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Investing in Regenerative Medicine Companies

Tissue Repair and Organ Growth


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Thursday, February 21st, 2013

Wolverine—comic book hero and one of the central characters of the movie box-office smash-hit trilogy “X-Men”—is a mutant with unique abilities. One of them is to spontaneously heal himself from cuts and wounds simply by growing new cells and repairing his damaged flesh.

Ah, what one would do with that ability. Trying your hand at bullfighting? No problem. Snorkeling in shark infested waters? No fears there. Challenged to a sword duel? Bring it on. Nothing can stop you now.

Well, the marvels of medical science may very well have taken the human species one step closer to self-regeneration without requiring us to become mutants.

Yet at the cellular level, humans—and all life forms, for that matter—already have the ability to repair damaged cells and tissue. Even serious injuries sustained from major accidents can be naturally repaired over time.

What regenerative medicine is attempting to do is simply boost the body’s natural healing processes into overdrive. Wikipedia defines the endeavour:

“This field holds the promise of regenerating damaged tissues and organs in the body by replacing damaged tissue and/or by stimulating the body's own repair mechanisms to heal previously irreparable tissues or organs. Regenerative medicine also empowers scientists to grow tissues and organs in the laboratory and safely implant them when the body cannot heal itself.”

Numerous companies have been on the scene for years exploring ways to advance the science—and business—of regenerative medicine. And they are getting closer and closer to delivering results.

One company to watch in this field is Shire PLC (LON: SHP, NASDAQ: SHPG) which has a long pipeline of medicines and treatments at various phases of clinical trials across three main areas of medical treatment: specialty trauma, human genetic therapies, and regenerative medicine.

4-Traders.com reports that Shire recently “announced the initiation of a Phase 3 study designed to evaluate the efficacy and safety of ABH001, its dermal substitute therapy, for the treatment of non-healing wounds in patients with Epidermolysis Bullosa (EB), a group of rare genetic skin disorders”.

ABH001 has now received an orphan drug designation by both the U.S. and European Union, as well as the U.S. Food and Drug Administration’s Fast Track designation.

Jeff Jonas, MD, President of Shire Regenerative Medicine, was pleased with the approvals, and took the opportunity to reiterate the company’s dedication to this treatment.

"We are committed to developing regenerative medicine solutions that enable people with life-altering conditions to lead better lives, and are encouraged by the fast track and orphan drug designations we have received to further develop this potential therapy for people, most often young children, suffering from this devastating condition."

Regenerative medicine is also attempting to use the body’s own stem cells to repair or even manufacture new body parts, which are considered safer than organs received from donors.

Two firms to keep an eye on in the area of stem cell research are the aptly named StemCells, Inc. (NASDAQ: STEM) and Athersys, Inc. (NASDAQ: ATHX).

Stem Cells Inc. was recently named a “hot stock” by The Wall Street Journal, according to a 4-Traders.com report, “after announcing that 12-month data from the first patient cohort in the Newark, California-based company’s Phase I/II clinical trial of its proprietary HuCNS-SC® product candidate for chronic spinal cord injury continued to demonstrate a favorable safety profile.”

Two other patients in the trial “retained gains in sensory function at the one-year mark that were demonstrated at a six-month assessment. One patient even converted from a ‘complete’ to an ‘incomplete’ injury and the third patient remains stable.”

Martin McGlynn, President and Chief Executive at Stem Cells—though drawing attention to the small number of patients participating in the uncontrolled trial—was nonetheless very optimistic, announcing that “this is the first time a patient with a complete spinal cord injury has been converted to a patient with an incomplete injury following transplantation of neural stem cells.”

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The other stem cell technology play, Athersys Inc., has already received hefty investments from investment funds such as First Eagle Investment Management, Sabby Capital, Pappas Ventures, and Aspire Capital.

The company describes its flagship product candidate called MultiStem:

“We are developing a patented and proprietary non-embryonic stem cell therapy called MultiStem for the treatment of cardiovascular disease, neurological conditions, and inflammatory and immune conditions, as well as certain other potential applications.

“Over the past several years, we have advanced multiple programs into clinical development, and currently have four clinical stage programs involving MultiStem. These programs are exploring the potential use of MultiStem to treat:

• Inflammatory Bowel Disease (part of an ongoing Phase 2 clinical trial being conducted in partnership with Pfizer)

• Ischemic stroke (ongoing Phase 2 clinical trial)

• Complications associated with traditional bone marrow or hematopoietic stem cell transplants, such as Graft Versus Host Disease (GVHD) (recently completed Phase1 clinical trial - Orphan Drug designation)

• Damage from acute myocardial infarction (i.e. heart attack).”

Indeed, it is the company’s many partnerships with giants such as Bristol-Myers-Squibb, Pfizer, and Johnson & Johnson Pharmaceutical Research & Development, as well as with numerous other smaller companies, that investors are increasingly appreciating, as 4-traders.com explains:

“Being in a partnership with the world’s biggest drug maker [Pfizer] (whom happens to have a stack of cash and a thin pipeline), has the spotlight on Athersys to produce promising mid-stage results. Further, the investment community seems to be becoming more cognizant about Athersys’ partnership with RTI Biologics, Inc. (Nasdaq: RTIX) that has netted Athersys more than $5 million in licensing and milestone payments to date.”

With all this research and development into regenerative medicine garnering increasingly more attention and funding from the investment community, the Wolverine who leapt out of the comic books and onto the silver screen may be getting closer to taking yet another giant leap—into real life.

Joseph Cafariello


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