastrom Biosciences, Inc. Abeona Therapeutics Advanced Cell Technology AGTC Akron Biotechnology AlloCure AlloSource Athersys, Inc. Avita Medical AxoGen, Inc. Baxter Bell BioSystems BioLife Solutions, Inc. Biomatrica Biospherix, Ltd. BioTime, Inc. Blood Centers of America Inc. bluebird bio BrainStorm Cell Therapeutics Calimmune Capricor Therapeutics, Inc. Celgene Corporation Cell Cure Neurosciences Ltd. Cell Line Genetics, Inc. Cell Therapy Group CellGenix GmbH Cellular Dynamics International Cellular Technology Limited Celsense Inc. Cesca Therapeutics Circle Biologics, Inc. Cord Blood Registry Clinical Trial Consulting Cynata Therapeutics Inc. Cytomedix Cytori Therapeutics, Inc. DiscGenics, Inc. Dohmen EMD Millipore Corporation Fate Therapeutics Fibrocell Science Fisher BioServices GE Healthcare GenVec Global BioTherapeutics Harvard Apparatus Regenerative Technology HemoGenix Histogen Inc. Histogenics Humacyte, Inc. Invetech InvivoSciences, Inc. iPierian Inc. ISTO Technologies Johnson Johnson Juventas Therapeutics Lonza Group Ltd. MaxCyte, Inc. Medpace Mesoblast Ltd. MiMedx Group, Inc. Minerva Biotechnologies Corporation Nanofiber Solutions NeoStem Northwest Biotherapeutics, Inc. Organogenesis Inc. Organovo Holdings, Inc. OrthoCyte Corp. Osiris Therapeutics Oxford BioMedica Pfizer Inc. Pluristem Therapeutics Inc. Progenitor Cell Therapy Q Therapeutics Regeneus Ltd. Reglera RepliCel RhinoCyte Inc. Rossi Group Consulting RxGen Sangamo BioSciences Sanofi-Genzyme Sartorius AG Shire SironRX Therapeutics Smith Nephew StemBioSys StemCells, Inc. Tengion, Inc. TERUMO BCT, Inc. Thermo Fisher Scientific Tissue Banks International
  39. 39. 37 TissueGene, Inc. Tissue Genesis, Inc. TrakCel Ltd. Vet-Stem, Inc. ViaCyte, Inc. Investors Asset Management Ventures Kentucky Seed Capital Fund Novitas Capital Toucan Capital Triathlon Medical Ventures Patient Advocates/ Foundations/Associations Association of Clinical Research Organizations Alpha-1 Foundation ALS Association American Association for Dental Research BioBridge Global California Institute for Regenerative Medicine Californians 4 Cures Cell Society Centre for Commercialization of Regenerative Medicine Friends of Cancer Research Genetics Policy Institute Human Organ Project, Inc. International Society for Stem Cell Research JDRF Missouri Cures National Disease Research Interchange National Multiple Sclerosis Society National Stem Cell Foundation Nebraska Coalition for Lifesaving Cures New York Stem Cell Foundation Parkinson’s Action Network Prevent Cancer Foundation Stop ALD Foundation Student Society for Stem Cell Research Texas Cures Education Foundation Unite 2 Fight Paralysis Research Institutions Cleveland Clinic Cornell University Johns Hopkins Translational Tissue Engineering Center Neural Stem Cell Institute Northwestern University Comprehensive Transplant Center Pittsburgh Tissue Engineering Initiative Sanford-Burnham Medical Research Institute Texas Heart Institute UC San Diego Stem Cell Program University of Maryland Center for Stem Cell Biology and Regenerative Medicine University of Minnesota Stem Cell Institute University of Utah Cell Therapy and Regenerative Medicine Program Affiliates AlphaMed Press European Affiliates Andalusian Initiative for Advanced Therapies Aposcience AG ATMI Cardio3 BioSciences Cell2B CellData Services Cell Therapy Catapult Chemelot Campus B.V. DCPrime B.V. Foundation for Biomedical Research and Innovation Fraunhofer Institute for Cell Therapy and Immunology Gri-Cel, S.A. Kiadis Pharma K.U. Leuven Med Cell Europe AG Newcastle University Novadip Biosciences SA PharmaCell B.V. Promethera ReGenesys B.V. B.A. ReNeuron Group plc Sistemic Scotland Limited TiGenix NV University College London Center for Stem Cells and Regenerative Medicine Voisin Consulting
  40. 40. Regenerative MedicineRegenerative Medicine ALLIANCEfor 525 Second Street, NE Washington, DC 20002 www.alliancerm.org

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