Advanced Cell Technology's CEO Says Markets Are Just Starting to Appreciate the Significance of Their Stem Cell Derived Treatments

The excitement around ACTC comes after a recent series of key positive announcements including the fact that the FDA granted orphan drug status to the micro-cap's patented embryonic stem cell derived treatment for specific forms of Macular Degeneration and blindness (Stargardt's Macular Dystrophy and Dry Age-related Macular Degeneration). The eye conditions destroy the pigmented layer of retina (retinal pigment epithelium) which is the pigmented cell layer just outside the neurosensory retina that nourishes retinal visual cells.

The condition destroys the pigmented layer of retina (retinal pigment epithelium) which is the pigmented cell layer just outside the neurosensory retina that nourishes retinal visual cells. Advanced Cell Technology has shown success introducing the embryonic stem cell derived RPE cells into the eye in animal models and this resulted in 100% improvement with no side effects for more than 220 days. Human clinical trials are expected to start in the first quarter of 2011, and can potentially take only a few weeks to show positive results.

Advanced Cell Technology has shown success introducing the embryonic stem cell derived RPE cells into the eye in animal models and this resulted in 100% improvement with no side effects for more than 220 days. Human clinical trials are expected to start in the first quarter of 2011, and could potentially take only a few weeks to show positive results according to some analysts.
In addition, for only the second time in history (following Geron's therapy for spinal cord injury), the FDA granted approval for clinical trials for a therapy derived from human embryonic stem cells.
William M. Caldwell, Chairman and CEO of ACTC tells BioMedReports that ACTC plans on building upon their orphan drug status and accelerating clinical testing. In addition, they hope to continue showing promising advancements in other forms of regenerative medicine which the company is developing -- most notably its Myoblast program for the treatment of heart failure. The Myoblast program (part of the company's 2007 acquisition of Mytogen, Inc.) has successfully completed Phase I human clinical trials and the FDA has finished reviewing the data, thus allowing Advanced Cell Technology to proceed with a Phase II human clinical trial (in approximately 160 patients) early next year.

BioMedReports: It appears that suddenly your company has a lot of attention given your news developments. What do you make of all the activity in your stock during recent days?
William M. Caldwell, Chairman and CEO of ACTC: The market is starting to appreciate the significance of the FDA approval of our particular therapy. I think they are now beginning to understand the strategy of having filed for an orphan indication designation for Stargardt's Macular Dystrophy (SMD is one of the most common forms of juvenile macular degeneration in the world) and they now realize that that represents the first wave, with potentially huge commercial opportunities in Dry AMD (Dry Age-Related Macular Degeneration reportedly afflicts more than 30 million people worldwide, including an estimated 13-15 million Americans). Both indications do not have viable therapies and so to the extent that our program can make an impact, it's going to not only help a very large patient population, it -- as well as any other therapies that are approved -- will help validate a very large technology.

BioMedReports: Can you help us digest or simplify what some of those implications are?
William M. Caldwell, Chairman and CEO of ACTC: I can certainly try. Right now, Genentech has a drug on the market for Wet AMD [Note: the FDA approved Lucentis in 2006 after a 6-month priority review] and that patient population is substantially less than the Dry AMD component. Their procedure is to apply a needle into the eye every two to three months with their therapy and for that they get some $2500, plus or minus, for each injection. In our particular situation, we are inserting a needle into the eye- which is something that is done all the time, by the way, this isn't something that's foreign to the practitioner that does the application -- but our application takes place only once or possibly twice over the life of the patient. It is our expectation that the therapy which we'll apply will have an impact on either slowing down or arresting the progression of the disease. We've seen that in our animal models. There have been some very dramatic results when we've applied it into animals and we are extremely hopeful that we will see the same types of results when we apply it into humans.

The problem has been that this technology is totally new to the world of medicine. It is an embryonic stem cell derived therapy. It turns out that our cells have been derived utilizing what we call a blastomere technology which means that we have been able to develop those stem cells without any embryo destruction, which somewhat mitigates the issues that have been in the media.

So, we take our particular stem cell therapy -- and remember that the stem cells are converted into a single cell type so there's really no actual stem cells into the therapy that we are applying only a certain cell-type and in this particular case, it's what they call RPE (retinal pigment epithelial) cells. That RPE layer is in the eye between the photoreceptor and the Bruch's membrane. It protects that photoreceptor -- which gives us the ability to see -- and it also nourishes it. With deterioration, all sorts of different diseases occur. One of which is Stargardt's Macular Dystrophy and another of which is Dry AMD. Now, there are certainly different characteristics to those, but to the extent that you can replenish that RPE layer with new, healthy, viable cells you have the opportunity to dramatically impact the deterioration that is occurring within the photoreceptor.

