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GLOBAL WATCH MISSION REPORT
Advanced cell and tissuetherapies a mission tothe USA
SEPTEMBER 2006
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Global Watch Missions
DTI Global Watch Missions enable small groups of
UK experts to visit leading overseas technology
organisations to learn vital lessons about innovation
and its implementation, of benefit to entire industries
and individual organisations.
By stimulating debate and informing industrial
thinking and action, missions offer unique
opportunities for fast-tracking technology transfer,
sharing deployment know-how, explaining new
industry infrastructures and policies, and developing
relationships and collaborations. Around 30 missions
take place annually, with the coordinating
organisation receiving guidance and financial support
from the DTI Global Watch Missions team.
Disclaimer
This report represents the findings of a mission
organised by bioProcessUK with the support of DTI.
Views expressed reflect a consensus reached by the
members of the mission team and do not necessarily
reflect those of the organisations to which the
mission members belong, bioProcessUK, Pera or
DTI.
Comments attributed to organisations visited during
this mission were those expressed by personnel
interviewed and should not be taken as those of the
organisation as a whole.
Whilst every effort has been made to ensure that the
information provided in this report is accurate and up
to date, DTI accepts no responsibility whatsoever in
relation to this information. DTI shall not be liable for
any loss of profits or contracts or any direct, indirect,
special or consequential loss or damages whether in
contract, tort or otherwise, arising out of or in
connection with your use of this information. This
disclaimer shall apply to the maximum extent
permissible by law.
Cover image: Fibroblasts labelled for actin (red), microtubules
(green) and nuclei (blue) courtesy of Andrew E Pelling, Brian M
Nicholls, Michael A Horton, London Centre for Nanotechnology
and Department of Medicine, University College London
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1
Advanced cell andtissue therapies
a mission to the USA
REPORT OF A DTI GLOBAL WATCH MISSION
SEPTEMBER 2006
Report prepared by
Philip Aldridge Centre of Excellence for Life Sciences (CELS) Ltd
Rosemary Drake The Automation Partnership Ltd
Bo Kara Avecia Ltd
Mike Leek Intercytex plc
Chris Mason University College London
Nick Medcalf Smith & Nephew plc
Angela Scott Angel Biotechnology Holdings plc
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CONTENTS
EXECUTIVE SUMMARY 2
FOREWORD 3
1 INTRODUCTION AND 4
OBJECTIVES
2 INFORMATION FROM COMPANY 6
VISITS
2.1 Manufacturing and automation 62.2 Distribution 14
2.3 Process validation and regulation 16
2.4 Commercialisation 23
3 STRATEGIC IMPLICATIONS FOR 27
THE UK
3.1 The state of the Californian industry 27
3.2 The Californian company position 29
on Europe
3.3 A strategy appropriate for the UK 30
4 CONCLUSIONS AND 34
RECOMMENDATIONS
4.1 Conclusions 34
4.2 Recommendations 34
APPENDICES 37
A Acknowledgments 37
B Mission participants 38
C Terms of reference 47
D Company visits 48
E Glossary 56
F Sources of information 64
G List of exhibits 68
This report describes the outcomes from amission to Californian companies working in
the field of advanced cell and tissue therapies
and draws conclusions for UK policy.
After a brief introduction which sets the scene,
Chapter 2 describes the technology seen and
the issues it raises for all those concerned
with commercial activity in the field.
Chapter 3 addresses the lessons from themission in terms of the state of the
Californian companies and their views of the
UK. It then examines the issues raised for UK
strategy beginning with a summary of some
recent actions and how they might be
enhanced. That is followed by an analysis of
how the National Health Service (NHS) could
relate to UK company activity and how the
research councils could contribute.
The above topics lead to a number of
recommendations for future actions which
are dealt with in the final chapter.
The report is followed by appendices which
include a list of the mission participants and
the terms of reference plus acknowledgments
to those who made the mission and this
report possible. The companies visited are
identified and finally a glossary and sources of
information are provided.
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ADVANCED CELL AND TISSUE THERAPIES A MISSION TO THE USA
EXECUTIVE SUMMARY
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ADVANCED CELL AND TISSUE THERAPIES A MISSION TO THE USA
FOREWORD
The UK faces major challenges in the field ofhealthcare. Firstly, in common with many
countries it must meet the prospect of a rapid
increase in the old age dependency ratio. This
will bring a greater demand for all kinds of
healthcare but particularly for the treatment of
degenerative diseases. The second challenge is
that many countries, and not just developed
ones, have recognised that healthcare
technologies are worth assigning top priority:
they are knowledge intensive and can justify a
high price if they replace current poorer
alternatives with a better outcome. If the cost
comparison of old and new technologies is a
fair one taking account of social services and
home nursing needs it will demonstrate over
time that the new approaches are of lower cost
as well as greatly enhancing the quality of life.
Because the UK must deal with the challenge
of ageing and is unlikely to be able to
compete globally on less sophisticated
technologies, the sector of advanced cell and
tissue therapies is a crucial one for which to
build a coherent short and longer term
strategy. Part of that plan must be to
understand progress in other countries.
In 2004 a Department of Trade and Industry
(DTI) Global Watch Mission visited countries
in South East Asia and was impressed by the
scale of activities and their ambitions. To
complement that mission the present one
visited California which is at the forefront of
US and global activities on particular
advanced cell and tissue therapies.
The focus of the visit was Californiancompanies and the mission team had experts
on the range of issues that start-ups in the
new field face. I am immensely grateful to all
of them for the time they gave to pre-briefing,
the punishing schedule of visits and their work
on the report. I am also very grateful to
bioProcessUK the sponsoring organisation and
its Technical Director Malcolm Rhodes who
accompanied us, to UK BioIndustry
Association and DTI staff and to the local UK
Trade & Investment and UK Science &
Innovation teams in California whose hard
work laid the foundations for the visits. Most
of all I would like on behalf of all those
involved to thank our American hosts for their
openness, friendliness and willingness to give
us time and to entertain us. The visit has
already strengthened ties and shown
common interests. We share a conviction that
the new field can bring real benefits to
people.
Dr Chris Mason
Mission Leader
University College London
November 2006
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This document describes conclusions of aDTI Global Watch Mission to California to
explore the state of advanced cell and tissue
therapy companies. The California Institute
for Regenerative Medicine (CIRM) plus
14 companies were visited in San Francisco
and San Diego, and a further 80 stakeholders
in the sector attended a reception at the
British Consulate General. The report
describes how companies perceive key
commercial, technical and regulatory
issues. It concludes with an analysis of
the strategic implications for the UK and
recommendations for action.
The activity of the largest companies visited
was centred on human embryonic stem (hES)
cell-based science and technology (S&T), and
CIRM, with a planned $3 billion (~1.5 billion)
research programme, is focused on the same
area at present, given the ban on federal
funds for derivation of hES cells. The term
regenerative medicine is useful in
distinguishing the activity from more
established biomaterial-centred technology.
Therefore we have used regenerative
medicine as shorthand in this report though
the expertise of the mission members is
wider and the conclusions apply to all
advanced cell and tissue therapies. The
mission did not include companies producing
agents such as erythropoietin, which has a
relevant impact on stem cells, because the
technology related to such materials is that of
molecular biopharmaceuticals.
Regenerative medicine has the potential to
become both a key commercial activity for the
UK and a crucial contribution to dealing with
the needs of a population with a growingproportion of older people. With coordinated
management it could become a vital element
in the future NHS with the public sector as akey customer enabling growth of companies.
