Advanced Cell Technology:Gary Rabin. Applying Stem Cell-Based Technologies to Create Patient-Specific Therapies




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Video title: Advanced Cell Technology:Gary Rabin. Applying Stem Cell-Based Technologies to Create Patient-Specific Therapies
Released on: May 29, 2013. © PharmaTelevision Ltd
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In this episode of PharmaTelevision News Review, filmed at BioEurope Spring 2013, in Barcelona, Spain, Fintan Walton talks to Gary Rabin, CEO of Advanced Cell Technology
Focus on cell therapy, clinical programs and Basis of clinical trials
Fintan Walton:
Hello and welcome to PharmaTelevision News Review here at BioEurope Spring, in Barcelona, in 2013. On this show I have Gary Rabin, who is CEO of a company called Advanced Cell Technology, based in the US, welcome.
Gary Rabin:
Good morning.
Fintan Walton:
How are you?
Gary Rabin:
Things couldn't be better for us.
Fintan Walton:
Good, well ACT is an interesting company, it's one of the first biotech company that's focused into the area of cell therapy probably at a time when it's pretty tough for companies like yours to get off the ground in the US, today you are attacking a number of disease areas, Gary could you just tell us, just remind our audience a little bit about the origins of ACT, of ACT, and where you are placed today?
Gary Rabin:
So the company's lead program involves trying to solve one of the largest unmet medical needs in the world which is dry age-related macular degeneration for which there is no cure, and you are looking at a patient population of around 90, around 15 million people in the United States, around 15 million people in the Europe and so you are talking very big disease indication, and we've seen really tantalizing very promising results in the 18 patients we've treated today. And one of the knocks on cell therapy as you alluded is that in the past companies really were not thinking about cell therapy in a scalable way, and we are approaching it from a completely different perspective, our competitors have tried autologous cells which are high touch, and they've tried a whole bunch of different ways to try to make cell therapy look like a pharma product, we are taking a very different approach, we are looking at creating off-the-shelf solutions at low cost that can bring significant curative power of the recapitulation of the back of the eye to sort of solve for this disease, and so we really see this as a really very significant change from the rest of the cell therapy industry and we were seeing like I said very promising and tantalizing results.
Fintan Walton:
So just tell us a little bit about that procedure then, what cells are you using, how they apply to the eye, et cetera?
Gary Rabin:
Right, so we take a cell called retinal pigment epithelium and we derive those cells from human embryonic stem cells and the retinal pigment epithelium sit at the back of the eye in the back of the macular and they provide a whole variety of trophic factors, both waste removal as well as photo pigment recycling, and they bring vitamins to the photo receptor layer and so they are very critical in the nerve function in particular a photo receptor function, and as the RPE cells die there is a corresponding decline in the photo receptor layer and so in AMD patients typically around 60-years old or later begin to see a little bit of a fuzziness or blindness right in the center field of vision and over the course of 10, a dozen, 15 years that spreads to the rest of the eye and you get nearly complete blindness, and 50, 60, 70-years ago it wasn't a very important disease because of the life expectancy of the population, but today with an aging population and increased life expectancy we're really seeing very significant changes in how important this disease is and how much it costs the society.
Fintan Walton:
Sure, yes. So these cells are applied directly to the back of the eye?
Gary Rabin:
So the surgical procedure is a subretinal injection, it actually starts with the vitrectomy and then there is a subretinal injection using an off-the-shelf injector device, the whole surgery takes about 90 seconds, is done with a local anesthesia and it's an outpatient surgery, so the patients go home five, six hours after they check in.
Clinical trials
Fintan Walton:
Right, so where are you in your clinical trials program for this?
Gary Rabin:
We've treated a total of 18 patients, we have three trials ongoing, we have this dry age-related macular degeneration trial that we've talked about, we also have two other trials both for a disease called stargardt's macular dystrophy which is a juvenile on set form of macular degeneration, it's actually born out of a genetic defect but the end result is the same decline of the RPE layer killing of the photoreceptor layer. And so we've treated a total of 18 patients, 6 AMD patients in the US, and then 6 stargardt's patients in the US, and 6 stargardt's patients in the UK. So we are half way through the treatment phase, a stage of Phase I. Just today we got approval to begin a cohort 3 which is, this is a dose escalating trial, so we'd treating these patients with a 150,000 cells and again we'll be treating three patients in each of these three cohorts, stargardt's US, stargardt's UK, and AMD US, and then we've also been approved by both the FDA and as of yesterday our Data Safety and Management Board to treat a special cohort 2A of much better visual acuity patients and this is going to be I think very important for us. When we started this trial we were treating patients that had hand motion vision only or 20/800 vision, so patients that are very legally blind, and then as the trial progressed we were able to get it down to 20/400 vision again still legally blind, with the fact that we've seen no incidence of adverse safety events across all these patients so far plus the tantalizing visual acuity improvements that we've seen in a majority of the patients, the FDA and the DSMB have cleared as to began treating patients that have 20/100 vision, and so just to give you a little flavor of what 20/100 is, at 20/80 people still have their drivers licenses, at 21/100 they've lost their drivers licenses, but importantly in this disease in the Fovea or central field of vision the amount of atrophy, it's called geographic atrophy in the case of AMD of these patients that are late stage 20/400 or 20/800 it's almost the complete Fovea or central field of vision where there is no functional RPE and virtually no functional photoreceptors, in these 20/100 patients we'll be able to find spots where there is no atrophy, or limited atrophy and hopefully we will be able to see some really tantalizing results both in stemming the decline of this disease, as well as potentially seeing significant visual acuity improvements in these patients taking advantage of dormant, but not yet dead photoreceptors.
