ES Cell refocuses cell line marketing strategy

Singapore-based company ES Cell International (ESI) is changing the marketing strategies for its human embryonic stem cell lines because of researchers' reluctance to part with intellectual property.

The company is dropping its previous demand to share in any IP flowing from research using its lines and instead is attaching a straight dollar value to the lines.

It is asking $US6000 per line, which come in two containers or 'straws' each holding 500,000 stem cells.

Earlier this year, ESI was looking forward to rapidly rising demand for its six stem cell lines which are among the 72 lines certified for research use by the US National Institutes of Health (NIH).

But the momentum it established in the first half of the year, when it received 100 requests from researchers around the world and converted about 30 into signed Material Transfer Agreements, was not sustained.

It has not converted a high number of initial requests into MTAs with total shipments to date numbering only about 50.

"Some research institutes were uncomfortable with the IP restrictions associated with the MTA and were reconsidering their position," an ESI spokesperson said.

"We are very keen to develop a market for these cells so we have realised a simple letter agreement is a better way to go."

Essentially, the letter is a sales contract that does not attach any conditions about IP developed as a result of research conducted using the stem cell lines.

ESI's new marketing campaign has met "a positive reaction" since it was kicked off this month, the spokesperson said.

"Our aim is to be the gateway to human embryonic stem cells but this is a very new field," she said. "One of the challenges for us is to build the market for these cells and build the knowledge base."

She noted that US researchers have complained their work with stem cells is being slowed by restrictions, according to recent media reports.

"There is a misconception in the US that these cells are more difficult to access than they actually are," she said. "It is important for us to get the message out that we are set up to distribute these cells and have been doing so successfully since the beginning of the year."

The company does not believe its cell line sales will contravene any clauses of the Bill on Research into Human Embryonic Stem Cells being readied for debate in the Senate.

The Bill does outlaw trade in human embryos but that is not the same thing as human embryonic stem cells, the spokesman said.

Tasmanian Liberal Senator Guy Barnett, who sits on the Senate Committee currently preparing a report on the Bill, said he agreed with that interpretation of the Bill's current wording.

"My understanding is that there is a prohibition on the sale of human embryos but not specifically on human embryo stem lines although I acknowledge that some witnesses [to the committee hearings] have put a different view," he said.

"But I would express considerable concern about the sale and commercialisation of human embryo stem cells on the grounds that it leaves the process open to potential abuse."

The $US6000 being charged per stem cell line by ESI pays for a package of services which includes the scientific protocols for culturing the cells and the cell reagents such as antibodies and growth factors needed to make them propagate.

ESI is also offering training courses for scientists involved in stem cell research.

Its cell line offerings form part of ESI's short-term revenue strategy. In the medium term, it is looking for revenues based on partnering and licensing while its long-term goal lies with cell therapy revenues.