On September 12 and 13 of 2016, FDA conducted public hearing on clarification of regulatory guidances for cell therapy. In my view, it was historic event, because it was the first-of-its-kind public hearing for cell therapy field. The reason for the hearing was unexpectedly high number of controversial comments about 4 guidances that FDA released in 2014-2015. These guidances are aimed to clarify FDA’s current thinking on regulatory classification of Human Cell Tissue Products (HCT/P) and included definitions of “same surgical procedure“, “homologous use“, “minimal manipulation” and “adipose tissue-derived products“. The latest guidance was released almost a year ago, so it was long overdue to have this public hearing. Unusual public participation and controversial comments made FDA to reschedule this event from April to September and split it for 2 days. You can watch recorded webcast here and here.

General comments
FDA was criticized for waiting too long to have hearing to finalize these 4 guidances. It may take up to one year more to see final versions of these guidances. I completely agree with this criticism – up to 3 years from guidance release to final version is way too long. In a meantime, uncertainties, related to different statements in the guidances and some rooms for interpretation of current law make things even worse. It could contribute to proliferation of so-called domestic “stem cell clinics”, continuous unfounded marketing of 361 HCT/P with periodic warnings from FDA and undermine the public trust to FDA.
It is important to understand that hearing is not a favor from the Agency, it is a rule to comply with, in situations when FDA has a lot of comments from confused public. The mission of FDA is to serve public, therefore, they must to hear and learn from the public to amend regulation accordingly. This is a basis of democracy. Unfortunately, it is very hard sometimes to find a common ground between all stakeholders and FDA. And it was exact the case that we have been observing during the hearing. It will be impossible to find common ground here, because opinions of different stakeholders are so radical for some positions of regulation. One may appreciate how difficult it will be for FDA to decide and finalize these guidances.
It is also important to understand that FDA guidances are not enforceable laws, but a tool to explain current law in greater details and give recommendations “to improve stakeholders understanding”. Therefore, guidances must be in accordance with current law, but not depart from it. The current law, which defines HCT/P regulation is 21 CRF part 1271. FDA was criticized by some speakers that some positions in guidances are different from language, used in 21 CRF part 1271 (see examples below) or in letters to developers, therefore such deviations may look like an attempt to modify existent regulation or introduce new one. Guidance is not a right (read unlawful) tool to introduce new regulations. I agree with this criticism – FDA should be very very careful with language and introduction of new terms.
Because so many people wanted to speak, FDA allocated only 5-minute slots for each presenter. Some scheduled speakers were not able to make to the hearing (I assume, most of them are patients), but unfortunately, FDA did not use these empty slots for extended discussion, so a lot of time was wasted. Importantly, only FDA panel was allowed to ask questions during hearing, nobody else, so discussion was impossible. This rule seems very strange to me.

Patient perspective
Patients were heavily present on a hearing and were the most passionate speakers. The most common appeals to FDA from patients were “do not regulate our own cells (bodies) as drugs”, “leave decision about auto- cell therapy on us and physician”. Almost all patients presented successful cases of their treatment by autologous adipose tissue -derived cells. Unfortunately, there were no patients, who got harmed by unapproved “stem cell interventions” (few such cases were presented by ophtalmologist right before hearing). Unfortunately for patients, FDA would not get emotional about these cases and tweak the regulation as requested by them. For FDA, patient cases is bunch of anecdotes, without solid scientific evidence. FDA needs studies, which will deliver this evidence. Still, I think, it was useful exercise and FDA learned something from patient testimonials.

Structural versus nonstructural tissues and homology of use
Many speakers expressed concerns, confusion and disagreement on regulatory classification of tissues as “structural” and “nonstructural”. I agree with these concerns. The problem is that FDA defines minimal manipulation and homology of use, based on this tissue classification. This classification was expanded with examples in the guidances. But, based on scientific evidence, such simplification is wrong. Several speakers brought up evidence for many “nonstructural” functions of adipose tissue and amniotic membrane. It was proposed to determine homology of use and degree of tissue manipulation based on either structural or nonstructural functions of one tissue, depending on manufacturer’s objective intent, but not FDA classification. Importantly, previously FDA described nonstructural functions of adipose tissue and amniotic membrane, but then ignored it in “minimal manipulation” guidance for determination of homology of use and degree of manipulation, claiming these tissues as purely structural. FDA should be consistent in their language.
A new key word (used in “minimal manipulation” guidance) for bifurcation to structural and nonstructural tissues is “main function”. This term was not used before and may significantly limit examples of homologous use. For this reason, some people (representing organizations) are proposed to eliminate term “main function” from the guidances. It was also proposed to eliminate “performs the same functions as in donor” from defining homology of use. For example, fetal tissues (plalcenta/ amnion) in wound coverage.

