3 Companies Banking on Regenerative Medicine
Thanks to new legislation being approved by the Upper House of Japan’s Parliament in November, Japan’s so-called “drug lag,” specifically with respect to regenerative medicine, will likely become a thing of the past. By retooling the framework of the regulatory process for regenerative medicine products, the nation has shifted from a global drug development laggard to one of the most proactive countries on the planet aiming to safely expedite growth in the burgeoning, yet volatile, stem cell industry to meet the needs of a rapidly expanding aging population. The new laws are designed to promote innovation and could provide a clear channel to rapid commercialization that will benefit industry-leading companies like Cellular Dynamics International, Inc. (NASDAQ:ICEL), Athersys, Inc. (NASDAQ:ATHX) and Cytori Therapeutics, Inc. (NASDAQ:CYTX).
Japan’s motivations are not clouded; they’re concise and essentially borne out of economic necessity. With the second-largest mature healthcare market in the world, the country faces profound challenges as nearly 20 percent of its population is aged 65 years or more. By 2050, it’s estimated that up to 39 percent of Japan’s citizens will be older than 65, burdening the government to spend a greater portion of its budget on healthcare and pensions, while the working class contributing taxes contracts proportionately.
Prime Minister Shinzo Abe’s partial solution to the problem was to have Japan’s Parliament, the Diet, revamp the Pharmaceutical Affairs Law to provide a new definition for medical products containing stem cells and take a bold step to vastly accelerate bringing new regenerative medicine products to market. In short, the traditional pathway of multiple lengthy and expensive stages of clinical trials is no longer mandatory for regenerative medicine therapeutic candidates that qualify under the new framework. Under the new legislation, if small Phase I/II clinical studies can establish product safety and provide a meaningful indication of therapeutic effectiveness, accelerated approval becomes a possibility — in qualifying situations the government will grant conditional approval to commercialize the product. At that point, a post-market surveillance period will be in effect to more thoroughly delineate safety and efficacy profiles, with subsequent final approval granted at a later date, or alternatively, the potential of revocation of the approval if data shows the therapy to be inefficacious or unsafe.