Orange County stem cell entrepreneur Hans Keirstead refers to his newly established biotechnology company as a “startup with mature assets.”
“It’s been a wonderful culmination of a couple of decades of work,” said Keirstead, a former professor at the University of California-Irvine whose latest post is chief executive of AiVita Biomedical Inc. in Irvine.
He formed AiVita at the start of the year by making 10 deals to buy back “everything we sold” to Basking Ridge, N.J.-based Caladrius Biosciences Inc. in late 2014. Caladrius, formerly known as NeoStem Inc., got the programs through its buy of Keirstead’s previous enterprise, California Stem Cell Inc.
“I kind of feel like I was playing 10 chess games and I had to checkmate them all at the same time,” Keirstead said with a laugh in an interview last week.
AiVita is focused on using stem cells to develop “curative and regenerative” therapies for various ailments. Its latest deal was announced in late May, when it licensed the rights to a stem-cell treatment for ovarian cancer from Caladrius. It subleased space in Caladrius’ office on Von Karman Avenue at about the same time.
The Food and Drug Administration last week gave the company “formal permission” to proceed with a second-phase clinical trial, Keirstead said.
“I’m very excited about that. I’ve also, just last week, concluded a deal with Hoag Memorial Hospital Presbyterian. They are going to run our clinical trials and carry some of the burden of the expense of the clinical trials,” he said. “It’s a nice partnering clinical site.”
One of the AiVita-Caladrius deals already has led to a commercial product: Provoque, a facial serum based on stem cell-generating technology.
AiVita makes “early, early precursors to human skin” from stem cells, and the skin secretes growth factors responsible for human skin development that are used in Provoque, according to Keirstead.
AiVita licensed the rights to Provoque in February and worked with Irvine-based “lifestyle” medicine company Alphaeon Corp. to develop the treatment. Alphaeon is marketing Provoque.
“It’s had about six years of development work put into it and many millions … I’d say it’s probably the deepest scientific package that has been generated on a skin care product,” Keirstead said.
Provoque launched last month, retails for about $160, and is sold through doctors’ offices.
“Alphaeon, as you probably know, is the world’s largest physician consortium,” Keirstead explained.
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Keirstead said that Caladrius “ran the programs” it got from California Stem Cell “very well” during its ownership but hit a snag when a separate, unrelated stem-cell development program for heart disease failed.
“They found themselves in a position [in] the last quarter of 2015 where they just did not have the financial resources to support the cancer asset,” he said.
“I decided to buy back everything that I sold them,” he said. “I finished those deals a couple of weeks ago.”
AiVita recently closed a $2 million round of funding led by Pasadena-based California Technology Ventures.
The company does not disclose revenue information.
It now has revenue through the Provoque sales, and 12 workers, many of whom have been with Keirstead for a number of years through California Stem Cell.
“I’ve got my team—it’s the A-team, longstanding experts in the stem cell field,” he said.
AiVita also has tapped into some well-known figures in the cancer and skin health worlds for its management and board.
Dr. Robert Dillman, a hematologist and former director of Hoag Cancer Center, is AiVita’s chief medical officer.
And Susan Sweet Bloomfield, former president and general manager of Los Angeles-based Neutrogena Corp., a unit of New Brunswick, N.J.-based diversified medical giant Johnson & Johnson, recently joined the startup’s board.
Lessons Learned
Keirstead learned some lessons from his experience selling California Stem Cell.
“I think I’ve learned that emerging technologies have to be led by the science,” he said.
“When I look at the demise of other stem-cell companies, every single one of them has been due to manufacturing and commercial processes being locked down when the scientists at the bench are screaming ‘No! It’s not ready.’”
He was referring to companies such as Newark, Calif.-based Stem Cells Inc., which terminated a second-phase clinical trial in early June—and whose directors approved a plan to wind operations down. Menlo Park-based Geron Corp. halted a stem-cell trial in 2011.
AiVita’s latest deal with Caladrius came less than six months after the latter cut 40 Irvine jobs and ended a clinical trial of its lead drug candidate for skin cancer treatment.
Caladrius Chief Executive David Mazzo said in a statement at the time of the dermatology deal that licensing what became Provoque to AiVita was “yet another step forward in streamlining our strategic focus.”
Mazzo, who is no relation to local medical device executive James Mazzo, mentioned that the Provoque technology was a “non-core” asset and that Caladrius would receive royalties on the product’s net sales.
