BioTime and Asterias Enter Into Definitive Merger Agreement to Create Leading Cell Therapy Company

BioTime and Asterias Biotherapeutics announced that they have entered into a definitive merger agreement whereby BioTime will acquire all of the remaining outstanding common stock of Asterias that are not currently owned by BioTime. Asterias stockholders will receive 0.71 shares of BioTime common shares for every share of Asterias common stock and will own approximately 16.2% of the combined company. Subject to customary closing conditions, including approval by the respective shareholders of BioTime and Asterias, the transaction is expected to be completed in the first quarter of 2019.

“Our vision is to build BioTime into a premier cell therapy company and this acquisition can support that transformation as it not only diversifies our pipeline with two additional clinical-stage assets addressing high unmet medical needs, but also adds partnerships with notable institutions such as the California Institute for Regenerative Medicine and Cancer Research UK,” stated Brian M. Culley, Chief Executive Officer of BioTime. “We believe this merger is an exciting opportunity for BioTime’s shareholders to benefit from the potential future value of a more differentiated pipeline as well as the opportunity to impact disease areas that are in desperate need of innovative therapeutic approaches.”

“This transaction can create substantial value for our stockholders, employees and our clinical programs,” stated Michael Mulroy, Chief Executive Officer of Asterias. “The stock merger structure provides Asterias stockholders the ability to continue their investment in our clinical programs in spinal cord injury and non-small cell lung cancer as part of a larger, more diversified company with greater resources.”

Asterias’ Pipeline

OPC1 – Innovative Phase 2 Program for the Treatment of Severe Spinal Cord Injury

  • OPC1 is a cellular therapy utilizing oligodendrocyte progenitor cells (OPCs), which in preclinical testing has demonstrated potentially reparative functions that address the complex pathologies observed in demyelination disorders such as spinal cord injury and multiple neurodegenerative diseases, including multiple sclerosis and white matter stroke. The potential reparative functions of OPC1 include the production of neurotrophic factors, the stimulation of vascularization, and the induction of remyelination of denuded axons, all of which are critical for survival, regrowth, and conduction of nerve impulses through axons at the injury site.
  • Asterias is currently completing a Phase 1/2a clinical trial (the “SCiStar Study”) for severe spinal cord injury where there currently are no approved therapies. The results from the SCiStar Study have been promising:
    • Safety Profile: Results-to-date for the SCiStar Study have shown no evidence of adverse changes in any of the subjects treated with OPC1. To date, there have been no serious adverse events (SAEs) related to the OPC1 cells.
    • Cell Engraftment: Over 95% of subjects in the SCiStar Study have magnetic resonance imaging (MRI) scans consistent with the formation of a tissue matrix at the injury site, which is encouraging evidence that OPC1 cells have engrafted at the injury site and helped to prevent cavitation.
    • Motor Function Recovery: Many of the patients in the SCiStar Study have shown promising upper extremity motor recovery in their arms, hands, and fingers.
  • An independent data review meeting was held recently to discuss the latest results from the SCiStar Study and positive feedback was received from the outside medical and scientific experts on the panel.
  • A meeting with the FDA under OPC1’s RMAT designation is scheduled for later this year to discuss the trial design of the next OPC1 study.
  • A final update on the SCiStar Study results is expected in the first quarter of 2019.
  • The SCiStar Study has been partially funded by a $14.3 million grant from the California Institute for Regenerative Medicine (CIRM) and there is the potential to obtain additional non-dilutive funding in 2019 to partially offset the cost of OPC1’s next phase of clinical development.

VAC2 – Phase 1 Program for the Treatment of Non-Small Cell Lung Cancer (NSCLC) Partnered with Cancer Research UK

  • VAC2 is a non-patient-specific, or “allogeneic,” cancer immunotherapy candidate. VAC2 cells are engineered to express a protein widely expressed in tumor cells but rarely found in normal cells. The VAC2 antigen presenting dendritic cells instruct the immune system to generate responses against tumor cells.
  • VAC2 currently is being investigated in a Phase 1 study for the treatment of NSCLC and is sponsored and conducted by Cancer Research UK.
    • The safety data from the first three subjects has been reviewed by the study’s Safety Review Committee which found VAC2 to be safe and well-tolerated in those subjects.
    • The study currently is enrolling subjects in the advanced disease cohort of the study and immune response and survival data are expected during 2019 and 2020. The study design also includes a cohort of less advanced patients where tumors have been resected.
  • VAC2 is potentially complementary and synergistic with other immune therapies such as immune checkpoint inhibitors.
  • In addition to being investigated in NSCLC, a leading cause of cancer deaths, VAC2 is a platform technology that has the potential to be applied to other solid and liquid tumors and to deliver additional or different antigens depending on the cancer type.

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