C&G Regulatory Guidance with Lineage Therapeutics' Brian Culley

This inaugural expo is a fantastic opportunity for biopharma companies and contract manufacturers to evaluate the latest and greatest from the comfort of your desktop or mobile device Conveniently . We've broken down the lineup into upstream solutions on July 30th , downstream solutions July 31st and quality analytical and data solutions on August 1st .

It's absolutely free to register for this series of short , digestible and interactive sessions . Just hit the link in today's show notes to register for BioExpo Live today . It's been far too long since I sat down with today's guest . In fact , it was 177 episodes of the Business of Biotech ago when we last connected .

I'm Matt Pillar , this is the Business of Biotech , and when we last spoke I was recording from the spare bedroom of my house while on COVID lockdown , while Lineage Cell Therapeutics CEO Brian Culley was trying to figure out how to keep a dry AMD clinical trial going in an elderly patient population that either couldn't or simply didn't want to go anywhere near a

hospital or clinic at the time , for valid reasons . On that episode recording during an unprecedented time , we did a lot of pontificating on how biotech might look different post-COVID . At the time , biopharma was hailed a hero on the heels of the COVID vaccine and money was flowing to virtually anyone with lab space and a hypothesis .

It didn't take long for both of those things the hero status and the money to dry up On today's episode . We're going to learn how lineage fared as Brian navigated the company through post-COVID minefields .

We'll revisit our three-year-old conversation and maybe reflect a little bit on what we got right and wrong on the regulatory and clinical fronts , and we'll learn where lineage is going next . Brian , welcome back . It's great to see you .

I've enjoyed every minute of it and , you know , it was kind of fun to be honest with you , like when , uh , when we started talking about getting back together and recording another podcast , I was like I'm going to go revisit that , that episode that we recorded so long ago . I believe it was like the turn of the year 20 to 21 .

It was like when things were really hitting the fan in terms of COVID and it was like it was like opening up a time capsule , like reviewing our conversation , the things that we talked about that day , um , the things that were happening , the things that we thought might happen , uh , some of which did , some of which didn't . And then just how ?

How one 80 , the industry went , uh , almost directly on the heels of COVID . It was , it was very interesting . I would encourage anyone who , uh , who is listening and want some of that context to reference , to go back . I think it was episode 30 , you know this'll be like two 200 something , you know .

So it was quite a while ago , but , um , at the time , as I said , our conversation kind of centered on your work , lineage's work , keeping the Oprigen and , I believe , opc1 , the spinal . So Oprigen is the dry AMD candidate and I believe at the time you were also maybe starting out on OPC1 spinal cord clinical trial .

You can talk about that a little bit too , or correct me if I'm wrong . And , like I said , the premise of the conversation was like how are you keeping these things going in the context of what's going on in that here and now ?

So I thought maybe we'd start there , brian , if you could give us an update on , maybe a refresher on , where those candidates were then and where they are now .

But as I was thinking about it just now , as you're speaking , you know , it occurs to me that that just happened to be the name around those challenges at that time . Making new therapies is very difficult , takes a long time . There's a lot of failure and setbacks that occur in even the best of circumstances .

At that time , the challenges were really COVID-related , which were certainly extraordinary , but there are always challenges , even in the best of times and , you know , I think that's what makes good companies and good management teams successful , as they get tested and challenged in really unusual ways .

For us , I think we were able to navigate those difficult and challenging waters in a very successful way , way . We end up , at the end of 2021 , entering into a partnership with Roche and Genentech for that dry AMD program .

So you know , we'd gone from having the challenge of getting people to electively go and have optometry appointments to get assessed for how they're doing , to announcing what at the time was the largest ever cell therapy license deal outside of a cancer program . And so a lot happened with that program .

It's continued to go into another clinical trial , which is running today , and even just recently our partners at Genentech announced the 24-month follow-up data from our trial showing that people still had gains in vision in a condition where they should be losing , and had gains in key layers of their retinal tissue which they should be losing .

So we are essentially reversing what is thought to be as an irreversible degenerative condition . So massive change from where we were three years ago , and maybe some of that change is applicable also to the spinal cord program .

The spinal cord program is in pretty rough shape , you know three years ago , but we've made incredible strides with the manufacturing , the purity , the control and we even have an entirely new device . So it's really been an incredible few years . That's's probably added a few gray hairs to to our chins , but a great success with our programs at that time .

So , as you said that that I don't know six or eight months probably after we last recorded , if not a little bit longer , give us some detail on how that came together . There are a lot of companies in this space who , you know , drool . They salivate at visions of dream you know of , of of deals like that .

