Aastrom Biosciences Seeks to Catch Cell Therapy Wave, Ride Dendreon’s Coattails

6/2/10Follow @xconomy

Dendreon blazed a new trail in late April when it won FDA approval of a treatment to actively stimulate a patient’s own immune cells to fight prostate cancer. Now lots of companies are casting themselves as the next Dendreon, with gee-whiz biotechnology on the verge of a breakout. One of them is Ann Arbor, MI-based Aastrom Biosciences (NASDAQ: ASTM).

There are plenty of reasons to be wary of companies grasping for Seattle-based Dendreon’s coattails—chief among them the fact that every cell-therapy company before Dendreon failed, and that none of the other contenders is trying to do just what the Seattle company does. In the case of Aastrom, its vital stats don’t inspire great confidence, either. The company was founded 20 years ago, hasn’t developed a marketed product, has racked up a deficit of more than $195 million, and today has a market valuation of less than $50 million. This is one of the biotech companies out there with a history it would like to forget.

“The good news is the company has been around 21 years, and the bad news is the company has been around 21 years,” says CEO Tim Mayleben. “We’ve survived.”

Aastrom has been able to survive the past few years on a couple technologies floated by a lot of hype—stem cells and cell therapies like the one from Dendreon. But quite a bit has been happening at Aastrom in the past few months, and the company is looking forward to an important presentation on June 11 at the annual meeting of the Society of Vascular Surgery in Boston. Aastrom is expected to present some positive—albeit preliminary—results from a small study that showed its injectable adult stem cell therapy was better than a placebo at delaying major complications for patients with a severe type of vascular disease known as critical limb ischemia.

Tim Mayleben

Tim Mayleben

Before diving into the data that’s expected and why it matters, a little background is required on Aastrom. The company was founded in 1989 as a University of Michigan spinoff. For the past five years, it has pursued a strategy of developing adult stem cell therapies for people with severe cardiovascular diseases.

Like Dendreon’s prostate cancer treatment, the Aastrom method is designed to be an “autologous” cell therapy, in which a patient’s own cells are processed outside the body and re-injected. It starts with a 15-minute procedure in which the patient has about three tablespoons of bone marrow withdrawn, Mayleben says. That bone marrow is then shipped to Aastrom’s Michigan facility where it is incubated for 12 days in a nutrient broth and with some specific gas conditions that are proprietary to the company. The controlled environment is supposed to help adult stem cells and progenitor cells, the kind involved in healing and tissue repair, to proliferate 30 to 300-fold. The new batch of stem and progenitor cells get re-injected directly into the muscle or tissue where they are supposed to promote healing.

Mayleben, 49, the former chief operating officer of Esperion Therapeutics, has been familiar with the Aastrom story since he joined the board in 2005. But he only formally took on the full-time job of CEO this past December. Since then, he raised almost an extra year’s worth … Next Page »

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