They in turn could provide a quality of
therapeutic material that the healthcare
industry is highly skilled at achieving. The
necessity for a close relation between clinician
or surgeon and the bioprocessor could also
make this an embedded activity which would
be less likely to be lost from the UK than a
conventional industry.
The field of regenerative medicine addresses
three of the policy challenges posed by the UK
Government Treasury to the research councils:
A rapid increase in the old age
dependency ratio
An acceleration in the pace of innovation
and technological diffusion
The intensification of economic
competition
As people live to older ages and need to be
sustained in an active independent state,
regenerative medicine will have a crucial role.
The commercial activities associated with it
are inherently highly knowledge intensive both
in the goods provided and the services
needed to deliver them. It is going to be
increasingly difficult for the UK to compete on
lower cost goods with a high labour input.
Regenerative medicine is by its nature high
value and, though labour costs are currently
high, the technology is susceptible to the
adoption of automation and the associated
clinical services are often highly sophisticated.
There are already commercial productsaddressing severe burns, chronic ulcers and
damage to the cartilage of the knee.
1 INTRODUCTION AND OBJECTIVES
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Current research suggests that progress canbe expected in the next few years with the
treatment of heart failure and some
neurological conditions, for example,
Parkinsons disease.
For these exciting developments to come to
fruition it will be vital to understand the global
situation. This report describes a visit to
California which currently leads US activity in
key parts of the field and hosts the most
developed commercial activities in any country.
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ADVANCED CELL AND TISSUE THERAPIES A MISSION TO THE USA
Exhibit 1.1 Mouse embryonic fibroblast cells (MEFs) are presently used as feeder cells for culturing embryonic
stem cells (Primogenix Inc)
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2.1 Manufacturing and automation2.2 Distribution
2.3 Process validation and regulation
2.4 Commercialisation
This chapter addresses the technical,
commercial and regulatory information that
the mission team heard about during the
company visits. As is the requirement of
Global Watch Mission reports, individual
companies are not identified in terms of what
is described here and confidential information
is excluded. However, the visit reports
provide a valuable insight into the challenges
which all regenerative medicine companies
and their suppliers face. They also indicate the
kind of approaches which will help in
addressing these issues. The specific
Californian companies are described in
Appendix D.
2.1 Manufacturing and automation
2.1.1 Manufacturing overview
Generally the primary systems being used to
manufacture clinical product where cell
expansion was required were standard
tissue culture systems such as T-flasks for
initial expansion from cell banks and either
roller bottles and/or cell factories for the cell
production stage. These were incubated in
standard tissue culture incubators or warm
rooms. Where cells could be grown in
suspension culture, eg stem cells and
progenitor cells from peripheral blood
mononuclear cells (PBMCs), disposable bag-
based bioreactors were used. The latter
provided a scalable system for one of the
companies visited, which noted that shouldone of its universal products (an allogeneic
therapy based on cell enrichment from
PBMCs) achieve blockbuster status, acommercial manufacturing facility would
only require scale-up to batches of hundreds
of litres capacity in a dedicated
manufacturing stream.
A small number of companies visited were
developing products which avoided the need
for cell expansion and relied on cell
enrichment only to deliver therapeutically
useful doses of the cell therapy product.
A schematic of the cell product systems
employed is provided in Exhibit 2.3.
Cell factory scale-up from single to triple units
was generally thought to be without any major
issues. However, a number of companies
visited indicated that further scale-up to higher
multiple layer units was limited by theformation of unwanted gas and temperature
gradients. This was an area they would address
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2 INFORMATION FROM COMPANY VISITS
Exhibit 2.1 Good Manufacturing Practice (GMP) cell
therapy production incubator loading (Cognate
BioServices Inc)
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following process optimisation during clinical
development of their product with the
manufacturing system selected and would be
addressed prior to Phase 3 clinical
manufacture. One of the more advanced
companies in bioprocess terms indicated that
cell factory systems were not viable longerterm and it would ideally like to eliminate them
as soon as possible. There is an opportunity
here for the further development either of the
cell factory system or an alternative disposable
system that scales easily.
Scale of operation was primarily driven by the
therapeutic indication targeted by the cell
therapy product and potential market
opportunity and thus in some cases use of
systems with limited scale-up potential was
not considered an issue. Generally, with all
companies visited it was clear that scale-up,cost of goods (CoG), market and
reimbursement were being considered at an
early stage of product development but not at
the expense of delaying proof-of-principle early
clinical trials. Automation of the manufacturing
process alone was thought insufficient to
achieve longer term CoG targets, with
significant process development being
required/planned during clinical development.
With all of the manufacturing systems
described above, there was a strong focus on
the concept of maintaining a closed system
within the Good Manufacturing Practice
(GMP) facility throughout the manufacturing
process. This was facilitated by non-invasive
process monitoring, eg visual examination of
the cells, by limiting sampling to passage
stages and by using custom sterile welding
and connect technology. In some cases
proprietary integrated bioreactor systems had
been developed which addressed sampling
and further processing requirements in a
purpose designed system. Although these
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ADVANCED CELL AND TISSUE THERAPIES A MISSION TO THE USA
Exhibit 2.2 GMP cell therapy production incubator
checking (Cognate BioServices Inc)
Exhibit 2.3 Overview of typical cell product manufacturing systems
Cell bank
Tissue
sample
Enrichment of
desired cell
fraction
Primary
expansion:multiple stages
Production
stage: roller
bottles or cell
factories
Bulk cell product
Bulk cell productExpansion
Bulk cell
product
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could be beneficial there were concerns that
they could increase CoG and introduce risk in
the future in terms of cost and security of
supply of the proprietary bioreactor system
when compared to simpler off the shelf
disposable bioreactor systems.
2.1.2 In-house manufacturing versus
outsourcing
All the companies visited during the mission
that had a pipeline of cell therapy products
either had in-house GMP manufacturing
capability, typically simple single or multiple
clean room facilities for cell banking and cell
processing, or were considering establishing
in-house GMP manufacturing in the nearterm. Two of the companies visited were cell
product contract manufacturing organisations
(CMOs). One had an established track
record in this area whilst the other was a
more recent entrant to the field and was
refocusing itself by offering capacity into the
CMO market.
The experience of the CMOs suggested that
the decision to manufacture internally rather
than outsource during the early phase of
product development was not driven primarily
by cost of product. It was more a need to
avoid technology leakage, a belief that only
they could handle their specific cell product,
or that by manufacturing in-house they could
more easily handle potential regulatory
approval delays, eg Investigational New Drug
(IND) applications or approval by Institutional
Review Boards (IRBs). Typically, in-house
manufacturing costs for an allogeneic product
for Phase 1 clinical trials were at a high level,
described by companies visited as closer to
that typical for autologous products. This was
seen as an area that would be addressed
later, during clinical development.
Both CMOs visited indicated there was a
significant market opportunity in this area for
companies with an established track record
of manufacturing both autologous and
allogeneic cell therapy products. Their
experience of the market to date was a split
between the two cell therapy product classes
in the ratio of 50:50. One of them noted their
customer base was a mixture of clients that
routinely outsourced clinical manufacture and
other activities and clients that had attemptedinternal manufacture but for various reasons
had failed and had then looked at the services
of a specialist CMO for process development
and manufacturing.
