StemCells Inc., a California-based biotech company announced that they will stop developing the potential treatment for spinal cord injury after a failed mid-stage clinical trial. The company stock went down to $3.03 per share at the start of the pre-market trade. StemCells reported that they still have $5.5 million in cash as of May 31, but they don’t have a liquidating distribution to their stockholders.
The company said that the amount that they can give to the shareholders depends on the liquid assets, any liabilities, and costs of the wind down.
The decision to end the trial comes from an in-depth review of the clinical data from the concurrence of the Interim Analysis Data Monitoring Committee study. Due to limited financial resources, the company decided to end their Phase II Spinal Cord Injury Trial because of the insignificant results of the clinical findings. The results were not able to justify that stem cells can treat spinal cord injury.
After their announcement the company’s share went down to 85%.
Jason Kolbert, analyst of Maxim Group, noted that the combination of tough market and long clinical trials have drove StemCells Inc. to stop their experimental study. Kolbert added that this might be a similar scenario for biotech companies who do not have any partner.
StemCells also announced that it had to lay-off 50 employees and record a charge of $1.25 million in the 3rd quarter ending on September 30.
The company announced that it will look into the possibility of monetizing its intellectual property including the data collected in the study. They also plan to transfer the proprietary of Hu-CNS-SC cells and some assets through a possible sale.
Failed Stem Cell Research
This is not the first time that a biotech company has decided on not to continue with the stem cell research. In 2011, Geron Group also pulls the plug on stem cell research and decided to focus on experimental cancer drug therapy.
The assets of Geron’s stem cell were bought by BioTime Inc. and are now presently being tested in another clinical trial by Asterias Biotherapeutics Inc.
Stem Cell Therapy: A New Hope or Hype?
For decades, the stem cell treatment as been hailed as a potential cure to end all illness. Some believed that it is a miraculous lifeline for desperate sufferers of diseases where no any conventional medicine offers any hope.
It is understandable when a patient or their family would try any treatment possible and spend huge amount of money to save the lives of their love ones. But the list of possible diseases where stem cell therapy can be used is very limited.
The well-known stem cell treatments are for cord blood and bone marrow transplants. The stem cell therapy has been used successfully to treat immune and blood disorders including leukemia, sickle cell anemia and lymphoma. Stem cells are also being used for skin and bone grafts.
Despite a thousands of studies conducted on Stem Cell Therapy, according to the International Society for Stem Cell Research or ISSCR, the number of diseases were stem cells is beneficial is still very short.
Somaraju. (2012). Hematopoietic stem cell transplantation for Gaucher disease. Cochrane Database of Systematic Reviews .
Weitz. (2016). Extracorporeal photopheresis treatment for chronic graft‐versus‐host disease after haematopoietic stem cell transplantation in paediatric patients. Cochrane Database of Systematic Reviews .