Interview with Gary Rabin of Advanced Cell Technology (ACT)

One of the more exciting stem cell biotechs out there today is Advanced Cell Technology (ACT).

At this time ACT has the only two ES cell-based FDA-approved clinical trials ongoing and so far they have looked quite promising in terms of preliminary safety data. However, ACT has much more in the pipeline including potentially iPS cell-related products such as platelets.

I interviewed ACT CEO and Chairman, Gary Rabin, to get the latest on the company and its future. I wanted to thank Gary and the other folks at ACT for doing this interview, which was an email Q&A. I think the questions were probing and fairly tough in some cases.

Note that some of these questions came from ACT investors, whom I queried on the Investor Stem Cell website for their questions, while others (as indicated) came from me. Also, keep in mind that for the investors’ questions, I often condensed down many related questions into one.

1.) Where do you see ACT in 5 years? One company or several? Revenue?

In life science companies, five years is a long way off in the future for trying to make predictions.  We work on the premise today that we will be one company, perhaps with various joint ventures and subsidiaries, and include in our thinking about deal structures those which would provide us with the opportunity to become a fully integrated life science company with marketable approved products.  It is also conceivable that, with success in one or more of our clinical programs, we become an acquisition target for a big pharma company looking to bolster its regenerative medicine capabilities.  So our business strategy also includes preserving this option.

Revenue depends on the timing and success of our clinical trials. We can’t make specific revenue projections that far out, but as an example, just take a look at the market for dry age-related macular degeneration (dry AMD), which is the focus of one of our three ongoing trials. There are more than 30 million dry AMD patients in North America and Europe, alone, and with no approved treatments currently available. That indication alone clearly translates into tremendous revenue potential.

2.) Any comment on DOD/DARPA and the platelet or synthetic blood therapy?

We are certainly open to accepting government funding, both broadly and for specific projects, and we are currently exploring some such possibilities.

3.) How are things going between ACT and CIRM?

CIRM is doing good work and we applaud the government of California for taking the initiative to fund regenerative medicine on the state level. We don’t currently have any active programs with CIRM, but remain in regular communication with their senior management in case the appropriate opportunity or RFA presents itself.

4.) How competitive do you think the stem cell arena is for ACT today? How about looking to the future?

This is a very broad question, and I think the best way to answer it is to say that we consider ourselves to be a unique player in the regenerative medicine space. No one else is doing precisely what we’re doing with macular degeneration, and there’s certainly no one else in the clinic with an embryonic stem cell-based therapy.  But what we have taken away from getting to these trials is far broader.  We have an experience level that is unique, deriving from our understanding of what it takes to bring cell therapy products from pluripotent stem cell sources forward to the clinic – both in the U.S. and Europe.  We have already met with the FDA to discuss iPS-derived products, and found that our experience from our hESC-RPE program was immensely useful in predicting the FDA concerns and walking into the meeting with answers and solutions.  Finding the scalable manufacturing solutions for these cell therapies, along with solving many of the “final mile” problems in optimizing these cell therapies for use in human patient,  also provides us with a very solid intellectual property position both in terms of breadth but also in terms of length of coverage.

5.) Any news on the partnership and/or JV front for ACT? Small partners? Big partners?

We continue to have regular one-on-one meetings with many of the biggest pharmaceutical companies in the world.  They are keenly interested in our programs, even beyond RPE. However, as we’ve said before, we want to make sure the timing of such a JV is appropriate and in the best long-terms interests of the company and its shareholders.  The value of a deal halfway through phase I is likely to be significantly different than the value of a deal could command coming at the end of phase I, particularly with our ability to treat 8 “better vision” (20/100) patients in the second half of our trials.

6.) What is the situation regarding the reverse split?

We will update the shareholders on our plans in the near future.

7.) Can you update us on ACT’s MMD clinical trial situation? Who is the sponsor for the IND for the MMD trial? Are others doing similar work for retinitis pigmentosa?