The driver for companies partnering with
CMOs, in addition to accessing specialist
skills and know-how, was avoiding having to
devote capital towards GMP manufacturing
facilities, particularly when they would not befully occupied. In addition, one company
noted that venture capitalists generally were
not keen on funding companies at an early
phase of product development which were
capital-intensive, and preferred to reduce risk
going forward. This was due to a concern
that, should the activity fail, a significant
proportion of the value could not be recouped
from disposal of the manufacturing assets
and equipment.
It was interesting to note that both CMO
companies visited had existing operations on
the East Coast of the USA but had made the
initial decision to expand their manufacturing
capacity in response to existing demands in
California. However, both CMOs also
anticipated the potential impact of Proposition
71 (see section 3.1) on the number of cell
therapy products and the increased market
size as a direct result of the enormity of
additional state funding.
A number of companies visited indicated that
they would outsource early clinical
manufacturing but may consider bringing
manufacturing in-house for commercial
supply. Geographic location of manufacturing
was not thought to be a significant issue
particularly for allogeneic cell therapy
products especially if there were no
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significant shelf-life constraints. Shipment of
product on dry ice or even liquid nitrogen was
not seen as a geographic barrier to the
location of manufacturing versus end use.
Ultimately, the view of one company visited
was that if the manufacturing process could
be automated, and access to specialisttechnical skills was not required, commercial
manufacturing could be located in any low
cost geographic location.
2.1.3 Translation strategies
Distinct approaches to identify stem cell
and/or progenitor populations of cells were
exemplified by two established stem cell
therapy companies.
The first approach was a proprietary platform
technology invented by an hES cell company as
a means of rapidly identifying and isolating
novel embryonic cell lines but without infringing
on the all encompassing WARF (Wisconsin
Alumni Research Foundation) embryonic stem
(ES) cell patents. This technology was
developed from its conception to be easily
scalable. It is complemented by the ability of
the company to accelerate the differentiation of
cells from hES cells. For example, product
candidates discovered by the platform
technology are tested at a very early stage for
the capacity to be scaled up in roller bottles
before being designated a product candidate.
The company has already announced the
isolation of its first line, embryonic smooth
muscle cells which may have potential clinical
application in heart disease.
A different approach was exemplified by
another of the companies visited. It is
developing neural stem cells using a proven
approach to stem cell discovery and isolation.
This is based on use of proprietary panels of
monoclonal antibodies (MAbs) and high
speed cell sorting to establish proprietary
populations. They had found that conventional
cell culture techniques were requiring up to
100 days of culture to select the cell
population required. By using high speed cell
sorting they had reduced the time to do this
and had increased throughput.
The area in which their approach differed from
that used by others was that they cell sorted
aseptically in a GMP facility. Challenges suchas potential for cross contamination, and
adulteration from both direct and indirect cell
product contact materials and surfaces, were
overcome by a combination of bespoke
redesign of the cell sorting equipment and
the enclosures that the equipment was sited
in, and substitution of cost effective parts, eg
the flow path was considered as a single use
disposable. Cell sorting was seen as a viable
bioprocess if the number of cells requiredwas small, viability was not compromised by
the high pressures to achieve high speed cell
sorting, cell size was compatible with
fluids/nozzles, and cells sorted at the
beginning of a run were the same as those
isolated at the end.
A key advantage of the latter approach was
that once cells had been sorted under GMP
they could be further expanded and GMP cell
banks manufactured and characterised without
having to attempt to replicate the derivation of
a required cell line, for example, following
research and development (R&D) work using a
research cell line. The ability to sort cells at
high speed at an early stage clearly provides
an advantage in reducing research translation
and product development risks.
The company using GMP high speed cell
sorting had reviewed its strategy with the
Food and Drug Administration (FDA). The
regulatory focus was on reproducibility and
comparability. The company also indicated
that its quality function had a high degree of
involvement at every stage of development
including discovery and it believed that recent
FDA thinking on concepts such as Quality by
Design and Design Space will have
significant potential to influence cell-based
therapeutic products.
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Getting involvement of a quality function early
in the development of a cell therapy product
and in the development of its manufacturing
process was seen by the mission participants
as a key message for organisations
developing cell-based therapies and tissue
engineering products in the UK.
2.1.4 Raw materials
A vital process factor being addressed by
most of the companies visited during the
mission was the variability seen with some of
the raw materials. With autologous cell
therapy products, processes developed were
required to be able to handle inherent
variability, such as starting tissue mass,genetic variability and growth differences
between cells extracted from different
samples and/or patients.
An area that required a strategy to be defined
early was the sourcing of GMP grade MAbs
used to support cell sorting as well as
bioactive molecules or other manufacturing
components. MAbs were usually employed
at therapeutic grade and at the corresponding
cost. Future supply could present difficulties
since the licensing arrangements were
usually predicated at these low volumes. The
approach to alleviate issues in this area was
to form collaborations and partnerships
though even this route could potentially
impact on longer term CoG. Clearly, the
message here for companies in the UK is to
consider the security of supply and costs of
raw materials used as the research process
begins to be defined, and continue to
re-examine this area as the manufacturing
process is developed and optimised.
Feedback from the companies visited
indicated that, universally, antibiotics are not
used to avoid regulatory issues in this area.
Also of concern was the potential to overlook
endotoxin producing organisms in a
manufacturing process if antibiotics are used
since cell manufacturing processes typically
have no specific endotoxin removal step.
Lot-to-lot variability of some raw materials
was a major concern. In this case the
strategy adopted was to manufacture these
in-house or seek CMOs to manufacture
them. Alternatively, process development
work was undertaken to eliminate as manyundefined media components as possible.
However, changing raw materials required a
significant investment in testing and
characterisation to understand the impact of
the changes. It was evident that there was at
least an appreciation of and in some cases a
focus on ultimate CoG and economics of
manufacturing versus reimbursement within
most of the companies visited. One of the
CMO companies visited with significantexperience of manufacturing a large number
of cell therapy products did indicate that most
US companies did not consider CoG and
reimbursement early enough, a situation
generally similar to that in the UK and one
which requires addressing.
The use of mouse embryonic fibroblast cells
(MEFs), better known as feeders, to grow
hES cell lines was being addressed by one of
the companies visited. It had developed
methods to grow cells without mouse
feeders, had filed patents and avoided the
conventional use of media conditioned with
mouse feeders for the majority of its projects.
Some of the companies visited had indicated
that their work was based on use of the
limited number of ES cell lines approved by
President Bush. One companys view was
that the biggest issue for companies in the
USA was the intellectual property rights (IPR)
of the WARF patents (eg US 5843780) which
unusually had both multi-composition of
matter and methods. Also, even the so-called
Presidential lines are thought to have low
level microbial contamination due to their
origin in research laboratories.
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2.1.5 Minimal manipulation
manufacturing
An alternative, if not unique, manufacturing
route to cell therapy commercialisation was
provided by one of the companies visited.
The therapeutic cell product market isreached by providing equipment and
consumables for cell therapy manufacture at
hospital sites. Technology is based on the
enrichment of stem and progenitor cells
from adipose tissue. Original equipment
manufacture, distribution and servicing of
the next generation device and consumables
are being handled via a 50:50 joint venture
(JV) with a major established global medical
devices company.
These companies are initially targeting heart
failure secondary to acute myocardial
infarction (heart attack) and chronic ischemia
(angina) and have developed a proprietary
device to allow operating theatre cell
processing such that adipose tissue can be
processed and the autologous cell therapy
product be available for administration to the
same patient within one hour of collecting
the initial tissue sample. Manufacturing has
been simplified to an automated cell
processor/centrifuge with predefined
processing algorithms requiring the operator
to interface with the manufacturing system
via just three buttons.
