From Revolutionary Idea to Miracle Cure
Proneuron’s therapy for spinal chord injury brings mobility and sensation to a paraplegic

OVER THE PAST NINE YEARS, I HAVE COVERED BIOTECHNOLOGY COMPANIES FROM STARTUPS TO MULTINATIONALS. I HAVE WATCHED THE START-­UPS MATURE AND REACH PHASE I, Il AND OCCASIONALLY III CLINICAL TRIALS. I HAVE INTERVIEWED THE CEOS, RESEARCHERS AND INVESTORS. BUT I HAVE NEVER WRIT­TEN ABOUT A COMPANY FROM THE PERSPECTIVE OF A PATIENT WHO IS BENEFITING FROM THE TECHNOLOGY. THIS IS THE HOPEFUL STORY OF A NEUROBIOLOGIST, THE START-UP SHE FOUNDED AND A QUADRIPLEGIC WHO MAY WALK ONE DAY THANKS TO HER EFFORTS.

Michal Schwartz, a professor of Neuroimmunology at the Weizmann Institute, has dedicated years to disproving an article of faith in the medical profession. A specialist in central nervous system (CNS) trauma and spinal cord injury, she sought to prove that there is positive communication between the nervous and immune systems at the time of a central nervous system (CNS) injury. "I focus on the crosstalk between the immune system and the nervous system," she says.

If that sounds like an obscure corner of medical research, it's not for close to 250,000 people living in the U.S. alone who are permanently disabled due to spinal cord injury. For these people, there is currently no cure. And each year, there arise some 11,000 new cases in the U.S. alone and 34,100 around the world. It is estimated that the per patient lifetime costs for medical treat­ment, rehabilitation and other support range from $233,000 to as much as $1.9 million. Additionally, lost productivity for a spinal cord injury patient has been estimated to average $38,000 per year. The cost to healthy and active individuals whose lives are suddenly and radically changed can't be measured.

Until Schwartz's work was pub­lished in the British science journal Nature in 1998, the accepted dogma was that when a trauma occurred, the immune system had a negative impact on the nervous system. Schwartz, how­ever, proved that macrophages (white blood cells) can actually stimulate regrowth of nerve cells. In fact, she showed that in rats, macrophages and T-cells play just as important a role in tissue repair at the site of the injury as they do in any other tissue. T-cells can actually protect neurons from the spread of damage, and macrophages can help in the repair of the injured central nervous system by inducing nerve cells to regrow. "I wanted to identify the body's own mechanism for coping with brain and spinal cord injuries. I believe that self therapy is the body's best chance for repairing itself," says Schwartz.

But Schwartz wasn't satisfied with simply conducting research; she wanted to apply her work to human patients in a clinical setting, and she realized she needed a robust financial infrastructure to do it. Not content to let Yeda, the commercial arm of the Weizmann Institute, find her partners, Schwartz went out and found for herself a seed investor with the Hudson Investment Group of the U.S. With a $3.1 million investment by Hudson, Proneuron Biotechnologies was formed in 1997 as a virtual company, based in Schwartz's lab. A year later, it moved to the nearby Weizmann Science Park, where it is based today.

One of the first people hired by the start up was Valentin Fulga, senior vice president of development. Fulga is a medical doctor who has always been interested in biotechnology. His first position was at Pharmos, one of the oldest Israeli biotech companies, which was started by pioneer Haim Aviv. Fulga then went on to direct clinical trials at Holo Or, a medical device company, before being approached by Proneuron. By the time Fulga joined Proneuron, the company was seeing very good laboratory results. Experiments with rats proved that by activating macrophages in a test tube with damaged peripheral nerve tissue and then returning the macrophages to the damaged CNS site, researchers could restore to the animals the partial use of previously paralyzed legs. "When we are talking about spinal cord injuries, we are looking at nerves in the central nervous system and peripheral nerves," explains Fulga. "The difference between these two types of nerves is that nerves in the central nervous system do not regrow by themselves, and nerves in the periphery do. The macrophages help these central nervous system cells to grow after being injured."

