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The Business of Stem Cells

By RIcki Lewis

Nov. 12, 2008 | Stem cell science is on the precipice of becoming big business. The potential markets for stem cell-based therapeutics are huge; in contrast to markets such as anti-neoplastics or anti-depressants, stem cell-therapy targets will extend into many fields of medicine. Already therapies are in various stages of development for Alzheimer's disease, cancer, cardiovascular disease, diabetes, Parkinson disease, and spinal cord injury.

The hundreds of millions of potential patients helped to fuel the 2006 projection of an $8.5 billion global market by 2016 (calculated by Robin R. Young [Robin Young Consulting Group]). Market projections based on health statistics, however, cannot always factor in the effect of new enabling technologies or major discoveries, which may have been the case for human induced pluripotent stem (iPS) cells.

As 2007 dawned, the first iPS reports had just been announced and academic researchers immediately began to confirm and extend the groundbreaking work of Shinya Yamanaka (Kyoto University), for iPS cells are much easier to generate than embryonic stem (ES) cells. Pharma, just awakening to the potential of stem cells, at least in an active way, couldn’t have helped but notice the new and exciting stem cell source. Given the facts that iPS cells may ultimately offer a much more expedient route to developing patient-specific cell therapies than ES cells, and that both restrictions and attitudes on all stem cell research are loosening, the $8.5 billion 2016 market projection is more likely an underestimate than an overestimate.

The hard questions are just now being asked. Will iPS cells stand in for human ES cells, once the bugs have been worked out, or will they find their own niche? What will companies do that have invested heavily in ES cells? For example, Geron (Menlo Park, Calif.) is pursuing the first human ES cell-based therapy, GRNOPC1, for spinal cord injury. They declined to comment on how the emergence of iPS cells is affecting the project.

Setbacks in stem cell research and commercialization have been rare, although one such setback was the May 2008 “clinical hold” that the FDA placed on Geron’s trial of GRNOPC1. The company’s stock dropped 20% in the wake of the announcement. Geron’s news releases had indicated that the company expected to be the first to have an ES cell-based therapeutic approved—which could still happen.

Pharma Comes on Board
Pharma emerged from the wait-and-see sidelines with the October 2007 debut of “Stem Cells for Safer Medicines” (SC4SM), an independent, not-for-profit partnership run by GlaxoSmithKline, AstraZeneca, and Roche, as well as a roster of U.K. government organizations. SC4SM will disperse funding to pursue use of human stem cells to develop lines of normal, human differentiated cells for high-throughput toxicology screening in drug development.

Pharma is supporting early stage academic research as well as partnering with nearer-to-market biotechs:

  • GlaxoSmithKline has a five-year, $25 million+ collaborative agreement with the Harvard Stem Cell Institute to use all types of stem cells to develop new methods for drug screening. The funding will support research at Harvard University and several affiliated hospitals. GlaxoSmithKline supports biotech companies as well: It recently invested $1.4 billion in a project using antibodies to target cancer stem cells at OncoMed Pharmaceuticals (Redwood City, Calif.).
  • Pfizer is founding San Diego-based EyeCyte to explore autologous stem cell treatments for disorders of the ocular vasculature. The effort builds on research from Martin Friedlander from the Scripps Research Institute. Friedlander approached Pfizer when he wanted to take his preclinical work toward the clinic. The investment begins with $3 million, with Pfizer retaining the option to buy the company.
  • Johnson & Johnson Development Corp. is supporting Novocell (San Diego) in commercializing its platform to encapsulate human ES-derived pancreatic beta cells as a diabetes treatment. The proprietary biocompatible coating for the cells overcomes the problem of immune rejection of natural islets. Clinical trials are for long-standing type 1 diabetes patients.

The Harvard Stem Cell Institute, EyeCyte, and Novocell’s novel islets provide a glimpse of what stem cells might do in the near future. Stem cells have developmental potential in that they can become many things; so, too, can their commercialization potentially help to treat an astounding variety of medical conditions.

Ricki Lewis can be reached at

Further Reading: Stem Cells Come of Age, by Ricki Lewis, Ph.D. Published by Insight Pharma Reports, November 2008. 





This article appeared in Bio-IT World Magazine.

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