However, although the final device
appeared simple at least in terms of
operability, product development had
involved 30-40 engineers and scientists to
develop the tissue and liquid handling
systems, microfluidics, cell handling/biology
and control systems over a significant
number of years. The development of the
medical device potentially provides a faster
route to market. The system is using the FDA
510(k) pre-marketing approval route in the
USA with a target of full approval in 2007.
2.1.6 Commercial manufacturing
Only two of the companies were in later
phases of clinical development or operating
commercial manufacturing facilities. One of
the CMOs visited had manufactured cell
products for clients at Phases 1, 2 and 3 andwas now in discussion with a client in terms
of commercial production. Generic
information on the challenges faced by
companies as products moved to later clinical
development, process validation and
preparation for commercial manufacture was
therefore limited.
Only one of the companies visited was
moving to manufacturing a licensed productfollowing acquisition of the product licence
and an existing manufacturing facility. It was
fully recommissioning the manufacturing
facility after a short shutdown period. This did
provide some important messages/learning,
albeit based on one facility and one product.
The facility was originally designed to produce
a wound care tissue engineered product to
support a large market. However, low market
penetration resulted in the facility operating at
significantly below capacity. Its high-cost
location coupled with operation below
capacity had influenced CoG significantly. CoG
was primarily driven by the high fixed costs
associated with the facility. One important
message was that, with hindsight, if the
company were to establish the facility again it
would be planned for incremental expansion
and be located in a low-cost location.
Additional issues faced were that the batch
manufacturing time was long (12-13 weeks),
requiring continuous operation of the facility
and accurate predictions from the marketing
group on product requirements. Routinely,
during normal operation, full facility shutdown
was problematic, incurring an estimated 2-3
month facility restart-up time.
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Consequently, a number of operational
strategies had been implemented to reduce
impact, eg initial cell expansion could be
initiated at risk and abandoned if additional
manufacture was not required, and significant
redundancy had been built into the facility
both in terms of some of the utilities and keyequipment as well as building up inventory of
materials such as water for injection (WFI)
and autoclaved parts to allow for breakdowns.
Routine facility maintenance and
requalification activities were scheduled into
short, typically weekend, time slots.
Key learning for cell product development
companies in the UK from this would be to
consider and understand overall commercialmanufacturing strategy as early as possible and
focus process development and automation
efforts during development to eliminate or
reduce any key factors likely to influence facility
operation and CoG for the product.
2.1.7 Automation
The process steps required to produce a cell-
based therapy are highly variable, depending
on the cell type and intended therapeutic
application. The steps can include:
Biopsy
Cell separation/isolation/enrichment
Cell expansion
Cell encapsulation or seeding of a scaffold
Packaging
Cell freezing
Shipping
Generally the companies visited were using
standard cell isolation or separation equipment
and standard tissue culture vessels such as
T-flasks, roller bottles and cell factory systems
for cell expansion and processing. The two
CMO companies had experience of a broader
range of culture systems, including wave
bioreactors for suspension cell culture,
reflecting their need to serve a wide client
base, but neither CMO had yet invested in
significant levels of automation.
There are significant process challenges
associated with automating and scaling up
these steps, particularly for autologous
therapies, where each patients cells
represent a small batch (ie scale-out) and
there is inherent biological variability in the
source material. Most companies expresseda strong preference for allogeneic over
autologous therapies for these reasons and
because allogeneic therapies can be
manufactured on a larger scale, which is
economically much more attractive.
Cell expansion was identified as the highest
priority for automation because it is labour
intensive, involving a lot of manual aseptic
processing over many days or even weeks,and requiring repeated cell feeding and
passaging, harvesting then seeding into a
new culture vessel. Cell freezing (including
cell banking) and cell separation were also
mentioned as areas where automation may
be required in the future.
All the companies visited recognised that
automation would be necessary to enable
cost effective process scale-up and/or scale-
out. The principle reasons are that it removes
people from the process and so will reduce
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Exhibit 2.4 GMP cell therapy production cell
harvesting (Cognate BioServices Inc)
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CoG where labour is a major cost
component, which was true for most of the
companies. Automation also was perceived
as improving staff productivity; for example,
several companies mentioned that
recruitment and especially retention of skilled
staff was an issue and thought this would bean increasing challenge as the company grew.
Automation also reduces potential sources of
process contamination or errors.
Standard culture vessels, flasks and roller
bottles are still used in commercial application
in the biologics industry for animal cell and viral
culture, particularly for certain anchorage
dependent or fragile cell lines that are difficult
to grow in a bioreactor. These culture vesselsare therefore a potential route into production
for some cell-based therapies. Changing to
bioreactor technology may require substantial
time and effort in process optimisation,
whereas scale-up by increasing the number of
vessels is not a major process change, and
may be more suited to the smaller batch size
typical of low volume cell therapy products
such as for treatment of rare neurological
diseases. There may also be regulatory
considerations to take into account, such as if
clinical material has been produced in flasks or
roller bottles, or culture conditions have been
optimised using these vessels, which may be
a barrier to making significant process changes
2.1.8 Automation experience and
expectations
There was limited direct experience of using
automation for cell processing in the
companies visited, with the exception of a
company that recently took over the large GMP
facility (35,000 ft2 3,250 m2) that was built
and commissioned by another company in the
1990s. Significant investment had been made
by the earlier company in automation including
developing custom equipment for product
packaging and for processing the custom
cassettes in which the cells and support are
shipped. However, it was not successful
commercially, partly attributable to the high
fixed cost of the large facility necessitating the
sale of large numbers of units.
The production process takes approximately
12-13 weeks from the start of the expansion
of the fibroblast cells to quality control (QC)test and release. The adherent cells grow in
roller bottles, and two robotic systems are
used to process large batches of up to 500
bottles per day. The robots are used for
aseptic processing of the cells through all
stages, including feeding and passaging, that
is harvesting cells and reseeding to expand
cell numbers. The resulting cells are then
seeded onto a support scaffold. The robotic
systems give improved process consistencyand reproducibility.
Most other companies were either at too
early a stage in their product or process
development to consider investing in
automation, or intended to outsource
production. At least two companies said they
plan to automate cell expansion in roller
bottles in the next two years.
2.1.9 Adoption of automation
The possible business models range from
central processing facility to distributed
regional centres. The model chosen has a
major impact on the type of processing
equipment and automation that is
appropriate. It is difficult therefore to make
appropriate choices about routes to scale-up
if a company has not yet developed its
business model.
Several of the smaller companies identified
the scale of financial investment required as
the main barrier to adoption of automation.
Others believed that it was too early in their
development process for them to be able to
specify appropriate automation. Process re-
engineering takes significant resource and
time, as well as the regulatory consideration.
It was understood by all that during the early
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stages of development scientists are making
significant choices which subsequently lock
them into a particular technology that may be
extremely difficult or costly to automate or
scale up for production. Early involvement of
engineers was not a priority, the major driver
being speed to Phase 1, raising more financeas a result and then re-engineering if
required. This is an important issue for all
stem cell and regenerative medicine
companies to ensure that potential scale-up
or scale-out routes are considered early, as
this can have a major impact on commercial
potential or even make the difference
between commercial success or failure.
There was little evidence of sophisticatedautomated equipment for bioprocessing
being used by the companies visited, with
one exception. Generally companies were no
further advanced than their equivalent in the
UK and Europe, and few described specific
plans for how they would scale up.
