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Secret Cytori

By Mike HavrillaMay 15, 2007

Cytori Therapeutics (Nasdaq: CYTX), a micro-cap stem-cell therapy developer, is not as well-known as many of the more publicized and controversial embryonic stem-cell companies, such as Geron (Nasdaq: GERN). Cytori's proprietary Celution System is capable of processing a small sample of fat tissue from a patient in about one hour, and then delivering a concentrated dose of regenerative stem cells back to the patient for applications such as breast reconstruction and heart attacks. The Celution System avoids the ethical controversy of embryonic stem cells, instead relying on the patient's own fat tissue to provide the ultimate in personalized, regenerative stem-cell therapy without the hassle and cost of storage.

Last week, Cytori reported a first-quarter loss of $8.7 million, versus $7.5 million in the year-ago period. At the end of the first quarter, Cytori reported a cash balance of just less than $25 million. More importantly, the company plans to launch its first medical stem-cell device in Europe this year, with a market debut planned for Spain and Italy. After the European launch, Cytori hopes to be granted full FDA approval for a late 2008 product launch in the United States. In the first quarter, the company also initiated a chronic ischemia trial and made preparations to begin heart attack and breast reconstruction trials.

While Cytori may be a lesser-known player in the field of adult stem cell therapy, its unique approach of providing personalized, regenerative stem-cell therapy to patients without the cost and hassle of storage makes it a stock to watch in the coming year.

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Fool contributor Mike Havrilla, R.Ph., B.S., Pharm.D., is a Rite Aid pharmacist who lives, writes, works, and enjoys running on the streets and trails in the small Pennsylvania town of Portage. He invites your comments and feedback. You can check out his picks and pans, along with the collective stock-rating wisdom of Foolish investors, at the free CAPS community home page -- where you can join in all the fun! Mike does not have a position in any company mentioned in this article. The Fool has a disclosure policy.

Tom hat mir auf ein paar Fragen nach dem CC geantwortet - um 7.51 deutscher Zeit. Bei neun Stunden Zeitverschiebung war das wohl kein kurzer Arbeitstag

-> Antworten fett!!!
-> daraus folgende Interpretationen meinerseits kursiv!!!

1) I´m not sure if I understood it right that patient enrollement for Restore II (70-100 patients) at 5-10 clinical sites will take 12 months - so enrollement would be completed when the JV in Nagano goes online. That really seems extremely long for me in respect of the relatively low number of included patients. Or did Marc intend to say that enrollement + 6 month follow-up + data reporting would probably be finished until the launch in Nagano!

Marc meant to say six month enrollment plus six month follow up, but as with all trials, this is an estimate as enrolling patients that meet strict criteria can be hard to predict timing wise.

Also habe ich es im Conference Call tatsächlich falsch verstanden. Sehr schön, d.h. die Rekonstruktionsumsätze werden meiner Meinung nach in 2009 aufgrund der Kostenerstattung und einer erhöhten Akzeptanz nach Produkteinführung in 2008 gut durchstarten

2) In which timeframe following data reporting from Restore II do you expect to receive clearance from the reimbursement agencies?

Again, there are so many variables, it's hard to give a specific date, however our goal is Q4 2008 to early 2009. But it's hard to know for certain.
 
3) You always choose the phrase "prepare for market launch in Europe and Asia." Does this mean market launch in Japan in 2008? In case this does not mean Japan, which countries are you talking about where you can go to market without official approval for the device and the procedure?

To my knowledge the Roadmap anticipates Japanese approval for Celution in the first half of 2009. Is the indication "breast reconstruction" already cleared with the MHLW Agency or do you still have to file for the approval based on the Restore I data or is additional data needed? Which timeframe do you anticipate for final approval in Japan?

For 2008, you should focus your analysis mostly on Europe for therapeutic-based revenues on the Celution System. We have not disclosed any further specifics yet related to our regulatory strategy in Japan and Asia as it's something we're still navigating. However, there could be some limited sales in some of those regions if researchers were interested in using the system as lab equipment for research.

