nov tx sci.tech.122909

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Confidential and not to be reprinted or reused in any form without the express written consent of NovTx (29-Dec-09)

Novostem Drug Discovery and Development -------------------

A Scientific and Technical Review

(2) 1 - Novostem (NovTx) Therapeutics - Next Generation Cancer Drug Discovery

(4) 2 - Cancer Stem Cell (CSC) Biology - A Paradigm Change with Implications

(8) 3 - NovTx Scientific Leadership

(10) 4 - Key Events – The Transition for NovTx from Academic to Commercial

---> For a Concise Timeline (10)

---> For a Detailed Summary (11 - 12)

(13) 5 - Basics and Building Blocks: A Decade of Solid Science Infrastructure for CSC R&D

---> For a Concise Summary (13 - 15, 30 - 36, 39 - 45)


(46) 6 - NovTx Drug Discovery and Development

---> For a Concise Summary (47 - 54)


(61) 7 - Intellectual Property

(64) 8 - Appendix

1. NovTx Highlights, Accomplishments, Early Successes, Productivity, Products (65 - 67)

2. Bibliography (68 - 69)

3. Glossary of Terms (70 - 77)

4. Proforma of Current Industry Standards for Drug Discovery and Development (78)

5. Schematic of Estimated Platform Screening Productivity and Related Parameters (79)

6. List of Figures (80 - 81)

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1 . Novostem Therapeutics – Next Generation Cancer Drug Discovery

Novostem Therapeutics, Inc. (NovTx) is a drug discovery and development company that specifically targets the cancer stem cell (CSC) subpopulation. CSCs are rare, but have been demonstrated to exist and play an important role in most critical disease aspects of solid cancers. CSCs have become the new cancer cell target of choice for drug discovery, and the basis for changing NovTx’s understanding of cancer and its approach to cancer treatment. Cancer stem cell biology is paradigm changing and has grown as a body of knowledge exponentially over the last decade from the collective contributions of numerous cancer and stem cell research scientists of diverse backgrounds, labs, and academic

institutions. Virtually all research to date coming from the academic and biotechnology sectors implicates CSCs as a rare fraction of cells that exist within the total cancer cell population of a given tumor, yet are responsible for virtually all major biological events in cancer, including but not limited to: tumorigenesis, primary tumor development, local and regional tumor spread, metastasis, resistance to chemotherapy and radiation, and tumor recurrence.

NovTx’s primary focus is discovery, preclinical development, and clinical testing of CSC-targeted small molecule therapeutics. NovTx’s scientific team is among the most

experienced in the world in CSC biology understanding and technical know-how. This gives NovTx a decided advantage over competitors that are only now entering the field. Conversely, NovTx scientific leadership can claim taking an active role in establishing the field through their collective efforts and early discoveries in CSC biology. The comprehensive understanding of CSC biology created over the last decade by NovTx researchers will be used by NovTx’s Smart-Pharma group to identify targeted approaches to anti-CSC drug development. Further, NovTx biotechnology is centrally relevant to the CSC biology of virtually all solid tumors, is relatively sophisticated when compared to the current state of cancer drug screening (in industry), yet is easily adaptable to diverse therapeutic strategies. For example, areas of growing interest to NovTx that should be simple to implement using NovTx patented methods

for CSC selection and detection in vitro include macromolecule and immunotherapy approaches, as well as the development of diagnostic and prognostic modalities. The addition of research programs such as these would simply require interested partners and collaborators from the academic and commercial sectors. There are two areas in the clinical cancer arena where NovTx anticipates having the most immediate impact:

