Athersys inches closer to bankruptcy as stroke cell therapy fails interim analysis

After tweaking a phase 3 clinical trial for the ischemic stroke cell therapy MultiStem with the blessing of the FDA and moving forward with an enrollment goal of 300 patients, Athersys now reports that the sample size is insufficient to achieve the primary endpoint.

The news, revealed via an interim analysis of the MASTERS-2 clinical trial, is another blow for the Cleveland-based company that has suffered massive layoffs, a failed Japanese trial and the loss of a key funding partner in the past year and a half.

Shares of Athersys, already in penny stock territory, plunged by more than half, from 30 cents apiece at yesterday's close to just 14 cents as the markets opened Tuesday.

Athersys announced Tuesday that the independent data safety monitoring board conducted a pre-planned interim analysis of the phase 3 MASTERS-2 pivotal clinical trial and determined that the current sample size of 300 patients is insufficiently powered for the primary endpoint. The goal was to assess MultiStem’s effect via an mRS Shift analysis, which is a commonly used measurement of stroke outcomes with 0 representing no symptoms, 5 denoting severe disability and 6 meaning death.

Enrollment in the trial will now be paused. Athersys will conduct additional analysis with independent statisticians because of the larger patient population that is needed.

The biotech plans to continue looking for strategic options but warned that if a transaction or funding is not secured, it may need to file for bankruptcy and wind down operations. Athersys is also “streamlining its operations to preserve its capital and cash resources” at this time.

“We’re disappointed with the results of the unblinded interim analysis indicating a large sample size adjustment would be required to achieve our primary endpoint. We intend to conduct further analysis to better understand these results,” CEO Dan Camardo said in the release.

Athersys has managed to secure a bit of financial help through a memorandum of understanding with partner Healios offering global writes to develop and commercialize MultiStem in acute respiratory distress syndrome. Athersys will earn $1.5 million and $4.5 million in near-term payments from the agreement with $150 million in potential milestones and royalties down the line. The company will also earn some revenue from the sale of existing MultiStem doses that will be used in Healios’ phase 3 ARDS trial.

Trouble began for Athersys in May 2022 when MultiStem failed a phase 2/3 stroke trial being conducted by Healios in Japan. The therapy did not show a statistically significant achievement of the primary endpoint of an “excellent outcome” at 90 days.

MultiStem is designed as an off-the-shelf cell therapy to promote tissue repair and healing in a variety of ways, such as in response to signals of inflammation and tissue damage. The therapy has received both the fast-track and regenerative medicine advanced therapy designations from the FDA.

Weeks after the failure, Athersys laid off 70% of staff in an effort to cut costs including removing most of its C-suite. That would later prove to be a crucial error, as Aspire Capital Fund cut its funding of the biotech in July 2022. The firm had purchased shares with a caveat that it could cut and run under a range of circumstances, including the departure of any of Athersys’ then-current executive officers for any reason.

Athersys then tried to de-risk the MASTERS-2 trial, meeting with experts to come up with a protocol amendment that the FDA later cleared in March of this year. The primary endpoint assessment of mRS Shift analysis was changed from day 90 to day 365. The company also removed some exclusion criteria to better reflect the standard of care and set up plans to have the interim analysis completed to ensure the patient population is sufficient.