Fintan Walton:
Right, now one of the things you mentioned earlier which is the scalability one of the important things is and of course these cells are ultimately derived from embryonic stem cells.
Gary Rabin:
That's right.
Fintan Walton:
So you have to go through the process of generating or making these cells, is there any relationship between, obviously if you are doing a scale and storage and the, basically the health of the cells that you going to have to apply to the eye, I mean how much research has gone there, and how sure are you you've got that element right?
Gary Rabin:
Right, well that was actually critical even in the initial approval clearance of the, by the FDA of our trials. So one of the things that I think is highly misunderstood is that embryonic stem cells, the creation of embryonic stem cells does not necessarily require the destruction of embryos and in fact we have a patented technique, a technology where we don't destroy the embryo, it's we removed a single cell from an early stage embryo that doesn't change the fate of or harm the embryo in any way, it's identical to what's done in pre-implantation genetic diagnostics where they test in in-vitro fertilization clinics for Huntington's or Tay"Sachs or in older parents chromosomal abnormalities. So back in 2012 we created a dozen embryonic stem cell lines, and because embryonic stem cells propagate or replicate infinitely we have an unlimited source supply of material, and our company's scientific specialty, is really developmental biology, so being able to identify and create the cues that are necessary to take a cell that's a pluripotent cell and turn into these terminally differentiated retinal pigment epithelial, and one of the great things about working in the eye is that you're looking at a small number of cells that is required here, so we are treating patients well this cohort with a 150,000 cells.
Fintan Walton:
Which is not a lot of cells.
Gary Rabin:
Not a lot of cells, it's equivalent to about the head or the tip of a pen. So it's a small number of cells, the scalability of this is significant, just one six well plate can create enough dosage for about a 100 patients. We could at current production levels one shift a day no improvements in efficiency we could create half a million doses a year in our little 500 square foot manufacturing facility in Marlborough, Massachusetts. So and these cells are shipped in vials, eventually by the end of this year they will be syringe ready, they are not currently shipped in a biocompatible medium, in other words the cells have to washed down and then injected in with the injection medium, but by later this year we plan to have, ship these cells essentially syringe ready, so the doctor will just draw them down into the syringe and inject them right into the eye.
Fintan Walton:
Right, okay.
Gary Rabin:
But they ship in the cold chain, easy shipping, easy storage, they can be frozen and kept for, well shelf life of these cells right now is a year, but I mean we believe we can keep them for much longer.
Fintan Walton:
Right, and then of course the procedure themselves are important, how that is actually delivered to the eye, at what time or what place in the eye because that's the basis of all your clinical trials now?
Gary Rabin:
You bet, in fact we now have treated in five different centers and it's important to understand that this is a procedure that is relatively straight forward, the injection technology, the injection procedure dates back to when the docs where in medical school, that's how long ago they've learned this kind of procedure, now as you say it's important to put these cells in exactly the right place, so the scanning technology and the microscope that they use to watch while they inject these cells if they are injecting them in the right place that's all very critical, but it's technology that is state of the art, but not cutting edge in any sense.
Fintan Walton:
Yes, it is a technology that they are using anyway for lot of their own procedures?
Gary Rabin:
Absolutely they do vitrectomy's everyday using identical scanning technology, identical surgical techniques.
Fintan Walton:
So in that sense then there is another reduction of risk there?
Gary Rabin:
Oh you bet.
Platelet therapy
Fintan Walton:
Okay, so Gary just going on to the other areas you are exploring at the moment, you've got this platelet therapy, if you can tell us a little bit about that as well?
