StemCells turning a corner?

The path seems to be clearing in front of US biotech StemCells as it advances cell-based therapies for blindness and spinal cord injury (SCI) into mid-stage clinical testing.

StemCells completed a $20 million fundraising last month that should provide funding through to the end of 2015 and - crucially - the completion of Phase II studies in age-related macular degeneration (AMD) and SCI.

StemCells progress in the clinic of late has been somewhat overshadowed by funding concerns and a long-running intellectual property lawsuit with rival NeuralStem focusing on human neural stem cell patents.

Both companies use human neural stem cells to derive therapies that aim to repair and replace neurons and regenerate cell growth and after eight years of suits and countersuits the outcome is impossible to call. However, the recent news that a call for a summary judgment by NeuralStem was denied by a US judge - allowing court proceedings to get underway in December - means that the end may well be in sight.

Removing the distraction of litigation would be an important development for the company as it moves into what it describes as a "transformational" year.

With promising interim results in the bag from its Phase I/II dry AMD trial and the completion of enrolment of its Phase I/II SCI trial in recent weeks, the company is now preparing to start Phase II for both programmes before the end of the year.

The AMD study revealed sensory gains and the return of function in around half the patients treated with the neural stem cell therapy, indicating "that something that was not working in the spinal cord now appears to be working following transplantation," according to StemCells chief executive Martin McGlynn.

Benefits of the therapy included a 70% reduction in geographic atrophy with respect to the untreated eye, as well as improved contrast sensitivity, with no safety issues reported.

"These data are from a small number of patients but are sufficiently compelling for StemCells to stop enrolment to the Phase I/II trial and bring forward the start of a Phase II trial to fourth quarter 2014, before final data is due in mid-2015, according to analysts at Edison.

Meanwhile, preliminary data from the SCI trial revealed no safety issues and some signs of promising efficacy, and "lay a strong foundation for the next set of trials" which will involve patients with damage to the cervical (neck) vertebra. This is the first time that a stem cell therapy has reached this stage of clinical development in SCI, according to McGlynn.

StemCells has also started to tackle the thorny issue of manufacturing - a perennial problem for companies developing ell-based therapies - and recently hired a new vice president of process development, Mohammad El-Kalay, to develop scalable production processes that will allow the company to prepare for late-stage clinical testing and commercialisation.