CytoTherapeutics Inc. has signed a research agreement withdevice maker Medtronic Inc. to develop implantabletherapeutic-producing cells to treat chronic pain, the companiesannounced Tuesday.

CereCRIB would use encapsulated living cells or tissue thatproduce therapeutic substances to control pain that originatesin the trunk or limbs, from diseases such as cancer, bydisrupting pain signals to the spinal cord.

Medtronic will take an equity position of less than 1 percent inCytoTherapeutics and will provide through its NeurologicDivision an undisclosed amount of funding for research byCytoTherapeutics' collaborators. Other terms weren't disclosed.

CytoTherapeutics, which completed its initial public offering inMarch, has about 7.8 million shares outstanding. Its stock(NASDAQ:CTII) gained 13 cents Tuesday to close at $6.

The financing should not "have a material effect on ourperformance," said Dick Reid, a spokesman for Medtronic(NYSE:MDT). The Minneapolis company develops andmanufactures biomedical devices for cardiovascular andneurological conditions.

CytoTherapeutics' collaborators at Brown University, theUniversity of Illinois and Rush Presbyterian Medical Center inChicago have helped develop the technology, called CellularReplacement by Immunoisolatory Biocapsule. CRIB uses asemipermeable polymer membrane to encapsulate cells withpores that allow nutrients and oxygen in, but are small enoughto keep out elements of the human immune system, virusesand bacteria, and to prevent the cells from escaping.

Initial work is focused on harvesting, preserving andencapsulating adrenal chromaffin cells, which are found in theadrenal gland and secrete substances that stimulate theformation of pain-disrupting neurotransmitters or endorphins,said CytoTherapeutics spokeswoman Erika Karplus.

The Providence, R.I., company is also developing media tobathe the cells with nutrients, a matrix framework for cellgrowth, and a specialized catheter that will be used to implanta capsule where the therapeutic can be released inside thespinal sheath. The capsule would be tethered inside a patientso that it could be removed easily, Karplus said.

"The technology being developed by CytoTherapeutics bridgesthe worlds of biotechnology and devices," Karplus said."Medtronic brings us their understanding of the pain marketand their understanding of what makes a good device, and webring our understanding of cell biology and biocompatability."

In this collaboration, "Medtronic sees itself as a devicecompany trying to become more of a biological company andplans to use this as a way to understand how cell biology andbiotechnology might enhance their business," Karplus said."They are interested in exploring how the next generation ofdevices might be best designed."

If the initial phase is successful, Reid said, Medtronic willbecome involved in regulatory approvals, sales and marketing.Technological contribution also might come from Medtronic'sdevelopment of the SynchroMed morphine pump, which isused to treat pain in cancer patients, and its Itrel II system,which treats chronic pain by stimulating the spinal cord withelectrical impulses, he said.

CytoTherapeutics has two other CRIB products in preclinicaldevelopment. The company plans to begin in 1993 Phase Itrials of NeuroCRIB, a neurological implant that secretes theneurotransmitter dopamine to treat Parkinson's disease, and tobegin in 1994 Phase I trials of EndoCRIB, a self-regulatingimplant that secretes insulin to treat type I diabetes, Karplussaid.

-- Kris Herbst BioWorld Washington Bureau

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