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Acknowledgements xiii List of abbreviations xv About the author xvii 1   Introduction: stem cell science, biotechnology and the problem of commercialization 1.1 Modelling the most successful biotech business in the world 1.1.1  Entrepreneurialism and the US biotechnology industry 1.1.2  Negotiating the ‘valley of death’ 1.2 Emerging stem cell therapies and the commercialization of biotechnology 1.2.1  Similarities 1.2.2  Differences 1.3 Some prospective possibilities for the stem cell industries 1.3.1  1.3.2  1.3.3  1.3.4  1.3.5  Reagents and media Disease models and cell lines Storage and technology systems Off-the-shelf products Non-human applications 1.4 The limits of commercialization in the stem cell sciences 1.4.1  The size of the market 1.4.2  The relationship between risk and return 10 11 12 12 13 13 14 15 15 16 1.5 What are the most lucrative commercial models to adopt? 16 17 References 2   Stem cell treatments in a global marketplace 2.1 Patients drive the market 2.1.1  Patient activists 2.1.2  Stem cell tourism 2.1.3  Anti-ageing and life-extension medicine Published by Woodhead Publishing Limited, 2012 19 21 23 25 27 iPS cells 179 demand for iPSC-based treatments Given these developments for adult and embryonic stem cell research, it seems inevitable that iPSCs will eventually become available in these ways too In many respects, these developments are no different than the existing medical service provision, where a patient/client seeks out local services from GPs and other allied health professionals However, the core difference that might be imagined with iPSC-based treatment is the level of skill of technical services being provided in the clinic In theory, the patient could provide a small skin sample in the clinic, the sample is then expanded to create the tissue required and then the tissue is implanted into the patient Much further down the track, it may transpire that the two most complicated parts of the process – growing the material required and reintroducing it into the patient – will be outsourced to laboratories and larger clinics in this scenario This question of affordability will be a significant one when the capacity to grow biological materials on demand becomes a technological possibility Who will be able to access services and how services will be accessed will have a major impact, not only on the future success of the industry, but also on the long-term social consequences of inequalities in healthcare If the cost of, say, a whole organ produced via iPSC technology is not supported by government healthcare systems or private health insurers, yet is still expensive to obtain relative to average weekly earnings, then clearly only the wealthy will be able to afford this service However, aside from the question of affordability, there may be other social implications of a scenario where organs might be made to order that are as yet unimaginable As discussed previously, one of the potential ethical concerns raised by Yamanaka is that human germ cells might be made out of iPSCs, allowing possibilities of parenting not seen before Furthermore, should body parts become easily replaceable through an affordable and accessible healthcare system then current models of public health will be rendered redundant (Harvey, 2010) If the body and its constituent parts are no longer a precious resource that is irreplaceable, then the incentive to protect it from harm will surely decline as more options for the replaceability of body parts rises Published by Woodhead Publishing Limited, 2012 180 Commercializing the stem cell sciences 6.3  The iPS cell industry? The broader question that might be asked about the future of iPSC research is whether or not a viable and sustainable industry will emerge While it is too early to tell at this stage whether some of the more radical possibilities of iPSC research – like whole organs being made to order by individuals walking into a clinic – will ever eventuate, what has been established so far is an increasingly viable market in tools and supplies for drug manufacturing This in itself is lucrative enough to sustain a smallish niche industry within the biotechnology sector As more cell lines are derived adopting the disease-in-a-dish approach it might be expected that further interest from pharmaceutical companies will follow Many of the prospective commercial models identified above for iPS cells are based on a number of established industry models These include a traditional manufacturing base, the franchise model, the education delivery and information-communication industry model and lastly the biotech industry model There is also much room for cross-over between different cell products and the kinds of commercial models that might be adopted Other issues affecting the commercial development of the iPSC market, however, include concerns about the role of patenting and its impact on commercialization (Eisenstein, 2010), the increasing lack of rarity around pluripotency (Sipp, 2009) and the effect any patent reforms will have on business (Harrison, 2011) Patenting issues have been widely debated in the stem cell sciences for some time As noted previously, there was some initial speculation that a patent thicket would emerge around iPSCs as broad patent claims would be staked out over the production of iPSCs as has occurred with hESC (Eisenstein, 2010) Yet it has also been suggested that lessons learnt from patenting in hESC research will lead to a more cautious approach to broad patent rights being granted early in the development of iPSCs (Eisenstein, 2010) Also, the diversity of production methods used in inducing pluripotency may potentially see a more diverse range of patents established over time (Eisenstein, 2010) Published by Woodhead Publishing Limited, 2012 iPS cells 181 Patent reform is an ongoing area of concern for future developments in stem cell research (Harrison, 2011) There is currently a bill before the US Congress advocating for transformations in the way that patents can be challenged in the legal system by third parties, the implementation of the first to file ruling rather than first to invent, and a change in the way that damages for patent infringement is calculated (Harrison, 2011) How this might impact on iPSCs is largely speculative at this stage, but the ongoing disputes over patent rights in hESC have demonstrated that patent challenges can have a severely disruptive impact More controversial perhaps is the suggestion that iPSCs are so easy to produce that the commercial incentive for patent protection or significant financial investment might turn out to be negligible Due to social, ethical, legal and technical reasons, pluripotent cells have been precious and scarce resources not easily accessible – until now, that is (Sipp, 2009) The advent of the capacity to induce pluripotency is argued to have radically altered how its value is configured (Sipp, 2009) In essence, iPSC technology is argued to have ‘democratized’ the field of pluripotent cells, allowing more researchers to enter into stem cell research with much less of the regulatory entanglement that has been associated with hESC research (Sipp, 2009) Current commercial models include focusing on developing proprietary techniques for the production of iPSCs Ongoing debates about the efficacy and safety of the methods used for inducing pluripotency have led to a range of different techniques being developed For example, Fate Therapeutics has developed a chemical process that impacts on the differentiation of iPSCs after they have achieved pluripotency, in contrast to other methods based on introducing viruses or genetic modification into the cells (Lin et al., 2011) As different techniques become more established there could potentially be a wide range of options for developing iPSC-based technologies Alternatively, in years to come it could also be established that one method is superior to the others and the field will become less diverse than it currently is At this stage though, the field is open Published by Woodhead Publishing Limited, 2012 182 Commercializing the stem cell sciences References Apostolou, E and Hochedlinger, K (2011) ‘Stem cells: iPS cells under attack’, Nature, 474 (9 June): 165–6 Baker, M (2009) ‘Stem cells: fast and furious’, Nature, 458 (22 April): 962–5 Ben-Nun, I., Montague, S., Houck, M., Tran, H., Garitaonandia, I et al (2011) ‘Induced pluripotent stem cells from highly endangered species’, Nature Methods, September (online) Callaway, E (2011a) ‘Cells snag top modelling job’, Nature, 469 (17 January): 279 Callaway, E (2011b) ‘Schizophrenia “in a dish”’, Nature, 13 April (online) Cardona, B (2009) ‘“Anti-ageing medicine” in Australia: global trends and local practices to redefine ageing’, Health Sociology Review, 18 (4): 446–60 Carpenter, K., Frey-Vasconcells, J and Rao, M (2009) ‘Developing safe therapies from human pluripotent stem cells’, Nature Biotechnology, 27 (7): 606–13 Colman, A and Dressen, O (2009) ‘Pluripotent stem cells and disease modeling’, Cell Stem Cell, (3): 244–7 Courtney, A., de Sousa, P., George, C., Laurie, G and Tait, J (2011) ‘Balancing open source stem cell science with commercialization’, Nature Biotechnology, 29 (7 February): 115–16 Crook, J., Hei, D and Stacey, G (2010) ‘The International Stem Cell Banking Initiative (ISCBI): raising standards to bank on’, In Vitro Cellular and Developmental Biology – Animal, 46 (3–4): 169–72 Cyranowksi, D (2010) ‘Disease-in-a-dish approach gives clues to Rett syndrome’, Nature, 17 November (online) Daniels, J., Secker, 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Woodhead Publishing Limited, 2012 184 Commercializing the stem cell sciences Mauron, A (2005) ‘The choosy reaper: from the myth of eternal youth to the reality of unequal death’, EMBO Reports, (Special Issue): S67–S71 Maynard, A (1991) ‘Developing the