Precious Cells Biobank Acquires Pharmacells Group
News Jul 25, 2014
Precious Cells BioBank has agreed terms to acquire stem cell technology specialist Pharmacells Group. The deal, the first in the UK stem cell sector, will provide Precious Cells BioBank with its own proprietary adult blood stem cell collection service and will accelerate the company’s growth, particularly in stem cell therapies, adding a forecasted £25 million in revenues over the next three years.
Pharmacells Group’s patented Oristem® technology allows stem cells to be collected from adults’ blood and the company is the only one globally to offer this disruptive stem cell isolation facility. The Oristem® technology yields up to twenty five times more stem cells than taking them from other sources and autologous stem cell treatments, which is using stem cells from a person’s own body, are far more effective and yield better outcomes because of the absence of rejection associated problems when using someone else’s cells.
Being able to offer this service will enable Precious Cells BioBank to target the much larger health concerned adult market and will also accelerate its growth into initiating clinical trials for stem cell therapies for a rapidly-expanding range of illnesses and medical conditions. The company estimates that this acquisition will boost revenues by up to £3 million in the first year, some £7 million the following year and over £15 million in year three.
Some 50 new jobs will be created, over the next three years, to meet the expected demand for the combined companies’ services, divided between Pharmacells Group’s offices and laboratories in BioCity in Glasgow and Precious Cells BioBank’s offices in Brunel Science Park, West London.
Precious Cells BioBank’s acquisition of Pharmacells Group is part of the company’s overall “strategy 2020” to make acquisitions across the broad stem cell landscape, including storage, distribution, transportation and delivery of stem cells, both in the UK and overseas.
It’s now estimated that there is a one in five chance that individuals will use stem cells in their lifetime to treat a particular medical condition or for diagnostics. Due to recent technological advances, stem cell therapy is now under investigation to treat a much wider range of medical conditions where repair and re-growth of tissue is a critical factor.
Diseases and medical conditions that have been shown to have early exciting preliminary benefits from stem cell therapy include diabetes, cancer, heart disease, eye diseases, metabolic diseases, gastrointestinal tract diseases, musculoskeletal disorders, immune system diseases, spinal cord injuries and neurological diseases. High profile personalities who have selected to store stem cells include Thierry Henry and Darcey Bussell.
The cost of treating these conditions is putting a heavy burden on the NHS. Take diabetes. The recent Impact Diabetes report forecasts that the cost of treating diabetes will nearly double to £16.9 billion by 2035 and the cost of treating diabetes complications is expected to almost double to £13.5 billion by 2035/6. Inexpensive stem cell therapy could significantly reduce these costs and free up funding for the NHS to target other high priority areas.
The global stem cells market is expanding fast, particularly in emerging markets, driven by increased funding from the government and private organisations, an expanding industry focused on stem cell research and rising approvals of clinical trials for stem cell therapies.
Industry experts estimate that the global market for stem cell products is expected to reach nearly £2.5 billion in 2012 and £3.87 billion by 2016, increasing at a compound annual growth rate (CAGR) of close to 12%. The European market for stem cell products is expected to grow by a CAGR of 11% and is forecast to reach nearly £1 billion by 2016. Similarly the stem cell therapy market is forecast to grow by a CAGR of close to 40% to be worth close to £200 million by 2020.
Precious Cells BioBank moved into the Middle East in 2011 and has ambitious plans to open labs and storage centres in Southern and Eastern Europe, South Africa and India over the next year. This international expansion will help establish the company as a fast-growing business with the high clinical standards, disruptive technology and high quality of services to make it a major player in the expanding global market.
Dr Husein K Salem, CEO of Precious Cells BioBank, commented:
“This is a transformative acquisition, which gives Precious Cells BioBank a highly sought after patented technology with infrastructure in place to bring it to market, which embeds considerable value in the business. We are now one of only a few companies globally to offer this disruptive stem cell collection and storage facility and can now target the much larger health and technology savvy adult market. The acquisition will also significantly accelerate our growth, particularly as we look to move towards developing stem cell therapies and diagnostics, which is one of the fastest growing areas of the stem cell sector.”
Athol Haas, CEO of Pharmacells Group, commented:
“Partnering with Precious Cells BioBank, one of the world’s leading stem cell consumer technology platform service providers, with its depth of resource and international reach will considerably enhance our efforts to market the Oristem® technology in the UK and globally. We are proud to have been one of the pioneers of a method to collect hundreds of millions of ultra-naïve stem cells from adult blood, which significantly improves the effectiveness of stem cell therapies and will help slow the spiralling cost of treating some of the most common and expensive medical conditions.”