So , to the to the extent you're able or willing , can you share some , I guess , backstory on how that deal ?

In some cases , even if we had the money , we couldn't do some of the things that they are able to do . You're talking about one of the greatest companies in the world of ophthalmology . So we offered a company like Roche and their Genentech branch .

We offered them something that they'd never seen before , which is the ability to halt the progression of this degenerative disease dry age-related macular degeneration .

The most advanced programs today really just do a small amount to slow the disease and we were really halting it in its tracks and we were bringing back tissue , and that's incredible , because human beings don't have that ability naturally . So it was clear that it was our therapy that was driving these outcomes .

So it wasn't a huge number of patients , but they had such extraordinary outcomes that Roche wanted to learn more about what we were doing . Of course , we went through the very rigorous diligence process that Big Pharma puts you through to understand if they want a licensed program .

They kicked a lot of tires around manufacturing because cell therapy manufacturing is very , very difficult . Kicked a lot of tires around manufacturing because cell therapy manufacturing is very , very difficult and ultimately they ended up writing us a check for $50 million on day one .

We're eligible for another $620 million of success-based milestones for making progress , and then there are double-digit royalties that increase as certain sales thresholds are met . So you know , in the aggregate it was an enormous and very normal deal , which is great for an approach that is different .

I mean , people have tried cell therapy in a lot of different ways in the past and there haven't been very many successes . So we really fly the flag about this relationship being a success for our program and for our approach and what it can mean to the other things that we're doing .

I've worked on deals that you know all they needed was a signature and you figured it was going to be done in a few days and then I , you know , the company ended up getting acquired by its parent and the deal was off .

And it's amazing , you know the journey of getting deals done I've had , you know , the big black escalades roll up and all the people from Big Pharma pile out and , you know , start going through all of your documents in the war room that you set up for them . It's a lot more virtual now and digital now .

But yeah , I've gone through that experience and it's tough , especially when they say no . You know they come and they look stuff over and they say no , too risky or doesn't fit our pipeline or whatever . It was very frustrating but it was actually a fairly efficient process .

We're very impressed with our , with our friends and colleagues over there at Genentech in particular , and you know we're really excited about this , this alliance , it's moving forward and they continue to support this program by electively going out and talking about data that's been collected and analyses that they've found , and you know they don't have to do that .

So you know , from our perspective , we think that that's a good indication that they're enthusiastic and excited about what they're doing .

I'm curious the black escalades and the uh and the war room is is the color I was looking for I'm curious Uh and I'm sure I'm sure a lot of our audiences , like you mentioned , they come in and they they do a lot of due diligence , very detailed , kick a lot of tires . Can you give us any more um , any more color or perspective on like I asked you ?

If you , if you'd seen this before and you had , if you hadn't like , what would you advise someone in your role who hasn't gone through a deal like that ? What would you advise them to expect ?

They're not that interested and just want some confirmation of that . They usually don't tell you if that's what they're up to , but I've also gone through really extensive processes . So , for example , there's a big pharma that was looking at this program that we were in touch with literally for five years and they were never discouraging .

They just kept saying this is very interesting , please stay in touch , this is very interesting , please stay in touch . Year after year , month after month . And then somebody else ended up licensing it and I think that that other company missed out .

So you can have some deals that get pulled together very quickly for three or four months because they just pour the resources into it . It's very intense . Deals might go , you know , never close after years of expectation and excitement . I think if you can be organized as a licensor , I think that helps facilitate things .

Don't make it difficult for people to get information . Give them access to your organization . If you're proud of your program and you believe in it , it's going to pass muster . You're not competing with just theoretical programs , but you're also competing with other things that they're looking at .

So you know , if you really want to destroy the process , hide something that's a negative and then let them find it right . What a terrible idea , because you really want to destroy the process . Hide something that's a negative and then let them find it Right . What a terrible idea , because you're going to lose credibility through the whole process .

You know , I would rather get in front of it and say hey , here's what you're going to find , here's what we think about it , and you know there's no asset out there that's perfect , that works perfectly , and so you know you're going to have some deficiencies , and so I think it helps those who are doing diligence If you can say hey , I'd just like to walk

you through this so that you know in advance and we build our diligence rooms like that we basically have like a guide to the room . So it was sort of like here's the program in totality , and now for the regulatory expert , here's sort of a written guide to kind of walk you through the history of the regulatory process .

That would be a different guide for the manufacturing person who's got to look through all of those documents . It just makes their jobs easier and gets to answers faster . Because , think about it , you're not moving your program forward while you're going through diligence .