As we discussed in our February 11 announcement, the clinical partner for the clinical trial for MMD is UCLA (the clinical trial will be led by Steven Schwartz, M.D., Ahmanson Professor of Ophthalmology at the David Geffen School of Medicine at UCLA and retina division chief at UCLA’s Jules Stein Eye Institute. Dr. Schwartz is the principal investigator in each of ACT’s two Phase I/II clinical trials for Stargardt’s macular dystrophy and dry AMD using RPE cells derived from human embryonic stem cells (hESCs).  MMD is surprisingly big indication, particularly amongst Asian patients.  In Shanghai, for example, twice as many people are blind from MMD compared to AMD.  Dr. Schwartz is working through the final steps at UCLA in order to begin enrolling patients in that new clinical trial.

With respect to RP and other back-of-the-eye diseases, we are working with animal models through several academic labs.  We are testing not only RPE cells in these models, but also photoreceptor progenitors and combinations.

8.) Any plans to publish another article like the Lancet one in 2013?

Yes, we certainly plan to share additional clinical trial results in a peer-reviewed medical journal, and are coordinating efforts amongst all of the clinical investigators to gather data and images useful to that end.

9.) Any info on NIH redefining to include single-blastomere?

We are optimistic that the Supreme Court’s recent decision to deny certiorari in the cast of Sherley vs. Sebelius should indeed clear the way for the NIH to issue revised guidelines that would qualify our hESC lines for federal funding, possibly in coming months.

10.) What is the situation with ACT and MSC-based therapies?

As we’ve mentioned, ACT is developing a method for scaled manufacturing of Mesenchymal Stem Cells (MSCs) from renewable pluripotent stem cell sources. This involves expanding hESC-and IPS-derived MSCs to large numbers in-vitro.

ACT has a proprietary, scaled manufacturing method for generating “young” MSCs from hESC and iPS lines. This permits the use of a single allogeneic MSC bank to manufacture MSCs. Moreover, hESC- and iPS cell-derived MSCs are far more potent immunomodulators than adult-derived MSCs.

We think the single donorless source of cells solves many of the manufacturing bottlenecks that have concerned others in considering all the potential that MSC therapies have, and that the potency of our MSC’s provides a further differentiating factor over the adult-derived MSC that currently in the clinic.

11.) Could RPE be considered as a new Breakthrough Therapy Designation?

Based on currently-available guidance from the FDA, it appears that some of our programs could potentially qualify as a “breakthrough therapy.” We are researching it and discussing with the appropriate parties.

12.) Are there developments in China that impact on ACT?

We don’t have anything to announce with respect to China at present. We are interested in putting together a partnership in China and continue regular dialog with the government, as well as hospitals, universities and potential partners there, but the regulatory environment and concern over protection of our know how and intellectual property has dictated a go-slow approach while we sort the best path forward.  I am confident that we find our way there.

13.) From Paul: As ACT looks to the future does it have any plans to do educational outreach to patients and/or the general public? For example, I think it would be extremely beneficial and cost next-to-nothing, to have a patient portal on your company website with resources for patients.

Yes, we do have an initiative along these lines in the works, which we hope to be able to share with you and our many followers in coming months.

14.) From Paul: What are ACT’s plans for iPS cell products besides platelets? Can you tell us about ACT’s IP on cellular reprogramming? How valuable do you see these as being for the company?

Our scientists and others have been involved in iPS technology since well before Dr. Yamanaka coined that term and thrust this technology into the forefront of public view with his well-deserved Noble Prize.  We used to call this “dedifferentiation”, and our IP position includes claims around inducing pluripotency using Oct-4, as well as zero footprint reprograming using vectorless technology.

We see our platelets program as only the beginning of our iPS cell-based program; we are planning to target other indications, as well.

15.) From Paul: Does ACT have any interest in or is actively researching possible products related to transdifferentiation?

Yes, our efforts in transdifferentiation date back to the late 1990s, when the company was awarded a sizable grant (seven figures) from the National Institute of Standards and Technology (NIST) to identify agents and conditions that predispose, through non-genetic modification, target cells such as fibroblasts to be more amenable to reprogramming factors.

We remain interested in transdifferentiation. However, it is not a top priority.