The success with animal trials encouraged Proneuron to apply to the U.S. Food and Drug Administration (FDA) for permission to begin a Phase I clinical trial. To fund the trial, the company conducted a second round of financing for an additional $10 million with the help of Hudson and some Israeli venture capital funds, including Nessuah Zannex, Infinity, Pitango and Giza. Phase I permission was granted by the FDA in September 1999, and the company was ready to begin the trial at Sheba Medical Center at Tel Hashomer (outside Tel Aviv) by the beginning of 2000. There was one catch, however: the company's strict requirements regarding prospective patients resulted in no patients. Specifically, to avoid respiratory complications, a prospective patient had to have suffered a complete spinal cord injury no higher than the fifth cervical vertebra. Moreover, the injury could not have occurred more than two weeks before the patient's enrolling into the program, because lab results had been most effective within that window of time. By the summer of 2000, no one had met the criteria.

Meanwhile, in America, a young college student's life was about to radically change. Melissa Holley's car flipped over on June 25, 2000, and left her pinned beneath it. "I was on my way to work, and I had to be there at 4 p.m.," recalls Holley. "It had been raining earlier, and my wheel just caught on the side of the road." When the car flipped over, a wheel landed on her T6 and T7 spinal vertebrae, crushing them. The 20-year-old was paralyzed from the middle of her back down to her toes.

Doctors could offer no hope to her parents, Gwen and Roy, that their daughter would ever walk again. "They found that I had a complete injury," Holley says. "I was paralyzed from the middle of my back on down. You don't believe it at first. You think you can get past this; it's just temporary, it's okay. It soon became more evident that I was going to either start dealing with what I had, which was nothing, or look for some hope elsewhere." Her father, who teaches leadership skills, would not accept the doctors' prognosis. "My dad had been misdiagnosed in the past, so he did not believe in medicine as absolute," says Holley. "He took to the Internet to find a way of proving the doctors wrong."

Within hours, Roy had found information about a new treatment designed to repair nerve damage in patients with recent spinal cord injuries. But there was a catch: the treatment did have a great success rate, but so far only in the lab, and only in rats. And while the FDA had approved a clinical trial of this treatment, the only doctors actually using it were 7,000 miles away in Israel. Nonetheless, Holley was a perfect fit for Proneuron's therapy.

Holley's family had to hire a private medical plane, along with two nurses and a doctor, for the flight to Israel at the cost of $90,000. "It was definitely frightening to be the first human to try this therapy.... We took a leap of faith and a leap of finances," Holley says. Being far away in a distant country and in an unfamiliar environment made the ordeal even harder "I woke up from surgery with no pain medication and started screaming, but the nurses didn't know English," she remembers, adding wryly, "I think they understood me pretty quickly." Holley learned some basic Hebrew during her three month stay so that she could communicate with the nursing staff, whose members largely spoke Russian and Hebrew.

Doctors took blood from Holley's arm, isolated the macrophages and cultured them together with a bit of Holley's skin in order to fully "educate" them. The following day, Nachshon Kenoller, a neurosurgeon at Sheba Medical Center, injected into the spinal cord at the injury site four million macrophages - a quantity that could fill a thimble. "We are talking about regeneration of the spinal cord, which has never been recorded in the past," Kenoller told Reuters, following the surgery. "The spinal cord and brain have been considered areas where regeneration was thought to be impossible."

But it turned out to be quite possible - and in a very short time. "I remember that two weeks after I arrived at Tel Hashomer, a nurse came to swab my thigh prior to an injection, and I could feel the quarter size of an area where the alcohol had been," she says, adding that strangely, she did not feel the injection itself when it was administered. Over time, circular patches of feeling began developing down her right leg, then her left leg, and then they finally started connecting with one another. As summer moved into autumn, Holley had regained complete feeling all over her lower body, with the exception of her left foot, which could feel a sensation, but not necessarily pain. After a month in the surgical ward, she was transferred to the hospital's rehabilitation department, where she spent the next two months learning to do basic things like sitting up again. She also managed to do a bit of touring in nearby Tel Aviv, Jaffa and Caesarea along with her father, who stayed for the entire three month period Holley was in the hospital.

When Holley returned to America, she was admitted to Craig Hospital in Denver, Colorado. Her doctors, who had been quite skeptical about her traveling to Israel for treatment, were forced to admit pretty quickly that her progress was different from that of other patients with the same injuries. Dan Lammertse, the medical director at Craig Hospital, says the results of this feasibility study look promising. "The scientific basis makes sense," says Lammertse. "It appears to have very low potential for adverse outcomes and complications, so it has a lot of inherent advantages. But the test is to provide this treatment to a number of people and to use the best scientific means to figure out if it has helped them." He admits that the people in the study have so far experienced a better than typical recovery but at this point, he warns, it's premature to say what the long term results will be.