Like you're focused on that diligence and you know trying your best to get good value out of that transaction . So if you do a couple of those every year , you know that's slowing down your company , so you want to make them efficient .

You mentioned also the other follow-up question I had for you on sort of the high level recap of those two clinical programs was around the spinal cord program and you mentioned that I don't recall exactly what word you use , but you alluded to it not being in a very great place at some point around our last conversation on 21 .

Tell us about that and how you got that program resurrected .

You go to the regulators and you look at expectations and you go to the competitive landscape and you see what others are doing and you can find out , you can really assess whether you have a competitive product or not . And so there were some deficiencies in that product .

Now , to be clear , even with those deficiencies , it had thrown off some very evocative phase one data in patients with spinal cord injury . So that's the rationale is you see this really cool data with an imperfect product and you say , oh , this is great , now I want to fix this product because I can only get it better from here .

And so that's really what we did , was we took that product , we went back to square one , we reimagined what the process , development steps , would look like , ie the recipe for how we make the particular cells that we use for those patients , and we also looked at how they're delivered and we noticed , for example , that the old way of delivering the cells involved

this big apparatus that was basically constructed above the patient to hold a needle , and you needed the patient to be immobilized while you're pushing the cells into the spinal cord . Well , you know you have someone who's not breathing and you're trying to administer very carefully cells to just the right location . That's not a great environment .

So we actually spent some of this last couple of years identifying a new delivery system which attaches directly to the patient .

So now the patient's chest cavity is going up and down while they're breathing and because that apparatus is attached to the patient , not to the bed , you can be delivering the cells to the patient while they're still connected to the respirator and breathing . So it offers a really convenient and more safe way of delivering the cells .

And so these are improvements , and that's really been .

Our approach is to mature this new field of cell therapy out of more of an early stage curious sort of maybe I saw something cool in phase one and move it into products that can truly be commercially successful , because you don't have to plate and count the cells beforehand , you can just thaw them and put them right in the patient .

There's so many places where you can make these products better , and so that's what we did , was we invested in that time . And it's very challenging as a business because you're not rewarded for doing that work until years later .

But if you don't do that work , it inevitably is going to catch up with you , and I think that's something that plagued a lot of the early efforts in cell therapy .

Let's reevaluate delivery , like those are , you know , those are big things , like that's product , you know , re-engineering , which can be , you know , if not handled correctly , I can imagine it would be pretty deflating to a company and the team .

Certainly , the team needs to be engaged and motivated , and it has to be the right team , and so there are so many competing factors that it's almost impossible to sort of perfect it . There's no place you can go to school to learn how to do that trade of , you know , moving an organization through that process .

But I do think what can be helpful is to have a strong and optimistic belief system to reward success , to not penalize failure if it's tied to things that are outside of people's control .

Right , If you only look at the scoreboard and don't think about how the game went , you might find yourself developing a culture in your organization that people are not enthusiastic about , and you might lose some very high caliber individuals .

So , you know , I try to get input from people who are a lot smarter and a lot more experienced than me , and then what I really try to bring is just the synthesis of that information to say , all right , based on a lot of unknowns , probabilistically , here's what I think we can do . Do we have the capital or the access to capital ?

Do this flow , this work stream , yes or no ? Would it make sense ? When would we be rewarded for it ? So , integrating in a cohesive manner all the many moving parts and constantly updating that and then providing that vision for what could happen is definitely part of my job .

And I do think that staff from the top of the organization to the lower , more junior levels of the organization can buy into that leadership and be excited about it , because they might not see that the same number of things that I see from the perch that I happen to sit in , the same number of things that I see from the perch that I happen to sit in ,

you know , if I convey that information into the organization , people say , oh , Brian said X and that's why we're doing Y and now I feel better about things . So I think communication is really important , I think optimism is really important and I think you know being honest about where you stand .

You know sometimes you have to shut a program down and people who have worked on it for a long time might not like that , but if you can walk them through why it's important for the health of the company and the long-term success , you know people usually get there .

You know it's going to take too many resources and too much time to get this back on track and to re-engineer the program . So so so two questions come out of that one like how do you lead upline ? How do you , you know , how do you rally the folks who have decision making control about ?

Yeah , Especially in a difficult you know the difficult funding environment that we were pleasure of the board , and so you know I do think about you know I'm wanting the board to be very happy with my performance , but you know I've got thousands of other board members and you know they're called investors and you know there's social media .

They , they have a voice , even if they only own one share or a hundred dollars of stock . Yeah , they're usually the most vocal too , aren't they ? Yeah , they might be , yeah , and sometimes , unfortunately , they might have the least amount of experience in the field , and that happens .