2.2 Distribution
2.2.1 Overview
The regenerative medicine industry has now
reached the point that it must consider the
issues of cryopreservation, shipping,
distribution and end-point use as key
components in its aim to bring these
therapies successfully to the clinic. It is
imperative that these issues should not be
considered as separate processes at the end
of the development/manufacturing process
but should be an integral part in the whole
regenerative therapy process.
Issues to be considered include identifying
which methods of shipping have been
developed to ensure final product consistency
and delivery in order to achieve the required
clinical needs while still maintaining cell
viability. Furthermore, there are requirements
for consistent distribution and delivery of final
products to distant geographic sites; for further
processing post-production to prepare the final
product at these distribution sites; and any
requirements to involve training in final
product handling and delivery methods for
end users. There may also be a need for
this training to be formally implemented to
ensure consistency in meeting regulatoryrequirements. Those providing stem cell
therapies need to be aware of new
developments in cryopreservation technologies
that involve the use of new materials and
equipment to achieve the cell type-dependent
requirements for storage and shipping without
compromising GMP standards.
Although storage and distribution of stem cell
therapies may be viewed as separate entitiesit is more realistic or practical to consider that
shipping of cells is simply mobile storage.
2.2.2 Cryopreservation
All the companies visited deployed
either vapour phase or liquid nitrogen
cryopreservation for their master cell banks
(MCBs). However, for storage and distribution
of their cell-based products, a variety of
techniques and temperatures were being used.
The majority shipped either on dry ice or used
bespoke shipping cartons (shippers). Individual
products are first packed in a sealed sterile
inner pack complete with transport media. This
sealed pack is then placed in a secondary
shipping carton which is heavily insulated and,
through the use of phase-change packaging
material, can maintain the product within a
narrow predetermined range of temperature for
prolonged periods (3-4 days). The advantage of
this system is that it is in common use and has
been extensively tested by shipping companies
and airlines globally. However, transportation of
samples in these conditions has its limitations
and must comply with local hazardous material
transportation laws.
One common problem of shipping products
on dry ice or liquid nitrogen is the
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requirement for cryoprotection of the cells.
The traditional use of dimethylsulphoxide
(DMSO) as a cryopreservant has limitations
due to it being associated with potentially
severe adverse reactions upon reinfusion into
patients and is restricted by regulatory
authorities, therefore suitable alternatives arebeing sought and include naturally-occurring
disaccharides such as trehalose.
The best example of cryopreservation was
from a company with a wealth of experience in
tissue-engineered products. The company
manufactures a live product for use in wound
repair and has FDA approval for the treatment
of diabetic foot ulcers. For distribution, the
product is kept frozen at -70C using DMSO asa cryopreservant (approved by FDA). The
product uses a biodegradable mesh scaffold
which provides product stability during
shipping and aids final product application to
the patients wound. Shipping is carried out in
unique shippers which were custom designed
by the company, extensively validated and
capable of maintaining temperature for over
100 hours, thus reducing logistical limits for
the location of clinics using the companys
product. The shippers have additional in-built
design features that allow use at the end-point
clinics as short-term storage devices where
suitable low temperature freezers are not
available; this is an important issue ensuring
that lack of correct storage conditions does not
become a limiting factor.
2.2.3 Shipping
Recent advances in temperature-controlled
packaging have seen the development of new
types of systems. These use novel
technologies to provide a closed system
package that can maintain 2-8C for up 72
hours and would be ideally suited for stem
cell-based regenerative therapies which can
be stored and shipped at these temperatures.
The technology relies on a prepackaged unit
which, following push-button activation,
causes evaporation of a small amount of
water under low pressure creating a cooling
effect that is seven times more effective than
ice packs to cool and maintain the package
interior at the required temperature. As this is
an active process, the package has the ability
to adjust to variations in ambient temperaturewhich can occur during shipping and
distribution and appears to be a significant
advance over conventional shipping methods.
Internal temperatures can be data-logged and
the process validated.
2.2.4 Local production
Two of the companies visited by the mission
team have taken novel alternative approaches tothe issues of storage, shipping and distribution.
For example, one company has developed
portable equipment that can enrich stem and
precursor cell populations from adipose tissue
(fat) for treatment of cardiovascular disease and
return them to the patient in around an hour, as
described in section 2.1. By fitting its equipment
with single-use disposable components the
company has provided an ease-of-use system,
allowing change of consumables between
patients and the potential to use the equipment
for multiple different cell-dependent applications.
It has developed this in partnership with a major
technology and engineering company with a
proven track record in technical manufacturing,
an established distribution network and
extensive follow-up maintenance capabilities.
Furthermore, a second more compact version
of this equipment is currently under
development. There is also the potential to store
spare stem cells isolated from the patient for
future autologous therapies, and the company
planned to address the cryopreservation issues
associated with this as they arise.
2.2.5 Future storage and distribution
Based upon the technologies currently
employed by the regenerative therapy
companies visited, a number of suggestions
for the future were evident with respect to
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allowing improvement on existing
cryopreservation, shipping and distribution
methods to achieve optimum conditions for
the products arrival at the clinic. These include
further development of current
cryopreservants which are GMP compliant.
The next generation of cryopreservants shouldideally provide product stabilisation that would
assist in global shipping and distribution, allow
resuscitation of high numbers of viable cells
from storage, and replacement of any
components which are not fully compliant
with the regulatory authorities. Certain
autologous processes that do not require
cryopreservation may employ interim stages
of quality release from the end of
manufacture and throughout the distributionprocess. Otherwise, it may be preferable for
most processes to undergo quality release at
the point of manufacture rather than at the
end-point clinic, placing an emphasis on
effective shipping and distribution processes.
In autologous processes where time may be
at a premium, rapid sterility (including
mycoplasma testing) has proven invaluable
and is now being accepted by regulatory
authorities provided it is carried out in parallel
with standard tests. A number of
manufacturers are developing more
sophisticated rapid sterility tests to address
this need, at least one of which is already in
use with a cell therapy product, and some of
these have advantages over polymerase chain
reaction (PCR)-based detection methods as
they selectively detect only viable
mycoplasma. The current trend for rapid
release testing in the manufacture of
autologous cell therapies will facilitate the
release of product for patient treatment;
however, there is a requirement that these
tests are fully validated against standard US
pharmacopoeia testing methods.
Shipping equipment should ideally be a fully
monitored closed system in order to simplify
use and increase safety. Disposable
compartment components should be used to
minimise cross-contamination, and robust
equipment employed that can be used by any
courier or airline. There must also be
compliance with relevant hazardous material
transportation legislation. Important factors to
achieve will be to data log as well as validate
the storage and transport systems allowingany risk reduction to be implemented and
ensure final product consistency. Final
product delivery systems should also be
engineered to provide ease-of-use at the
clinic. There should be cost-effective product
design where the costs of the deliverable
ideally should not outweigh the costs of the
process, and the delivery systems should
have low maintenance commitments.
The advent of these new stem cell therapies,
their progression to the clinic and their
predicted success will rely not only on their
scientific merits but on robustness of final
product formulation, effective and precise
shipping and distribution, and ultimately
ease-of-use in the clinic. These should be
major considerations for regenerative
medicine companies moving their products
forward to the clinical setting in the future.
2.3 Process validation and regulation
2.3.1 Overview
When any bioprocess is executed it is
important to be confident that the product
will conform to the specification registered.