By Thanksgiving 2000, Holley was beginning to regain muscle control. Today she can move most of her major muscles quads, hamstrings, feet muscles, toes, even abdominal muscles. And she has regained bladder control, ending one of the most debilitating side effects of being a paraplegic. "It's not quite enough to get up and go, but in November, I will go to Craig to be outfitted in crutches and braces." For now, she is swimming twice a week and is undertaking physical therapy in the little town of Ridgway Colorado, where her parents live. She is still getting used to the enormous changes that the accident has made in her life. "This is a reality that you never really get used to," she admits.

Yet after Holley returned to America, Proneuron was again left for a long stretch without patients - an especially frustrating situation, given the positive results of the first test. Over the Internet, the company invites suitable patients from around the world to come to Israel, all expenses paid, to participate in the clinical trial. But the target population is small. "We do not need so many patients.... What limits us is that we are very strict with our inclusion criteria, and the window of opportunity for treatment is within 14 days of the accident. We opened it to anyone in the world because we do not have enough patients in Israel," says Fulga. Holley herself has pitched in to the recruitment effort. Since she started the therapy she has been interviewed live on the CBS television program 48 Hours, and her story has appeared numerous times in print. "Since the company is not allowed to use the media to attract patients, I wanted to make sure potential patients knew about the therapy she says. "There is not a lot of hope out there. I wanted to offer some hope for the newest patients, and perhaps it will translate one day into a treatment for the chronic paraplegics."

As of this fall, Proneuron had six patients in its Phase I clinical trial, which is intended mainly to show the safety of the therapy. The company hopes to presents its final results based on a total of nine patients to the FDA by the end of 2002 at the latest. "We may be able to move straight into Phase II/III clinical trials with a relatively small number of participants," says Fulga. Once the therapy is proven safe and effective, it may be tried on partial injuries of the spinal cord or on other injuries in the CNS.

The company faces no competition. Its technology is unique, not the least because Schwartz's theory went against common thinking. "Nobody is trying autologous macrophage therapy says Fulga. "In addition, any therapy in spinal cord injury will be additive or synergistic." Proneuron's business strategy is to build cell centers for culturing the macrophages adjacent to spinal cord injury centers (there are 16 across the U.S.) and to set up one or two centers per country in Europe. Proneuron already has good relationships with some centers in the U.S., but the exact type of collaboration is not yet finalized.

The company is also pursuing a T-cell-based vaccine, which is still being tested in rats. After a spinal cord injury, there is often a spread of deterioration in the area, causing an even greater damage than the original injury does. The body subsequently needs to boost its self response to enhance T-cell proliferation. Although autoimmune reactions to CNS antigens had been generally thought to have harmful effects, Schwartz proved that autoimmune T-cells can actually protect injured neurons from the spread of damage. "We came up with a vaccination that can be injected after the trauma, and the recovery from the injury is far better. We are rescuing neurons that without such intervention would deteriorate, and we are boosting the body's own mechanism of repair," she explains. The vaccine is targeted at partial spinal cord injury patients, but it will also be applied to chronic neurodegenerative disorders like glaucoma, Alzheimer's, Parkinson's, and ALS. Proneuron is also developing a molecule that is inherent to the CNS with strong immunosuppressant and anti-inflammatory properties. The company hopes that the molecule will serve the same therapeutic purpose as steroids, but with fewer side effects and greater potency.

"The company has a very unique technology,” says Zeev Holtzman, founder and chairman of Giza, which invested in Proneuron more than two years ago. "We believe this technology can provide a breakthrough in therapy. It is a very special company, and we believe it will become a big story one day." Ruti Alon, managing director of healthcare ventures at Pitango Ventures, agrees. After reading about Schwartz's work, Alon contacted her. "If you can take a person who is paralyzed and return feeling and muscle control to that person," says Alon, "it is huge on a humanitarian level. In addition, it alleviates a tremendous financial burden from the healthcare system." Alon believes that Proneuron has the ability to become a large and successful company. One indication, Alon notes, is that pharmaceutical enterprises have already been in touch with the company.

Amidst all the optimism, if anyone retains caution, it's Schwartz herself, who has patiently seen her work develop from a revolutionary idea to the first tentative proof that it can in fact change human lives. "It is too soon to celebrate," she cautions.

Proneuron Biotechnologies Ltd.
www.proneuron.com
CEO: Michal Schwartz
Senior vice president, development: Valentin Fulga