But they still can have , in many ways , an equal voice to people who might own a million shares of our stock . So you actually find yourself having to manage in many directions simultaneously . I'll tell a short story . There was a program that I thought was really challenged .

I wasn't particularly supportive of , I didn't think it was right for the company , and I got good advice from a board member who said you know you're approaching it in a way that you think would resonate with you . Instead of going through the approach that you think would make sense to you , try this other approach . And in this case it was basically the data .

So he said why don't you go knock on 100 doors and show that 100 out of 100 companies weren't interested in partnering with you on this program and then bring that data back ? So now it's not Brian talking about Brian's opinion , but Brian's experience . Good or bad , this is just data . The data says that 100 companies were not interested in program X .

Okay , I think the data speaks . We don't do program X anymore . So there are many ways to convince people or to be persuasive , and one way is not the right way . You have to kind of be flexible and think about your audience . It's the same with funding , the second part of your question .

I often say around this organization that you might have a great idea I mean a really spectacular idea but we can only do the work that we can fund . So even the greatest idea in the world , if it's not viewed as a great idea by the investor community , it's not going to happen because there's not going to be capital available .

So there are constraints that are out there in running an organization and if you spend too quickly , even on great ideas and you're not keeping your head up and looking at the macroeconomic environment , you may find yourself destroying your company in a financial way through its capitalization structure that has nothing to do with the fundamentals of your program .

And similarly , if you just sit around and you wait , always for better days , like , oh , maybe the stock will be higher tomorrow or next week or next month or next quarter . The world shifts and moves on , so you have to be constantly paying attention to both the micro and the macro and factors that go far beyond the fundamentals of your program .

You got to tell people what you're doing , or it's a tree falling in the woods . All of these things come to play and make this job and this activity of developing new therapy is incredibly difficult , but it also is incredibly rewarding .

You sit with someone , for example , who has a spinal cord injury and they say I'm really counting on what you're doing , not for me you won't be able to help me but someone like me , and it's just I mean the chills , right .

And so you get up the next day and grind like like you never grinded before , because you're working for sort of a bigger picture , big , bigger mission .

And that calculated bet was that our manufacturing team that had been so successful with the dry AMD program so successful that they got a $50 million upfront payment from Big Pharma for their work we made the calculated bet that they would be able to do similar successful campaigns with the allodendrocyte progenitor cells , ie the cells of the spinal cord , and they

were . You know the data that comes off of that program , the identity of the cells , the consistency and control of that program , the RNA-seq data that we see when we compare the old way of making the cells and the new way of making the cells . It was a tremendous success .

So you know , very , very happy with how we were able to do that transition from that program and really that's the long-term goal . I mean , there's no reason that transplanting retina cells and pulling vision back in the condition of dry AMD . There's no reason to believe that that's the only place in the body where that kind back in the condition of dry AMD .

There's no reason to believe that that's the only place in the body where that kind of cell therapy can work . It shouldn't be limited to just the eye and the spinal cord .

And so if we can apply what we bring on the manufacturing side and the process development side , and our ability to control the differentiation of cells and the lineage of cells , that is something that we could apply in a lot of places , and so we might be able to multiply our success .

And that really is how to build a big , sustainable company , rather than just , you know , lucking your way into one asset that got a pharma deal and you know , hoping that years later it ends up throwing out you know , royalties . For you right ?

You've got to keep moving forward and build on the technology and the lessons and keep your advantage , your competitive advantage , over others .

I'm I had in my head sort of a , you know , a linear chronology , a linear approach to this interview , but now we're now , now , now it's now , I'm moving all over the place , cause you just gave me , gave me , a good segue to another point that you and I discussed when we last spoken .

You know , I mean it could be taken as a sort of a great one of those great big , audacious , bold statements right From a biotech CEO when he says you know , we , we , we envision becoming the Amazon of cell therapy , right , like having a product for everything rolling out of our platform .

And you do have programs , as we noted , and spinal cord and ocular indications , and also auditory , right , you've got a candidate in the works that's related to hearing . What else , I guess , what else would you see ? You know , if you , if you were going to , if you're going to dub yourself the Jeff Bezos of , of of cell therapy , what other areas do you do ?

You look at and you go . There's no reason , like you just said , there's no reason why this approach shouldn't work here or here or here , and I know this , I'm treading into potentially dangerous water . I don't want you to make any announcements that you shouldn't be making .

