NeoStem, a leader in the emerging cellular therapy industry, announced that the company has signed an exclusive license agreement with China-based Cellular Biomedicine Group (CBMG) to begin a phase 2 clinical trial in patients with late stage liver cancer. The trial, to be conducted in China in accordance with international standards, will investigate the use of the company’s developmental patient-specific cancer immunotherapy known as “DC-TC”, in patients with hepatocellular carcinoma (HCC).

Pursuant to the terms of the license agreement, the cost of the phase 2 trial will be borne by CBMG, and CBMG will also be responsible for all clinical, marketing, and, should a product be approved, commercialisation activities in China. NeoStem will be responsible for all regulatory filings and will directly control and manage all manufacturing processes and procedures relating to the development of its DC-TC product. NeoStem could receive up to $30 million in licensing milestone fees over the life of the agreement, with $1 million payable upon enrollment of the first patient in the currently planned phase 2 trial. Royalties and sublicense fees may also be payable.

The Company’s DC-TC therapy involves growing cancer initiating (stem) cells that have been isolated from a patient’s resected tumour sample, and then enriching and inactivating them. This newly created cancer initiating (stem) cell line is then combined with dendritic cells, a type of antigen-presenting immune cell that is derived from the same patient’s blood. The product is then reintroduced to the patient via a series of subcutaneous injections.

The planned study follows a phase 1 trial which demonstrated safety in HCC patients. There were no serious adverse events related to the treatment in patients who co-presented with active hepatitis B and underlying cirrhosis, commonly associated with liver cancer in China, and patients were not charged for treatment. “We were very pleased to have concluded a Phase 1 trial with positive safety outcomes and look forward to continuing to work to develop this treatment in a country where so many people are greatly affected by this disease,” said Dr. Hans Keirstead, president of NeoStem Oncology, LLC, the company’s wholly-owned subsidiary developing targeted immunotherapies for cancer treatment. “Patients with this stage of disease are not eligible for curative resection or transplantation.”

“The planned phase 2 study in China is seeking to assess the efficacy and safety of our new DC-TC platform technology in treating hepatocellular carcinoma, and we look forward to working with CBMG to develop this indication in Asia,” said Dr. Robin L. Smith, chairman and chief executive officer, of NeoStem. “China holds more than 45per cent of the world’s HCC patients, being responsible for 395,000, or roughly 50 per cent of new cases in 2012.”

The company has also recently reached agreement with the US Food and Drug Administration to begin a phase 3 clinical trial for its lead product candidate, Melapuldencel- T, in metastatic melanoma, expected to begin in 2014. Melapuldencel-T’s phase 3 protocol has been granted Special Protocol Assessment (“SPA”) and the product candidate has received Fast Track designation for metastatic melanoma, as well as Orphan Drug designation. Five year survival data from the phase 2 clinical trial in metastatic melanoma has been accepted for a poster presentation at The American Society of Clinical Oncology’s 2014 annual meeting in June.

The Company’s DC-TC treatment is based on recent clinical findings that the rapid proliferation and subsequent spreading of cancer throughout a patient’s body may be fueled by a small number of cancer initiating (stem) cells. Through proprietary processes, our researchers have refined isolation and expansion of these cancer initiating (stem) cells to clinically useful numbers, which are then combined with autologous dendritic cells, and reintroduced into the patient with the intention of training and bolstering the patient’s immune system to target the cancer stem cells that have the ability to metastasize and create new tumours.