Moving your Cell Therapy from Concept to Product: A discussion about navigating funding and grant writing, partnering with organizations, and the regulatory process

By on August 29, 2013
A standard 12-well cell culture dish containing human stem cells placed under an inverted biological microscope for routine inspection.

Last week, we finished our Ask the Expert discussion on Moving Cell Therapies from Concept to Product. The result was an excellent guide to creating a cell therapy product development strategy. The discussion included information about acquiring funding, working with regulatory agencies, strategic partnering, manufacturing strategies, IND submission and moving products from academic research to start up.

The session, sponsored by CIRM (California Institute for Regenerative Medicine) and hosted by Neil Littman, the Business Development Officer at CIRM, provided an interesting discussion full of tips and tricks for navigating the cell therapy product development process. Mr. Littman is responsible for facilitating opportunities for outside investment in stem cell research in California for both CIRM-funded and non CIRM-funded programs by biopharmaceutical strategic partners, equity investors, and disease foundations.

Below is a sneak peek of the discussion. For a full transcript of the discussion, please see – Ask the Expert discussion on Moving Cell Therapies from Concept to Product.

Acquiring Funding


When looking for funding, are there any ways that you can set yourself apart from the competition. A way to make your company or product stand above the rest?

The Answer:

This is typically what investors refer to as “positioning” and is the crux of a good pitch. The key items to discern are how is your technology/product different from the competition? Is your technology entirely novel, or does it built upon and improve what is already on the market? What sets you apart from the current standard of care and importantly, why should insurers be willing to reimburse for your technology. Tackling the healthcare economic (i.e. reimbursement) argument early and upfront will show investors you are planning ahead which can all too often be the exception and not the norm for small start-up companies.

The best way to make your company stand-out is to focus on what makes your technology unique and better than what is currently available and/or in development. The other key to standing apart is to have realistic expectations and demonstrate you are planning ahead – if you are entering phase 1, demonstrate that you are acutely aware of how the results may inform your phase 3 trial to achieve the necessary endpoint for regulatory approval. Also, not all products will achieve +$1 billion in sales in the first five years of reaching the market – unrealistic revenue expectations are a sure sign of an inexperienced management team. Demonstrating you have realistic expectations and understand the dynamics of the marketplace will help separate you from the pack and provide investors and potential partners confidence you have the experience necessary to move the technology forward.

In the case of therapeutics, one great tool to help plan ahead is the Target Product Profile, or TPP. Successful product development begins with having the end in mind, and the TPP conveys the long-term aspirational product attributes and overall intent of the development program. This type of foresight and planning is exactly what will help separate you from the competition.

To learn more about the TPP, please see the following link where CIRM’s Vice President of R&D, Ellen Feigal, discuss the concept in detail:

In addition, the following link provides the Draft Guidance from the FDA for the TPP:

IND Submission


When it comes to IND submission, do you have any tips for a successful submission? Are there any things that you would recommend including or any preparatory work you could recommend?

The Answer:

The single best recommendation I have for a successful IND submission is to make sure that you have communicated with the FDA throughout the development process. This can be accomplished by communicating with the agency via a pre-pre-IND meeting, which is an informal discussion focused primarily on preclinical issues (and always handled by teleconference). The pre-pre-IND dialogue can help ensure that the IND proceeds and mitigate the risk of a clinical hold; however, the focus of the pre-pre-IND is only preclinical and sometimes very preliminary CMC, and for this reason, a standard pre-IND is still highly recommended.

The pre-IND discussion is a key venue to communicate with the FDA where critical issues are raised, addressed, clarified, and resolved prior to the IND filing. There is one pre-IND meeting available to sponsors and sponsors should prepared with the questions and data the FDA will need to review to answer their questions.

Strategic Partnering


How would you advice utilizing strategic partners to progress a product. What things do you want to look for in a strategic partner?

The Answer:

Often times a strategic partnership is a great way to advance your technology or product candidate. There are many forms of strategic relationships, ranging from collaborations where the strategic partner is very hands-on and involved in the development (often committing in-kind services), to others where the partner may simply help fund the development based on milestones with no or little direct involvement.

When evaluating a potential partner, it is important to think about the scope of the collaboration and what type of assistance (beyond financial), you may benefit from. Does the potential partner have expertise in your area of research? Have they successfully brought a similar product to market? What is their interest in your technology and how will it complement their own technology and / or products?

Often times the benefits of a strategic partnership go far beyond the financial component and allow you to access expertise that as a small start-up company you may lack. This can be particularly important in clinical development where a small company may not have in-house clinical or regulatory expertise necessary to successfully navigate product development and ultimately gain regulatory approval.

Manufacturing Strategies


There are at least two manufacturing strategies to bring stem cell therapies to market. In first strategy, you can build the GMP facilities in small sections in each hospital to use in patients, whereas in second strategy you can produce your product in a larger cGMP facility. My question is, in your opinion which of these strategies is best suitable to scale up over the next 10 years?