That's a layman's description of what we're doing with respect to that therapy, but more importantly the market implication is such that if you have in excess of ten million patients currently suffering from that disease; which is age related and as we know the baby boomers are getting older. Unfortunately for those of us that are getting into that post fifty-five or sixty year-old age range, those individuals are prime candidates for this disease. That market is fairly significant. There is an opportunity of tremendous magnitude for a company like ours.
BioMedReports: Let's talk about the structure of the company for a bit. There have been some concerns that there are a lot of shares out there and that a company that is set up in this way could suddenly announce something like a reverse-split during a run-up in price like this one. What are your comments in regard to that as far as ACTC goes?

William M. Caldwell, Chairman and CEO of ACTC: I'm an investment banker and I can tell you that it has been my experience that reverse splits for the sake of reverse splits are very problematic. There has to be a rationale behind why someone would do such a thing and it has to be done around some sort of event that is accretive to shareholders and makes logical sense for all the stakeholders. I'm not inclined at all to recommend a reverse split unless that opportunity presented itself. If it does, based upon our charter, we would then have to go to the shareholders for their approval. In that way they would have an opportunity to understand our rationale and determine whether that makes sense for the majority of them. I think that's about all I can say about that subject at this stage.

BioMedReports: Can you talk about any of the upcoming milestones for the company? Some think that is part of the reason for this run-up, that there are some events worth looking forward to on the horizon.

William M. Caldwell, Chairman and CEO of ACTC: I think we've alluded to some things a couple of times either on blogs or in conferences, and I can start with the approval of our IND for Stargardt's Disease which we will be seeing some time in the first half of the coming year. (That will mark) us going into the clinic. And we have already alluded to the fact that we will go into multiple sites, not just one particular site, for the reason that we have filed for Phase I/Phase II. For those who are not familiar with that, Phase I really focuses on safety. That's going to be a very, very important piece, not just because of the safety, but because it will ensure for the FDA that this cell type can be safe in humans.

You know the first one is always the toughest one, so we've designed the trial to be very, very slow in its evolution. We have a dosage escalation schedule whereby we're only inserting a minimal amount of cells at the outset per patient. Then we will increase that with ensuing patients and we'll pause to allow the FDA to review the results of that so that they can feel comfortable with the safety issues related to the fact that the cells go where they are supposed to go and do what they're supposed to do and that they don't cause any side effects, or tumors or anything else that has been ballyhooed around. By the way, we have never, in any of our studies, ever seen that.
So, I can't speak for others, but for us; our patented differentiation processes are such that our cells are terminally and totally differentiated into the cell type that we're dealing with. Once we do that, then we'll move quickly into efficacy and that tells us, of course, "does it work?" And that's why we're starting out with multiple sites. Right now, I'm in the process of finalizing those sites and developing a relationship with the primary investigator -- the surgeon at each of the sites. I'm working with the internal review boards to gain approval on the protocols on any specific issues that they may have relative to their particular situation and then we will initiate those trials when all of that is completed.

The second major milestone is that we've filed a second IND. That one is for the Dry AMD and we anticipate that it will take much less time for the FDA to evaluate that, versus the time they took to evaluate the first one. We anticipate that sometime in the first quarter (of 2011) there is a very reasonable chance that we will see approval for that IND -- at which time we will then initiate trials for that program as well. Just so you know, it's the same cells. So we're really just taking the same cell-type and treating a different disease-type. So that's why we're relatively bullish on that particular program.

A third area that we've announced is that as big as the market is, and the opportunity is here in the United States, the European community offers a similar opportunity. And with the E.U. controlling the regulatory perspective for the various countries on the continent, we will be looking very hard at the opportunity to take both our Stargardt's and Dry AMD programs over there. I've been spending some time over there trying to ascertain what the best way is to do it and where the best places are to initiate the trials as well as learning a little bit about the process of how to work through the regulatory situations over there. We should be in position to make an announcement about that in the first half of next year.

We've also mentioned another disease condition called our Myoblast or heart program. It's an adult stem cell -- meaning it's the patient's own cells -- in this particular instance. We extract out of the thigh in a biopsy and then we re-place it into the heart with a catheter system. Basically, it goes over the dead heart tissue from a heart attack that a patient has had. And what those cells do, those myoblast cells, is they integrate with the good cardio myocyte cells -- the heart cells -- and help those cells pump the blood in and out of the heart. That's important because when you have a heart attack, part of your heart muscle is killed or dead, and unlike other parts of the body the muscle doesn't regenerate itself and so the remaining muscle has to work harder and the heart becomes a little weaker. Because of the strain on the muscle it gets, sometimes, enlarged. The walls get thinner and that's when you start seeing heart failure. What this does is that it helps mitigate that and the patient can start feeling better. That's really where the FDA is focused on, is the quality of life of the patient. Most of the patients that we're dealing with are in advanced age heart failure. So that is another disease condition. We have gotten approval from the FDA to move out of the Phase I, where we did four trials, and we're moving into Phase II. I've made an announcement that we intend to do that in the first half of next year. So again, that is another program that you should be hearing some things from us about during the first half of next year.
So just in the first half of the coming year we have some fairly significant milestones that we have before us and then there are a couple that we're working on now that we haven't announced yet.