GlobalStem blazes new trails in stem cell research

KAREN BUCKELEW

Daily Record Business Writer

February 8, 2007 6:18 PM

The political and ethical firestorm over embryonic stem cell research might scare more than a few entrepreneurs away from the issue.

But for Jonathan M. Auerbach, the debate is part of what makes the field enticing.

Auerbach, president and CEO of GlobalStem Inc. in Rockville, founded the company last March to provide himself and his fellow researchers an innovative inroad into the burgeoning area of science.

As a neuroscientist, Auerbach said he had become accustomed to people’s eyes glazing over as he described his work. But now that he specializes in stem cell work, that is no longer the case.

“People know about it, people are watching it,” he said. “It’s exciting.”

The controversy has its downside as well, he conceded. Restrictions on federal funding for studies involving embryonic stem cell research have stunted the field’s growth, Auerbach said.

But state programs like Maryland’s $15 million stem cell research fund and California’s $3 billion fund are helping keep the field afloat.

“The government restrictions are not really limiting [the research], but slowing things down,” Auerbach said.

There are several stem cell firms in Maryland, including Osiris Therapeutics Inc. of Baltimore, which work with adult stem cells. Osiris went public last year. NeuralStem works on treatments for central nervous system disorders.

The stem cell field seemed healthy enough to lure Auerbach from his secure job at a Manassas, Va., cell repository to start GlobalStem. Five of his co-workers from the American Type Culture Collection have since joined him.

The company began with funding from Toucan Capital Corp., a Bethesda-based venture capital firm.

GlobalStem now sells research supplies to academic scientists working with stem cells. That includes reagents such as the substance in which the cells are grown and the feeder cells that form a bed on which they thrive.

The firm is midway through developing a full array of services to provide to those same academic researchers. Auerbach plans to create a sort of one-stop shop for scientists in the field.

“We’re making the tools available that will help move the research forward,” the CEO said.

Its leaders hope GlobalStem one day will branch out into developing therapeutics as well. But the company’s business plan is to begin at the beginning.

“Everybody’s talking about the promise of these cells and bringing them to the clinic and curing disease,” Auerbach said. “We’re not ready yet. What’s needed right now … is a lot of upfront help for basic research.”

That’s not to say Auerbach and his colleagues don’t believe in the promise of stem cells. The founder saw the science’s potential with his own eyes while doing research a decade ago at the National Institutes of Health.

Implanting stem cell-derived neurons into the brains of rats with Parkinson’s disease, Auerbach and his fellow researchers watched the new neurons function healthily, even in the diseased environment.

It’s the kind of potential, the scientist said, that keeps the field alive despite the federal restrictions.

Researchers also must contend with intellectual property held by the University of Wisconsin, where stem cells first were isolated.

Companies must skirt the procedures and cell lines for which the university holds patents. Those patents currently are being re-examined by the U.S. Patent and Trademark Office, at the request of consumer groups.

The field “could be healthier,” said Linzhao Cheng, an associate professor in the stem cell program at The Johns Hopkins University School of Medicine’s Institute for Cell Engineering.

“I respect other opinions,” Cheng said of those who oppose stem cell research, including anti-abortion activists who decry the destruction of the embryos involved. “But the limitations from federal agencies is one of those important issues that is still going on.”

Auerbach said GlobalStem is carefully avoiding infringing on the University of Wisconsin’s intellectual property while developing its technology. For example, for its in-house work the firm uses slightly imperfect human cancer stem cells rather than licensing embryonic cells. The cells are useful for developing tests, but not therapeutics.

A key service GlobalStem hopes to offer is characterizing stem cells for researchers. Embryonic stem cells are believed to be pluripotent — that is, they have the potential to become virtually any type of cell in the human body.

In fact, they are quite prone to become other cells, Auerbach said. It is difficult to keep the stem cells stable before guiding them to the type of cell needed.

Characterizing the cells, he explained, is determining if they have started to become a certain type of cell — for example, neural cells that would form neurons.

For such tests, researchers ordinarily have to shop around to various companies, Auerbach said.

But GlobalStem, he hopes, will offer it all — from the substance in which the cells grow to the feeder cells that keep them alive to the tests that characterize them. The full set of tests should be completed in about six months.

“We’re trying to have a core set of these assays,” the scientist said of the tests the company is developing. “We’ll do it all in one place for you.”

The company does not need to worry about intellectual property just yet, Auerbach said. GlobalStem will keep the reagents as trade secrets, without seeking patents. The tests one day will likely be patented, but probably not for some time.

Auerbach acknowledged there is competition in the field, though it is sparse. He compared GlobalStem to a microbrewery among the likes of Anheuser-Busch.

“We’re like your home-brewed beer,” he said. “We carefully make [the brews]; carefully check them to make sure everything is right. We don’t mass-produce things.”

At Johns Hopkins, Cheng switched last fall from a larger provider of feeder cells and media to GlobalStem. The types of services and products the company aspires to provide do exist, he added — but not in one place.

“The cost is high,” Cheng said, “and it’s not centralized. We spend a lot of time just to find the individual expert who is good at a particular task.”

Auerbach is just excited to be part of it all, he said: “It’s a young field, moving very quickly as far as the science goes. It’s fun so far.”