Cerus, With Technology to Knock Out Viruses in Blood, Finds New Potential in Chronic Fatigue

9/7/10Follow @xconomy

Cerus has struggled for years to convince regulators that its technology for ridding the nation’s blood supply of pathogens deserves a chance on the U.S. market. Now the Concord, CA-based biotech company is pinning some renewed hope for its business on a study that says it can wipe out a newly discovered virus that some scientists suspect may the culprit behind the poorly understood disease known as chronic fatigue syndrome.

Cerus (NASDAQ: CERS), along with collaborators at the Whittemore Peterson Institute for Neuro-Immune Disease, are reporting today that the Cerus Intercept Blood System was able to wipe out all viable copies of a virus known as XMRV in the blood of an infected patient who had chronic fatigue syndrome. The findings are being presented today at the first International Workshop on XMRV being held at the National Institutes of Health in Bethesda, MD.

The result is bound to stir interest among the many active patients online, and researchers, who have spent years trying to better define this malady and find out what causes it. Many scientists have been looking to find a virus that might be the cause, and a study published last month in the Proceedings of the National Academy of Sciences offered a provocative suggestion that XMRV could be involved. That study, by NIH and FDA scientists, found that 86 percent of blood samples from chronic fatigue syndrome patients had the virus, while it was present in just 6.8 percent of healthy samples.

The Cerus technology is designed to kill all kinds of known and unknown pathogens. So that means the company is hopeful that if XMRV is branded as a lurking threat in the nation’s blood supply contributing to chronic fatigue syndrome, then it might have a new justification for why its technology should be approved for sale in the U.S. market. The Cerus technology is already available for sale in the European Union, and CEO Claes Glassell is counting on this to provide his company with a lift in sales.

Claes Glassell

Claes Glassell

“We think this study could potentially accelerate our rate of adoption in Europe,” Glassell says. “It’s a new threat to blood safety, and a lot of people in Europe are wondering about how to address it.”

If this is the big new pathogen for Cerus, it will have been a long time coming. The company was founded in 1993, won clearance to sell its system in Europe in 2002, but has never been able to persuade the FDA that its technology was needed to protect the U.S. blood supply. Cerus, with about 73 employees today, has racked up an accumulated deficit of $420 million and has never been consistently profitable, according to its most recent quarterly report. It has taken years to gain acceptance for its technology, and Cerus has only captured about 4 percent of the total available market it sees in Europe, but acceptance is gaining, Glassell says. Based on sales growth rates of the first half of 2010, Cerus expects to generate $21 million to $22 million in sales this year, and it figures it can reach break-even when it reaches about $50 million in annual sales, Glassell says.

The Intercept system represents a pretty big shift in how blood centers think about keeping their supplies safe. The traditional model is to test for something specific you think might be there, like HIV or West Nile virus. The Intercept system is designed to inactivate all known or unknown pathogens by interfering with DNA and RNA so the virus can’t replicate. While there are ways to kill known pathogens like HIV, there are always new pathogens being identified every year that require new strategies to get rid of, Glassell says. The Cerus argument is that by using its technology, blood centers will have security knowing that they are already wiping out pathogens that haven’t even been identified yet as threats.

The study being presented at the NIH’s workshop on XMRV was only conducted on a blood sample from a single infected patient. Variability from patient to patient shouldn’t be an issue for this technology because of the broad mechanism it uses to interfere with viral replication, says Lainie Corten, Cerus’ director of global communications.

But it’s still just a small study offering a glimpse into where Cerus is going with this. The company is in talks with the FDA about the design of a pivotal Phase III clinical trial in the future that might provide evidence necessary to bring this to the U.S. market. The latest findings on XMRV and its possible link to chronic fatigue, combined with Cerus’ ability to wipe it out, will definitely give the company a potent new angle to talk about with the FDA in those negotiations.

While the FDA has traditionally said the U.S. blood supply is safe and doesn’t really need a sweeping new technology to protect it like the one from Cerus, the new evidence could sway regulators to reconsider. If that happens, Glassell says, “we could be in a very good position.”

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