First, to use NovTx next generation drugs as an adjunctive treatment for those cancers that have somewhat effective therapeutic options, but collectively are limited in their overall utility in the long run for a patient with a given type of cancer. In this scenario, a patient with newly diagnosed cancer would undergo surgical resection, followed by radiation to the tumor bed, and the initiation of chemotherapeutic protocols with standard of care drugs. NovTx next generation drugs would be an appropriate addition to this typical cancer treatment approach, and would likely lead to significant gains in quality of life and cancer free survival. Select examples of common limitations that might be encountered as patients engage in standard of

care radiation and chemotherapeutic protocols include: inability to achieve cure or remission despite effective reduction of the overall tumor burden, dose limiting toxicities, poor access to organ systems with natural barriers (i.e., the central nervous system), interpatient differences in response of a given cancer to a given drug due to genetic heterogeneity in patients of differing genetic backgrounds, and different efficacy profiles of a given agent against the

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cancer in its primary location as compared to a distant site of metastatic spread. Examples of such cancers are adenocarcinoma of the breast and prostate.

Second, to use NovTx next generation drugs as a primary or front-line therapeutic for those cancers that are very malignant and rapidly progressive, yet currently do not have good therapeutic options. This class of cancers includes glioblastoma multiforme of the central nervous system, and pancreatic adenocarcinoma. These cancers, for reasons that are primarily unclear, have been largely unaffected by the dramatic advances in molecular based knowledge of cancer as a disease, and in the various technologies used to diagnose and treat these cancers. Diagnosis with one of these cancers in the present is typically associated with rapid disease progression and death within months to a few years (most commonly 6 – 18 months). For cancers of this nature, next generation drugs discovered and developed by NovTx that target CSCs would provide patients with much needed treatment options.

NovTx is approaching the CSC drug discovery space from two directions:

Arm 1: The Smart-Pharma Drug Discovery Program is identifying high yield hand selected

drug targets based on its collective expertise and extensive experience with cancer, and especially with CSC biology that goes back over a decade. We are pioneers in CSC biology, and leaders in the field.

Arm 2: The Pan-Pharma Drug Discovery Program is identifying novel compounds with anti-CSC activity using its first in class large volume CSC culture technology and high throughput drug screening platform to screen compound libraries at a rate of thousands per month.

High potential compounds and novel drug targets discovered by Pan-Pharma or Smart- Pharma Platform Screening will be further developed in a preclinical and translational manner in accordance with industry standard protocols and methodology. Early stages of formal drug development will most often occur internally, while later stages up to and including clinical testing will most often occur in collaboration with strategic partners. Conversely, some of these high potential cancer drug candidates will be made available for licensing to the pharma and biotechnology sectors. NovTx will bring a minimum of one and a target of three CSC-

targeted therapeutics into phase I/II clinical trials over the next five to seven years. In addition, NovTx will open its screening platform in the near future to pharmaceutical and biotechnology companies interested in collaborative compound library screening efforts.

------------------------------- NovTx is committed to its partners and to those whose fate will be affected by cancer to utilize its novel biotechnology platforms and approach to discover, develop, and implement the next generation of drugs for the treatment of cancer.

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2. CSC Biology as a Paradigm Change - Implications for Cancer Drug Discovery

The identification of CSCs in solid cancers (in conjunction with relatively accurate in vivo models of CSC biology), has led to a new and very different understanding of cancer. This new understanding, in turn, will eventually change how cancer is approached with respect to therapeutic strategy and drug discovery. Some core concepts and their implications are listed briefly below: 1) CSCs are responsible for most (if not all) major biological events in a cancer’s life

cycle, some major categories include: tumorigenesis, metastasis, resistance to radiation

and chemotherapy, and tumor recurrence despite maximizing all therapeutic options. Thus, the CSC subpopulation, as it exists naturally in vivo as a part of the total cancer cell population, should be the primary focus of targeted and screening drug discovery over the next decade.

2) CSC biology has yet to be formally introduced into present day drug discovery

(neither into its thought process or methodology). Therefore, this is an untouched Drug Discovery space that is poised to be strip mined with significant short term gains. The predicted yield in the present day, and further over the next 5 – 10 years is relatively high. Beyond five years, and certainly within a decade, the biotechnology deficits

that exist almost uniformly in the CSC field with respect to utilizing this stem-like population for large scale drug discovery approaches will be overcome by alternative paths. Ultimately, as would be expected, the density of the field with respect to new CSC focused companies developing or existing biotech/pharma redirecting resources to CSC programs, will reach a steady state similar to that seen today for cancer pharma in general (excluding the CSC field).