health care market’, Economic Journal, 101 (408): 1277–86 Meyer, J., Howden, S., Wallace, K., Verhoeven, A., Wright, L et al (2011) ‘Optic vesicle-like structures derived from human pluripotent stem cells facilitate a customized approach to retinal disease treatment’, Stem Cells, 29 (8): 1206–18 Nakatsuji, N., Nakajima, F and Tokunaga, K (2008) ‘HLA-haplotype banking and iPS cells’, Nature Biotechnology, 26 (7): 739–40 Neilson, B (2009) ‘Ageing and globalisation in a moment of so-called crisis’, Health Sociology Review, 18 (4): 349–63 Nelson, B (2008) ‘Stem cell banking: lifeline or sub-prime?’, Nature Reports Stem Cells, 13 March (online) Prescott, C (2011) ‘The business of exploiting pluripotent stem cells’, Philosophical Transactions 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defined factors’, Cell, 126 (4): 663–76 Takahashi, K., Tanabe, K., Ohnuki, M., Narita, M., Ichisaka, T et al (2007) ‘Induction of pluripotent stem cells from adult human fibroblasts by defined factors’, Cell, 131 (50): 861–72 Taylor, C., Bolton, E., Pocock, S., Sharples, L., Pedersen, R and Bradley, A (2005) ‘Banking on human embryonic stem cells: estimating the number Published by Woodhead Publishing Limited, 2012 iPS cells 185 of donor cell lines needed for HLA matching’, The Lancet, 366 (10 December): 2019–25 Timmerman, L (2011) ‘iPierian shake-up continues, as Chairman Corey Goodman, Scientist Doug Melton exit firm’, Xconomy San Francisco, 15 June (online) Unger, C., Skottman, H., Blomber, P., Dilber, M and Hovatta, O (2008) ‘Good manufacturing practice and clinical-grade human embryonic stem cell lines’, Human Molecular Genetics, 17 (Review 1): R48–R53 Webb, S (2010) ‘Burgeoning stem cell product market lures major players’, Nature Biotechnology, 28 (6): 535–6 Yu, J., Vodyanki, M., Smuga-Otto, K., Antosiewicz­­-Bourget, J., Franel, J et al (2007) ‘Induced pluripotent stem cell lines derived from human somatic cells’, Science, 318 (21 December): 1917–20 Published by Woodhead Publishing Limited, 2012 What does the future hold? The way forward for the stem cell industries remains to be seen What we will see in the next 2–5 years is the incremental development of scientific knowledge, and some very simple yet highly effective clinical applications emerging from adult stem cell products that will not necessarily be very lucrative, but will substantially improve patient quality of life in some circumstances, to the point where the technologies will be quietly adopted as part of traditional medical practice The most promising applications so far are Mesoblast’s bone repair treatment, Regeneus’ osteoarthritis treatment, the contact lens-based application of adult stem cells for vision repair and, potentially, the current hESC-based products in clinical trials On balance, it seems that the much hyped search for revolutionary treatments and cures for diseases like Alzheimer’s, diabetes and cancer are important, but that the most effective product outcomes are aimed at improving quality of life for adults and animals with bone, joint and eye disease; that is, diseases that are difficult to live with but not life-threatening This book has mapped out some of the emerging developments in the global stem cell industries, beginning with examining the relationship between stem cell science and the global biotechnology industry Replicating the success of the US biotechnology industry is one component of emerging developments in the global stem cell industries Some of the difficulties facing new industries include attracting funding from investors and developing strategies for Published by Woodhead Publishing Limited, 2012 188 Commercializing the stem cell sciences negotiating the leap from early phase start-up company to established industry Some of the different strategies adopted by companies in this phase have been demonstrated through the examples discussed in the chapters addressed to specific stem cell techniques One of the key issues facing companies bringing new products to market too is the potential availability of people willing to use their products An important component of the emerging stem cell markets, however, is that expected patient demand has had a pivotal role to play in moulding the current shape of the field: from funding for basic research to the availability of untested therapies Observing the future of some of the trends in patient needs identified in Chapter could therefore be an important planning tool for companies entering the stem cell market As Chapter has shown too, there are a number of policy instruments that governments can choose to use in building national innovation systems that will have considerable impact on the stem cell industries The focus by a number of national governments on deliberately building policy initiatives targeted at the stem cell sciences is indicative of the level of expectation attached to this form of direct intervention What more general analysis of national innovation