Gary Rabin:
You bet platelets are very important cells in the body and they are actually very difficult to generate normally. The only way you can get platelets today is through the spinning of blood that's collected by blood banks. So we've actually created vials of red blood cells, platelets, so platelets are interesting kind of cell, they are enucleated meaning they have no nucleus and they cannot be stored or refrigerated, so they only last about five to seven days, and in fact they only live in your body for about five to seven days, and platelets play an important role in wound healing, cancer, and cancer recovery, plastic surgery, many different applications for platelets and hospitals and trauma centers are extremely limited on the number of platelets they have today. So what if we could create a limitless source of platelets identical in function to the platelets that are native to your body, well in fact what we've now seen both in our in vitro in the lab studies as well as in our animal studies is that we've been able to create these platelets that are functionally identical in every way to human platelets.
Fintan Walton:
These are stem cell derived?
Gary Rabin:
And we derive these platelets both from embryonic stem cells as well as IPS cells and our goal will be for later this year to file an IND and hopefully be first in man worldwide, but at least first in man, ex-Japan for using an iPS cell as the progenitor cell for any kind of cell, and we actually had a meeting with the FDA in early March of 2013 where we went through with them and understood what their gating issues would be to bringing this iPS to platelet cell therapy into mankind, but what's remarkable is that when we've done our animal studies and we've induced a thrombus or a wound into an animal we've seen our stem cell derived platelets performing and functioning in clot healing identical to those in the mouse, so human platelets into a mouse sort of participating in the clot formation, I mean this is a bit of a remarkable advancement for the company.
Fintan Walton:
Sure and I suppose it's a different scale as well because it's not, you are not just putting a few hundred thousand cells into the back of the eye, this is in the larger scale so that's a new challenge?
Gary Rabin:
Right, and that's why one of our Board Members is Dr. Robert Langer, who runs the Langer Labs at MIT, and they have some expertise in scale and how you can kind of ramp these things up and we are actually also talking to government and government affiliated organizations to help us with this, because ultimately through bioreactor we could scale this up to be millions, 10's of millions, 100's of millions, billions of platelets. So as we sit here today we're able to create lots and lots of these megakaryocytes which are sort of pre-platelet, and what we are working on now is ramping up the efficiency of translating megakaryocytes into platelets, your body translates megakaryocytes into platelets at a range of about 10,000 platelets per megakaryocytes, right now we are generating about 5, 8, 10 platelets per megakaryocytes, so this improvements and efficiency are the things that we are really focused on, if we can derive these improvements and efficiency we will create incremental demand for millions or 10's of millions of units of platelets to be used in just regular surgical procedures in the US and the UK on a yearly basis.
Business model and response of pharma companies to the technology
Fintan Walton:
Right, I suppose just I suppose towards this end of this interview I like to focus on just a couple of issues, obviously you are different from a normal biotech, you are in the cell therapy field, the issues are things like the FDA and I think, I understand that the FDA is working hard to, with companies like yourselves, to ensure that your products will get approved ultimately, there is not too many obstacles in the path, but they are applying the same sort of rules generally that they would apply to a normal drug or at least a biologic going through that regulatory process, I suppose the other area is the adoption of the business model, because obviously we are here at BioEurope in Barcelona and what are the pharma companies, how they respond to companies like yours? Are they ready for your type of technology?
Gary Rabin:
You know there have been a few cell therapy deals into pharma, at this date as we sit here in March of 2013 right, Shire bought Advanced BioHealing [PharmaDeals ID = 40808], Cephalon did this deal with Mesoblast [PharmaDeals ID = 38411], so there have been some big pharma into cell therapy companies, but you have to remember there are only about eight or nine cell therapy products that have been approved on the market, so all of the big pharma and big biotech companies are just getting their arms around it, but I mean you have to remember 15, 20-years ago the monoclonal antibody market was the same, I mean you had some early failures a lot of sort of dubiousness on the part of the big pharma's about do we want to really put big money here, now you look at the MAB market and it's absolutely enormous.
Fintan Walton:
Absolutely.
Gary Rabin:
So we see a lot of similarities, but we also recognize that cell therapies can be very complicated. Our main product appears to be a very straight forward surgical procedure, it appears in our animal models that it worked very well, it appears in the human model so far, the results appear to be tantalizing, but we are looking at ways in which it could conform more to the pharma methodology. So for example we've created a photoreceptor progenitor and when we injected these photoreceptor progenitors into the tail of a mouse we actually observed significant photoreceptor rescue so that tells us and we were unable to identify any of the photoreceptors or human DNA in the eye of the mouse, so that tells us that there is going to be something happening in the secretome here, the proteins or factors that are being expressed and so we are now looking at and talking to some of the pharma companies about identifying the gene expression here, figuring out what's really going on and that is something to create a biologic or something, that's something that really looks more like a pharma product. So there are a lot of ways to go here and I think early on pharma is very sort of concerned about whether or not for example autologous cell therapy procedures could be scalable, it's high touch, it's not very cost effective, may be it will be therapeutic, but that doesn't sound like something that big pharma will get into right away, straight away they will be looking at allogeneics which is or perhaps these protein secretion and things like that, so we are very cognizant in the fact that pharma needs to have a model that works for them, that looks like something that they can be scaled.