We clearly were not going to be Amazon in terms of the same size . The point of the analogy is that Amazon began as a bookseller , but they weren't book experts . They were delivery experts and they were able to move what they learned and what they were really good at in logistics and delivery into selling everything .

The analogy is that we started with an ophthalmology program . We got a big farm partnership for an ophthalmology program that continues to advance and it looks incredibly exciting , but we're not ophthalmology experts . We're cell transplant experts . So the point is scale .

The point is that we have value inherent in an approach that can scale and go into other areas , just as Amazon migrated from books to every widget imaginable and , frankly , no matter how big this company ultimately becomes , I'm not sure there are many companies that even have a shot at it .

I don't know who has a deeper and more advanced pipeline outside of cancer cell therapy . Cancer cell therapy is very established . Of cancer cell therapy , right , cancer cell therapy is very established .

As soon as you move out of oncology but you stay within cell therapy , you know we're essentially a growing center of excellence and I'm not aware of anyone who's got a superior pipeline to lineages in that way of using cells , making them and transplanting them to various parts of the body cells making them and transplanting them to various parts of the body .

Now I do have the advantage that I'm aware of undisclosed programs that we are evaluating in various ways , and so I , you know I can be more optimistic about the future perhaps than others .

But that's really the point here is that there are over 200 cell types in the human body and from a biological perspective , why would we think that the retina is the only place you can find success ? My goodness , bone marrow transplants we've been doing those for 60 or 70 years . They're pretty darn successful . That's really the same technology .

We don't use undifferentiated cells in human beings . We replace the cells that are actually there in the human being but they've been damaged or absent in some way . We're just replacing those cells and restoring function .

When you have a platform and you're an expert at cell transplantation and you subscribe to at least some portion of the Amazon model , kind of begs the question about , like the Amazon marketplace , the marketplace element of the Amazon model .

I mean , could you see a future where lineage cell therapeutics is the expert in cell transplantation for marketplace members' cell therapy programs for instance , like , do you see partnership ? You partnered upstream , obviously with a Genentech deal Do you see a future where perhaps your partnerships expand sort of laterally ?

We do not have a priori a plan to partner every program , nor do we have a priori a plan to commercialize everything other than our first program . Right that that is a a business value creation decision that gets made um based on many , many factors .

Right , if you have good access to capital at attractive prices , you're going to want to hold on to your assets for longer , create more value , before either partnering them or becoming a commercial entity . If you find that the market for capital is not attractive , then you go elsewhere .

And I think the last few years in biotech , you know it was very , very challenging . High interest rates is not a favorable environment for biotech companies , and you saw companies that had IPO'd at , you know , at $20 and shot up to $80 and then they came back to $5 . Well , when you raise money at $5 instead of $80 , it's very expensive cost of capital .

So I think that , on one hand , you have to consider your partner strategy in the context of your timelines and the value that you're trying to create and what's going on in your field . But with respect to partnerships as a standalone matter and smaller partnerships or future partnerships , we already struck one .

We struck one with the gene editing company , because , while our current platform focuses on replacing the cells that are naturally found in the body , the future of this field includes cell engineering , meaning introducing features and capabilities of cells beyond those that are found naturally .

Maybe in some simple and obvious cases , that would be something like hypoimmune cell line . Right , if you want to go outside of the ocular compartment or the spinal cord , into areas where you're fighting white blood cells with foreign material , the right approach there is to develop a hypoimmune cell line , and so we and some other companies are in that field .

But you can also imagine that there might be properties in certain conditions or diseases that would be beneficial , that could either protect cells or give them enhanced properties or enhanced durability , and you could engineer those features into cells .

So that you know , for example this is purely theoretical a retina cell , that is , a replacement retina cell , is a really great idea and working well for us .

But what if we engineered a capability that that retina cell somehow was a super performer , and then we clone those and then we use those and so maybe they're phagocytosing material at a faster rate , or something like that ?

That's the long-term big picture , and you definitely need to have a lot of partners to be working on and exploring all of these , and so we are planting those seeds .

While we are looking forward to the ongoing program in DryMD to be successful and hopefully make this company a lot more successful than the work we've already done , we are planting the seeds for the future , increasing our capability with the lines that we have available and things like gene editing , so that we can continue to maintain that leadership position .

I mean , do you recall some of our conversation around , like what was going on in the regulatory environment during COVID ?

We're challenged to get regulatory attention because there was so much attention being spent on the COVID vaccine and COVID therapeutics . On the other hand , you know , we were witnessing this rapid increase in the cadence of regulatory activity simply because we were in a . You know what is it ? Would it be DEFCON ? I think DEFCON 1 is more severe than DEFCON 5 .