systems shows, however, is that effective policy instruments have a key influence on everything from establishing a company and the availability of skilled workers to the potential revenues that might be gained from patenting and the level of investment in research and development Given this, the impact on the future of the stem cell industries of policy changes in areas related to regulation, education, taxation, patenting and funding cannot be ignored Chapter explores the development of adult stem cell therapies in more detail In the next few years it might be expected that a number of adult stem cell-based therapies will start to enter the marketplace, but they will not be for the high-profile illnesses and injuries that are routinely cited in media reports about the expectations associated with human embryonic stem cells It might be imagined that existing cosmetic treatments will start to become more widely available and that new treatments for debilitating conditions associated with ageing will start to replace the pharmaceuticals currently in use Published by Woodhead Publishing Limited, 2012 What does the future hold? 189 The much anticipated human embryonic stem cell based therapies discussed in Chapter are still in development Assuming the success of the current trials underway, more trials will be approved for other conditions Yet the continuing debates worldwide over funding and patenting for human embryonic stem cell research will still undermine commercial interest in the field Should the results of any trial produce radical results though, it might be anticipated that any qualms over the ethics of using human embryos would be largely overridden by the therapeutic potential In the wake of such a scenario, however, patenting disputes might be expected to deepen As discussed in Chapter 6, any clinical applications of induced pluripotent stem cells are still a long way off technical feasibility Yet given the rapid rate of development of the field this might change very quickly As with human embryonic stem cells, the patenting landscape will prove to be important for the first companies bringing products to market However, as the techniques for inducing pluripotency proliferate and the possibility of creating personalized therapeutics emerges, it may eventuate that applications of induced pluripotency yield little commercial value The still even more distant possibility is that the use of iPSCs in personalized medicine could radically transform contemporary ideas about health, illness and medicine To sum up: there are a number of applications in development worldwide but few treatments actually available to patients other than the unproven therapies advertised on the Internet, participation in emerging clinical trials or procedures for cosmetic enhancement The global stem cell industries are currently in their infancy but with strong prospects for the future Beyond the current limitations in scientific and technical knowledge, negotiating the regulatory environment around testing, marketing and patenting products is the main hurdle for successful development at this stage And while patient demand is having a strong impact on the opportunities for progress, governments still have an important role in ensuring that the right conditions for innovation are in place Published by Woodhead Publishing Limited, 2012 Index abortion wars (US), 128 adult stem cells, 3, 89 Adult Stem Cell Research Network, 91 advantages over embryonic stem cells, 90 primary commercial avenue, 116 Advanced Cell Technology, 124 blastomere cell derivation method, 142 dry AMD (age-related macular degeneration), 124, 144 Stargardt’s macular dystrophy, 124, 143 see also clinical trials animal treatments, 3, 14, 43 Frozen Zoo, 162 Genetic Savings & Clone, 44 horse-racing, 47 pet and livestock cloning, 44 see also Regeneus, VetStem anti-ageing medicine, 27–8 and life-extension, 160 critics of, 28 stem cell applications, 29 Australian Stem Cell Centre Patient Handbook, 27 biobanking: advantages of cord blood, 101 criticism of private cord blood banking, 100 emergence of a private biobanking market, 168 International Stem Cell Banking Initiative, 166 iPSC banking, 165 Richard Branson’s Virgin Health Bank, 99 UK Stem Cell Bank, 166 umbilical cord blood banking, 20, 99 biotechnology industry – see Genentech business rules, 73 removing barriers to new firm formation, 74 cell lines, 12 history of embryogenesis and regeneration, 93 origins of tissue culture techniques, 92 see also HeLa, 12 Published by Woodhead Publishing Limited, 2012 192 Commercializing the stem cell sciences clinical trials, 2, 107 clinical trial success and the future of hESC research, 145 in the US, 135 for Type diabetes, 91 the trial process, 141 see also Advanced Cell Technology, Geron cloned meat: European debate, 46 FDA investigation, 45 in vitro meat, 46 commercial strategies: cell banking, 13 collaborative agreements, 117 diversification, 11 on-site production, 