Executives of biopharmaceutical company Athersys Inc. seem more confident than ever that their stem cell therapy MultiStem could eventually be used to profoundly help patients recover from heart attack, stroke or leukemia.
In a conference call with securities analysts late Thursday afternoon, the executives also disclosed promising research on drug candidates to treat obesity and attention-related neurological conditions, such as narcolepsy.
The therapeutic and market potential for the Athersys products so captured analysts’ attention that they didn’t ask a single question about the company’s fourth-quarter and annual financial results for 2009, which also were announced during the call.
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Instead, the analysts pressed Gil Van Bokkelen, chairman and chief executive of Athersys, and William “B.J.” Lehmann, the company’s president and chief operating officer, for details on Phase 1 clinical trials of MultiStem–an off-the-shelf stem cell therapy derived from adult cells–to treat and minimize damage caused by heart attacks or strokes and to prevent leukemia patients from rejecting bone marrow transplants.
Van Bokkelen said his company’s development and commercialization collaboration with Pfizer Regenerative Medicine to develop MultiStem to treat inflammatory bowel disease (IBD) patients–announced Dec. 21–has started powerfully. Athersys is in line for up to $111 million in revenue from the agreement, with an initial $6 million in cash.
“Currently, we are working closely with Pfizer to complete planning and additional preparatory work prior to submitting an [investigational new drug application] and moving the program into clinical development,” Van Bokkelen said. “Our mutual objective is to leverage the prior work we have done in other areas while working together with Pfizer to develop a deeper understanding of the biological and clinical profile and characteristics of MultiStem for IBD and de-risk the overall development effort. Our work is well under way.”
The agreement with the Pfizer unit validated the capabilities of MultiStem to treat patients with inflammatory bowel disease. But it also was a validation for Athersys, which for years has been investing in its development programs in stages, trying to make its cash stretch to cover products like MultiStem, as well as drug candidates the company discovers through a proprietary technology.
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The company has gone down parallel paths to leverage its research and financial resources, Van Bokkelen told analysts Thursday. It has developed a network of collaborations among investigators in the United States and Europe, and it has looked to partner with companies that will help shoulder development costs.
Van Bokkelen said development interest from large pharmaceutical companies has picked up significantly. “Eighteen months ago, hardly any of them were talking about interests in regenerative medicine,” he said. “Now, a significant number of them are.”
Analysts seemed most interested in the Athersys trial of MultiStem for victims of ischemic stroke–those caused by a blocked artery in the brain. The standard of care for these victims is treatment with “tissue plasminogen activator,” better known as tPA, within three hours of a stroke to break up artery blockage. “The vast majority patients do not receive tPA,” Van Bokkelen said.
In its Phase 1 trial, Athersys is dosing patients with MultiStem between 48 and 60 hours after they have a stroke. Unlike tPA, MultiStem acts by reducing inflammation, protecting damaged tissue and forming new blood vessels. If successful, MultiStem could offer a superior treatment and a wider treatment window for ischemic stroke.
Earlier Thursday, researchers from Athersys and its collaborators presented some of their findings at 8th Annual World Congress on Trauma, Shock, Inflammation and Sepsis in Munich, Germany, Van Bokkelen said.
While looking for development partners, Athersys also has continued its research on drugs that fight obesity and neurological disorders by targeting a certain brain receptor while not activating other receptors that cause life-threatening side effects. A year ago, Athersys shelved development of its ATHX-105 obesity drug because it couldn’t find a development partner.
“I am happy to report that we have successfully achieved a major objective and have developed a high-quality portfolio of potent compounds which are potent at the 5HT2c receptor, yet exhibit no agonist activity at either the 5HT2b or 5HT2a receptors at any physiologically relevant concentration,” Van Bokkelen said. “We believe this represents a substantial achievement and that these compounds have the potential to be best-in-class clinical candidates.”
As for financial results, Athersys lost $5 million, or 26 cents a share, in the fourth quarter compared with a loss of $4.7 million, or 25 cents a share, in the year-ago quarter. Development contract and grant revenue were $869,000 in the recent quarter, compared with $259,000 a year ago.
Athersys lost $15.4 million, or 81 cents a share, in 2009, compared with a loss of $18 million, or 95 cents a share, in 2008. The company had revenue of $2.2 million in 2009, down from $3.1 million in 2008.
Athersys shares rose 7 percent Thursday to $3.32 on the Nasdaq Stock Market. The company made its financial report after the market closed. Its shares are up more than six times in the last year, largely on the strength of the Pfizer deal in December.
