Pluristem in Talks With Drugmakers on PLX-PAD Licensing

Pluristem Therapeutics Inc. (PSTI), a developer of placenta-based stem-cell therapies, said it has been in contact with drugmakers to set up partnerships for its flagship blood-circulation disease treatment PLX-PAD.

Pluristem wants to be ready to market PLX-PAD as soon as it receives regulatory approval, Chief Executive Officer Zami Aberman said in an interview, without identifying potential partners. After completing two initial clinical trials involving different forms of peripheral artery disease, or PAD, Pluristem plans to start a late-stage study in 2013 of PLX-PAD’s effectiveness in the disease’s critical limb ischemia stage.

“We are talking to more than one of the larger pharmaceutical companies about the possibility of outlicensing our treatment,” Aberman said by phone from Boston. “We are not under pressure as we are sitting on about $40 million in cash, but if the deal is good enough, we’ll take it.”

The company’s stock rose as much as 3.9 percent and was up 2.6 percent at $2.37 as of 9:58 a.m. in New York.

Pluristem’s PLX technology derives cells from placental material, releasing growth factors that promote blood flow, wound healing and artery and vein development to treat a range of ailments. The company is building a manufacturing center near its headquarters in Haifa, Israel, with capacity to provide treatments for more than 150,000 patients.

‘Promising’ Technology

“The fact that they are building this factory even before they have any partnership shows they are taking this effort upon their shoulders,” said Sabina Podval, an analyst at Leader & Co. Investment House Ltd. in Tel Aviv. “Pluristem wants to become a manufacturer of stem cells in a large scale for the bio-pharma industry. Of course there’s a long way to go, but their technology is promising.”

Because they don’t come from embryos or unborn babies, placental cells help the company avoid the ethical and legal debate that surrounds embryonic stem-cell research. Placental cells also aren’t rejected by recipients, which can occur when tissue is transplanted from one person to another.

PAD arises when there is significant narrowing of large arteries supplying blood to the body’s extremities, most commonly the legs. The narrowing is usually caused by cholesterol placquing in the artery and can lead to amputation. About 4 percent of the U.S. population over 40 years of age suffers from PAD, and the market for treatment is worth about $4 billion, according to Pluristem’s website.

Results from the PLX-PAD trials so far have been “solid,” Leader & Co.’s Podval said.

2011 Agreement

Pluristem agreed last year to license stem cells to United Therapeutics Corp. (UTHR) to develop a drug for pulmonary hypertension that will target a $3 billion market. United Therapeutics will finance clinical studies and development costs of the treatment and may pay a total of $55 million to Pluristem, including $7 million up front.

Other conditions for which Pluristem is conducting trials of stem-cell treatments include strokes, multiple sclerosis and nerve pain.

Pluristem, which is listed on the Nasdaq Stock Market in the U.S., is valued at about $106 million. The three analysts tracked by Bloomberg who cover Pluristem have buy or outperform recommendations on the shares.

The stock jumped 13 percent on May 9, the biggest gain in 13 months, after the company said a 7-year-old girl suffering from an aplastic bone marrow experienced a reversal of her condition following an intramuscular injection of its cells.

“Those results sparked a lot of interest in our treatment,” Aberman said. “Of course we will need more data to make a more conclusive declaration.”

Pluristem is also in talks with some governments, including Germany, Israel and the U.S., for grants to conduct large clinical trials of a treatment to counter exposure to radiation, Aberman said.

To contact the reporter on this story: David Wainer in Jerusalem at dwainer3@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

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