You know we were in an emergency situation so we talked a little bit about that . When we last spoke , you know , we talked about the speed and agility that we were seeing out of the regulatory authorities .

Speed and agility that we were seeing out of the regulatory authorities and I believe you spoke in favorable terms about your interactions with regulators at the time . Do you feel like any of that speed and agility that was sort of injected onto the scene during COVID has stuck ?

Has it stuck around or are you seeing more of a sort of return to normalcy , like what's ?

I mean , I got on the phone and for a particular call about a technology that was relevant to us in that period and I remember there were representatives from BARDA and DOD and NIH and FDA , and you know I'm giving the presentation to these very senior people , like 18 of them from all these different interdisciplinary , you know , departments and divisions across the

government . Well , you know , now our interactions are mostly limited to the project manager for our spinal cord program . So , you know , definitely some things have gone back to normal .

I think what we saw is what is possible and I felt so proud , in an extremely bipartisan way , that what I saw was , you know , what America is capable of doing , whether it's the corporate side , the government side , the human side .

It's why , when I watch the Olympics and I see someone running in there in sixth place but they've got a USA jersey I think they might just win this thing , because there's something about the DNA in the United States that we find ways of solving problems when really pressed . But , being human beings , you know we're fallible and we go back to the normal ways .

You know we're not great at . You know thinking about what statistical probabilities mean and you know we fall back into normal human patterns and psychology . So I think a lot of things have normalized and we've lost some of those special programs that existed for a very discreet purpose .

But I do think that when we were talking , we spent a little bit of time specifically on cell and gene therapy and I remember making a call that we need to see an increase , that the field is moving very quickly and we need the FDA to continue some of its aggressive and rapid activity into cell and gene therapy because otherwise it's going to get too far ahead

of the regulators and they have . If you go onto the FDA website and you look for cell and gene therapy guidance since 2021 , there's a very long list of stuff there .

So I think the push and the adoption of new regulations and understanding and expectations and criteria for monitoring and manufacturing and delivering cell and gene therapy product candidates has been able to keep pace in a very reasonable way .

But you know , when you're a government organization and you deal with an annual budget and you've got elections and everything , that's a very hard thing to do . So I think you know it's mixed , as it would expect it to be . It's mixed results . You're never going to go 10x and maintain 10x forever .

It was great and encouraging to see that it was possible , but I also have seen the shifts into the right areas of what the agency believes is important and where the future is headed , and that's a very promising sign for us .

You know , beyond your call for that on on my podcast , which certainly , I'm sure , influenced the FDA , I'm certain of that .

There's thousands of diseases and conditions to choose from , and so I think it is partly a response to the demand from industry . You know , if we're coming forward with cell and gene therapy programs and you know the regulators , you know that's what they need to staff up for . The other is complexity . You know small molecules are well understood .

There's established rules . Antibody is the same , but the complexity of a living cell is so many million times beyond that which we're accustomed to with small molecules that it requires new rules . I mean literally new rules . How are we going to measure control ? You say you're going to make this cell . What defines that being that cell ?

I sometimes would say to people that we could make something that's completely synthetic , as long as it's safe and effective , normally exist in the human body . That's not the criteria for a new product . The criteria for a new product is around safety and efficacy . So I think those are the two drivers .

There is that there's been an incredible shift into cell and gene therapy and so the regulators and everybody , the payers , everybody in the channel , everybody in that ecosystem has got to be responsive to that . And then you know , the old rules don't apply .

If you apply , you know , the standards of small molecules to making cell therapy , it's all going to fall apart . I would just joke the dose . I get asked . Almost every question I get asked about dose and I always make the joke that you know I don't know . I mean , if you put 100,000 cells or 100 million cells into a person , how many of them survived ?

100 million molecules of aspirin go into your body ? Well , you know , we know what happens to them , the cells they can divide . They might not survive the transplant . How many of them are going to graft and be durable ? So dose immediately is different .

The second , you push the plunger on the needle so the old rules of dose response might break down in the SES therapy . So you can take that kind of analogy or comparison as far as we need , but I think that's really what the agency is responding to is this is where the future is headed and they need to be part of that and ready for it .

Obviously you can't divulge all of it , but I do believe there have been a couple of publicly stated preclinical programs added to the docket since we last spoke . So what can you share about , beyond the two very active clinical programs right now ? What can you share about what's coming next for lineage ?

photoreceptor cell . The other program is called ANP1 , which is for auditory neuronal progenitors , so we're making the auditory neurons that pick up the sound from the hair cells to help people who have hearing loss . I really like that program for a couple of reasons . In particular , it shares a lot of similarity with the dry AMD program .