Functional homology
One of the most interesting “take home” messages from the hearing for me was proposal to extend definition of “homologous use” to mesenchymal stromal cells or other cells, which act through paracrine mechanisms. It was proposed by few academics (Arnold Caplan, Keith March and Joanne Kurtzberg), who said that there is scientific evidence for it. For example, March proposed to use term “functional homology” for MSCs from tissue as opposite to “structural homology”. March and Caplan said that irrespective of tissue of origin, after transplantation MSCs perform the same (= homologous) basic functions – paracrine, angiogenic- and anti-inflammatory. Ability of MSCs from any tissue, combined with endothelial cells from any tissue, to induce vasculogenesis in any tissue/organ was cited by March as example of “functional homology”.
Kurtzberg said that autologous cord blood transplantation cells in cerebral palsy should be considered as homologous use, because cord blood cells (e.g. monocytes) here are acting through signaling or paracrine mechanisms – which is their basic function in both donor and recipient. Unlike, hematological conditions, cord blood stem cells do not integrate/ differentiate in host brain. Engraftment and differentiation in other tissue would be considered as non-homologous.
I don’t think FDA will buy “functional homology” concept and paracrine mechanisms of MSCs as homologous. It sounds like “systemic metabolic” effects – a way no go for 361 pathway. But Kurzberg raised very good question about auto- cord blood transplant in cerebral palsy – since this type of therapy is not commercialized, who would hold the BLA – family, cord blood bank or hospital? FDA has to answer this question.

Adipose tissue
Pretty much all speakers expressed disagreement with FDA’s classification of adipose tissue as structural tissue exclusively. Such classification obliterates almost any use of adipose-derived cells outside of plastic/ cosmetic surgery (see more here). Also, everyone disagrees on classification of breast re-shaping by adipose tissue transfer as non-homologous use (because primary function is production of milk). Some commenters also disagreed on classification of adipose tissue decellularization as more than minimal manipulation, saying that this procedure does not alter structural function.
What concerning to me is FDA’s ignorance of scientific evidence for multiple functions of adipose tissue as connective tissue. Guidance says: “Because connective tissue provides structure and support to the body, FDA considers connective tissue, including adipose tissue, to be a structural tissue.” Common guys, what about blood or bone marrow? It is a connective tissue, why don’t you classify it as structural?
It is important to distinguish fat grafting (transfer) for cosmetic purposes and cell (usually refer as “stem cell”) isolation from adipose tissue for multiple (non-cosmetic) applications. Some speakers did not distinct these 2 ways of intended use in their talks. I don’t think FDA has any problem to leave fat grafting alone (with exception of breast – see above). But I don’t think FDA will change its position to anything related to SVF and other cells, isolated from adipose tissue, intended for other than cosmetic applications.

Alternative regulation
There were multiple appeals to FDA to create alternative pathway for autologous cells. Randal Mills of CIRM vaguely asked for some kind of “middle ground” regulation, but did not present any plan for what it could be potentially. Cord Blood Association (J. Kurtzberg) says that “current regulatory framework for drugs is not sufficient for cells”. If FDA decide to ease current regulation in favor of 361 products, the control and monitoring system could be achieved by (i) registration and inspection of surgical sites (proposed by ISCT) and other facilities, (ii) facility accreditation (by FACT or AABB) and (iii) creation of patient registries (example: GRAFT registry – recently created by plastic surgeons). Proposed REGROW Act was mentioned by few speakers, but was barely discussed as real alternative. FDA panel asked zero questions on alternative regulatory pathways for autologous cells, confirming their position (voiced somewhere before) that the current system is sufficient enough.

Cracking down on stem cell clinics
This hearing was portray in the media as a way to crack down on proliferation of “stem cell clinics” (see here and here), marketing unproven interventions. But I don’t know how exactly finalization of these guidances will affect these clinics. Let’s be realistic – final version of guidances will not magically shut down hundreds of clinics. The real problem of FDA is law enforcement. If they had a muscle, they would shut down some of clinics already, but it did not happen. Also, I’m not optimistic about “perfect language” in the final version of guidances, which will make everything crystal clear and close all loopholes.

