Aastrom Biosciences Inc., of Ann Arbor, Mich., made a wrenching decision to terminate its Phase III REVIVE trial in critical limb ischemia (CLI) and shift its focus to dilated cardiomyopathy (DCM). Management cited challenges in enrolling patients for REVIVE and difficulty finding a partner in a reasonable time frame to improve the situation.

The company recently began a Phase IIb trial of cell therapy product ixCELL-DCM in DCM, for which it has a U.S. orphan drug designation. "We are still very bullish about the promise of this technology," Aastrom CEO Nick Colangelo told BioWorld Today.

Colangelo attributed the enrollment difficulties to the complexity of the trial, as well as to challenges identifying patients and convincing vascular surgeons to consider cell therapy as opposed to revascularization procedures.

As well, Colangelo said, "enrollment criteria were a little strict," and it was a slow process getting clinical trial centers, many of them at academic institutions, up and running.

"It was really a business decision," Colangelo said, adding that development in DCM offered a "more streamlined approach" for a company of Aastrom's size.

Still, news sent the firm's stock (NASDAQ:ASTM) falling 44 cents, or 38.3 percent, to close at 71 cents Wednesday.

Just a year ago, Aastrom was riding high with a $40 million private placement with Eastern Capital Ltd. to support the REVIVE trial. The trial was designed to enroll 594 CLI patients with existing tissue loss due to ischemia who have no option for revascularization.

Participants would receive ixmyelocel-T, a patient-specific multicellular therapy expanded from the patient's own bone marrow and delivered directly to damaged tissues.

The product is manufactured using Aastrom's automated, fully closed cell-processing system, starting with a small aspirate from the patient's own bone marrow. The technology then selectively expands mesenchymal cells, monocytes and alternatively activated macrophages – up to several hundred times more than the number found in the patient's bone marrow – while retaining many of the hematopoietic cells collected from the bone marrow sample.

After receiving the therapy, patients would be followed for a total of 18 months, with primary endpoint data of amputation-free survival collected at 12 months and a six-month additional safety follow-up period.

A Phase IIb study of ixmyelocel-T in CLI patients with no revascularization options demonstrated that patients in the treatment arm had a 62 percent reduction in risk relative to placebo in the primary endpoint of time to first occurrence of treatment failure. While the study was not powered to show statistical significance in the secondary endpoint of amputation-free survival, results from a subgroup of 45 patients with wounds at baseline showed a positive trend (21 percent in the ixmyelocel-T group vs. 44 percent for the control event rate).

Along with the new program focus, Aastrom is reducing its staff and operating expenses by 50 percent in a corporate restructuring.

"We have been highlighting the risks to the CLI study, despite the positive randomized Phase IIb data in hand, and it now appears that the enrollment issues became insurmountable," wrote Roth Capital Partners analyst Joseph Pantginis, who assessed Aastrom's risk profile as "much heightened." That increased risk is attributable to renewed financing risk, an earlier-stage lead program, significantly extended development timelines and the challenge to the company of emerging successfully from its restructuring.

"In short, we believe today's announcement was a significant blow to investor confidence and the company is now facing significant headwinds to garner investor interest again," Pantginis noted.

Roth downgraded Aastrom's stock from "neutral" to "sell," and lowered its price target from $1.65 to 25 cents.

Uphill Battle for Financing, Partners

Autologous cell therapies face headwinds with investors due to the logistics involved in manufacturing a patient-specific product. The FDA's approval of Provenge (sipuleucel-T) in April 2010 allayed some of those concerns, though developer Dendreon Corp. disappointed investors when the product experienced a slower-than-expected uptake in the market. (See Bioworld Today, Nov. 5, 2012.)

Pantginis wrote, "From a macro standpoint, we believe there are also two potential readthroughs: 1) continued pharma aversion to partnering autologous therapies and 2) an overall setback to the stem cell arena."

Other companies in the autologous cell therapy space are feeling the pinch, too, though in February, Opexa Therapeutics Inc. landed a deal with Merck Serono SA to develop and commercialize Tcelna (imilecleucel-T), a personalized cell immunotherapy in multiple sclerosis, for $5 million up front and a potential $225 million total deal value. (See BioWorld Today, Feb. 6, 2013.)

The product, previously branded Tovaxin, is tailored to the patient's disease profile. Peripheral blood monomuclear cells are harvested for an autologous pool of myelin-reactive T cells raised against selected peptides from myelin basic protein, myelin oligodendrocyte glycoprotein and proteolipid protein. The expanded, irradiated T cells then are returned to the patient through a subcutaneous injection designed to trigger a therapeutic immune system response.

Yet, in spite of the recent cherry deal with Merck, Opexa's stock (NASDAQ:OPXA) has been volatile, losing 17 cents, to close at $2.44 Wednesday.

Late last year, the Cell Therapy Catapult Center, a UK-based incubator for the cell therapy sector, determined that there is limited investment in the field from commercial backers, with big pharma observing and waiting, while SMEs (small and medium-sized enterprises) that are active lack the finance and breadth of resources needed to advance rapidly. (See BioWorld International, Dec. 12, 2012.)

The center cited a lack of understanding within the pharma industry of what types of therapies are marketable and amenable to commercialization, comparable to druggability in traditional drug development.

Examples of other companies in the cell-based therapeutics space include Athersys Inc., which has MultiStem, a Phase II adult stem cell therapy for ischemic stroke; Mesoblast Ltd., with Phase II-stage allogeneic mesenchymal precursor cells for degenerated interverterbral discs; Neostem Inc., with AMR-001 in Phase I for myocardial infarction; Neuralstem Inc., which has Phase I-stage NSI-566 for spinal cord injury; and Pluristem Therapeutics Inc., with its placental expanded cells Phase I/II for muscle injury.