Therapeutics
Phase III clinical trials5. There are 23 regenerative medicine trials in heart failure alone, attempting to tap a market anticipated to reach $80 million in costs by 20306. In addition to the promising ther- apies in the pipeline, there are already multiple suc- cessful regenerative medicine products on the mar- ket. More than 300,000 patients have been treated with regenerative medicine products to date – the bulk having received Apligraft (Organogenesis) or Dermagraft (Advanced BioHealing) for foot and leg ulcers. With these sales the regenerative medi- cine cell therapy market was valued between $100- $200 million in 20107.
A nascent industry takes off Given the forecasted market growth and impres- sive product pipeline, there is a growing perception in the biotech and pharmaceutical industries, the research community, among policy makers and some parts of the investment community that regenerative medicine is poised for significant breakthroughs in the next few years and could rep- resent the next major leap forward in medical innovation. This view in part is due to several major developments in 2010. First, and perhaps most importantly, the sector performed quite well in 2010. The top 20 public regenerative medicine companies experienced 40% growth in their market capitalisation8. This compares with 23% growth in the BioCentury 100 index of public biotech stocks, 17% for Nasdaq, and 13% growth for the S&P 500. If Dendreon, which makes the autologous immunotherapy PROVENGE®, had been includ- ed in the regenerative medicine performance index, the sector’s performance would have been even better. In addition, there are a large number of private regenerative medicine companies, sever- al with products on the market, which are attract- ing the interest of investors, prospective partners or acquirers, or are candidates for initial public offerings. Advanced BioHealing filed an initial public offering in February 2011 in hopes of rais- ing $200 million9. There are also numerous ortho- biologic companies focused on bone regeneration and cartilage repair which remain private but have captured the interest of investors and the medical device companies. Finally, there are a very large number of profitable tool and service companies developing the enabling technology platforms that are indispensible to the research community and critical to the success of the regenerative medicine industry. Other areas of great potential are drug discovery and cell modulation. Large pharmaceu- tical companies such as AstraZeneca,
Drug Discovery World Spring 2011
GlaxoSmithKline and Roche are all showing inter- est in using stem cell-based assays for safety and efficacy screening for traditional small molecules. Boutique regenerative medicine firms such as iPierian are pioneering work in this field. Such assays could potentially cut costs and reduce uncertainty in diagnosis and treatment by provid- ing vital information about biological interaction early on in the development process. Many of these companies also experienced significant growth in 2010.
One event that signalled a major advancement in cell-based therapies during 2010 was the approval in April of Dendreon’s autologous immunotherapy, PROVENGE®, for the treat- ment of asymptomatic or minimally symptomatic metastatic hormone-refractory prostate cancer. PROVENGE® is derived from white blood cells taken from the patient and incubated with a fusion protein comprised of prostatic acid phos- phatase (PAP) and GM-CSF before being shipped back to the infusion centre for administration to the patient. Dendreon’s facilities should be fully operational by mid-2011 and sales in the US could surpass $1 billion. Their market capitalisa- tion has increased 10-fold from March 2009, when it stood at $412.44 million, to its current capitalisation of $4.74 billion. This was one of the largest increases in valuation of any company in the biotech sector in the past few years. Dendreon’s success is significant in that it repre- sents the first approval of an autologous cell product and highlights the potential for the mul- tiple autologous and allogeneic cell therapies in the clinical pipeline. Many of these treatments are being developed for major unmet medical needs such as spinal cord injury, diabetes and critical limb ischaemia, which represent huge market potential. As these products progress through clinical trials and reach the marketplace, the regenerative medicine sector could be poised for significant growth.
Another major development in 2010 that indi- cated a growing interest in the RM sector among pharmaceutical companies and large-cap biotech firms was the $1.7 billion deal announced in December between Mesoblast and Cephalon. Cephalon received a 19.99% equity stake in Mesoblast for $220 million and global rights to their mesenchymal precursor stem cell platform for cardiovascular disease, stroke and various neu- rodegenerative indications. The deal also included an upfront payment of $130 million. This was one of the largest biotech deals of 2010 and revealed a strategic shift into regenerative medicine by a
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