NESS ZIONA SCIENCE PARK, Israel, December 7, 2016 /PRNewswire/ --
Israeli biotechnology company Kadimastem (TASE: KDST) announced today the signing of a memorandum of understanding with Korean company Corestem, for a broad strategic collaboration between the companies. The synergy between the companies will assist in expediting Kadimastem's entry into international markets and positioning the Kadimastem-Corestem collaboration as a worldwide leader in innovative treatment for severe diseases in general and ALS and diabetes in particular.
Upon signing the final agreement, Corestem will invest $7M in Kadimastem. The parties have agreed that the share price for the investment will be determined at the time of the signing of the agreement, according to the average share price during the period between the signing of the MoU and the signing of the final agreement, it being agreed that the share price will reflect a pre-market company valuation not lower than $30M and not higher than $37M. Moreover, Kadimastem will become a shareholder of Corestem by investing $1M in a similar investment mechanism.
Under the collaboration agreement, the companies will conduct clinical trials on Kadimastem's product, AstroRx®, in Korea and the Asia-Pacific region. In this region, Corestem will be responsible for the regulatory processes and obtaining the approvals required to treat patients and market the Company's products. Additionally, Corestem will be granted an exclusive license for the commercialization of the Company's ALS and diabetes products in the Asia-Pacific region (including Korea, Japan, China, Australia, Singapore, India and others), and will pay Kadimastem royalties. Through a joint venture, the companies intend to work on development of new products.
The Company believes that the combination of Corestem's know-how and familiarity with the Asia-Pacific market and Kadimastem's capabilities and product advantages, will assist the companies in establishing their position as global market leaders in the field.
Korea is known for its capabilities and innovation in the biotechnology field in general and cell therapy field in particular. Due to its geographic importance, its affluent and aging population and significant regulatory facilitations, Korea is a key market in the Asia-Pacific region.
The regulatory authorities in Korea and Japan allow innovative medical treatments (including cell-based treatments) to receive a restricted marketing approval for a limited time immediately following preliminary results proving the treatment's safety and efficacy.
Corestem is the only company in the world with a cell treatment for ALS which has been approved by a regulatory authority for treating patients. Its product is approved for marketing in Korea, after the phase II clinical trial proved safety and efficacy.
Yossi Ben-Yossef, CEO of Kadimastem, noted: "We view the investment and the collaboration with Corestem as a strategic move, which will reinforce the status of both companies as global market leaders in the cell therapy field. We believe that the strong synergy between the companies and their products, together with the advantages of the Kadimastem's products, will lead to a global breakthrough in the treatment of ALS and diabetes patients. After examining market opportunities in the Asia-Pacific market, we have selected the most suitable, experienced and knowledgeable professional partner to establish our presence in that territory."
Professor Michel Revel, Kadimastem's Chief Scientist, commented: "Corestem expressed significant interest in Kadimastem's technology and its AstroRx product for the treatment of ALS. ALS patients suffer from malfunctioning astrocytes, support cells located in the brain and spinal cord which protect the neurons. AstroRx consists of healthy human astrocytes, produced by Kadimastem from embryonic stem cells, which are capable of restoring the protection of the neurons and improving motor skills. It is a shelf product which can be injected to a large number of patients. Corestem markets NeuronataR, which is an autologous product comprised of cells from bone marrow, taken from the patient and reinjected to the same patient. The collaboration between the companies will enable Kadimastem to enjoy Corestem's infrastructure, which is already treating of hundreds of patients, and expedite the clinical application of AstroRx in Korea and other countries in the region. The companies will collaborate to distribute the treatments, and even to combine them for the benefit of ALS patients."
In parallel, the Company plans to commence its phase I/IIA clinical trial (safety and efficacy of the product in humans) in mid-2017, under the supervision of the Israeli Ministry of Health, and according to the outline coordinated with the FDA. The trial will include approximately 21 patients and will be conducted in the Department of Neurology of Hadassah Medical Center, Ein Kerem, a world leader in the field of ALS.
The strategic collaboration between the two companies was mediated by Wonjae Lee, the CEO of Yozma Korea, an investment company in Korea.
The Company wishes to note Rosario Capital, who has worked with the Company since the Company's IPO, including accompaniment, advising and investment banking.
Corestem is a global bio venture that holds growth, momentum and stability through continuous research and development in the field of stem cell therapy since it established in 2003.
ALS (Amyotrophic Lateral Sclerosis) is the most severe of a group of neurodegenerative diseases that damage motor neurons, the cells controlling most muscles in the body. The disease is incurable and has no current significant drug treatment. In recent years, there is growing scientific proof that in ALS patients, the ability of astrocytes (supporting cells in the central nervous system) to maintain a supportive environment for motor neurons is damaged.
Kadimastem (http://www.kadimastem.com) is a biotechnology company that specializes in the development of human stem cell-based medical solutions for the treatment of diabetes and neurodegenerative diseases, such as ALS and Multiple Sclerosis. The Company was founded in August 2009 by Professor Michel Revel and Yossi Ben Yosef, and is traded on the Tel Aviv Stock Exchange (TASE: KDST). The Company's chairman is Dr. Eli Opper, formerly the Chief Scientist of the Israeli Ministry of Industry, Labor and Trade. The Company's investors, in addition to the founders, include Altshuler Shaham Investment House, foreign investors (Julien Ruggieri and Avi Meizler), and additional institutional investors.
Kadimastem was founded based on patent protected technology that was developed at the Weizmann Institute of Science. Based on the Company's unique platform, Kadimastem is developing technology for regenerative medicine, which repairs and replaces organs and tissue by using functioning cells differentiated from stem cells. The Company focuses on transplanting healthy brain cells to support the survivability of nerve cells as cell therapy for ALS, and transplanting insulin-secreting pancreatic cells for the treatment of insulin-dependent diabetes.
Kadimastem has an extensive scientific advisory board, featuring prominent scientists and pioneers: in the embryonic stem cells field, Professor Benjamin Reubinoff, Director of the Hadassah Human Embryonic Stem Cell Research Center and Senior Physician at the Department of Obstetrics and Gynecology at the Hadassah University Medical Center; Professor Joseph Itskovich, world renowned expert and pioneer in pluripotent stem cell research and former head of Obstetrics and Gynecology at RAMBAM Medical Center; in the neurodegenerative disease field, Professor Tamir Ben-Hur, Head of the Department of Obstetrics and Gynecology at Hadassah University Medical Center; and in the diabetes field, Professor Shimon Efrat, professor of Human Molecular Genetics and Juvenile Diabetes at Tel Aviv University and a world renowned expert in cell replacement therapy for diabetes and Professor Eddy Karnieli, former Director of the Institute for Endocrinology, Diabetes and Metabolism at the RAMBAM Medical Center, and a world renowned expert in these fields.