3) There are many reasons for presuming rapid growth in the number of known and novel

anti-CSC pharmaceuticals. A detailed discussion is not feasible as part of this technical review. However, there are three relatively logical considerations worth discussing.

i. First, a rapid identification of known drugs (cancer drugs or drugs currently being used for some other disease process) will occur based on biological similarities and overlap between that drug’s bioactivity, and the genes, proteins, and pathways CSC’s utilize.

The predictive nature of this approach by definition only implies some attractive anti-CSC activity, verification and develop of this “method of use” is required (and therein lies the IP as well) Thus, the flow is simple and logical.

Advances in CSC biology ---> Cross-reference against all known diseases and drugs --->

Identify overlap ---> Find drugs that appear to fit the model, and that target the biology --->

Pilot studies ~ Rapid early proof of concept ---> IP protection through standard channels --->

Definitive formal development studies targeting the new method of use discovered ------------>

Protection of new IP through standard channels, advance into early clinical trials as indicated

ii. From single attractive hits, derivative subclasses of molecules (derived from modeling the parent compound) can be created by introducing key changes in a given molecule’s functional groups. Such an approach will be feasible for a number of these drugs.

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Discovery of an attractive anti-CSC compound on the drug discovery platform, or Discovery of an attractive anti-CSC compound on the pan-pharma platform -------------------->

Simultaneously early drug development and creation of a derivative molecule subclass ----->

Pilot studies to provide standard criteria to identify the best 1 – 2 candidate compounds ---->

Late stage drug development for best compound (per its safety, efficacy, pharma profile) --->

Protection of new IP through standard channels, advance into early clinical trials as indicated

iii. Similarly, targeted approaches use cell and molecular research to create new targets by identifying a potential target based on know biology, and designing a drug against that target; This can lead to the creation of an atypical type of drug class (classified by their association with a critical pathway or regulatory process) by simply walking upstream and downstream of said pathway, using the original drug target as a starting point.

Thus, understanding biomechanism will yield (the potential will exist immediately, the

actual as such exploratory R&D approaches evolve) a series of prototypic drugs that may be extracellular (against a given receptor, for example), intracellular (a tyrosine kinase for example, that is part of a cell surface to nucleus signaling cascade), or intranuclear (a transcription factor, for example, whose response, whether direct activation or repression of its target gene’s activity, is the end result of that particular signaling cascade firing. Experienced stem cell and cancer cell biology teams are critical for using biomechanism as a catalyst to develop drug targets, and to use biomechanism as a starting point to begin walking through a cell’s key signaling and regulatory pathways to find new targets that exist up and down a critical pathway.

In summary: The end result of discovering high quality anti-CSC compounds through drug discovery, or through biomechanism based drug targeting, is a rapid proliferation of

subclasses of molecules around the best hits, or around the best cell signaling and regulation cascades. Biotechnology groups that can back up claims of CSC detection and selection technology, as well as CSC sensitive drug discovery, simply need access to compound libraries to operate in an untapped drug discovery space, and have a head-start on others in the field of months to years. Without the appropriate technology and know-how, there is no way to get there with standard approaches to cancer drug discovery. NovTx is ready to launch its drug screening platform at full operational capacity, begin targeted drug discovery in parallel to screening, and continue formal development of its first lead compound into clinical trials.

4) CSC-sensitive biotechnology implies that an exponential increase in the bioactive

signal is seen as a matter of routine (as generated by CSCs in culture for expansion of cell numbers, or as a part of drug discovery and development assays). This is due to enrichment of the correct cellular target, major advances in large volume culture technology, and the coupling of smart CSC biomarking approaches with sophisticated detection technology.

