NeoStem and the Cell Therapy Field

Cell Therapy Overview

Regenerative medicine is defined as the process of replacing or regenerating human cells, tissues or organs to restore normal function. Among the categories of therapeutic technology platforms are cell therapy; tissue engineering; tools, devices and diagnostics; and aesthetic medicine. NeoStem’s business model is focused two of these areas.  First, cell therapy, in which we introduce cells (adult, donor or patient, stem or differentiated) into the body to prevent and treat disease; and second, tools, devices and diagnostics in which we intend to utilize engineering and innovation to automate, integrate or otherwise modify cell therapy manufacturing platforms to improve the deliverability of cellular therapeutics to patients.

The History of Cell Therapy

All living complex organisms start as a single cell that replicates, differentiates (matures) and perpetuates in an adult organism through its lifetime. Cellular therapy is the process that uses cells to prevent, treat or cure disease, or regenerate damaged or aged tissue. To date, the most common type of cell therapy has been the replacement of mature, functioning cells such as through blood and platelet transfusions. Since the 1970s, first bone marrow and then blood and umbilical cord-derived stem cells have been used to restore bone marrow and blood and immune system cells damaged by the chemotherapy and radiation that are used to treat many cancers. These types of cell therapies are standard of practice world-wide and are typically reimbursed by insurance.

Within the field of cell therapy, research and development using stem cells to treat a host of diseases and conditions has greatly expanded. Stem cells (in either embryonic or adult forms) are primitive and undifferentiated cells that have the unique ability to transform into or otherwise affect many different cells, such as white blood cells, nerve cells or heart muscle cells. NeoStem’s cell therapy development efforts are focused on the use of adult stem cells; these cells are found in the bone marrow, in peripheral blood, umbilical cord blood and other body organs.

Types of Cell Therapies

There are two general classes of cell therapies: Patient Specific Cell Therapies (“PSCTs”) and Off-the-Shelf Cell Therapies (“OSCTs”).  In PSCTs, cells collected from a person (donor) are transplanted, with or without modification, to a patient (recipient).  In cases where the donor and the recipient are the same individual, these procedures are referred to as “autologous”.  In cases in which the donor and the recipient are not the same individual, these procedures are referred to as “allogeneic.”  A notable form of autologous PSCT involves the use of autologous cells to create vaccines directed against tumor cells in the body and has been demonstrated to be effective and safe in clinical trials. For example, Dendreon Corporation’s Provenge® therapy, an autologous PSCT for prostate cancer, received FDA approval in early 2010.  NeoStem’s CD34 Cell Program also focuses on PSCTs using autologous cells.  Autologous cells offer a low likelihood of rejection by the patient and we believe the long-term benefits of these PSCTs’ can best be achieved with an autologous product. In the case of OSCT, donor cells are expanded many fold in tissue culture, and large banks of cells are frozen in individual aliquots that may result in treatments for as many as 10,000 people from a single donor tissue.  By definition, OSCTs are always allogeneic in nature

Various adult stem cell therapeutics are in clinical development for an array of human diseases, including autoimmune, oncologic, neurological and orthopedic, among other indications. NeoStem, as well as other companies, is developing cell therapies for cardiovascular diseases and immune disorders. While no assurances can be given regarding future medical developments, we believe that the field of cell therapy holds the promise to better the human experience and minimize or ameliorate the pain and suffering from many common diseases and/or from the process of aging.

As a contract development and manufacturing organization (CDMO), PCT is currently working with a wide range of clients in the regenerative medicine industry. PCT provides us with a unique and fundamental base platform of experience with a multitude of cell types in development. PCT is strategically helping to position us in a way that allows us to participate in the cell therapy field on multiple levels as the cell therapy industry evolves.. Our goal is to be recognized as a premier service provider in the regenerative medicine industry by continuing to leverage the experience and expertise of PCT as a recognized leader of cell therapy manufacturing and development in the sector.

Market Analysis

According to Robin R. Young’s Stem Cell Summit Executive Summary-Analysis and Market Forecasts 2014-2024, the U.S. stem cell therapy market is estimated to grow from an estimated $237 million in 2013 to more than $5.7 billion in 2020.

With approved cell therapy products currently being sold in the United States and abroad, and an increasing number of Phase 2 and Phase 3 trials with cell therapies underway, we believe the “promise” of cell therapy is becoming more and more clear.

Cell therapies, if approved, should cut healthcare costs as they aim to facilitate functional restoration of damaged tissues and not just abate or moderate symptoms. Safe and efficacious cell therapies for chronic diseases could capture an increasing portion of future healthcare spending in the United States, driven both by favorable demographics and the meaningful pharmacoeconomic benefit.