Here's a good overview article about Geron's background, current situation and the bioethics controversies that may inhibit it's work.
Posted at 7:27 p.m. PDT Saturday, July 3, 1999
Biotech pioneer has vision, needs results
BY ARIANA EUNJUNG CHA
Knight Ridder News Service
After achieving a series of scientific breakthroughs that are reshaping the way we think about life, a daring Menlo Park biotechnology company now faces its most intimidating challenge:
Two years ago, Geron Corp. discovered what some called ``The Fountain of Youth,'' a way to reset the genetic clock of aging cells. In January, it isolated the most primitive human cells,which in theory could be coaxed to grow into any part of the body. And, in a scientific coup last month, it purchased the technologies used to clone Dolly the sheep.
Now, medical researchers talk excitedly of creating tailormade organs for transplantation, artificially grown blood and ``patch kits'' of cells to treat ailments from heart disease and Alzheimer's to severe burns.
And investors talk of billion-dollar sales.
But without a product on the market, none even in human trials and a workforce that only recently broke 100, industry analysts say Geron will have to fight hard to make its dreams more than hype and hope.
Chief executive officer Ronald Eastman said every employee at the humble biotech company -- whose lobby is decorated by a simple hourglass of sand -- has placed upon himself a tremendous internal pressure ``to fully deliver on the promise of our discoveries.''
Carl Gordon, an analyst with OrbiMed Advisors, an investment firm, said
``the world is holding its breath'' watching for
Geron's next move: ``Most companies in this stage nobody hears about, nobody cares,'' he said. ``But Geron has this awesome potential to change the way we . . . are born and age and die. And that matters to everyone.''
At this precarious moment, Geron finds itself at the center of a growing national debate on human embryo research, with some legislators and religious leaders calling for new limits on the experiments that are key to the company's stem cell program.
In addition, some analysts say Geron's greatest asset -- its broad, ambitious vision -- may also be its greatest liability, that its massive business plan overreaches its ability to deliver, especially as the world's largest pharmaceutical companies have become its competition.
And perhaps most critically, the company has seen heavy turnover in the past 18 months or so, losing some of its chemists, its top molecular biologists -- and even its founder.
Michael West -- Geron's aggressive visionary who colleagues compare to computer software czar Bill Gates in his ability to package ideas -- quit early last year and now heads up Geron's biggest competitor, Advanced Cell Technology in Worcester, Mass. With only 10 employees, it already is collaborating with some of the world's top cloning scientists and amassing impressive patents.
While it isn't unusual for founders to be ousted from their own companies when it reaches a certain stage, it is less common in biotechnology because ventures often take many years to bring a product to market, said Mark Edwards, managing director of Recombinant Capital, a consulting firm in San Francisco.
Some say West's departure may have come too soon. While his name appears on few of the scientific publications that broke Geron's developments, company leaders recognize the projects as his brainchild. As one scientist described it, ``Mike was the ideas person. Everyone else just carried them out.''
Michael West, son of a truck leaser from New Jersey, has always had an eccentric streak, and his interest in aging seemed to fit that part of his character.
In the late 1980s, the study of aging was on the fringe of respected medical science, and only a handful of scientists devoted their lives to the field. West, who had already obtained his Ph.D. and was going for his M.D., sought out two of those legitimate researchers while at at the University of Texas Southwestern Medical Center.
There, West became an expert in telomeres, the tiny caps at the end of DNA that shorten as cells age.
He soon quit school to work full time in an aging research lab at the university and in 1991 quit the lab to start his own company.
He named it Geron, Greek for ``old man,'' short for gerontology, the study of aging.
For several months, he pitched his idea to more than 450 potential investors across the country. Most of the time, West was laughed out of conference rooms.
In 1992, West's passionate speeches finally caught the attention of venture capitalists, who gave him $7.5 million. Alexander Barkas, an influential partner at Kleiner Perkins Caufield & Byers, based in Menlo Park named himself the company's temporary CEO. West became Geron's chief science officer. And the company moved west, setting up shop in Hayward.
Geron's secret to success, it seems, was financing several researchers doing identical work, analysts say. This forced competition allowed it to race ahead of its rivals time and time again.
