Adult stem cells are a promising market

Posted at June 17, 2009

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250px-Human_embryonic_stem_cells Amid controversies over embryonic stem cell research, drugs using adult cells are already bearing fruit.

NEW YORK (Fortune) — When it comes to stem cells, the public — and the media — tend to focus on embryos. But researchers and analysts say marketable therapies already are emerging from less controversial work with adult stem cells.

Adult cells make up the lion’s share of the stem cell space, mainly because they are easier to come by than embryonic cells, and less expensive to run in clinical trials. They are also derived from mature tissue, like bone marrow or umbilical cord blood, so they avoid the ethical debate that surrounds embryonic stem cells.

Researchers are far closer to commercializing drugs based on adult stem cells than any product based on embryonic stem cells.

“Adult derived cells are the ones that have been studied for the past 10 to 15 years and are ready for prime time,” says Debra Grega, the executive director of the Center for Stem Cell and Regenerative Medicine at Case Western Reserve University. “Large pharmaceutical companies are now wanting to get into the adult stem cell therapeutic area. That indicates to me that there is enough safety and enough efficacy that they are willing to put money in.”

The Investment Opportunities – The overall stem cell market, however, is still quite small. The California-based outfit Geron (GERN) dominates the embryonic market, and is perhaps 10 years away from commercializing a spinal cord treatment based on its research.

The frontrunner in the adult stem cell space is Osiris Therapeutics (OSIR). Last year, the biotech Genzyme (GENZ) paid Osiris $130 million up front, with another $1.2 billion to be paid in potential milestones, to develop two new adult stem cell treatments.

Osiris’s star drug Prochymal is used to fight graft-versus-host disease, a painful illness that can afflict transplant recipients. Osiris says the FDA could approve the drug within a year. If successful, Osiris would be the first company to win approval for a stem cell drug.

Other companies moving forward in the adult stem cell space include Stem Cells Inc., Cytori, and Aastrom Biosciences.

cnn.com