Da  bleibe ich bei meiner Aussage, dass wir wohl dort im nächsten Jahr einen Vertriebspartner haben, mit dem die Umsätze geteilt werden. Die Asiaten sind einer bessere Visionäre als die Amis +  Europäer - nice upfront

4) You repeatedly mentioned the goal to receive final 510(k) approval for Celution in the US in late 2007. Do you guys have to file an IDE thereafter for a specific indication and to run a trial in that respect to get approval from the FDA for that indication? Or is it also possible to offer Celution to the private payer market in the US following final 510(k)?

It's not clear until we have further discussion with the FDA. It's likely application-dependent. However, we definately expect we'll need to conduct trials in the US for cardiovascular applications.

ist wohl noch zu früh, das im Detail zu prognostozieren. Evlt. reicht für eine reine Vertriebserlaubnis wie im Februar für Europa erhalten ja schon die Datenauswertung von RESTORE I und RESTORE II. Die FDA-Verhandlungen werden wohl erst nach Erhalt der finalen 510(k)-Zulassung Ende dieses Jahres begonnen. Für eine Kostenerstattung durch die Reimbursement Agencies/Medicare wird aber wohl defintiv ein separater Pivotal für die USA notwendig

5) To my understanding Celution launch in Europe in 2008 is only targeting the breast reconstruction indication. That will remain a private payer market until the reimbursement agencies have reviewed the Restore II data. So  why don´t you extend the targeted patient population by also selling the device to for cosmetic applications (wrinkle removement, breast augmentation...) from the beginning. When do you anticipate to offer the procedure to the cosmetics market?

For 2008, we expect to launch under non-specific claims for reconstructive surgery, which would not specifically include breast reconstruction.

 
Für mich eindeutig die beste Antwort von allen. Das bekräftigt imho auch die etwas nebulöse Formulierung aus der Februar-PR, das man praktisch für alle "Claims" (also Indikationen) im Bereich reconstrutive surgery die Zulassung erhalten hat. Der Operateur darf die Technologie also von Anfang an so ziemlich für alle ästhetischen Schnibbeleien einsetzten (Faltenentfernung, Brustvergrößerung). Das erhöht natürlich die Patientenpopulation von Anfang an erheblich um eine zahlungskräftige und operationswillige Klientel. Jetzt bräuchte man nur noch eine Ikone a la Paris Hilton. Wenn die sich dafür unters Messer legt, können die Docs hinterher 24-Stunden-Schichten einlegen
 
6) Can you confirm that RESTORE II is also in the R&D budget for 2007? The total amount seems pretty low when compared with 2006 without any clinical trials.

It is. Keep in mind the pig studies were very expensive and we are no longer paying for those.

Zeigt noch einmal, wie akribisch wohl die Preclinicals betrieben wurden. Die Schweine-Versuche müssen richtig Geld gekostet haben. Das können keine einfachen PR-Studien gewesen sein, sondern sind mit aller wissenschaftlichen Sorgfalt angegangen worden um gute Hinweise für die momentanen Trials zu erhalten. Aus den Ergebnissen der Preclinicals kann man unschwer erraten warum sie so scharf darauf sind, die Ergebnisse von PRECISE und APOLLO so schnell zu reporten

Cytori Therapeutics is developing and seeks to commercialize stem and regenerative cell therapies for cardiovascular disease, reconstructive surgery and many other serious, chronic, and life threatening conditions. To provide these therapies, physicians remove a small amount of a patient's fat, also known as adipose tissue, and run it through Cytori's Celution™ System. This System quickly separates and concentrates stem and regenerative cells from adipose tissue so they may be quickly administered back to the patient about an hour later. This system will dramatically improve the way in which personalized cell-based therapies can be delivered to patients. www.cytoritx.com

Cautionary Statement Regarding Forward-Looking Statements

This press release includes forward-looking statements regarding events, trends and prospects of our business, which may affect our future operating results and financial position. Such statements are subject to risks and uncertainties that could cause our actual results and financial position to differ materially. Some of these risks and uncertainties include our history of operating losses, the need for further financing, regulatory uncertainties, dependence on performance of third parties, and other risks and uncertainties described (under the heading "Risk Factors") in Cytori Therapeutics' Form 10-K annual report for the year ended December 31, 2006. We assume no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made.

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http://ir.cytoritx.com/releasedetail.cfm?ReleaseID=246695