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Cellular Dynamics Raises $40.6 million
MADISON, Wis.—Cellular Dynamics International Inc. (CDI), reportedly the world's highest volume manufacturer of human heart cells, has closed on a $40.6 million Series B private equity round. This financing enables the company to, human heart cells derived from induced pluripotent stem cells (iPSCs), and to launch additional human tissue cell products for biomedical and pharmaceutical drug development and safety research. CDI also plans to use the proceeds to rapidly expand its commercial organization to meet the growing demand for these iPSC-based products. CDI has raised a total of $70 million since 2004.
In addition CDI plans to apply some of the new funding toward expansion of its product lines beyond the current iCell Cardiomyocytes product offering. "We intend to launch liver, nerve, and blood vessel cell products over the next 18 months," says Chris Parker, CDI's chief commercial officer.
"CDI has now secured the highest level of funding in this new industry," notes Robert Palay, the company's chairman and CEO. "We have strong demand from pharmaceutical companies for live heart cells derived from iPSCs because the high purity and quality of our cells result in more accurate preclinical drug testing. Prior to our product introduction, new drugs were tested primarily on either human tissue cells from cadavers, cells derived from tumors, or animal cells, none of which accurately mirror what happens in a live human body. We believe access to iCell Cardiomyocytes will help speed the discovery of safer and more effective medicines."
CDI grows its fully pluripotent stem cell lines from individual skin or blood samples from adults. "Our iPSC approach gives our pharmaceutical customers the opportunity to test their drugs' specific effects on different people's heart cells, allowing them to look at the effect of drugs on people based on factors such as gender, heritage and other biological differences," Parker explains. The company's iPSC technology isolates and cultures skin or blood cells from human donors and then coaxes them to turn back their developmental clock and become iPSCs, which then can be further directed to morph into any of the human body's more than 200 cell types.
"Today, iCell Cardiomyoctyes help pharmaceutical companies speed the discovery of safer, more effective drugs. Our vision is to one day manufacture personal stem cell lines for any individual, and to grow large quantities of that person's heart and other cells for their own bank of cells, Palay says. "I can foresee a day in the not-so-distant future when doctors will be testing medicines for safety and effectiveness on your own cells before giving you a prescription. CDI is working towards the day when such personalized drug testing leads to safer, more effective treatments."
This Series B Preferred Shared financing was led by Tactics II Stem Cell Ventures, which also led CDI's prior capital raises. Other investors in the recent financing include Sam Zell's Equity Group Investments, L.L.C., and Sixth Floor Investors LP
Newly elected board of director member, Leonard Loventhal, an officer of Sixth Floor Investors, comments, "While many in the emerging stem cell industry are chasing distant cellular therapeutics, CDI has developed industrial expertise in high-volume, high-quality manufacturing of human iPS cell-derived tissue products. When combined with their strong intellectual property position, full freedom to operate, and the capital resources of this investor consortium, CDI is uniquely positioned to provide its pharmaceutical customers with iPSC-derived products immediately useful in drug discovery and safety testing."
"We've known the CDI's management team for decades," says Mathew Zell, managing director, Equity Group Investments LLC. "We are impressed with its track record of creating value in the life science industry and with the exciting progress at CDI in particular. We believe the launch of iCell Cardiomyocytes is just the first of many important new products."
Jamie Thomson, CDI's chief scientific officer, further comments, "I am gratified that CDI has been able to secure funding to expand the availability of iPS cell-derived human tissue cells to the research community. CDI has been successful in manufacturing fully functional cardiomyocytes and other tissues from its fully pluripotent iPS cell lines. My view is that the immediate contribution iPSCs provide is as a model for drug discovery and toxicity testing, with therapeutic use perhaps decades down the road. CDI has attained this first goal, providing highly purified human iPSC-derived cardiomyocytes in the quantities and quality required for drug testing and is already well underway to offering multiple other tissue cell types."
CDI is a developer of next-generation tools and services for drug discovery, screening and predictive toxicology, and was founded in 2004 by Dr. James Thomson, a pioneer in human embryonic stem cells from the University of Wisconsin—Madison.