Major embryonic stem cell biotech company going out of business
NEWARK, California, July 6, 2016 (LifeSiteNews) — A California biotech company specializing in the use of fetal stem cells for research is going out of business.
StemCells, Inc. will cease operations, Reuters reports, in the wake of the company terminating a mid-stage test of its spinal cord injury therapy, and six months after it had said the therapy was showing promising results.
The Food and Drug Administration (FDA) approved StemCells, Inc.’s research using fetal brain tissue to treat macular degeneration in 2012, with the fetal brain tissue coming from miscarried or aborted children.
The biotech’s press release on the FDA authorization at the time referred to its proprietary product in the trial, HuCNS-SC, as “purified human neural stem cells.” However, the description of the HuCNS-SC as “fresh human fetal brain tissue,” available at the time elsewhere on the StemCells, Inc. website, has since been removed.
StemCells, Inc.’s focus remained on its HuCNS-SC for research on spinal cord injury, retinal disorders and neurodegenerative diseases.
The company opted to end the spinal cord study after an in-depth review of data from the study and getting “concurrence” from the study’s Interim Analysis Data Monitoring Committee, it said, with analysts saying “tough market environment and long clinical path ahead drove a financial/clinical failure.”
“In light of the decision to terminate the Pathway Study, the Company’s available strategic alternatives and its current cash position, the Board of Directors approved a plan to wind down the Company,” its announcement on terminating the study and ceasing operations stated. “As part of this process, the Company will evaluate opportunities to monetize its intellectual property, including data collected in its studies and trade secrets, as well as the transfer of its proprietary HuCNS-SC cells and other assets through a potential sale.”
StemCells, Inc. said it will lay off its 50 employees and record a one-time charge of approximately $1.25 million in the third quarter ending Sept. 30. The company’s stock plunged 85 percent with the announcement.