Right , it's a relatively small number of cells . They go to a very target location .

There's not a lot of competition out there , as we just saw some from announcements from you know , there's a big pharma that just announced recently that some wonderful success in modifying disease , and essentially the headline was , you know , deaf kids can hear again , and that's really extraordinary .

It shows you that this massive problem with sensorineural hearing loss can be modified with agents like ones that we are working on , and so that's really exciting , and this is a program that right now is in functional testing , right . So we're looking at hearing loss in animal models . You and I talked a few years ago and this program didn't even exist .

So what's really remarkable here with what we are doing is that we have the ability to skip a lot of those traditional small molecule steps .

We don't have to develop an assay that we hope is a validated target screen 5 million small molecules find hits , develop those hits to leads , do structure , activity , relationship and all the synthetic organic chemistry that goes along with it to try to finally get a small molecule lead that starts going into animal testing .

We went from sitting around the table and deciding to go into hearing loss to animal testing in less than one year and less than a million dollars . You cannot get that kind of efficiency , and so we have these really interesting advantages with our approach that I think ultimately are going to help this company be very successful .

Because the auditory neuron is known , right , unlike a small molecule where you have to figure out how to get into the pocket and inhibit this SH2 domain interaction and everything , we just have to copy what already is there . So we know what we're trying to make . The auditory neuron is deficient or destroyed .

We're going to replace it and inject it into the ear . If it remains durable , if it remains functional , it may be able to provide activity in the form of hearing , and so our ability to move very quickly is one of the advantages , I think , of our particular approach .

I would ask this question of any CEO of a cell therapy company like um , what , what , what effect do you believe you you can have , should have , maybe have a responsibility to have around , uh , reducing the cost , the , the , you know , the know , the end user cost of these therapies via , perhaps , efficiencies in manufacturing ?

That is a bespoke therapy , that is a custom therapy for one person , and so they're charging $300,000 , $400,000 , $700,000 or millions in some cases of dollars for that specific therapy , because it's one therapy for one person . It's incredibly inefficient .

If it does provide value , you can get reimbursed for it and there's a commercial opportunity , but it is horribly inefficient . What we do is we manufacture replacement cells that can be mass produced and delivered to any of the patients . So when we manufacture RPE cells , we're manufacturing those cells in a bioreactor . It's a closed system .

It can scale very easily from where we are today . It's not on . You know , you don't have a soccer field filled with plastic plates and you have to have people out there manually scraping the cells . That's not what we do .

We have this one three-liter bioreactor that can make 2,500 clinical courses in each run and we have not even scratched the surface on scale . Let's go to a 30-liter bioreactor and see what happens . So the really key advantage of an allergenic therapy is exactly that . These are pluripotent stem cell lines . They are self-renewing .

So you put the media on the cells , they divide and they increase in number and , like that old thing about you know , double a penny every day . It's not very impressive in the first week , but in the fourth week you're a billionaire . That's the same .

Principle here is that our starting material is essentially endless and then we put it through the process to manufacture the specific cell type that we want and our property to do that .

And having these off-shift therapies means that we can really value price our product and not get crushed by how expensive it is with all the handling and manipulation , and that's why I think this company will be very successful in the long run . We're solving those problems now .

We're investing in the manufacturing and investing in the formulation to be able to have those solutions , Because ultimately those can dominate over these autologous , patient-specific therapies that are so expensive .

Okay , well , lineage Cell Therapeutics is working in lockstep with Superman . That's good company to keep .

But so it leads to the question , like I'd like to hear about the relationship there , but also how important , like when you're working in a specific indication area , like in this case , spinal cord injury how important and strategic is it for companies like Lineage Cell Therapeutics to establish those relationships with patient advocacy groups and foundations who work to

build awareness and therapeutic success in those indications ?

Not all of us have the same pain points , but there are certain things that are held in common . So , for example , you know , there's the old commercial with Christopher Reeve that was shown during a Super Bowl , where you know there's .

There's this old commercial with Christopher Reeve that was shown during a super bowl , where you know he , he gets some therapy and he can stand up , and you know it doesn't need a wheelchair anymore . Um , and it and it set expectations . Many people , millions of people , saw that commercial and it set expectations for what you know a therapy should do .

But if you , as I did yesterday , if you spend time with a person who has lived experience person with a spinal cord injury , oftentimes they tell you just a little bit more . I'd like to be able to clamp my hands a little bit tighter around a stylus for my iPad or a fork for my food . People would benefit .

