RepliCel Life Sciences, a Stem Cell Franchise Meeting Truly Unmet Needs in Medicine

Clinical Trial in Achilles Tendinosis Passes with Flying Colors

BEND, OR / ACCESSWIRE / April 4, 2017 / There’s good news for patients suffering from severe heel pain due to a frayed and irritated Achilles tendon. On March 28, Vancouver, BC-based RepliCel Life Sciences Inc. (OTCQB: REPCF) (TSX-V: RP) gave patients and investors the verdict on the company’s first-in-human phase 1/2 study of its stem cell candidate RCT-01 (type 1 collagen-expressing, hair follicle-derived autologous fibroblasts suspended in cryomedium). RCT-01 cleared its initial major hurdle of safety, the study’s primary endpoint, and then there was the happy bonus of meeting secondary endpoints of pain relief and ultrasound imaging evidence of actual tendon repair. If you’re a patient in severe Achilles heel pain, you say, Bravo!

The trial (NCT02330146) was conducted at the Allan McGavin Sports Medicine Centre in Vancouver on patients with a confirmed diagnosis of chronic tendinosis. The study was randomized, double-blind and placebo-controlled. None of these patients in the study had received prior surgical intervention or injections into the heel or Achilles tendon. Basically, these subjects entering the trial were managed with non-invasive standard of care therapies including anti-inflammatory medications and physiotherapy. All in the study had a Victorian Institute of Sport Assessment – Achilles (VISA-A) questionnaire score of less than 70. (VISA-A score 100 = healthy).

Achilles Tendinosis, Image courtesy of RepliCel Therapeutics

All patients in the study suffered chronic tendon pain and loss of function over an extended period of time with no recovery or sustained relief from standard of care therapies. Each person receiving RCT-01 cells showed various clinically important improvements over a range of measures including tendon composition, blood supply, physical function and pain sensation.

Injection of RCT-01 Cells
(Image courtesy of RepliCel Therapeutics)

Safety was established. There were no adverse events to any patient from either the injection or the cells, which is the first thing the FDA wants confirmation of in a trial like this. After six months, the most meaningful recoveries observed from the experimental therapy with RCT-01 included: (These data are from patients who completed the VISA-A scoring questionnaire)

Clinically significant healing including with a 15.3% improvement in total VISA-A score versus the baseline.
Two of the five patients receiving RCT-01 injection demonstrated near-complete improvement in function and pain.
Four of the five subjects who receiving RCT-01 demonstrated clinical improvement in pain during running or jumping. The average progress in VAS score for these four patients was 62.9% versus baseline VAS score.
Three of the five participants who were administered RCT-01 demonstrated improvement in pain on palpation. The average improvement in VAS score for these three patients was 55.2% over baseline.
Two of the five patients receiving RCT-01 demonstrated measures of near-complete elimination of pain.

It should be noteworthy to investors that patients in the experimental arm (receiving RCT-01) were given only a single injection of cells, which indicates a rather durable response after six months. RCT-01 cells are autologous, meaning that the patient serves as his or her own donor. RepliCel’s platform technology utilizes cells harvested from the patient’s own hair follicles from the back of the neck. It would be an interesting hypothesis to assume that an even more improved result might be possible for patients who receive an additional injection of RCT-01. A repeat dose might not be possible with some allogeneic (same species donor) therapies, which could pose danger of an immune response; however, given that RCT-01 cells are the patient’s own, they are genetically and immunologically compatible. A repeat dose of cells should be possible.

This study was not powered for statistical significance. Only five patients completed the study and were evaluated. A phase 1/2 trial is designed first for safety and then secondarily to determine if there are signals of efficacy. These small trials serve to inform the design of a larger pivotal (FDA registration) trial. But no one can argue the good news on this trial.

Market Opportunity

The market for chronic heel pain, not counting tennis elbow or other tendinopathies, is considerable. Estimates for Achilles tendon sports injuries range from 200,000 to 250,000 people annually in the U.S. alone.

Because a true healing or disease-modifying, non-surgical therapy does not currently exist for Achilles tendinosis, it’s reasonable to assume that insurers would be amenable to reimbursing an indication that could alleviate the need for chronic physiotherapies and surgeries over many years. So, pick your number. Assume $3,500 charge per case of processed cells. Then assuming a miniscule 10% market penetration following approval, one might expect a conservative estimate of $3,500 per dose x 25,000 patients per year = $87,000,000 in U.S. Dollars per year to RepliCel. If that’s too conservative, do your own math, but it’s not hard to imagine a $1 billion market valuation for RepliCel, based on this Achilles tendinosis indication alone. Given that the current market cap of RepliCel is in single-digit millions (USD), investors could potentially be looking at a windfall.

Harvesting of Cells and Processing, Image courtesy of RepliCel Therapeutics

RepliCel’s cell technology platform is also addressing two other indications – skin damage due to aging and sun exposure and pattern baldness. For the time being, the tendon indication is going to be the value driver, and investors should consider these other indications to be call options.

Upcoming catalysts include:

Clinical data from RCS-01 for aging and sun-damaged skin are expected before 2H17.
The company is now completing manufacture of its dermal injector functional prototypes, which are designed to deliver the cell therapies to patients. RepliCel is anticipating a revenue stream from the device in 2018.

The risks are pretty standard to a biotechnology investment. Any trial could ultimately fail. Newer, better therapies could emerge. The company could find it difficult to raise capital to complete its clinical trials. There could be challenges to the intellectual property. There could be reimbursement problems. And then of course there could be general market downturn which would further encumber the company’s ability to raise capital. As always, it is recommended that you perform your own due diligence before investing and consult your financial advisor.

Dr. George S. Mack, the author of this report is an independent contractor. He owns, or his family owns, shares of the following companies mentioned in this interview: None.

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SOURCE: Sylva International, LLC

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