Stem-cell business round-up
Here’s a collection of some stem-cell business news in March.
Two companies selling stem cell products for laboratory research have announced a deal. According to Fox Business, Stemgent is going to start marketing CellDesign’s kits to differentiate adipocytes.
Just a couple weeks ago, Stemgent announced that it had received $14 million in venture capital from firms including HealthCare Ventures and Morgenthaler Ventures. Stemgent sells a range of products for growing and differentiating pluripotent stem cells, particularly small molecules that influence cells’ fates. Also recently, CellDesign announced that it was selling two lines of adipocyte stem cells.
Meanwhile, Invitrogen has launched a product to push DNA and RNA into a wide variety of mammalian cells. (The fact that they mention stem cells in the title of the announcement gives an indication of where they think their market is and where it will be growing, I think.)
The UK’s Epistem has signed a deal with Novartis to use epithelial stem cells to find drug targets. It’s $4 million upfront, with up to $45 million in potential milestone payments. How does this compare with other deals? I tried looking up a few. Some announce milestones, such as Cellartis with Novo Nordisk. Other deals, like Novocell with Pfizer and Roche with Cellular Dynamics International, don’t mention. I’m sure somebody has thought of this more deeply than I have, but it doesn't seem to correlate (as I would have guessed) with whether the cells are used as therapies or as screening tools. Please comment.
A lot of people in the business realm expect a spate of mergers between stem cell companies. We saw Jamie Thomson’s companies come together in November. Cellular Dynamics International, Stem Cell Products Inc. and iPS Cells Inc are all one in CDI.
I seem to have been the only person in the world surprised that cell-therapy company StemCells, Inc merged with Austin Smith’s reagents company Stem Cell Sciences. I figured each could find a more-similar company to merge with, but the goal, it seems, is diversity. StemCells is in California and is testing fetal neural stem cells in children’s neurodegenerative diseases. Stem Cell Sciences is in the UK, has reagents that keep stem cells from differentiating, and also has intellectual property on rat embryonic stem cells.
Comments
Monya,
Nice summary. I agree the STEM-SCS deal does in some ways seem an awkward fit.
Even though - as I pointed out in a recent blog post - I smelled this one coming before it happened it even then seemed to me to be a somewhat odd fit.
I think the other driver here in addition to the 'diversity' of platforms which Marty has emphasized in public statements, is the short-term revenue opportunity that SCS represents for a company like STEM that has a long-term product development burn rate before its products become commercial.
STEM's hunt for revenue generating companies that it could buy/merge with that could help lower their burn rate has been a driver in other potential acquisitions that it investigated including the deal it did with Progenitor Cell Therapy and then backed away from after due diligence.
--Lee
http://www.celltherapyblog.com
Posted by: Lee Buckler | March 25, 2009 08:40 AM