SCIENTIFIC RATIONALE
PRODUCT PORTFOLIO
It is estimated that there are approximately 35,000 new SCI victims each year. These injuries typically
occur during an individual's most productive years, between the ages of 16 and 30. The trauma frequently
results in significant morbidity, including respiratory problems, bladder and bowel dysfunction, and loss of
motor function. Moreover, these sequelae represent a significant physical, psychological, and economic
burden to the affected individual and a substantial economic burden to society. For example, it is
reported that first year costs associated with spinal cord injury range from $325,000 to $500,000 per
patient, potentially exceeding $2 million over the life of the patient.
Proneuron believes that treatment of complete SCI represents an attractive niche market opportunity, and
anticipates launch of the Autologous Activated Macrophage Therapy, in 2005. The company intends to
market the therapy through its own sales force and distribution network. The concentration of its target
customer, neurosurgeons treating SCI, and the uniqueness of the Proneuron Cell Centers will allow the
Company to feasibly achieve this goal.
Today, the Company operates two cell-processing centers: one in Israel and one in Belgium. To support
the next stage of clinical trials, Proneuron is actively negotiating with several model rehabilitation centers
and leading academic institutions located in large metropolitan areas throughout the US. Proneuron will
establish several cGMP compliant cell centers in the US during 2002 and 2003, and will upgrade the Belgian
and Israeli cell processing centers to support its clinical trial program and the commercialization of its
therapy.
To enhance its dominance in the area of SCI, Proneuron is intensively pursuing a research and
development program to address the specific challenges associated with developing a therapy for
incomplete SCI injuries.
In addition to the Autologous Activated Macrophage Therapy, Proneuron has developed a proprietary
therapeutic vaccine for acute and chronic neurodegenerative disorders. This agent is the result of work
performed by Professor Schwartz, demonstrating that progression of various neurodegenerative disorders
could be attenuated via therapeutic vaccination. The therapy is currently in late stage preclinical
development for various indications.
The therapeutic vaccine uses Copolymer-1 (Cop-1), the active compound in Copaxone' (Teva
Pharmaceutical Industries), which is an FDA approved treatment for Multiple Sclerosis. During 2001,
Proneuron entered into a strategic collaboration with Teva to develop this proprietary therapeutic
vaccine. Proneuron has licensed to Teva the development and commercialization rights to its therapeutic
vaccine for various indications. In addition, Proneuron has secured a development and supply agreement
from Teva that will allow it to independently commercialize the agent for certain indications that fall within
the Company's strategic focus (i.e. ALS or Lou Gherig's disease, Huntington's disease and partial spinal
cord injuries). Based on promising preclinical results and the proven safety profile of Copolymer-1,
Proneuron is in the process of implementing an intensive development plan that will allow it to commence
clinical studies in ALS during 2003.
Proneuron's portfolio also includes a novel molecule, Immune Privilege Peptide (IPP), which has been
shown to possess immuno-modulating properties.
Company Profile
Proneuron has a 18,000 square foot R&D facility in Ness-Ziona, Israel. This facility includes a GMP
cell-processing center. The Company currently employs 40 professionals, including more than 20 PhDs
and MDs. Proneuron also benefits from its exclusive research contract with the Weizmann Institute. Under
this agreement, initiated already in 1996, 15 scientists are supporting Proneuron's pipeline expansion
under the leadership of Prof. Michal Schwartz.
Proneuron's clinical trial of the macrophage therapy began in 2000, under an 'Investigational New Drug'
(IND) authorization from the US FDA and the Israeli Ministry of Health. Patients from the US, Europe and
Israel participated in the study following the referral of leading hospitals. Those patients who met
eligibility criteria were transported by Proneuron to Israel for administration of the experimental cell
therapy and follow-up at the Sheba Hospital in Israel, before returning to their homes for long-term
follow-up.
Over the course of the trial, Proneuron has had enquiries from hundreds of prospective patients wishing
to enroll in the study. Dr. Valentin Fulga, Proneuron's Senior VP of Development, noted the enormous
effort that patients, their families and their referring physicians have made in helping to advance
Proneuron's clinical investigation, and a hope to continue to help others in return for their support.
Dr. Daniel Lammertse, Medical Director of Craig Hospital in Colorado and President of American Spinal
Injury Association, has followed the clinical progress of several of the Phase 1 trial subjects. Dr.
Lammertse expressed cautious optimism for the potential of this treatment noting that, "the Phase 1
results suggest a positive treatment effect, giving clinicians hope that a new era of intervention is at
hand."
PRONEURON BIOTECHNOLOGIES, INC.
Proneuron, a Delaware registered company, is the first biotechnology company to apply the power of the
body's own immune system for the treatment of permanent debilitating central nervous system (CNS)
disorders. The six year old company bases its activities on the groundbreaking research of Professor
Michal Schwartz of the Weizmann Institute of Science, which demonstrated the role of immune response in
normal and pathological conditions in the central nervous system. Currently, Proneuron is focusing its
expertise in cell therapy and neuro-immunology on the development and commercialization of a treatment
for spinal cord injuries (SCI) as well as other neurological disorders, which until now were considered
incurable.
The body, routinely employs the immune system, to protect against intruding microorganisms (such as
bacteria and viruses) by attacking and eliminating them. Traditionally, it was believed that protecting the
body against harmful self-compounds, which cause nerve degeneration in acute and chronic conditions,
was not part of the immune system's function and that immune cell activity may further exacerbate the
degenerative process. However, Prof. Schwartz has shown that appropriate modulation of the immune
system, can protect the body and overcome the normal inhibition of recovery and neuronal loss following
injury to the CNS. As a result of these findings, her group has devised a novel form of therapy, in which the
natural activity of the immune system is harnessed to facilitate recovery after acute SCI and attenuate
neuronal loss in diseases such as Amyiotrophyc Lateral Sclerosis (ALS), Parkinson's disease, and
glaucoma. The concept of helping the body to "cure" itself, offers hope for the millions of victims of
nervous system-related injuries and disorders.
To date, this approach has provided the Company with its lead candidate, Autologous Activated
Macrophage Therapy, currently in FDA approved Phase I trials for the treatment of complete SCI.
Proneuron has recently completed enrollment of patients in the study. Preliminary results suggest, that
the therapy is safe. Furthermore, it has exhibited promising efficacy. Due to the significant unmet need in
the area of SCI, the company anticipates that the FDA will grant the Autologous Activated Macrophage
Therapy accelerated approval status. The company is also conducting a Phase Ib clinical study in
collaboration with the Erasmus Hospital in Brussels, Belgium. This study is expected to complete
enrollment of patients before the end of 2002.