NewNeural Inc. is sidestepping the potential political and ethical land mines as it looks to treat victims of disease or injury of the central nervous system by developing adult stem cell therapies from bone marrow.

Whether the treatment is for Alzheimer's disease, stroke, spinal cord injury or Parkinson's disease - or even retinitis pigmentosa - CEO Bob Gonzalez thinks the experience of its chief scientific officer, Kiminobu Sugaya, on which the company is based, will ultimately lead to benefiting patients in need.

After overseeing the divestiture of a biotech unit at Monsanto Co., Gonzalez spent a year looking at different technologies before deciding in August 2002 to found NewNeural on Sugaya's technology.

"It clearly addresses a market with just a tremendous unmet need, and whether it's stroke or spinal cord injury, Alzheimer's or Parkinson's, all of these diseases are desperately seeking solutions [and] all result from when the neurons have been destroyed or damaged."

NewNeural, of Naperville, Ill., exclusively licensed the technology from the University of Illinois at Chicago. Its technology, Autologous Cell Therapy - Neurological, or ACT-N, involves taking stems cells from bone marrow, treating them and injecting them into the brain, where they multiply and migrate to the part of the body where they're needed.

After reading papers and patents in the field, Gonzalez was impressed by Sugaya's technology because it "really appeared that he had a technology that was differentiated, that he could use marrow cells easily obtained from a patient and efficiently make lots of neurons to repopulate the cell."

"A lot of people are trying to repopulate brain cells using embryonic stem cells and neural stem cells; however, those will face problems of ethical [and] political issues, as well as technically they're hard to control and they require some long-term immunosuppression," Gonzalez said.

Others are experimenting with placing therapies directly to the brain. Last week, New York Weill Cornell Medical Center said it performed the first gene therapy treatment for Parkinson's disease, administering the therapy to a 55-year-old man. However, the treatment involved placing genes in the brain of the patient and not stem cells.

Thus far, Sugaya has proved in rats and mice that his procedure creates human neurons, but Gonzalez noted that "every human disease has been cured in rats multiple times." He wants to proceed with confidence, so NewNeural is looking to demonstrate efficacy in a primate model before moving to humans.

"Some companies quickly try to get into Phase I, II, III, and they spend a lot of money and find out the efficacy is somewhat questionable," Gonzalez said.

Instead, NewNeural decided that studying, for example, stroke in a higher primate would be predictive of what would happen in humans.

"Our model is to really show efficacy in a higher-level primate in a stroke model so that we can make new neurons and restore motor and cognitive function," he said. "At that point, we actually have lots of flexibility on the human indications."

Sugaya in July was awarded a five-year, $1.4 million grant from the National Institutes of Health in Bethesda, Md., for his work in neural replacement strategies. He secured the grant from his position as a faculty member of the University of Illinois, but because of the license NewNeural has with the university, the company will benefit from new developments in his research.

Gonzalez would not reveal how much money the company has raised to date, but said NewNeural is in discussions with companies toward potential partnerships.

"Like all biotechs, raising money is important, difficult, and we're working it [from] multiple approaches. We're approaching accredited investors, starting to have discussions with large pharma/biotech/device companies," he said, adding that the company also is looking at life science venture capitalist firms.

Simultaneously, NewNeural, which has two full-time employees, is applying for Small Business Innovation Research grants and submitting grant applications to certain foundations that have interest in the company's disease areas.

The next scientific step is to prove efficacy in lower animals in an effort not only to validate the technology but also to generate "interest and excitement," Gonzalez said. Additionally, the company will use data from those studies to determine strategies for primate studies.

"We believe that if we can raise sufficient funding and if everything goes well, if we have success in our experiments, then we could be in the clinic within two years," he said.

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