Stem Cell Therapy Space Worth Review for Investors

By Tedra DeSue – August 3, 2012 | Tickers: BAX, OSIR | 0 Comments

Tedra is a member of The Motley Fool Blog Network — entries represent the personal opinions of our bloggers and are not formally edited.

Advances continue to be made in the field of regenerative medicine, with many products and procedures being made possible from stem cell therapy. While large companies are making headway in this area, many small companies are just as active, raising much-needed funds through the capital markets.

The main challenge all of these companies face is convincing naysayers that their research and subsequent results are ethical. There has been much ado about regenerative medicine efforts that involve stem cells. This has especially been the case for research and therapy involving human embryonic stem cells. For this reason, investors who may be bullish about the industry may avoid these stocks.

The stem cell market is expected to grow to be a $5.1 billion industry by 2014. One of the reasons stem cell research is important to these companies is that it can help them grow their pipelines, according to a research report on the industry Stem Cells in Regenerative Medicine: Benchmarking Analysis of Big Companies Entering the Market.Researchers also see stem cell research as a way to find out the effectiveness of therapies without having to use animals for testing.

Lets take a look at a few of the public companies that have made strides in the stem cell therapy space.

One of the largest pharmaceutical companies active in the stem cell therapy space is Baxter Healthcare (NYSE: BAX). It is in the process of developing stem cell therapy for people who suffer from chronic myocardial ischemia or CMI. The condition stems from coronary artery disease. The company is in the midst of clinical trials to prove that its therapy can repair damaged heart muscles. Its referred to as stem cell therapy CD34+.

Also noteworthy for Baxter is a purchase it made last year. It bought Synovis Life Technologies, which made a name for its self because of the mechanical and biological products it made to repair soft tissue. The acquisition is expected to help Baxter further expand its offerings in the biosurgery and regenerative treatment.

Osiris Therapeutics (NASDAQ: OSIR) accomplished an important feat in the stem cell space by becoming the first company in the world to be able to market its stem cell therapy called Prochymal. On that news in May, its stock traded 20% higher, indicating that investors have more confidence in stocks in this space when they have some kind of meaningful approval by regulators. This product was approved by Health Canada.

Now the company is embroiled in a battle over Prochymal with a French pharmaceutical company that it partnered with to test the therapy. News that the sides have been unable to resolve their differences sent Osiriss stock lower this week. At the time of writing, it had lost 5.32% of its value and was trading around $9.

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Stem Cell Therapy Space Worth Review for Investors