162 reagents, 12, 171 replacement tissues and organs on demand, 161, 177 training delivery model, 168 community reaction (hESC), 125–9 2001 Bush decision, 127 embryo supply, 125 media coverage, 125 people with disabilities’ perspectives, 126 potential donor attitudes, 127 see also ethical objections to stem cell research companies in the iPSC space, 156 Cellular Dynamics International, 169 Fate Therapeutics and BD Biosciences, 175 GSK, 159 iPierian, 158 Stem Cells Inc., Invitrogen, Hamilton Company, 171 StemGent, 169, 176 competitiveness: American Competitiveness Initiative, 64 EU Lisbon Strategy 2000, 64 Europe 2020, 65 measurement debates, 61 of firms, 61 of nations, 62 policy support for competitive advantage, 64 consumer protection, 76 potential biohazards, 77 public trust in stem cell science, 79 cosmetic therapies, 37 fat stem cells in breast enhancement, 111–13 ‘disease-in-a-dish’ model, 157 criticism of, 158 current disease models, 158 drug screening, 158 Long QT syndrome, 158 Rett syndrome, 158 schizophrenia, 158 Dolly the sheep, entrepreneurialism, ‘entrepreneurial science’, 117 role of, 56 scientist-entrepreneur, 116 epithelial cells, 104 ethical objections to hESC research, 124 Australia, 133 Canada, 134 Germany, 78, 134 global patchwork of regulations, 133 Israel, 133 Published by Woodhead Publishing Limited, 2012 Index Japan, 134 US, 78 Warnock Report, 133 see also community reaction EU Tissue Directives, 164 Genentech, 4, 6, 117 corporate history, Geron, 123 clinical trial, 138 close of clinical trial, 124 critics of the clinical trial, 139 see also clinical trials globalization: impact on trade, workforce and finance, 79 transformations in the workforce and competitive advantage, 72 haematopoietic stem cells (or ‘bone marrow transplants’), 20, 95 history of, 96 the enrolment of the biosciences in R&D, 98 HeLa, 12 see also cell lines hESC: barriers to development, 123 challenges of therapeutics, 10, 41 discovery, 1, 121 efficacy issues with, 138 history of, 122 impact of regulations on research, 68 safety issues with, 137 innovation, critics of linear model, early adopters, 22 193 importance of human capital, 71 national innovation system, 57 relationship to economic growth, 56 role in creating competitive advantage, 63 role of learning, 66 valley of death, iPSCS: development of iPSC research, 154 discovery of induced pluripotency in animals and humans, 153 future scenarios, 159 immune response, 157 impact of patent reforms, 181 social implications of future applications, 179 transcription factors, 155 International Society for Stem Cell Research (ISSCR), 38 International Stem Cell Research Network, 27 mesenchymal stem cells: fat derived, 108 origins of, 103 potential clinical applications of, 104 see also Mesoblast, Regeneus Mesoblast, 14, 102, 105 patenting, 74 biotechnology patenting, 132 Diamond v Chakrabarty, 131 European harmonization, 132 suspension of stem cell patents, 132 patent rights, 107 Published by Woodhead Publishing Limited, 2012 194 Commercializing the stem cell sciences patenting in the EU, 131 public morality, 132 stem cell patents: in the EU, 76 in the US, 75 US patent system, 130 WARF, 131 patient activism, 23 CIRM, 24 Proposition 71, 24–5 patient-centred therapy, 155 pharmaceutical industry, 30 market share, 31 modelling of, 106 politics of healthcare, 29 criticism of, 35 government investment, 32 inequalities, 34 R&D, 66 funding across the OECD, 67 relationship between public and private funding, 67 taxation strategies designed to encourage investment, 72 Regeneus, 14, 102, 108 state strategies, 58 Australia, 60 Canada, 59 China, 59 India, 59 Singapore, 60 UK, 58 stem cell tourism: as a form of medical tourism, 25 clinic advertisements, 26 Dr Greeta Shroff, 40 Medra, 41 patient choices, 27 patient narratives, 42 technology transfer: role of, 6, 116 see also entrepreneurialism UK Human Tissue Authority, 165 US FDA, 136 FDA Good Tissue Practices Final Rule, 164 US Orphan Drug Act, 21 venture capital, risk and return, 16 transnational venture capital, 80 VetStem, 14 vision repair, 102, 114 Advanced Cell Therapeutics clinical trials, 142 limbal stem cell deficiency, 114 retinal pigment epithelial cells, 142 see also clinical trials workforce: ‘human capital’, 70 in science and technology, ‘star scientists’, 80 Published by Woodhead Publishing Limited, 2012 ... 1.2  Emerging stem cell therapies and the commercialization of biotechnology On the one hand, the stem cell sciences are clearly part of the biotech industry Most obviously, stem cells are biological... influencing the future shape of the stem cell market 1.4.2 The relationship between risk and return The other major factor limiting the potential success of emerging stem cell companies is the relationship... commercialization in the stem cell sciences While the above list suggests a potentially unlimited commercial possibility for stem cell products, there are two core limitations that set the outer limits These