In 1993, Ronald Eastman, who was a general manager for pharmaceutical giant Lederle Laboratories, became the new CEO. Eastman later recruited an old buddy, David Greenwood, to be chief financial officer.
In those days, West's charisma was contagious, his fanciful talk of immortalizing cells and organs inspiring to all those around him.
``The building was full of enthusiasm,'' remembered Calvin Harley, a Canadian who is now Geron's chief science officer and was one if its first hires. ``It was like we were planning a big trip to a new territory.''
The company went public in 1996 and, as is the case in many start-ups, as Geron grew, West's role shrank.
He moved from science to business, coordinating collaborations with other biotechnology ventures and large pharmaceutical companies. Eventually, he settled into the role of vice president of new technologies, an honorary title.
In time, it was clear West didn't fit in with the new corporate leadership, employees say.
Eastman and Greenwood were golden boys, popular all-American graduates groomed at Ivy League business schools. West had little patience -- and knack -- for politics.
Eastman, whose boyish grin belies his graying hair and is fond of wearing a polarfleece vest with Geron's logo stitched on it, and Greenwood, a towering tri-athlete, made the company an intense but fun atmosphere. Both now 47, they live less than a mile from each other in Monte Sereno.
They made appearances at parties and sporty outings thrown by the
youthful Geron researchers and lab technicians. (The
average age of the company's employees is 35.) West rarely attended.
``It seemed like I always had too much to do to play,''
he said in a recent interview. ``I'm a bit more of a workaholic.'' He was still well liked by the scientists but admits that their relationships were more professional than social.
Under this trio's leadership, the company expanded steadily. Morale was high, as Geron stock over the years resembled mountains with new peaks each time an achievement was announced.
Geron reached its first milestone in August 1997, when scientists in academic labs it funded discovered telomerase, the ``holy grail'' of aging, extending the life of flasks of cells by resetting a part of their DNA.
OrbiMed analyst Gordon said most biotech companies with Geron's resources would have limited their research to telomerase, focusing on its role in cancer development and inhibition. That may have been more practical from a business standpoint, but West and his colleagues had grander plans.
The company's hurricane-like growth only intensified. In December 1997, Tom Okarma, a former Stanford University professor, was named vice president for research and development. He was recruited to jump start the company's stem cell program, formerly West's domain.
With Okarma on board, it seemed clear that there was little responsibility left for West. By February 1998, West said, he knew he should leave.
``Being a gerontologist, I think about aging all the time and I recognize our lives are short. I really wanted to make an impact and I thought that I could get more done if I branched off and did my own thing,'' West said. ``I made the decision and left quickly.''
After West left, others started trickling out of the company. One former employee said it was due mostly to Geron's trailblazing that the field of aging had progressed so rapidly that there were now many job options for experts.
Last November, a few months after West's departure, Geron announced another stunning achievement -- isolating primordial stem cells that, in theory, could be made to grow into any part of the body such as skin, muscle and bone.
Geron's scientific leaders immediately recognized their technology and the cloning techniques developed by Scotland's Roslin Institute -- which had created Dolly -- were complementary.
They theorized that stem cells could be used to grow into new tissue, and that the nuclear transfer could be used to move a patients' own DNA to this tissue, preventing rejection. The telomerase would ensure that the cells remained young despite numerous lab manipulations, which tended to age them.
Early this year, Geron and Roslin Bio-Med, a spinoff of the Roslin Institute, were married. Geron acquired the Scottish company for 2.1 million shares of stock worth about $25.7 million. They also promised to invest an additional $20 million in the non-profit institute over the next six years.
In return, Geron won the rights to all the nuclear transfer patents and a contract with the institute's famous cloning experts, Ian Wilmut and John Clark. Under the agreement, Wilmut, the scientist credited with creating Dolly, would spend around 75 percent of his time on Geron-related projects.
With this acquisition, Geron scientists believe they have all the pieces to create hundreds of medical miracles. Whittling down the huge range of possibilities quickly became one of their biggest dilemmas.
Cancer? AIDS? Or stroke? Spinal cord injury? Or cuts?
In early June, leaders on both sides of the Atlantic met in Edinburgh for an intense three days of scientific presentations and debates.
One of the first things that emerged unanimously on their agenda: cloned piglets.