Fintan Walton:
Yes, and particularly with the AMD, dry AMD product it's very close to that, it's like a biologic in fact very?
Gary Rabin:
Very much like a biologic.
Financing and partnering strategy
Fintan Walton:
So but then finally the other question I want to focus on is financing, because obviously that the model is the model we've just described and so you need to have your coffers full of dollars, so how do you approach that, I mean obviously you've got your current investors, what do you as a CEO need to do to make sure that you continued the this research going forward without too much of dependency on partners?
Gary Rabin:
Right, in the past the company has done very bad financings, I mean financings that had significant warrant overhang, recurring price resets very, very adverse financings. Our current financing partners group called Lincoln Park Capital, they provide us financing at effectively very little discount to market, but we are drawing down on that financing every few days, so it's not like we are getting a year's slug of capital and then it goes away, so we are getting, it's very efficient in terms of discount, there is no warrant overhang or no price resets and so forth, but it requires us to regularly be in the market, and so while this is much more attractive financing than the company has achieved in the past it's not the same as having Fidelity invest 10 million into your $35 million fully marketed equity deal, but as we sit here today in March of 2013 we are an over the counter bulletin board listed stock but we are very close to meeting the listing requirements for the NASDAQ, that's an important goal for us this year and that will get us out of this sort of serial dilution in small chunks kinds of financings that we've been doing, and obviously we are looking toward the future where we will be able to get significant non-dilutive capital, but we want to be able to do that on our terms, we don't want to give away important technology for pocket change and this company had done that in the past, and we are just not going to do that. So well as we sit here today with Lincoln Park if we were to draw down on the full $35 million commitment that they've made to us that would fund us into early 2015, so two-years hence, so we are in good shape right now, we are lucky because we don't have a big burn rate, the company's burn rate is only about 15, $16 million a year even including the cost of these trials, so we think that there is ways to optimize this financing in the future, but for now we are very happy with our financing partners.
Fintan Walton:
Gary Rabin, thank you very much indeed for coming on the show.
Gary Rabin:
Nice to see you, cheers.
Fintan Walton
Dr Fintan Walton is the Founder and CEO of PharmaVentures . After completing his doctoral research on the genetics of cell proliferation at the University of Michigan(US)and Trinity College (Dublin, Ireland), Dr Walton gained broad commercial experience in biotechnology in management positions at Bass and Celltech plc (1982-1992).
Gary Rabin
Chairman
At the time of recording this PTV interview Gary Rabin serves as Chairman and CEO of Advanced Cell Technology. Gary Rabin's 25-year career in finance and operations has primarily encompassed investing in, managing and raising capital for small-cap and emerging growth companies. From 2007 to 2010, he was Managing Partner at GR Advisors, LLC, a hedge fund focused on media and communications. From 2005 to 2007, he was a Portfolio Manager at MAC Investment Management, LLC, a hedge fund concentrating on technology, communications and healthcare. Prior to that he was a Managing Director and Portfolio Manager at Marketus Associates, a hedge fund focused on communications, healthcare services and energy. Before that, he was Managing Director and Co-Head of the Media and Telecom Investment Banking Group at CIBC World Markets ("CIBC"), where he was responsible for all corporate finance and M&A, financial restructurings and principal investing activities (both debt and equity) within the sector. Before joining CIBC, Mr. Rabin served as Chief Strategy Officer of CAIS Internet, Inc. ("CAIS") , a broadband services company, where he was responsible for securing over $500 million in financing commitments. Mr. Rabin has also served as Managing Director and Head of the Global Telecom Investment Banking Group at ING Barings Furman Selz and was a founder of the telecom group at UBS Securities. He began his career in finance in 1987 and concentrated on energy, utilities and metals until 1993. Mr. Rabin earned an AB in Economics from the University of Michigan.
PharmaVentures
PharmaVentures is a corporate finance and transactions advisory firm that has served hundreds of clients worldwide in relation to their strategic deal making in the pharmaceutical, life science and healthcare sectors. Our key offerings include: Transactions / deal negotiations; Product / technology valuations; Deal term advice; Due diligence & expert reports; Strategy formulation; Alliance management; and Expert opinion for litigation/arbitration cases. PharmaVentures provides the global expertise to ensure our clients generate the highest possible return on investment from all their deal making activities. We have experience of all therapeutic areas and can offer advice on both product and technology commercialisation.
Advanced Cell Technology
Advanced Cell Technology is a biotechnology company that specializes in the development of cellular therapies for the treatment of diseases and conditions that impact tens of millions of people worldwide. The company applies stem cell based technologies (both adult and human embryonic) and other proprietary methods in the field of regenerative medicine to bring patient-specific therapies from the lab bench to the bedside.