Phillips Plastics to help develop orthopedics with stem cells

Wisconsin Technology ^ | 05.21.07

[Coleus]

Prescott, Wis. - Phillips Plastics Corp., a custom injection molder and materials science company based in Prescott, Wis., has entered into a collaborative agreement with a St. Paul biomedical company to develop and commercialize stem cell therapeutics for orthopedic applications.  The agreement with BioE, Inc., which develops human stem cells for drug discovery and therapeutic research, represents a convergence of medical technologies in the form of bio-devices, and has enormous potential for the orthopedic industry, according to Michael Haider, president and CEO of BioE. The companies plan to develop “orthobiologics” products from BioE's proprietary multi-lineage progenitor cell, which is derived from human umbilical cord blood, and from Phillips Plastics' patented growth structures. Haider said BioE, which will serve as the commercial arm of the partnership, anticipates the application will lead to therapeutic products for osteoporosis and bone fractures of the hip, spine, wrist, arm and leg, as well as remedies for injured or deteriorated joints throughout the body.  "With Phillips' materials technology and BioE's biology, there will be a real convergence of devices with biologics," Haider said.

Orthobiologics market

In early development studies, Bio's progenitor cell differentiated into bone (osteoblasts) and cartilage (chondrocytes) progenitor cells, along with a number of other cell and tissue precursors. The progenitor cells, Haider said, appear to be versatile in their ability to develop into a variety of tissue types, including bone and cartilage, and they can be manufactured in large quantities. "Stem cells from cord blood seem to be more immune privileged than stem cells from other sources," he added.  Phillips Plastics, which has annual sales of more than $250 million and employs 1,600 nationwide, will develop custom structures to enhance the growth of BioE's progenitor cell.

The companies initially will focus on developing combination products for strategic licensing. BioE's business model was developed for a licensor, and Phillips' technology already was the element of licenses, so the collaboration fits nicely with the BioE's partnering strategy, Haider said.  While their target market is not the actual patients, but the companies that deliver therapies, the collaboration could improve patient outcomes in the sizeable orthopedics market. On an annual basis, orthopedic conditions affect up to 75 million Americans alone, and are considered one of the fastest-growing sectors in medicine. The stem cell market for orthopedic applications currently is less than $100 million, but industry analysts believe it could exceed $3 billion within the next 10 years.

Robert Cervenka, founder and CEO of Phillips Plastics, says the combination of an aging population, and that population's interest in remaining active, will create opportunities for this type of synergy between the two companies and their intellectual property.  “As the U.S. population ages and individuals become more active throughout their lives, the use of orthobiologics will be a key part of many future orthopedic treatment paradigms,” Cervenka said.
Under the terms of the agreement, Bio has the right to commercialize any combined technologies developed through the collaboration.  Phillips Plastics has 15 locations throughout the United States, including design centers in Wisconsin and California. The company has 176,000 square feet of Food and Drug Administration-registered facilities for the purpose of high-volume medical and clean-room manufacturing.

The two companies were brought together by a mutual business partner, and discussions soon turned to due diligence and internal research on Phillips' material technologies. Haider was impressed with Phillips' patent portfolio and its keen understanding of the needs of medical companies. "We found out it was quite synergistic," he said.