Concluding remarks
I think, it was great and very useful hearing. Overall, I was able to count only 3 speakers, who fully agreed with existent regulation and guidances. Most of organizations (societies, foundations, associations…) provided very good constructive comments for each statement in each guidance and offer FDA their help. I don’t believe FDA will leave these guidances unchanged. Agency must respond to inconsistencies, confusions and some scientifically unfounded concepts, pointed out by multiple speakers during the hearing. I think, at least they will remove “breast re-shaping by adipose tissue is non-homologous use” example. FDA may respond by changing classification of adipose tissue as exclusively structural. I think, FDA will add examples to the guidances for homologous use (for example, umbilical cord tissue) and for minimal manipulation (for example, centrifugation in fat processing). It was asked by many organizations.
General public and some professionals believe that with these 4 guidances FDA is departing from its goal: “to improve protection of public health without imposing unnecessary restrictions on research, development, or availability of new products”. It will be very hard for Agency to convince general public that FDA does not impose unnecessary restrictions. Unfortunately, it will be impossible to convince patients. But I believe that such public hearing can change something and help to make educated scientifically founded decisions for improvement of regulation.
I’d highly encourage you to watch recorded webcasts (overall 9 hours) and learn! Of course, many speakers pushed their agenda and were biased, but, still it was very educational and useful.

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Few months ago I was watching presentations from Bipartisan Policy Center on support of REGROW Act as alternative regulation for cell therapy, proposed to FDA. I was especially intrigued by presentation of Randal Mills – President and CEO of California Institute for Regenerative Medicine (CIRM). Here is a quote that I’d like to discuss today (watch min 7-8):

It is not difficult to conclude that there is some sort of regulatory problem that exists. The current paradigm has been in place for 15 full years, and there is zero (nothing!) on a scoreboard for stem cells. And there is nothing that is close. So, we don’t actually know how long it will ever take, it’s all theoretical at this point. So, we gonna fix that!

To prove that it is not just his imagination, next minute, he referred to a survey of CIRM stakeholders, 70% of which blamed FDA in stalling stem cell therapy development:

Every group, and it was shocking to us, every group listed FDA as a single biggest impediment to development of stem cell therapy. That’s in state of California.

I’d encourage you to whole whole presentation, but one more important thing to mention here is his argument for so-called “on-pathway” (current over-regulation by FDA), which involves by estimates ~15 years and ~$1B investment for development of cell therapeutic (slide 14):

No one has gotten through it, but we’ve had a lot of people had dropped out that race.

You can also read Mills writings here and here. In brief, he as well as CIRM stakeholders, put whole blame for absence of approved stem cell therapeutics in US on FDA – regulatory framework for cells, created by FDA about 15 years ago was promising, as proposed, but it never delivered.

This “let’s blame FDA” position is very different from what I’ve heard on multiple conferences that I’ve attended. Many stakeholder, especially product developers from “compliant industry” claimed that FDA is a partner, but not a barrier. Every developer, who was asked about their experience with FDA said that the Agency was very helpful and engaging since the first day of communication.

I was trying to memorize “stem cell products”, which were “killed” by FDA (to confirmed Mills statement “a lot of people had dropped out that race”), but did not find any example. The only possible candidate was Prochymal – mesenchymal stromal cell-based product, developed by Osiris, which failed few Phase 2/3 trials in several indications. Mills was CEO of Osiris exactly that time. Seem like Mills got frustrated with FDA, which did not like Prochymal’s efficacy data, and, product was eventually divested to another company (Mesoblast). But, to me, Prochymal was not killed by regulators. It was not good product with only moderate efficacy profile in some subsets of patients. Also, I think, developer (Osiris) failed with trials design. Seem like there is no reason to blame FDA here.

Now, let me articulate my opinion. I think, most, if not all stem cell products-candidates were not good in the past 15 years. To me, this is a major reason for absence of approved stem cell products in US. If product will perform exceptionally well in trials, FDA would greatly support it! I may be too naive, but it’s my feeling now. So, I’d respectfully disagree with Dr. Mills and CIRM stakeholders on this. Regulatory uncertainty, to be fair, may also played some role for few developers, but not the major.

I was wondering what other people think of this and, first asked my followers on twitter. Here is result of my brief poll:

2/3 of my followers agree with me – we have to blame developers for bad products, first of all. Some industry professionals voiced their opinions publicly on this. The most recent example is CEO of British company Celirix, who said: “Lack of innovation is the only barrier when it comes to cellular therapies”. I’d also like to note that I saw few surveys on barriers to deliver cell therapeutics to the market and all of them include “regulatory issues” option. If you’re a developer, who answering such survey, would you admit that you’re product suck? When developers answering these survey they usually have no idea how their product will perform in advanced phases of trials and whether design of the trials will be just right.

