Pfizer sees opportunity in stem cells

MADISON, Wisconsin Tue Sep 23, 2008 6:17pm EDT

MADISON, Wisconsin (Reuters) - Stem cell research has long been the domain of tiny biotechnology companies operating on a shoestring budget, but new technologies allowing researchers to make stem cells from skin cells has big pharmaceutical companies taking note.

Pfizer Inc (PFE.N), the world's biggest drugmaker, is especially intrigued by new discoveries using induced pluripotent stem cells or iPS cells, in which researchers coax ordinary cells into behaving like embryonic stem cells, said John McNeish, an executive director in global research and development at the company.

"These cells will be tremendous in drug discovery. They will help us understand personalized medicine, genetic variation, ethnic populations, what biomarkers to follow," McNeish said in an interview.

McNeish heads the company's new regenerative medicine unit set up last spring in Cambridge, Massachusetts and devoted to stem cell therapies.

The goal of the unit is to combine Pfizer's strengths in making pills with therapies that take advantage of the unique properties of stem cells, the body's master cells that can give rise to any tissue in the body.

IPS cells can be collected from people with genetic diseases or from specific populations and grown in batches that will live for months and years in the lab.

Some of the first applications will be in drug testing, McNeish said in an interview at the World Stem Cell Summit in Madison, Wisconsin.

"Stem cells can help us make good decisions around which compounds will be more likely to be safe," McNeish said.

Down the road, he said Pfizer hoped to use compounds to stimulate stem cells in the body to repair injuries.

For example, in chronic heart failure, the hope is to use a drug to stimulate the production of new heart cells to repair damaged tissue.

"It doesn't even have to be that much. A three or four percent improvement could be a tremendous improvement in their quality of life," he said.

McNeish will run Pfizer's U.S. unit, which will focus on heart disease and diabetes. In November, the company plans to open a standalone regenerative medicine unit in Cambridge, United Kingdom, to focus on research in ophthalmology and diseases of the central nervous system.

McNeish said the overall operation will eventually have 50 to 60 scientists working on stem cell therapies, and they are working with academic researchers and smaller biotech companies.

"We have several small collaborations already announced and we have several in the works that we hope to be announcing in the next months or so," he said.

McNeish feels the move is a bold one. "It's tough times in the pharma industry -- it is in all industries. For Pfizer to take a risk is very telling," he said.

While he thinks Pfizer is the first to have its own research institute, many other drug companies making investments as well.

Last month, GlaxoSmithKline Plc (GSK.L), the world's second biggest drugmaker, signed a deal worth more than $25 million with the Harvard Stem Cell Institute to use stem cell technology for drug development.

And last year, GlaxoSmithKline, AstraZeneca Plc (AZN.L) and Roche Holding (ROG.VX) launched Stem Cells for Safer Medicines, a collaboration to use stem cells for safety testing of new drugs.

"I think other pharma companies are watching us very carefully," McNeish said.

(Editing by Maggie Fox, Leslie Gevirtz)

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