GHP June 2017

24 GHP / June 2017 , 1706GH08 Leaders in the Use of Stem Cells to Treat Animals VetStemhas been one of the leaders in the use of stem cells to treat horses, dogs, and cats over the last 14-years. Regenerative medicine is rapidly changing the way veterinarians approach the treatment of many diseases, especially chronic degenerative conditions and those with few therapeutic options like kidney failure. Regenerative medicine provides a wholly new modality by potentially providing the ability to reverse tissue and organ damage rather than just manage the symptoms. The chronic degradation and inflammation caused by diseases such as osteoarthritis can be halted, there is published peer-reviewed evidence of real regeneration of cartilage and meniscus injury (Dragoo 2007, Toghraie 2011, Sato 2012). The use of stem cells also helps spare the use of drugs that might be damaging when used long term (NSAIDS, corticosteroids). VetStem focused its initial efforts on the autologous (patient’s own cells, henceforth called “Auto”) approach due to lower regulatory hurdles through the FDA. This essentially means that VetStem has been a service lab where the veterinarian provides a small sample of fat collected from the patient and ships the fat to VetStem for stem cell extraction. VetStem immediately extracts the stem and regenerative cells in a laboratory, esssentially adhering to FDA Good Tissue Practices regulations. The extracted cells are then sterile packaged and returned for immediate use, while freezing the balance of the cells for future use. The autologous/service approach is the “proof-of-concept” model that has demonstrated with over 12,000 patients (dogs, cats and horses) that adipose stem cell therapy can be effective and safe for a number of conditions. VetStem has authored more than 14 manuscripts and book chapters on this adipose stem cell therapy. However, due to the cost and required surgery involved with autologous stem cell therapy, the end game is a “pharmaceutical” model with the development of an allogeneic or “Universal” cell product, much like a universal blood type. The advantages to allogeneic stem cells are: 1. Immediate “off-the-shelf” availability 2. No surgery or lab processing required 3. Lower cost of goods and cost to vet/owner 4. Higher gross margins There are already human allogeneic (called “Allo” henceforth) products approved in Canada, Korea, the European Union and veterinary Allo products marketed in Australia. VetStem is committed to the development and regulatory approval of a platform of Allo “Universal” stem cell products for the veterinary markets. Pet owner’s views of therapy options are changing as well. The owner calls received by VetStem Customer Service staff are often about the alternatives to chronic drug therapy. The owners of these affected pets seem to have a much better understanding of the potential side effects correlated with chronic drug therapy. The FDA Center for Veterinary Medicine published a summary of adverse events and showed that NSAIDS (pain medications) account by far for the largest number of adverse events from licensed drugs. Owners understand this and with the market withdrawal of human drugs like Vioxx, they are seeking alternatives for their beloved pets. This 14 year product development journey provides a treasure chest of clinical, manufacturing, and commercial knowledge which enabled VetStem to develop a proprietary product platform including full GMP manufacturing facilities and methods. VetStem’s current autologous business operation generates revenue that helps cover the basic operating costs of the business while developing the allogeneic product. VetStem also has their first commercial partner, Aratana Therapeutics, which is funding the first Allo product for canine osteoarthritis. This funding covers the actual cost of development plus overhead, and pays milestones of success toward FDA approval. Upon FDA approval, Aratana will purchase the product from VetStem, market and sell the product, and pay royalties to VetStem. VetStem has assembled an executive development team with expertise across the spectrum of cell therapy. Carolyn Wrightson, Ph.D., our COO and head of manufacturing, had a prior successful career in developing gene-sequencing technology at Sequenom before joining VetStem in 2007. Our head of Research, Kevin Hicok, MS., has had a 20+ year career in cell therapy spanning from the Mayo Clinic, to Osiris Therapeutics to the human adipose stem cell company Cytori Therapeutics, before joining VetStem. Many other key team members have careers in human and veterinary