During processing, natural variations in the
process features will cause variations in
outcome. There are two ways of assuring that
these variations are acceptable:
The first method is to verify that all is well
during or after the step has occurred by
applying direct measurement. This is the
act of verification and an example would
be the confirmation that a cleaning
operation had been successful by taking
surface samples at all critical points in a
piece of apparatus and testing for residues.
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The second method is used where
verification cannot be applied or where it is
not practical. In the example above it could
be the earlier development of a cleaning
procedure (complete with verifiable
parameters such as temperature, duration
and reagent quality) which, if appliedcorrectly, was known to produce an
acceptable level of cleanliness.
Knowledge of critical control points (CCPs) for
any given process acts as a barrier to entry
for competitors so it was unsurprising that,
for almost all of the companies visited, the
exact identity of the CCPs of each process
was proprietary information and would not be
disclosed. However, some patterns wereevident. Every company visited expressed the
view that the first principle of process
validation should be to ensure patient safety.
The processes fell within two broad categories:
those that did not require control under a
manufacturing quality system (basic research)
and those that required an auditable quality
system related to manufacture. In the latter
category, the three systems that applied were:
Good Tissue Practice (GTP)
Good Laboratory Practice (GLP)
Good Manufacturing Practice (GMP)
Process validation applies with varying degree
to each of these three quality systems but
most particularly to GMP. In order to satisfy
claims to GMP it is necessary for a
manufacturing company to understand its
process, to have identified the CCPs and to
have designed a process around the CCPs
such that, under normal variation in
manufacturing controls, the product remains
within the desired specification.
It was evident that FDA had expectations that
had strongly influenced both process design
and the subjects that had been investigated
the most during development. Broadly these
subjects were:
Removal of unwelcome sources of variation
in the raw materials for the process
Rigorous investigation of the process so as
to provide compelling evidence that the
industry understands the process in detail
Control of process variation using in-
process controls
2.3.2 Raw materials
Natural raw materials were universally
viewed as an unwelcome source of
unpredictability in the processing. Solutions
to the problem comprised:
The removal of animal-derived serum or
other materials of natural origin from the
growth medium to give processes based
on defined media (many of the companies)
Exclusion of feeder cell layers from
animal sources (usually murine) (all the
hES cell companies)
Replacement of a natural raw material with
one made in-house from recombinant
technology to a predictable specification
(one company)
None of the products affected by these
developments was yet on the market; however,
the implication is clear, ie it is important fully to
define the feedstock. Once the precedent is set
for a commercial product that is made by a
process that contains no highly variable natural
raw materials then the bar will be raised for
competitors. In the event of any disease scares
in the natural source of the raw materials it will
be unlikely that parallel products which still
contain such components will be acceptable
anywhere and the regulatory position will be
toughened. This subject represents a barrier to
entry for less well established companies but it
is also a potential theme for precompetitive
collaborative research in UK industry, eg the
creation of reliable libraries of serum-free media.
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2.3.3 Cell source and banks
There can be a problem when working with
human stem cell lines as they may grow at
hugely different rates when harvested from
different sources. For this reason some
researchers had sought to developimmunologically-acceptable lines that could
then be used as a single bank of known
(predictable) behaviour. At least one such
master line had been created. Some work on
the feasibility of establishing immunologically
simpler cell libraries had also been
undertaken, not single cell lines but a move
towards a small set of validated lines to cover
the whole patient population instead of a fully
autologous product. The aim here was toproduce one homogeneous genetic
background to the cells including only helpful
alleles. This subject (banks of cells with
reduced immunogenicity) is starting to be
addressed in the UK and may be a suitable
topic for UK-US precompetitive research.
The natural variability of the cell source was
clearly a problem at the design stage for
autologous processes. Assurances were given
by some providers that the process efficacy
had been validated for the natural envelope of
properties that were to be expected in cell
isolates from a normal population. However,
on further questioning it was recognised that
there is no simple or definitive way to do this,
and 90% capture of variation was the best
that could be hoped for. Inevitably some
batches had to be scrapped in production
because they fell outside specification on
maturity. The implication was that during early
phase clinical trials it was important to define
and capture a representative sample of
variation in the patients. Guidance for doing
this was not possible and changed for one
indication to another.
2.3.4 Asepsis
Aseptic validation was crucial in every case as
there were no instances of the inclusion of
antibiotics in-process and none of the
products could be terminally sterilised.
However, with the exception of the centres
that offered modular clean rooms for service-
based business models, there remained the
issue of finding suitable downtime for deep
clean operations (such as might be doneannually in a therapeutic protein production
plant). This seems to be a feature of scaled-
out processes, ie those where the production
is done in many small units rather than only a
few large ones (scale-up). The overlap in time
for prolonged periods of culture makes it
difficult to take the whole plant off-line and
may contain implications for facility design, eg
the creation of several parallel production
suites instead of one large one.
There was a trend, shown by several
companies, to set up non-accredited clean
suites containing identical apparatus to that in
the authorised clean rooms. This allowed
production dress-rehearsals at
manufacturing scale. Operator training can
thus be validated without compromising the
production floor, and the facility also allowed
debugging of the production protocols before
they were issued as controlled documents.
2.3.5 Manufacturing equipment
Manufacture using certain types of popular
equipment was limited in some areas by
validation problems. More than one company
alluded to the differences encountered on
scale-up when using cell factory systems
with multiple layers for cell growth. When
moving from three layers to ten layers
problems arise in control of buffer gas
content and temperature control. For full-
scale work, triple layer machines with full
automation were therefore regarded as a
suitable upper limit.
Cleaning validation was also of primary
importance. In the case of autologous
therapies, individual patient, process line-
clearance was of course critical to avoid
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cross-contamination but in addition the
companies had found that surprisingly low
levels of some cleaning agents exerted a
detectable effect on product. Hydrogen
peroxide, now gaining popularity for inter-
campaign sterilisation in situ, was a good
example of this. The acceptable residue levelshad been determined, suitable analyses put in
place and the cleaning and sterilising cycles
had been constrained to protocols guaranteed
to reduce residues to an acceptable level.
Automation and design for manufacture
remains at a low level, with most
organisations using scaled-up versions of the
familiar T-flasks and roller bottles of their
primary research. On process scale-up, theroute to manufacture can be defined by this
choice as it becomes expensive to revisit
early work and repeat clinical studies using
more amenable systems due to lack of
comparability data. However, some
organisations had done just this. It appears to
be an issue of confidence and is related to
the value of the indication. If the therapeutic
target is high value and life threatening then
the value release by efficiency engineering is
worth making the investment for, but if a low
margin product is proposed then the financial
justification to repeat clinical studies for a
new manufacturing protocol simply will not
be justified.
2.3.6 Process Analytical Technologies
and in-process control
Science, risk management and Process
Analytical Technologies (PAT ie tests applied
in real time or near real time to ensure that
the process is conforming to specification)
are seen by FDA as important for new
bioprocesses. Cell markers derived by some
of the companies were based mainly on past
experience and used in-process to monitor
progress. FDA has advised that more
extensive characterisation will be needed
including real time, non-invasive monitoring.
There are surface markers for cell activation
but the envelope of the parameter is rather
too wide to be very useful.
The products in development were mostly
made by recipe-driven processes, ie
processes designed and validated early in
development in terms of passage number, re-feed times for cells together with medium
delivery volume and supplements. There
were two notable exceptions to this. The first
was an instance of the development and
validation of a proprietary in-process control.
