Stempeutics Research, backed by Ranjan Pai’s Manipal Education and Medical Group (MEMG) has signed an agreement to raise ₹95 crore from Bengaluru-based Kemwell Biopharma, for global commercialization of its stem cell product Stempeucel.
Stempeutics is a late stage life sciences firm that develops and markets therapeutic products based on adult stem cells in India. Incorporated by the Manipal Group in January 2006, the firm has so far received ₹125 crore from its promoter group. In 2009, Cipla committed ₹100 crore over an eight-year period for marketing Stempeucel in India for the treatment of critical limb ischemia (CLI).
“Stempeutics has done pioneering work in stem cells R&D and by far it is the first stem cell company in Asia to demonstrate significant clinical outcomes in CLI. The synergistic combinations of Kemwell & Stempeutics will accelerate the development of novel stem cell-based products for patients and transform India into a global player in stem cell therapeutics," said Ranjan Pai, chairman at Manipal Education & Medical Group
Kemwell is making the investment at a pre-money valuation of ₹400 crore.
Under the strategic partnership, Stempeutics would develop a manufacturing facility at Kemwell’s facility in Bengaluru for contract manufacturing of its cell therapy products. The investment will be made in the firm over a period of five years.
“Presently we have a manufacturing facility in Manipal, which will move to Kemwell’s Bengaluru plant in Nelamangala in the first half of 2020. The construction of the new manufacturing unit has already begun," said BN Manohar, chief executive officer of Stempeutics.
“The idea is to create a global facility since we are trying to globalize our stem cell product and it is very critical because in stem cell research, process is the product. So we want to ensure that we are compliant with the manufacturing requirements of the developed markets," said Manohar.
Part of fresh funds would also be used to expand our existing pipeline in India, he added.
Kemwell plans to infuse about ₹50 crore over the next three years, and another ₹45 crore in the following two years after the first tranche of investment, according to Manohar.
The firm plans to use the proceeds to secure regulatory clearances for its drug in developed markets such as the US, Europe and Japan. It has already initiated discussions with the United States Food and Drug Administration (USFDA), European Medicines Agency (EMA) and Japan Pharmaceuticals and Medical Devices Agency (PMDA).
“Once we have the regulatory approvals, there will also be an opportunity to tie up with a bigger multinational pharma company. Because we are, for now, only present in India and have partnerships with known pharma brands such as Cipla and Alkem," said Manohar.