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Thread: Company that uses modified cancer cells to treat stroke victim receives financing for continued clinical trials in humans

  1. #1

    Company that uses modified cancer cells to treat stroke victim receives financing for continued clinical trials in humans


    Company that uses modified cancer cells to treat stroke victim receives financing for continued clinical trials in humans

    From The Deal at URL

    Layton BioScience clinches $10M round

    by Katherine Goncharoff
    Posted 07:00 PM EDT, Aug-14-2001

    Cell researcher Layton BioScience plans to close a $10 million round of venture financing next week, and oddly, credits the current political and ethical battle over stem cells with its success.

    "Our cellular therapy is totally outside of the stem cell debate," said Layton CEO Gary Snable." But the controversy has heightened interest in the sector and has had a "positive effect on our fund-raising efforts."

    The funding is a first tranche of a Series F round led by Bethesda, Md.'s Toucan Capital Corp., which pitched in $3 million, and including Meridan Venture Partners of Radnor, Pa. Layton has not identified other investors in the round. But to date, the Sunnyvale, Calif.-based company has raised $32 million, including this round, from friends, family and angels including Tim Draper, a managing director of Redwood City, Calif.'s Draper Fisher Jurvetson.

    Snable said this first institutional round, which has so far taken a year to raise, will top out above $40 million in three tranches and achieve "a post-round valuation of $80 million."

    Philadelphia's Morgan, Lewis & Bockius llp is advising Layton on the transaction and Wilmer, Cutler & Pickering of Washington, D.C., is advising Toucan.

    Last week, President Bush said he would allow federal funding for stem cell "lines," or self-sustaining colonies already derived from embryos, and on Monday vowed to veto any legislation that aims to push it beyond that.

    Interest in Layton rose after the Bush administration began reviewing the subject in January, raising interest in alternative forms of cellular therapies such as Layton's own.

    The 10-year-old firm has developed a patented cellular therapy that does not involve the use of embryonic stem cells. Rather, the company says its process transforms human cancer cells into viable neurons or replacement cells to treat a host of neurological disorders including stroke and spinal cord injuries, brain tumors and diseases such as Alzheimer's, Parkinson's and Tourette's syndrome.

    Something else sets Layton apart from other cell therapists such as Stem Cells Inc. of Sunnyvale, Calif. and Neural Stem Pharmaceuticals of College Park, Md: It has a product in clinical trial stages and is possibly less than five years away from developing a commercial product.

    Most recently, Layton has been working with physicians at Stanford University Medical Center and the University of Pittsburgh to transplant its lab-grown cells into the brains of stroke patients and to complete the second phase of its clinical evaluation of the safety and usefulness of its therapy.

    "They are trailblazers in the cellular therapy realm that have actually reached the clinical trial stage and so many people are waiting to see how things turn out for them," noted Dr. Ron Cohen, CEO of Acorda Therapeutics, a Hawthorne, N.Y.-based firm that develops therapies for spinal cord injuries.

    "What we like about this firm is that they are three years into clinical trials and they are not working with embryonic stem cells and so they fall under the approved category for cellular research," said Linda Powers, a managing director with Toucan Capital.

    Powers said Layton is the only cellular therapy startup so advanced in clinical trials with humans and no adverse reactions have yet surfaced. Powers also said Layton is ready to increase production of neural cells and, in another sign of its preparedness, is capable of producing two billion cells per week. Many biotech firms don't start tackling production issues until clinical trials are completed, she pointed out.

    "Everyone else in this sector is still working with mouse models or is still working in the laboratory," she said.

    On the other hand, Layton has yet to prove its procedures' safety and usefulness to the U.S. Food and Drug Administration. And some scientists have raised concerns that the cancer cells that Layton uses to create neuron cells which come from a 29-year-old cell line may ultimately cause cancer rather than eliminate it.

    Some critics have said Layton should conduct more research on animals before proceeding with clinical trials on humans. "The burden will be to show that if you do this a great many times that it will indeed be safe," Cohen said.

    But Snable, pointing to the likelihood that years, if not decades, will pass before stem cell technology can be successfully commercialized, is nonetheless optimistic. "That puts us in a nice position," he said.

    [This message was edited by Wise Young on August 19, 2001 at 11:55 AM.]

  2. #2
    I disagree with their assessment that it will take decades before stem cell therapies are applied to humans. What do they think the Diacrin trial and the Russian trials are all about?

  3. #3

    Other links to Layton Bioscience

    It is interesting that Layton has an exclusive license to the technology being developed by Evan Snyder at Harvard regarding embryonic stem cells:

    The founding scientists of the company are all from the University of Pennsylvania, including James Eberwine, Virginia M.-Y. Lee, and John Trojanowski.

    Layton has an exclusive licensing agreement with Stratagene to market the hNT human neuronal cells.

    They also have a partnership with Incyte, a genomic company, to find faster ways of sequencing genes in competition with Human Genomics.

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