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Will Pluristem Really Dominate The Orthopedic Market With Their Tendon Therapy?

Oct. 27, 2014 6:47 PM ETPLUR1 Comment
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Pluristem (PSTI) is an early stage company who uses mesenchymal stem cells derived from placentas to treat a number of conditions. One of those applications is in tendon healing or tendinopathy. Is this the next Penicillin or an expensive boondoggle that will end up falling flat?

Tendinopathy is a common condition where the tendon that attaches muscles to bone is beat up, with small tears. It traditionally hasn't responded well to steroid cortisone shots, with the pain going away and then returning with a vengeance once the steroid anti-inflammatory wears off. Surgery is also a poor option. This would seem to be a huge market space where a cellular product promising tissue repair might do well. Stem cells would seem to be a good fit here, but what if a cheaper alternative already exists?

The main competition to Pluristem's tendon product is platelet rich plasma (PRP). This is a simple procedure where the doctor draws blood and the uses a bedside machine to concentrate platelets, which are rich in healing growth factors. This PRP is then injected into the damaged tendon. There are now many FDA approved devices that can inexpensively make PRP at the bedside. There are also already tens of thousands of US physicians that commonly inject PRP into tendons. Why? It works well based on large randomized controlled trials. For example Mishra recently published a very high quality trial of 230 tendinopathy patients showing good efficacy for PRP. This begs an important question about Pluristem's expensive off the shelf stem cell product. If PRP has many studies showing it works to heal tendons and costs about 200 bucks to make, even if Pluristem can get their product cost down to a few thousand dollars (a very big if), why would any insurer pay several grand for a vial of stem cells when a much cheaper PRP treatment works just as well? By the way, as of this morning, listed in the US National Library of Medicine there are 146 studies showing efficacy for PRP in thousands of patients. All Pluristem has been able to produce is a press release where 13 patients have been treated for teninopathy in a dosing trial.

In conclusion, as a practicing physician using PRP to treat tendons day in and out, it's always amusing to see stock market analysts and paid physician consultants comment on how well a tendon product will fare. From the end user, it's very unlikely that Pluristem's tendon product will supplant PRP as a mainstay for tendon treatment. In addition, the cost of a cultured cell therapy product will be many times what an insurer will be willing to pay in this market. While Pluristem may have some other winners in the cell therapy space for serious diseases, their tendon product will likely hit the market with a resounding "thud".

Analyst's Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

The author is a practicing physician using platelet rich plasma and owns a private company focused on building a network of physician's who could be potential users of Pluristem's tendon product.

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