The basic idea, to use the pigs as a source of organs to transplant in humans, had been thrown around for decades. But in every case, patients' immune systems repelled the transplanted material. Geron was offering a new twist: delete the gene in the pig that creates a sugar coating thought to be a major cause of rejection.
Wilmut, who heads up the project, said they hope to produce such a pig by the end of the year.
The rest of the agenda that emerged from the Geron-Roslin meeting was even more ambitious. Geron even decided it would move into livestock, cloning premium animals -- from derby horses to meaty cows -- that would have taken generations to breed.
Anne Anderson, president of Atlantis Investment Co., said she believes the broad nature of Geron's business ambitions are temporary and are important for fostering fertile and imaginative ideas. But, she said, she expects them to ``prune down the road.''
Meanwhile, analyst Gordon said investors are getting restless for the company to bring a product into clinical trials. Geron's most advanced program is in exploiting a cell's love of telomerase to treat cancer.
In normal cells, telomere tips act like a burning fuse, shortening each time the cell divides and ultimately triggering the cell's death. In cancer cells, the enzyme telomerase prevents the tips from shortening, causing the uncontrolled growth that leads to tumors. Geron's goal is to inhibit the telomerase presence in tumors.
Its challengers are intimidating. Scientists at Bristol-Myers Squibb, which currently dominates the cancer market, and other pharmaceutical giants that are 200 to 500 times Geron's size have jumped into telomerase research, building on Geron's successes.
Geron's sudden success had another downside: close scrutiny. As more and more people learned of its work, some began to question the ethics behind it.
Geron faces challenges on two grounds. One is stem cell experimentation. Anti-abortion and religious leaders have denounced the practice because stem cells are harvested from human embryos, which they say have rights because they could be grown into a person. Another is the fear that Geron's advances in transferring one being's nuclear material to another's may one day help scientific renegades clone humans.
While human embryo research remains legal in most states so private firms like Geron and West's ACT have been free to go ahead with experiments, Congress has prohibited federal funding of such activities.
Legislators are now reconsidering the philosophy behind that law.
About 30 patient groups -- for diabetes, Parkinson's disease, AIDS, cystic fibrosis, stroke and cancer -- have formed a coalition urging the government to give a green light to this research. Without substantial federal funding, they feel the research will make sluggish progress.
The National Bioethics Advisory Commission, formed by President Clinton, announced on Monday that they would side with the patient groups and recommended that federal funding be given to some embryo research. Officials at the National Institutes of Health hope the bioethics advisory decision will spur legislation that would reverse the government ban.
But Sen. Charles Grassley, an Iowa Republican and chair of the U.S. Senate Aging Committee, along with other political leaders, the National Conference of Catholic Bishops as well as such prominent people as former Surgeon General C. Everett Koop have loudly fought these types of experiments.
Richard Doerflinger of the Catholic conference said Geron's experiments
``destroys one life for another. They take the embryos
apart at about a week old when they are perhaps a couple of hundred cells,'' he said.
Okarma said Geron currently gets its human stem cells from embryos discarded by fertility clinics -- and, despite reports to the contrary, does not plan to clone human embryos for use in its experiments. Geron's research remains controversial because it involves destroying a living embryo. In another, less convenient method, the cells are harvested from aborted fetuses.
As for the second ethical issue, the Roslin Institute's Wilmut said fears over human cloning are misplaced, that there is a huge difference between therapeutic cloning, where embryos are created for their cells, versus reproductive cloning, where they are grown into babies.
There must be ``public understanding for this technology so people are not afraid of it. When you talk abut cloning, people automatically think that you are copying people,'' Wilmut said. ``But that was never and never will be a goal.''
Analysts predict many of these ethical debates will be settled in Geron's favor in the next few years. Meanwhile, as Geron moves from the freedom of childhood to the responsibility of adolescence, it will have to quickly prove that it can live up to its great expectations.
For the time being, Dr. Jerry Shay, a professor of cell biology at the University of Texas Southwestern Medical Center, and the other members of the the coterie of world aging experts who collaborate with Geron or serve on its board of directors, are betting on Geron: ``Soon, very soon, Geron will be up there with the Amgens and Genentechs and some day it may even rival the major pharmaceutical makers in the world.''