The Answer:

The answer to this question is unequivocally the latter strategy – it is imperative that you start as early as possible using cGMP (current good manufacturing practice) that may be scaled-up and scaled-out as your process moves through clinical development. While having dispersant manufacturing areas at various hospitals may be suitable for phase 1 studies involving small numbers of patients, this process will not easily scale for phase 2 and particularly phase 3 trials involving larger number of patients (and it certainly will not work for commercial scale production).

On June 25, 2013, CIRM hosted a Roundtable with experts from around the country entitled “Key Tools and Technology Hurdles in Advancing Stem Cell Therapies” and one of the three topics discussed were the challenges in scaling up manufacturing for cell therapies products (the other two were imaging and assay & biomarker development). It was the recommendation of the Roundtable that cGMP processes be implemented as early in the process as possible in order to ensure a smooth transition to phase 3 and commercial-scale production. The Roundtable participants agreed that the most expensive and time consuming steps in manufacturing often involve removing processes that worked for phase 1 (or even phase 2 trials in some cases depending on patient numbers), but will need to be removed or changed for larger scale production. Thus, developing a commercially-viable process early on is crucial to saving time and money down the road as your product advances through clinical development and commercialization.

CIRM is currently in the process of writing a White Paper about the key themes and outcomes of the June 25th Roundtable – please check back on our website in early September for the full report which will discuss cGMP and manufacturing scale-up in greater detail.

Proof of Concept to Start-up


Once proof of concept has been established, what recommendations do you have for seeking out funding for a small start-up company looking to move their product forward?

The Answer:

There are a variety of funding sources available for small start-up companies that have generated proof of concept (POC) data, as well as for those companies that have yet to do so and are seeking funds to establish POC. The available sources of financing at this stage in a company’s life cycle will generally include a combination of non-dilutive capital from the federal / state government, angel investors, disease foundations and potentially VC’s and/or industry partners.

At the Federal level, two available sources of financing for start-up companies include the Small Business Innovation Research (SBIR) program and the Small Business Technology Transfer (STTR) program. SBIR grants provide for up to $1.5 million over two years and are geared towards small businesses at the early stages of R&D. STTR grants provide for up to $1 million of funding over three years and are focused on small businesses that have a formal cooperative R&D effort with a US research institution. The total available funding for these programs in FY2012 was approximately $715 million.

Angel investors and disease foundations represent two additional sources of capital early during a company’s life cycle. Angel investors who may have a specific interest in the area of research due to personal or other altruistic reasons should be considered. For example, Tech Coast Angels (based in San Diego) has invested over $120 million in 200+ companies across a variety of industries. Disease foundations such as the Michael J Fox Foundation, The Muscular Dystrophy Association and the Juvenile Diabetes Research Foundation (to name a few) all invest in early stage R&D and represent an alternative source of capital prior to more traditional funding sources such as venture capital and industry partnerships.
In addition, foundations such as The Thiel Foundation’s Breakout Labs provide funding to “spur innovation by filling the funding gap that exists for research and development outside the confines of an academic institution, large corporation, or government facility.” Brekout Labs funds transformational ideas and will generally not consider applications from companies that have raised over $1 million.

Once proof of concept has been established, the available sources of funding may broaden to include traditional venture capital investors and industry partners. VC’s each have unique styles and there are several firms in the life sciences space that will typically invest before a product reaches human clinical trials, such as Third Rock, Atlas and Versant (to name a few). Other VC’s prefer to wait to see human clinical data. Traditionally, to generate interest from Big Pharma (although not always) human proof of concept data was required, however, given the lack of productivity in their pipelines, the breadth of late stage product failures, and the need to externalize R&D costs there has been a general shift in the landscape and Big Pharma has recently been willing to invest in earlier stage assets.

Overall, early stage start-up companies have a variety of funding alternatives to help advance their technology and will typically need to secure funding from multiple funding sources to be successful. These will typically include the federal and/or state government, angel investors, disease foundations, other non-profits organizations as well as more traditional sources of financing such as venture capital investors and industry partners. Once proof of concept has been established, the more accessible traditional sources of funding will become, however, it will come at a cost and so alternatives forms of non-dilutive financing should still be pursued.


CIRM was established in November 2004 with the passage of Proposition 71, the California Stem Cell Research and Cures Act. The statewide ballot measure, which provided $3 billion in funding for stem cell research at California universities and research institutions, was overwhelmingly approved by voters, and called for the establishment of an entity to make grants and provide loans for stem cell research, research facilities, and other vital research.

In July, CIRM approved a $70 million plan to create a new statewide network of clinics called the Alpha Stem Cell Clinic Network. These clinics will serve as a hub for stem cell clinical trials with the goal of supporting and accelerating clinical trials funded by CIRM. As more stem cell therapies are approved, the focus will evolve to include delivery of approved stem cell therapies.

“These clinics have the potential to revolutionize how we deliver stem cell therapies to patients. Stem cell therapies are a completely new way of treating diseases and disorders so we need a completely new way of delivering those in a safe and effective manner. These clinics will help us do just that and the clinical trials carried out in this network will fulfill the agency’s promise of bringing new therapies to patients who need them,” said Alan Trounson, PhD, President of CIRM.

In addition to furthering stem cell therapy testing, the clinics will also take on the role of educating the public about stem cell therapies and clinical trial enrollment.