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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO
SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): MAY 27, 1998
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CYTOTHERAPEUTICS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-19871 94-3078125
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification Number)
701 GEORGE WASHINGTON HIGHWAY
LINCOLN, RHODE ISLAND 02865
(Address, of principal executive offices, including zip code)
(401) 288-1000
(Registrant's Telephone number including area code)
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Item 5.
CytoTherapeutics, Inc. today announced that CytoTherapeutics and
Genentech, Inc. plan to end their collaboration to develop and commercialize a
product utilizing Genentech's proprietary growth factor, Neurturin, to treat
Parkinson's disease. The collaboration focused on the delivery of Neurturin via
CytoTherapeutics' proprietary encapsulated-cell technology. As a result of the
companies' decision, CytoTherapeutics expects to reduce its current workforce by
approximately 20%, and to redirect its resources toward programs for pain
control, for ophthalmic diseases and conditions and for stem cell research and
discovery.
The collaboration agreement for Parkinson's disease was previously
announced in November 1996 and superseded a previous agreement announced in
March 1994. Agreements relating to Huntington's disease and ALS, or Lou Gehrig's
disease, remain in effect. In connection with termination of the Neurturin
collaboration, Genentech has requested CytoTherapeutics to redeem a portion of
the shares of its Common Stock acquired by Genentech in connection with the
collaboration as provided by the agreement under certain circumstances. The
redemption amount requested by Genentech is approximately $4 million.
CytoTherapeutics is reviewing the merit and amount of Genentech's redemption
request.
"CytoTherapeutics' scientific team made substantial progress toward
development of an encapsulated-cell product to deliver Neurturin. However, it is
our judgment that encapsulated-cell delivery does not constitute the method of
choice for delivery of Neurturin in Parkinson's disease," stated Joffre Baker,
Ph.D., Vice President of Discovery Research at Genentech.
"Looking ahead, we expect to restart our Phase II clinical trials for
pain in Europe and expect to pursue several opportunities for collaborations
related to our neural stem cell program in the neurodegenerative disease and
ophthalmics areas," commented Richard M. Rose, M.D., President and Chief
Executive Officer of CytoTherapeutics.
In regard to the pain program, Astra and CytoTherapeutics are
continuing to develop the encapsulated bovine cell product which is designed to
deliver natural analgesics to treat chronic pain in cancer patients. Based on
results from a Phase IIA trial reported in January, the Company modified its
implant tether and has recently completed a submission to the FDA to commence a
Phase II trial in cancer patients. In addition, contingent upon approval by
participating institutions, Astra expects to resume patient enrollment for the
Phase IIB European trials of the modified implant within the second quarter.
In the ophthalmics area, CytoTherapeutics recently announced a
significant new initiative under the leadership of Bill York, Ph.D., to discover
and develop novel cell-based products to treat eye diseases and conditions,
including macular degeneration and retinitis
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pigmentosa. Prior to joining CytoTherapeutics, Dr. York was Vice President of
Research and Development, Ophthalmic Products at Alcon Laboratories, Inc., where
he built and directed Alcon's drug discover group. CytoTherapeutics is currently
engaged in discussions regarding potential funding for accelerated development
of its ophthalmics program.
In the stem cell area, the Company is working to further develop its
neural stem/progenitor cell technology program. In 1997 preclinical studies,
CytoTherapeutics' researchers and collaborators successfully isolated,
characterized and engrafted human neural stem/progenitor cell cultures in
rodents. The Company is also conducting stem cell research directed toward the
discovery of stem cells for the liver and the pancreas.
Statements in this current report other than statements of historical
facts constitute forward looking statements regarding, among other things,
product development strategies, partnering opportunities, clinical trials,
preclinical research and development and future business operations. The
Company's actual results may vary materially from these forward looking
statements due to risks and uncertainties to which the Company is subject, such
as failure to achieve required product development, delays in obtaining, or the
necessity to satisfy conditions imposed for, regulatory approval, failure to
achieve corporate partnerships or other funding arrangements, the need to raise
additional capital, risks of third-party intellectual property, adverse clinical
or preclinical developments, and other risks, which are described in Exhibit 99
to the Company's Annual Report on Form 10-K entitled "Cautionary Factors
Relevant to Forward Looking Statements" and incorporated herein by reference.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CYTOTHERAPEUTICS, INC.
By /s/ Frederic A. Eustis
Title: Secretary
Date: May 27, 1998
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