For example, in standard cancer drug discovery methodology: The CSC fraction is rare (0.01 – 10% of the total cancer cell population), is unknown to the investigator (conceptually), is relatively hidden within the total cancer population, and is too few in

number to collectively create a detectable signal change.

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Conversely, compare with NovTx CSC-sensitive Drug Discovery Technology: CSCs are the predominate cancer population in the screening assay (93 – 96% of the total cancer cell population), are relatively well understood by the investigator (again, conceptually), collectively give off a strong detectable biologically relevant signals that parallel viability for all cells, and also specifically for the CSC subcompartment of the total cancer cell population.

Thus, compounds that generate signal changes in CSCs will be identified or discovered.

5) The probability that a hit with good efficacy against the CSC population will perform well in preclinical and clinical drug development is exponentially higher. The simple assumptions from a decade of research, and in concert with the results of many other competing academic groups and biotechnology entities, are that: solid tumors have CSCs; these cells are the critical initiators, drivers, and biomechanistic implementers of cancer as a disease. To restate this in a manner that is relevant to drug discovery; CSCs are the cancer cell subpopulation that should be the target of choice based on their pan-cancer biology phenotypy.

6) Leukemia as a model for the potential positive changes in understanding and therapeutics on the horizon for solid cancers: The best example of this potential impact, and where the role of CSCs are best understood, can be taken from the last four decades of research for leukemia, hematopoietic stem cells (HSCs), and their transformed counterparts in leukemia. The discovery and characterization of CSCs in leukemia led to

CSC targeting with novel drugs and alternative therapeutic strategies (for example, the bone marrow transplant). The result for patients with leukemia was unprecedented gains in quality of life and long-term outcomes (for example, the ten year survival of patients with leukemia increased from 5 – 15% upwards to 80 – 90%).

------------------------------------------------ The Way Forward

Whether from the viewpoint of traditional academics or the biotech/pharma sector, a CSC concept for solid tumors, and solid tumor CSC biology in general, has rapidly taken hold. As

shown in Figure 1A below, a trend of signficant and exponential growth is observed in the academic sector (using the publication of new scientific reports in the literature as a rough correlate of interest and activity in the academic sector; from 0 in 2001 to roughly 200 in 2008). As shown in Figure 1B, similar trend was noted in the commercial arena, where the number of pharmaceutical and biotechnology companies communicating a shift in resources, manpower, and research funding towards CSC-oriented R&D is also exponentially growing (from 1 in 2001 to 38 in 2008).

\The identification of novel extra- or intracellular drug targets in CSCs, and the design and discovery of new drugs that target or impact the CSC population directly, will require a deep

and intimate cell and molecular based understanding of CSC biology. A diverse array of stem cell and cancer oriented approaches are needed (for example, in vitro stem cell assays and pan-biologic animal models of CSC biology). NovTx’s roots are in academics with a long and rich history of discovery focused basic science research in CSC biology and related areas.

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NovTx is led by a group of researchers that are pioneers in the field of solid tumor CSC

biology, and are the first group ever to present a solid tumor CSC concept publicly (Kukekov et al., Society of Neuroscience Meeting, Los Angeles. November, 1998), and the first ever to publish the concept in the scientific literature (Ignatova et al., 2002, Glia). \\

-----------------------------------------------

CSC biology is moving from a paradigm change to a widely accepted model of cancer.

FIGURE 1 Analysis of the exponentional growth of CSC biology related research and development activity in

the academic biosciences and commercial biotechnology sectors. A. Number of CSC-focused research

publiciations in the scientific literature in a given year as specified. B. Number of Pharmaceutical or Biotechnology companies communicating CSC focused R&D, in a given year as specified.

# #

A B

Year Year

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3 . NovTx Scientific Leadership*

Christopher D. Duntsch, M.D., Ph.D. (Age – 38)

Relation to NovTx: Original Scientist. Company Founder.