This biochemical example was based upon a
metabolite of energy production (adenosine
triphosphate (ATP) turnover) and was used as
an aid to define the time when product
should be harvested. The second was a casewhere the batch manufacturing protocols
allowed for additional passages in cases
where cells were unusually slow-growing
(autologous source).
A general point was that early identification of
robust markers during research could help to
obviate the need for extensive requalification
during process changes in development since
it could be shown that little alteration had
taken place.
2.3.7 The product
There was considerable reliance on release
assays (an example of verification, eg PCR-
based mycoplasma assays, analysis for tissue
matrix components, cell viability and cell
number). In one case, release testing was done
pre-shipment with some features at risk, ie
the results not known before the product had
been used. For this to be an acceptable risk the
statistics of process validation have to be very
robust. Several companies expressed
aspirations to move to fully responsive
manufacturing based upon in-process controls
as time went on. A sterility test based upon the
supernatant medium alone was negotiated
with FDA by one company.
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FDA places emphasis on confirmation of
potency of the product batches. This is based
on a multiparametric approach. It was felt by
the organisations visited that there was too
high a risk associated with relying on just one
outcome measure cross-calibrated to in vivo
potency, and there had been cases wheresuch a marker had eventually turned out to be
indicative of undesirable features that could
not later be disentangled from the potency
question. Therefore several such outcome
measures per product, independently
determined, were favoured by regulator and
industry alike.
Validation of product shelf life seems to be an
issue that continually recurs during acompanys development. The extension of
shelf life in certain indications was of such
high economic benefit that it justified the
expense of revisiting the early work and
repeating (and extending) ageing studies.
In some organisations, development activity
has been carried out on the stem cell banks
to find out what happens to the cells post-
differentiation under some of the growth
conditions. This takes the process validation
beyond the lifetime of the process into post-
therapy areas on the assumption that some
changes may not become apparent until later
in development and raises a question about
how long such studies should or could last. If
this subject becomes the accepted custom
and practice then it must be taken into
account in the calculation of product
development costs.
On a related subject, FDA is concerned about
potential problems with certain stem cell types
where the starting preparations might
potentially form cancerous tissues under some
conditions. There may therefore be a need to
confirm the absence of significant numbers of
such cells in the final preparation. At present,
preclinical tests cannot be done in the
numbers required to give statistical
significance for such tests so the current
implication is that at-line analysis must
supplement an already validated process.
2.3.8 Delivery
For products in which the transit to the
customer is made in a refrigerated state itwas necessary to validate the chosen carrier
container during transit trials. In spite of this
some customers had requested that
verification for their particular route and
holding conditions be made with temperature
mapping during special transit trials. This
request produced problems because the very
presence of thermocouple arrays within the
package led to thermal conductance across
the insulated boundary and invalidated theoutcome. A compromise was reached to
provide some measurement without rigid
adherence to this request. Similarly there was
some variation in the approach to end-user
training with preference for company field
staff offering training to new clients in the
thaw process (previously validated for cell
recovery and product potency). This effectively
means that the manufacturing company has
qualified specific named individuals only for
use of goods. Formal validation ended with
the thawing of the product.
2.3.9 Impact of process understanding
There was evidence from several organisations
of an emerging confidence in understanding
the CCPs for different classes of operation
during development. It was clear that for
specific activities that were addressed
repeatedly for different products (eg cell sorting
and expansion in different classes of bioreactor
such as the wave bioreactor and the cell factory
systems) the parameters that will turn out to
be the dominant process features are now
more predictable than they were even a few
years ago. This emerging know-how holds out
the potential that a unit operations approach
can now begin to be applied to cell therapy
processing along similar lines to those enjoyed
by the molecular pharmaceuticals industry.
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2.3.10 Validation of training
Staff training is paramount with such labour-
intensive operations. There is much turnover
of manufacturing staff in the Californian
biotechnology sector because of the close
proximity of so many related industries, andthis creates a burden of ongoing training for
employers. A positive outcome, however, is
that there is a growing pool of technical and
production staff in the area who are fluent in
clean production of cell and tissue therapies
and that the training is always fresh. This is a
benefit of having so many companies in one
geographical location.
2.3.11 Examples of company approachesto regulations
Regulatory awareness is a vital component in
business planning for the successful medical
company. In addition, California occupies a
unique position in the American legal
landscape because of the special state funding
for ES cell research that was voted in after the
veto on Federal funding by President Bush.
Some of the companies visited were solely
focused on stem cell activity and were still
engaged in research work. As a result their
awareness of regulatory and quality issues was
high as it had a bearing on how they were to
move towards commercialisation. The mission
team observed a high level of pragmatism with
regard to the generation and maintenance of
statewide regulations on this subject.
Broadly there were three levels of operation
evident in the companies visited, depending
on the state of maturity of the business and
the business model. At the preclinical, pre-
GMP stage were several of the organisations
visited. One example was a company
focusing on the commercial development of
ES cells for use purely as assay-based
screens. In order to achieve this, the research
concentrated on a robust understanding of
the biochemical switches that drive the cells
down the alternative differentiation pathways;
specifically to pancreas, heart, liver,
endothelium, blood and nerve. The
commercial aim was to offer the cells as a
means of assessing the potency of
therapeutic treatments (eg by acting as a
calibrated control against activepharmaceutical ingredients (APIs) that are
intended to drive the regeneration of different
organs or tissues). The target markets are
cardiovascular, diabetes, drug screen and
predictive toxicology. It was not necessary to
manufacture to GMP as the technology is
intended as a research tool; the company
does, however, work to GLP.
Moving closer to the marketplace, anothercompany was commercialising allogeneic cell
therapies derived from ES cells. Fully aware
of all quality and regulatory issues it will need
to address with regard to commercialisation,
for nearly a decade the company has been at
the leading edge of developing human ES
cell-based therapeutics for several diseases
including neural cells for spinal cord injury and
Parkinsons disease, and cardiomyocytes for
heart disease. It has developed proprietary
methods to grow, maintain and scale up
undifferentiated hES cells using feeder cell-
free, chemically defined culture medium,
before differentiating them into
therapeutically relevant cells. The companys
most advanced programme is hES cell-
derived glial cell for acute spinal cord injuries.
It has already had multiple FDA pre-IND filing
meetings, and the GMP grade MCB has been
produced and stored. The GMP cell line has
now been rigorously qualified for human use
after extensive animal and in vitro testing. The
data generated will be used to support the
IND filing in 2007. If successful, this will be
the worlds first hES cell-derived product to
enter clinical testing.
The mission team also met with two CMOs.
Some saw the European Quality Procedures
(QP) system as a potential barrier to entry in
exporting cell therapy products from the USA
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to the EU. All were keen to develop rapid
release assays and as a consequence some
have implemented automated bacterial
contamination detection systems but still
follow up with a conventional 14-day sterility
test. Many had also looked at PCR-based
mycoplasma assays. Product is generallyreleased at risk based on standard tests such
as cell count, viability and gram staining,
whilst awaiting sterility data.
One of the few companies in the clinic had
two product approaches:
Cell-based delivery of missing lysosomal
enzymes in Battens disease
Re-myelination of axons to restore
motor function
The companys approach was predicated on
use of fluorescence-activated cell sorting
(FACS) to isolate a population of stem cells
which are then reintroduced into the patient. In
its discussion with regulatory agencies, focus
has been on GMP-related issues, such as use
of clinical grade material and techniques to
reduce potential for contamination. It tries to
avoid use of antibiotic as yield and phenotype
may be affected.
