Collaboration and convergence - Indicators of strength and growth in RegenMed
5 Nov 2013Michael May, President & CEO, Centre for Commercialization of Regenerative Medicine, Canada writes in regen magazine of the current landscape for regenerative medicine in North America.
In my role as CEO of the Centre for Commercialization of Regenerative Medicine (CCRM), I am often asked whether Regenerative Medicine has truly emerged as a viable industry. It has been almost 30 years since the launch of the industry’s pioneering companies. Are we there yet?
I thought we were in 2000, when I launched a new biomaterials company and Time Magazine issued the prophecy that “Tissue Engineer” would be the career of the future. Unfortunately, the hype generated over several years by the financing of those pioneering companies and the promise of engineered organs (e.g. “heart in a box”) would soon be corrected by a sharp decline in the industry, punctuated by the bankruptcies of those pioneering companies and ethical/political debates surrounding the “saviour” of this emerging industry, the embryonic stem cell.
That correction has led to the (re)emergence of a much more sustainable industry (see Gartner’s Hype Cycle of Emerging Technologies), now more broadly referred to as Regenerative Medicine. While “enabling” tools and reagents companies still largely support the industry, there are thousands of cell therapy trials underway globally. And what happened to those pioneering therapeutics companies? They now sell products focusing less on science than on manufacturing, distribution and quality systems.
Of course, science still underlies the industry, advancing at an incredible pace and earning the sector a Nobel Prize this year. There are, however, several non-scientific indicators that commercialising RegenMed in North America is approaching a “tipping point”.
More translation funding
The California Institute for Regenerative Medicine (CIRM) has transitioned in recent years from funding basic R&D and infrastructure to funding “disease teams”, which have strict timelines for achieving IND status around lead clinical applications.
In addition, CIRM is proposing so-called Alpha-Clinics to educate the public on the state of stem cell therapies, deliver approved stem cell therapies to patients, and enable clinical trials of experimental treatments.
One of the core areas of focus for my organisation, the Centre for Commercialization of Regenerative Medicine (CCRM), is on technologies and processes that enable cell manufacturing. If even a fraction of the therapies currently in human trials are successful, there will be significant bottlenecks in scaling to commercial levels. CCRM has recently signed an MOU with the UK-based Cell Therapy Catapult to cooperate on the translation of new cell therapies emerging from either institution.
Growth in industry organisations and consortia
The Washington-based Alliance for Regenerative Medicine (ARM) has grown to over 150 member organisations. ARM promotes the industry to government, hosts several key annual events and leads standing committees that address industry-wide issues such regulatory issues.
CCRM has also built a consortium of more than 30 companies from all sectors of the industry that co-invest in technology development, provide market input in support of due diligence and stand as ready receptors for technologies emerging our development pipeline.
Cephalon’s investment in Mesoblast helped create the world’s largest RegenMed cell therapy company. During the past year, several large pharma and device companies (e.g., Merck Serono, Shire, Novartis and Smith & Nephew) made acquisitions, investments or closed licensing deals, which enhanced the flow of capital within the sector. ARM and the Cell Therapy Group reported in the ARM 2013 Annual Report that the total investment in RegenMed companies in 2012 exceeded $1.2 billion, with 75 per cent of this investment coming in the form of equity investment.
According to Lumira Capital Life Sciences, more money was raised in the biotech industry in the first half of this year through IPO than in any year since 2007. The recent IPO of industry leader Cellular Dynamics and Fate Therapeutics’ filing for IPO indicate that RegenMed companies are participating actively in the current flurry of biotech investing.
For ARM’s Annual Report, CCRM prepared an unweighted stock performance index of 29 RegenMed companies with market caps greater than $10 million. Comparisons against the S&P500 and NASDAQ Biotech indices indicate that RegenMed companies trended well against other biotech companies from 03/12-03/13.
If there is any doubt that regenerative medicine is attracting investor interest, the First Regen Med Investor Day, organised by ARM in New York City, attracted over 300 investors – twice as many as were expected.
Additionally, various divisions of the U.S. military continue to invest tens of millions in the development of human-based drug screening assays, engineered tissue constructs and cell-based treatments for radiation and other sicknesses.
Building on the first stem cell therapy approval
Health Canada approved Osiris’ Prochymal, in 2012, for acute GvHD in children unresponsive to steroids. While approximately 12 cell-based products have been approved in regulated countries since 2008, this represented the first approval of a stem cell-based therapy.
Earlier this year, CCRM led a series of workshops sponsored by the National Institutes of Health (NIH), the Cell Therapy Catapult, ARM, the UK government, Canada’s Stem Cell Network and the International Society for Cell Therapy (ISCT), to address the lack of consensus and standards associated with mesenchymal stromal cell (MSC)-based products. This September, most of these organisations will sponsor another workshop, led by CIRM, dealing with the regulation of cell-based therapies in Europe, the U.S., Canada and Japan.
The 2013 ARM Annual Report noted that the RegenMed industry achieved a number of billion dollar milestones in 2012: more than $1.2 billion raised through grants, public and private monies; more than $1.1 billion in sector transactions with large life science companies; and, more than $1 billion in revenues generated for approved products. Underlying the industry’s achievements is a growing degree of collaboration and connectedness in the sector. CCRM’s commercialisation model is built around the premise that the right “ecosystem” must exist for translation/commercialisation to be successful.
I believe that close ties to the leading activities in the sector will create the right environment for bundling and launching the next wave of therapies and new companies in RegenMed over the next 5-10 years. Certainly, the industry doesn’t want to wait another 30 years to realise returns on the current explosion of discoveries in the field.
Read this and other articles in regen magazine here.