R&D/Science Leadership Roles: Chief Science Officer

Corporate Leadership Roles: President, and a Member of the Board of Directors.

Related Activities: Assistant Professor at the University of Tennessee, Department of Neurosurgery. Program Director of the University of Tennessee Molecular Neurosurgery Program.

Associate Program Leader for the University of Tennessee Cancer Institute Neuro-oncology

Program. Dr. Duntsch is an author of many manuscripts and platform technology patents related to the CSC field, and is the recipient of many private and public funding mechanisms, including a

currently active NIH/NCI RO1 for Brain Cancer.

Educational Background: Vertebrate Zoology Bachelor of Science, Doctorate of Medicine,

Doctorate of Philosophy with focus on Molecular Biology and Biochemistry. Neurosurgical Training and Licensure. Neurosurgical Fellowship in Complex Minimally Invasive Spine.

R&D Strengths and Interests: Cell and Molecular Biology, Cancer Biology, Stem Cell Biology,

Hematology-Oncology, Experimental Therapeutics, Translational Research, Cancer Drug

Discovery, and Cancer Stem Cell Biology.

Valery Kukekov, Ph.D. (Age – 62)


R&D and Science Leadership Roles: Director, Smart-Pharma Drug Discovery

Related Activities: Professor at the University of Tennessee, Department of Neurosurgery. Dr. Kukekov is an author of many manuscripts and platform technology patents related to the CSC

field, and is a co-recipient of many private and public funding mechanisms.

Educational Background: Bachelor of Science and Masters in Biomathematics, Doctorate of

Philosophy with focus in Biomathematics.

R&D Strengths and Interests: Cell and Molecular Biology, Cancer Biology, Adult and Embryonic

Stem Cell (ESC) Biology, Cancer Drug Discovery, and Cancer Stem Cell Biology.

Tanya Ignatova, Ph.D. (Age – 58)


R&D and Science Leadership Roles: Director, Smart-Pharma Drug Discovery

Related Activities: Associate Professor at the University of Tennessee, Department of

Neurosurgery. Dr. Ignatova is an author of many manuscripts and platform technology patents related to the CSC field, and is a co-recipient of many private and public funding mechanisms.

Educational Background: Cell Biology Bachelor of Science, Masters in Cancer Biology,

Doctorate of Philosophy with focus in Cell and Molecular Biology

R&D Strengths and Interests: Cell and Molecular Biology, Cancer Biology, Adult Stem Cell Biology, Cancer Drug Discovery, and Cancer Stem Cell Biology.

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Valery Antonenko, Ph.D. (Age – 47)

Relation to NovTx: Recruited in 2008

R&D and Science Leadership Roles: Director, Pan-Pharma Drug Discovery

Related Activities: Dr. Antonenko has had a long distinguished career as a medicinal chemist and

platform leader for large scale high through put drug discovery programs for several biotechnology

and pharmaceutical companies including Affymax, Glaxo-Smith-Klein, ArQule, and Johnson and Johnson.

Educational Background: Bachelor of Science and Masters in Chemistry of Natural Products and

Pharmaceutical Chemistry, Doctorate of Philosophy with focus in Bioorganic Chemistry

R&D Strengths and Interests: Cancer Drug Discovery, and Cancer Stem Cell Biology.

John Robertson, M.D. (Age – 64)

Relation to NovTx: Secondary Founder

R&D and Science Leadership Roles: Director, Pan-Pharma Drug Discovery

Corporate Leadership Roles: Secretary, and Member of the Board of Directors.

Related Activities: Chairman and Professor at the University of Tennessee, Department of Neurosurgery. Dr. Robertson is an author of many manuscripts, books, and book chapters. He is a

life-long physician, with focus on skull base neuro-oncology and neurosurgery.

Educational Background: Bachelor of Science in Biology, Doctorate of Medicine, Neurosurgical

Training and Licensure.

