ViaCyte Raises $10.6M as Artificial Pancreas Moves Toward Key Trials

ViaCyte, the San Diego regenerative medicine startup with a big idea for using stem cell-derived therapy to treat diabetes, says today it has raised $10.6 million through a private equity financing. The deal included the company’s largest existing investors—Johnson & Johnson, Sanderling Ventures, and the Johnson Trust.

ViaCyte says the funding matches the $10.1 million Strategic Partnership Award (SPA) approved by the California Institute for Regenerative Medicine last October to support clinical evaluation of the company’s encapsulated cell-therapy product. ViaCyte is developing the technology for patients with type 1 and insulin-dependent type 2 diabetes.

ViaCyte says its lead product candidate, designated VC-01, consists of pancreatic precursor cells derived from a proprietary line of human embryonic stem cells and encapsulated in a proprietary, immune protective medical device that is implanted under the skin. The device allows the encapsulated cells to release insulin into the bloodstream, and does not require drugs to suppress the body’s immune response to the implanted cells.

The company says it plans to file its Investigational New Drug (IND) application with the FDA to initiate clinical trials in patients with type 1 diabetes early next year. If VC-01 performs in humans as it has in animals in preclinical studies, ViaCyte says, “it could significantly alleviate or eliminate the challenges and complications for Type 1 diabetics who manage their disease through careful control of diet, monitoring of blood glucose levels and injection of insulin.”

ViaCyte says it might sell additional shares of its preferred stock and warrants before the end of the year.

Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.