In the past few years different cell therapy stakeholders were surveyed on barriers to translation. It seem to me, only CIRM survey shows FDA as a single major barrier. For example, industry organization ARM surveyed Biotech companies on investment in regenerative medicine in 2014 and concluded:

The companies surveyed believe regenerative medicine products have the ability to succeed within current regulatory frameworks, but product consistency and lack of standards could be the single greatest barrier to their growth.

Another examples of surveys (more general, on cell products) you can look at here, here and here. Efficacy, funding, manufacturing, cost-effectiveness among with regulatory requirements are all in the complex mix of challenges for commercial translation of cell therapeutics. But remember, efficacy will drive everything! If your product as efficacious as 50-90% in “no option” patients and potentially curative, regulators will love you, tools manufacturers will find a way to make it cost-effective and affordable, investors will shower you with money!

Finally, I’d like to ask you – if you know any examples of great stem cell product candidates, which were “killed” by FDA, please bring it up in discussion! I’d be happy to learn. Obviously, it is not about cells from fat as practice of medicine, but all about commercial cell product-candidates in development.

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Why price for cell/ gene therapy products is so high?

by Alexey Bersenev on September 6, 2016 · 0 comments

in business

The topic of pricing cell and gene therapies is very hot right now. The price tags for the most approved cell/gene therapy products are high and there is no one simple solution to address their reimbursement and adoption. The world’s most expensive drug is gene therapy drug Glybera, has captured a lot of attention in the media and facilitated pricing/ reimbursement discussions among professionals. Here I’ll try to highlight major reasons for high prices of cell/ gene therapy products as introduction for the further discussion on reimbursement and widespread clinical adoption. I was inspired by the recent analysis of Mohamed Abou-El-Enein, where he discusses challenges for commercialization of cell/ gene therapeutics in Europe.

First, let’s look at some price tags for the approved cell and gene therapy products on a market (all prices in USD):
cell products
ChondroCelect (Tigenix) in Europe ~ 24,000 (20,000 euros)
Provenge (Dendreon/ Valeant Pharma) in US = 93,000
Temcell (JCR Pharmaceutical) in Japan = 115,000-170,000
HeartSheet (Terumo) in Japan = 120,000
Cartistem (Medpost) in S. korea ~ 20,000-40,000
Hearticellgram (FCB-Pharmicell) in S. Korea = 19,000
Prochymal (Osiris Therapeutics/ Mesoblast) in Canada ~ 200,000 (20,000 per dose)

gene- and cell/gene products
Glybera (uniQure) in Europe ~ 1.1-1.4M
Strimvelis (GSK) in Europe = 665,000
Imlygic (Amgen) in US = 65,000

As you can see, compared to conventional drugs, prices for cell/gene therapy products are much higher. Some of them could be comparable to biotech drugs (monoclonal antibodies). However, such gene therapy drugs as Glybera and Strimvelis, will make to the Forbes top 10 world’s most expensive drugs list.

This list begs the question – Why cell/ gene therapy products are so expensive? I’d like to summarize the major reasons for high pricing of cell/ gene therapeutics. Most of these reasons were recently discussed in nice analysis by Mohamed Abou-El-Enein.

1. High cost of manufacturing
The cost of manufacturing of cell product is incomparable with small molecules (Pharma) or biomolecules (Biotech). It is much higher, but, mostly for autologous cell products. In general, manufacturing cost of auto- product is at least 10 times higher than allo-. For example, manufacturing of auto- T-cell product in academic facility could not cost less than $7-10k, with average numbers around $30-50k. In Pharma and Biotech, there is no such thing as medicine made of your own cells or biomolecules. Before cell therapy era, Biotech was unfamiliar with the concept of 1 batch = 1 product.

2. High cost of delivery
Cell products are extremely fragile biologics with very complex supply chain. For “fresh products” (Holoclar, Provenge), short shelf life is associated with high risk of potential product loss. For cryopreserved products, cold chain logistics and multi-site distribution is very costly and associate with their own risks. Overall, the cost of storage and shipment of cell therapy products is much higher than for conventional drugs. At the end, high cost of delivery added to manufacturing cost and embedded into price tag.

3. Lack of comparative studies as evidence for reimbursement scheme
Most approvals of cell and gene therapy products in US and Europe are relatively recent and were obtained in the last 7 years. After few years on the market, studies of cost-effectiveness, which can compare new approved product with predecessor or analog, are not available. Due to lack of these studies, payers do not know how to reimburse (and, in general, confused by high price tag), perform health technology assessment and negotiate pricing with manufacturer.