People with spinal cord injuries would love to have just a little bit more activity , mobility , function , freedom , quality of life . It's not about throwing away the wheelchair . And so that's a gap , right , that's a gap between expectations and reality , and every company working in spinal cord injury shares that gap .

So we can work on that collaboratively and that's what the conference has , in part , been created to do . It's building across some success that I had personally in the world of sickle cell anemia , where sickle cell disease was not eligible for one of these wonderful priority review voucher programs , which seems strange . I felt that it should have belonged .

So I got a bunch of companies together and we worked together and we literally changed the law and then President Obama signed a law which added sickle cell disease to the priority review voucher program . So every company in SCD benefited from that . We all contributed to it and it did nothing about competition .

It didn't matter if it was Pfizer or my little company , we all could benefit from that activity . So the conference is aimed at identifying and working on those shared pain points , like endpoints and things like that , in a way that is not competitive .

Like endpoints and things like that in a way that is not competitive and it helps , at the same time , the investor community to understand that there's a tremendous opportunity . There's a big unmet need , and so it does double duty for the investor perspective .

It's a one-stop shop to learn everything they might need to know and understand about the pros and cons and the opportunity about investing in spinal cord injury , and it allows us opportunities to have collaborative conversations around , like combination therapies or you know what could we work on .

So you wouldn't normally think of you know going to a meeting and finding you know AbbVie and the Christopher Reeve Foundation and Lineage all sitting around the table and laughing and having a grand old time . But it's because we're working on things that we all will benefit from .

Lineage just happens to have been the genesis of this activity , but we're really happy that others are coming in and working on solutions . It's just the kind of company we are . I think it's a statement to the spinal cord industry that we're important and we care .

So you know there's some beneficial branding that goes along with it , but really it's about trying to solve problems that we have in common and engaging others in those shared activities so that we can be more successful as a field which you might summarize as just saying making the pie bigger .

You know , I had a cool conversation not so long ago with a friend of mine , paul Preeb , who's been instrumental in creating standards around single use systems of all things , and he made the comment around like if you're ever in a situation where you're lamenting the lack of something and you say to yourself they need to do something about that , he said you need

to look in the mirror and realize that you are they . You know , and I think this is it's an example . It's an example of that mentality .

It's okay , right , there's no trick here , you know , so we get there . I think it'll continue to grow . I think it's become wildly successful . The conference that we created in sickle cell disease , I think , continues to this day . It's probably been 12 years since we started it .

I've been out of that space for a long time , but the need and demand and the benefit of it shows you why it continues to this day .

That's coming down the pike .

And you know , car T has been an incredible discovery . Now people are starting to move outside of cancer into other parts of the body and I think there is going to be an enormous wave of interest . And I see this at big pharma companies . I see this at places like a Stelis and Bayer and Vertex .

And I think there is going to be an enormous wave of interest . And I see this at big pharma companies , I see this at places like Estella's and Bayer and Vertex . And I see it in type one diabetes and I see it in Parkinson's . And of course we have the Roche deal with dry age related macular degeneration , which is huge .

And when I , when I try to answer why , like why is it happening ? I think partly it's because the industry in the field has matured , that we do have the ability to control and scale these technologies and maybe that wasn't present 10 or 15 years ago . So now we can actually have products that generate revenue and of course , that always interests investors .

But also I would say that , fundamentally , cells can do things that small molecules and antibodies cannot .

So when you get to these diseases , especially of , and you start thinking about , oh , I'm going to use a small molecule to treat this condition where the whole cell is completely whacked , you know there's thousands of things going wrong and you're going to go tickle this one pathway . I just don't think that's the right solution .

So , as we have an aging population and people want to live better , maybe replacing cells which has always been the dream of cell therapy right , Organ cells , tissues how do we do that ?

I think it's having its moment now , and so it's really exciting to me personally to be a part of that , to literally be a leader in that field and specifically for lineage , although , of course , any forward-looking statement that I might make , I would always refer people to the risks of investing in lineage first , which are all well-documented and available online .

But we're really interested in seeing what the ongoing clinical trial of our lead program in dry AMD looks like . That trial is being run by Roche and Genentech and when that information becomes available or whatever updates they provide become available .

I think that'll be really interesting because it's one thing for Brian Culley to say we might be onto something very special with this condition . It's quite different to hear that from a company with the experience and the depth and credibility of a Roche and a Genentech with their innovation . So I think that's something that's really exciting .

But we're going to just keep moving all of our programs forward because this probably is a new branch of medicine and we want to make sure that we're pushing the field forward and ahead and being successful with that . Yeah .

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