Geron halting studies on human embryonic stem cells

November 15, 2011
Geron halting studies on human embryonic stem cells
By Steve Johnson | McClatchy-Tribune News Service

SAN JOSE, Calif. — In a significant setback for stem cell research and many desperate patients, Menlo Park, Calif.-based Geron, the first company ever permitted to test human embryonic stem cells on people, announced Monday it is halting the studies to focus on developing two cancer drugs.

"It's a disappointment clearly, particularly to patients who are hoping for the rapid translation of stem cell research into therapies," said Dr. Arnold Kriegstein, director of the Broad Center of Regeneration Medicine and Stem Cell Research at the University of California, San Francisco.

Researchers have long held out hope that embryonic stem cells would be the key to treating a variety of ailments because they can turn into any type of tissue in the body and be reproduced in vast quantities in laboratories. But studies to develop treatments from them have been subject to delays in part because of ethical concerns surrounding the cells, which are harvested from discarded 3-to-5-day-old embryos. Monday's decision throws into question the future of the most-advanced study so far and puts a cloud over the commercial viability of stem cell treatments.

The announcement by Geron, which last year began an unprecedented study of human embryonic stem cells in people who had suffered spinal injuries, was distressing for longtime stem cell advocate Don Reed of Fremont, Calif., whose son Roman Reed was left a quadriplegic after breaking his neck in a college football game.

"This is a setback and it's a sadness," said Reed, who has closely followed Geron's efforts to develop a treatment for spinal injuries. But like Kriegstein, Reed said he is confident others will continue research into the cells, adding that the company's decision "in no way affects our confidence in what is to come."

David Greenwood, Geron's president and chief financial officer, said halting the stem cell studies was not something the company took lightly.

"This is a decision made quite reluctantly by our board," he said. "We pioneered this field."

But he noted that Geron - which also said it would eliminate 66 jobs, or about 38 percent of its workforce, as a result of Monday's action - had no choice, given its financial bind.

Although the company has sufficient finances to cover its cancer-drug costs over the next 20 months without having to raise more money, it noted in a news release, "this would not be possible if we continue to fund the stem cell programs at the current levels."

Although no problems have turned up so far in the stem cell study, Geron's cancer-drug studies are further along, making them a better bet for the company to pursue, Greenwood said. He added that it would have been difficult raising cash to continue studying both types of treatments, given Geron's stock price, which has fallen from $5.16 at the beginning of the year to $2.20 at the close of trading Monday. In after-hours trading following the stem cell announcement, Geron's shares sagged further to $1.82.

Besides the spinal research, Geron had been studying human embryonic stem cells as possible treatments for such ailments as diabetes, heart disease and cartilage repair. The company said it would attempt to seek "partners" to continue the research and "will retain a core group of employees from its stem cell operations" through the first half of next year to "facilitate transfer of these programs" to someone else.

Greenwood said Geron has "discussions under way" with at least one interested company, but declined to identify it.

Incorporated in 1990, Geron has been among the world's most closely watched biotech companies because it was the first to receive U.S. Food and Drug Administration approval to test human embryonic stem cells on people. Many other companies are working with adult stem cells, which can be harvested from various parts of the body.

Geron spent more than 15 years and $150 million developing its treatment for spinal injuries, which the FDA approved for human testing in July 2010. The study is designed to determine if the cells can regrow a spinal insulating material, called myelin, which often gets stripped away in patients suffering severe spinal injuries. The first phase of the test, which so far has involved four patients, is designed to see if the treatment has any unanticipated side effects.

To finish the first phase, Geron had planned to test the treatment on about 30 patients, Greenwood said. Later stages of the study would examine whether the treatment is effective at regrowing myelin and helping paralyzed patients regain movement.

Last November, the FDA gave a second company - Advanced Cell Technology of Santa Monica, Calif. - approval to also test human embryonic stem cells on people. That test is being conducted on patients suffering from a rare disease that causes a serious loss of vision.

One human embryonic stem cell researcher - Ralph Snodgrass, founder and president of South San Francisco-based VistaGen Therapeutics - said Geron's exit from the stem cell area might encourage other companies to jump into the field to take advantage of the void it is creating.

"We might be interested in licensing some of their patents," he said. "It might be a win-win."

Officials with the state's $3 billion taxpayer-financed stem cell institute, the California Institute for Regenerative Medicine, issued a statement also expressing confidence that stem cell studies would continue to flourish, despite Geron's decision.

"We are optimistic about many exciting stem cell programs in California and internationally that have the potential to treat chronic diseases and conditions and that will benefit from the regulatory path first forged by Geron," according to the statement, which quoted Ellen Feigal, the agency's senior vice president for research and development.

Syeve Johnson writes for the San Jose Mercury News.

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