4. Lack of competition
Currently, only few dozens of cell/ gene products achieved regulatory approvals worldwide. Most of them are taking unique small market niches without competitors. As a consequence of absence of competition, manufacturers can set any price that market can bear. Obviously, with coming of new generation (means better) products, competition will drive prices down.

5. Small market size
The recent trend (at least in Europe) is approvals for rare (orphan) diseases (the best examples – Glybera and Strimvelis). Orphan disease means small market. Don’t expect blockbuster sales here. Abou-El-Enein absolutely correctly said that approvals for orphan diseases “place manufacturers into pricing predicament”.

6. Potential for cure (high utility therapies)
One of the strongest argument in justification of high pricing is delivering a cure or “potential cure”. Some cell/gene therapies can deliver a cure with 1 shot! Many people would say that cure can justify any cost (high price for high payoff). It is suppose to be true – we are expecting from cell/ gene therapy products something big, something that conventional drugs or biologics cannot deliver – very high therapeutic value in a form of cure. In reality, very long-term observational studies are required for precise valuation of cure. For example, CAR T-cell therapy is promoted by many developers as “curative” (so, high prices could be justified), however, more than 30% of patients with B-cell malignancies will relapse 1 year after receiving CD19-CAR T-cells. Six-years outcome data analysis made uniQure to change promotional language from “cure” to “long-term benefit” and “potentially curative”.

7. Hunger for ROI
After investing a lot of time (roughly 20 years for development of 1 cell therapy product), tons of money for development of manufacturing, regulatory compliance and clinical trials, developers are very very hungry for return on investment. They want to recap R&D expenses ASAP and go for profit. In my opinion, that’s one more and very important contributing factor for high prices. It is very different for Pharma and Biotech, where many new drugs developed internally (without painful tech transfer from academia) by big profitable corporations. As of today, vast majority of cell/ gene therapy developers are going through tech transfer processes, do not generate profit and almost entirely rely on money of investors.


Is cell therapy failing commercialization in Europe?

August 19, 2016

Christopher Bravery – a consultant on advanced biologicals, has opened Cell Therapy Stream of the annual Bioprocessing Summit with worrisome note: “Half of approved cell and gene therapy products on European market eventually failed commercialization and were withdrawn“. Let’s look at it in details. Since introduction of regulation cell/ gene therapy as Advanced Therapy Medicinal […]

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FDA calls for collaboration on CAR T-cell therapies database

March 16, 2016

CAR T-cell therapy is disruptive technology on many levels. One of such levels is regulation. On the one hand regulators have not seen such impressive efficacy data for long time and it is very inspiring (FDA keeps awarding CAR T-cell developers with “Breakthrough Therapy” designation). On the other hand, high efficacy “comes with a high […]

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Spinal mass formation after auto- transplantation of olfactory cells in patients with spinal cord injury

February 13, 2016

The recent report, published in Acta Neuropathologica, describes 2 cases of spinal tissue mass formation after local transplantation of autologous olfactory mucosa in patients with spinal cord injury. Both patients underwent cell translplantation 7- and 5 years ago in Portugal as part of clinical trial. Patients were evaluated at University of Michigan Medical Center for […]

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Brain tumor after infusion of fetal liver-derived cells in patient with diabetes

January 24, 2016

I’m continuing to document of all clinical cases reports on complications of cell therapy with focus on regenerative medicine. I’m trying to capture all published autopsy or pathology reports. I believe, such database will equip professionals with a knowledge and allow to avoid mistakes in future translation of cell therapies. Today, I’m going to highlight […]

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On conditional approval of cell therapy products

December 20, 2015

As you may know, about 2 years ago Japan has passed a new law for regulation of Regenerative Medicine. Under this law, the regulatory pathway for commercial cellular products is significantly accelerated by skipping of typical “Phase 3 trial” and allowance of marketing authorization after demonstration of safety and some (minimal) signs of efficacy (Phases […]

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Results of regenerative medicine clinical studies from 2014

March 1, 2015

Starting from 2014, I was trying to capture results of clinical studies in cell therapy. Today, I’d like to share some results of this attempt. I decided to narrow down my analysis to regenerative medicine, since most of cell-based therapies with published results belong to this category. Inclusion criteria and definitions Clinical study defined as […]

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Trends in cell therapy clinical trials 2011 – 2014

February 14, 2015

Post updated on Feb. 17, 2015 Today I’m sharing some of my data for the last 4 years. This is a snapshot of trends in cell therapy trials from 2011 to 2014. This year, I’m planning to make few posts on cell therapy trends. I’d like to analyze some trends in mesenchymal stromal cells, adipose […]

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