Taking a two-pronged approach to cell
therapy, one company was developing both
autologous and allogeneic products through
the clinic. Its first product, an autologous
population of mesenchymal stem cells
derived by plasmapheresis and indicated for
treatment of sickle cell anaemia and
thalassaemia, is minimally manipulated and
derived from the patients own blood. It was
able to progress from Phase 1 safety studies
straight to Phase 4 studies. Because of yield
issues there have been problems with quality
testing of batches whilst still retaining enough
product to treat an individual.
The companys second product is allogeneic
and consists of human universal myeloid
progenitor (hUMP) cells. Currently at the
preclinical/Phase 1 stage, it comprises pooled
samples from multiple donors. The initial
indication will be neutropenia (abnormally low
levels of a particular type of white blood cell);
however, the product may offer some
protection from the effects of radiation. Thecompany claims an expansion of 30-50 fold in
culture. Interestingly it treats the product
more like a primary culture than an MCB and
uses routine hospital testing as a means of
screening for adventitious agents so that the
approach is more like transfusion.
One company was able to fast track its
development programme by acquiring
technology approved by FDA in one indicationand shoehorn it into another. Regulated as a
biological it is currently in Phase 1 trials, and
will need a potency assay for subsequent
studies. The company currently performs
basic assays including standard colorimetric
MTT and Sirius red as release criteria.
Taking the minimal manipulation approach to
cell therapy, one company has developed an
autologous system to isolate stem cells
from fat. As a simple system the
concept/service can be sold with little need
for clinical trial or regulatory involvement via
the GTP pathway. CE approval has been
obtained for the isolation device, facilitating
selling direct into the EU. The main clinical
indications will be the prevention of heart
failure following a heart attack. The company
has already conducted a Phase 1 safety study
earlier this year and is planning additional
clinical studies in peripheral vascular disease
and aesthetic applications.
By far the most advanced, one company was
in the process of reintroducing a wound care
product back to the US market having
acquired it in a post-Chapter 11 of the United
States Bankruptcy Code sale. As a well
established product there were no major
quality or regulatory issues to be addressed.
However, as a consequence of bankruptcy-
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induced hiatus in manufacture the acquirer
was able to initiate a thorough overhaul of the
facility, which has the advantage of not
requiring to be reinspected as there has been
no material change to product or facility.
2.4 Commercialisation
A range of Californian companies was visited
and their approach to commercialisation
assessed. Overall the mission team looked at
the types of business models and strategies
being used as well as the barriers and risks
they faced.
During the mission formal meetings were had
with 15 stakeholder organisations includingCIRM, a leading venture capitalist in the
sector, plus 13 stem cell and regenerative
medicine biotechnology companies. Eight of
the companies were targeting therapeutic
products, two were CMOs, one a drug
discovery tools company, one a technology
holding company and one a consultancy.
2.4.1 Therapeutic companies
The majority of companies were firmly
focused on the therapeutic sector of
regenerative medicine involving tissue
engineering and cell therapy. California has
had a long association going back to the early
1990s with tissue engineering companies
with headquarters and manufacturing facilities
in the state. Indeed one of the earliest
pioneers, Advanced Tissue Sciences, set up
in San Diego, listed on NASDAQ, achieved
FDA approval of its products and at its peak
employed over 200 people.
This background of early pioneers has left
California with a wealth of talent and
experience capable of forming, leading and
growing new companies in the sector.
Experience with the sector extended to all
the stakeholders, eg venture capitalists, angel
investors, service companies, clinicians,
distribution companies as well as the
workforce. Every company almost without
exception had leading management people
who were on either their second or even third
regenerative medicine related venture. Thus
not only were the companies being led by
seasoned management but also all the
individuals knew one another. An informalclub of managers was evidently in play both
within California and also throughout the
USA. Where key people had not been
available from the pioneers in the sector, the
shortfalls had been made up from the local
biotechnology communities both in the Bay
Area and around San Diego. The links to the
UK via this informal network are minimal.
Funding the companies did not appear to be asignificant problem although individual
company funding is not on the scale of the
hundreds of millions of dollars poured into the
pioneers in the late 1990s with just one
exception. This was a leading human
embryonic stem cell/cancer therapy company
which was the first to enter the stem cell
sector and thus enjoyed the sharp rise in the
NASDAQ stock market prior to its major
downturn in the early 2000s.
Funding was extremely diverse including
angel investments, venture capital, defence
monies (Project BioShield and Defense
Advanced Research Projects Agency
(DARPA)) and stock market. All the companies
expected Proposition 71 funding to help them
in the near future with many having already
applied as the partner of an eligible academic
or non-profit organisation.
Several angel investors attended the official
mission reception; whilst some were already
invested in the area and planning to invest
further, the remainder expressed a strong
desire to become involved in the not too
distant future. Leverage with the Proposition
71 funding was certainly a driver with none
expressing an interest to invest outside the
State of California.
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Venture capitalists had wider geographical
interests, but they too fully understood the
potential benefits of Proposition 71. Indeed
one leading venture capitalist had nearly
completed the formation of a $150 million
(~77 million) fund. Interestingly the same
venture capitalist was preparing to invest inUK companies because they were by current
US standards very undervalued.
Four of the companies visited had publicly
traded shares (three on NASDAQ and one on
the over-the-counter (OTC) market but was
expected to transfer soon to NASDAQ).
California also had a third vital ingredient for
the future success of its regenerativemedicine companies, namely an experienced
service sector. Two of the companies visited
were established CMOs in the cell therapy
sector. The leading one had experience of
growing more than 20 different cell lines in a
wide range of bioreactors. It provided a
turnkey operation including expansion,
storage, distribution and regulatory matters.
Other local supply chain companies included
major culture media and reagent
manufacturers, bioreactor designers and
international distribution companies. For
example, one of the pioneers in the sector
had originally planned to produce cell culture
media using 100 litre stainless steel media
vessels. However, after a short period of
operation it became apparent that it was far
easier, cheaper and more reliable to
outsource the supply of media. This initial
approach of being totally self-sufficient has
been turned around as the local supply chain
industries have become established. The
more recently established regenerative
medicine companies were considering total
outsourcing of the eventual production
including outside the USA such as Singapore
and the Irish Republic.
The therapeutic cell companies have adopted
a wide range of cell types and approaches.
All the major cell types were represented
including human embryonic, foetal and adult
stem cells and progenitor and somatic cells.
The companies business models very much
reflected the state of the science that their
respective chosen cell type had reached. For
example, companies with somatic cell basedproducts had either FDA approved product or
products in clinical trials whilst the human
embryonic stem cell based companies were
at a much earlier stage in their product life
cycles. The most advanced was at the stage
of being just about to file its FDA IND
application prior to being able to commence
Phase 1 clinical trials.
This range of stages was likewise reflected inthe investor base and its expectation with
respect to size and timing of likely returns.
However, the uncertainty with respect to
returns had not put off some of the
companies with very early stage products
from investing heavily in GMP production
facilities. For example, one hES cell company
had invested considerably in the purchase of
a 10,000 ft2 (~930 m2) GMP ex-
biopharmaceutical factory complete with
modest automation capability. The plan
was to be ready for when scale-up is required
and also to perform contract manufacture in
the meantime. Future staffing of the facility
was not perceived by the management
to be a problem as local talent was
relatively abundant due to the plethora of
biotech companies.
During the course of the mission it became
apparent that two distinct business models
were being considered. At one extreme was
the