StemCells Inc. said today it will wind down its operations after terminating a Phase II study assessing the company’s HuCNS-SC® human neural stem cells in spinal cord injury.

While the Phase II Pathway Study showed overall improvement in patients treated with the company’s proprietary cells, the size of the effect—and its trend over time—did not justify continuing the trial given StemCells’ financial resources, the company concluded.

StemCells cited a review of data from the study against what it called specific clinically relevant criteria linked to achieving statistically significant results for improving motor strength and function in treated patients. On the basis of that review, the study’s Interim Analysis Data Monitoring Committee (IA-DMC) recommended ending the study, concluding that the data failed the futility criteria established for the interim analysis.

“We are extremely disappointed with the results of our Pathway Study, which we had hoped to be the first clinical program involving cellular transplantation to meaningfully improve motor function in patients with chronic spinal cord injury,” StemCells President and CEO Ian Massey, D.Phil., said in a statement.

StemCells also cited cash and cash equivalents of approximately $5.5 million as of today, adding: “The company cannot determine with certainty the amount of any liquidating distribution to its stockholders, and it is possible that there will be no liquidating distribution to stockholders.”

StemCells said that it will not follow through on earlier plans to conduct a rights offering, for which it had filed a registration statement with the U.S. Securities and Exchange Commission.

Instead, the company added, it will wind down StemCells through a plan approved by its Board of Directors. StemCells said it will seek to monetize its intellectual property, including data collected in its studies and trade secrets, as well as a transfer of its HuCNS-SC cells and other assets through a potential sale.

To date, 17 patients have been dosed in the Pathway Study. The study’s first cohort of six patients was designed to assess the safety, and preliminary signs of efficacy, of cell administration into the cervical spinal cord and select the dose level for the second cohort, a randomized, controlled, and single-blinded arm of the trial in 40 motor-complete patients.

According to StemCells, 6-, 9-, and 12-month results from the first cohort of the Pathway Study revealed encouraging patterns of improvements from baseline, especially in the first 6 months of the study. However, the company also saw a declining trend in the magnitude of the effect in both strength and function at 12 months.

StemCells said the 12-month results were still improved from baseline, however the late variability prompted the company to conduct an earlier-than-planned interim analysis of the second-cohort data. The results of the interim analysis showed differences in motor strength that favored the treatment group, the company acknowledged.

“The magnitude of the effect led both the company and the IA-DMC to conclude that achieving the primary endpoint objective of the Pathway Study would be unlikely,” StemCells stated.

Added Dr. Massey: “We continue to feel immense pride over the contributions we have made to the stem cell research field, and we are confident that the progress we made will be instrumental in future studies in this area.”

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