R&D Strengths and Interests: Clinical Science, Neuro-oncology, Skull Base Neurosurgery

*For information about Novostem’s corporate leadership and business consultants, refer to our “At a Glance” document, our business model, or go to www.novostem.com (password:oryx, user name:crake)

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4 . Key Events – The Transition for NovTx from Academic to Commercial Major subtopics covered in this section include:

4.1. Concise Timeline for Major Research and Business Development Events

4.2. Detailed Summary of Major Research and Business Development Events

Novostem is a Decade in the Making ... 1998 - 2009

4.1. Concise Timeline for Major Research and Business Development Events

1998 A solid tumor CSC concept is presented to the scientific community by Dr. Valery Kukekov for the first time. Annual Neuroscience Meeting. Los Angeles, CA.R!

2002 A solid tumor CSC concept is first published for brain cancer by Dr. Tanya Ignatova et al.,

“Human cortical glial tumors contain neural stem-like cells expressing astroglial and

neuronal markers in vitro.” Glia. 39(3):193-206.

2003 The 2002 CSC manuscript in Glia is validated rather quickly, and reproduced by

several independent competitive labs for brain cancer, as well as for other types of

cancers.

2004 Numerous reports continue to appear in the scientific literature supporting and evolving a

CSC model for solid tumors, including: prostate cancer, gastric cancer, glioblastoma,

breast cancer, myeloma, and lung cancer.

2005 . CSCs are identified in osteosarcoma by Drs Ignatova and Kukekov in collaboration with

Dr. Parker Gibbs at the University of Florida.

Drs Kukekov/Ignatova are recruited to the Univ. of Tenn., Dept of Neurosurgery.

Creation of the nations 3rd CSC program behind Stanford and the Univ, of Michigan.

2006 . A series of breakthrough discoveries in CSC biology, modeling, and pre-platform concepts

are made by NovTx founding scientists: important examples include the identification, characterization, and validation of CSC markers, and the development and pilot study of

platform screening technologies.

The first drug discovery platform patent is filed. (PFP1)

NovTx Therapeutics officially forms and begins raising funds (late December, 2006).

2007 CSC marking and selection protocols are streamlined.

Advances in pre-platform pilot studies, including biosignal detection approaches.

The 2nd drug discovery platform patent is filed, covering multiple platform screening,

advances, but primarily focused on biosignal detection/interpretation (PFP2).

2008 Large volume culture technology (Novopro) is created and streamlined.

Formal pilot drug discovery platform is launched.

The first lead compound is identified, early formal drug development is initiated.

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Dr. Valery Antonenko, a medicinal chemist with significant hands on high throughput drug

screening experience, is recruited to the NovTx team.

2009 NovTx drug discovery streamlined and prepared for scale up (tied to completion of its

first round of fundraising).

The third drug discovery platform patent is filed (PFP3).

Lead compound patent initiated.

4.2. Detailed Summary of Major Research and Business Development Events

Introduction, Background, Significance: NovTx’s CSC R&D programs are led by Dr Christopher Duntsch (CSO), Drs Valery Kukekov and Tanya Ignatova (Co-Directors, Smart-

Pharma Drug Discovery), and Dr Valery Antonenko (Directors, Pan-Pharma Drug Discovery). Drs Kukekov and Ignatova are well known pioneers in the continuously evolving field of CSC biology, being first to present (Society of Neuroscience Meeting, Los Angeles, 1998) and publish (Kukekov and Ignatova et al., Glia, 2002) a CSC concept for solid tumors. Dr. Kukekov is also known for a previous landmark discovery in which he was the first to identify and isolate stem cells from the adult brain (known as neural stem cells, NSCs) (Kukekov et al., 1997 and 1998). Many of the initial breakthroughs in NSC research during this time were made possible through the creation and use of a novel and unique adult stem cell culture system (referred to as the neurosphere culture system) that clonally isolates and enriches normal adult neural stem cells from brain, while simultaneously suppressing the growth of non-stem, more

differentiated cells (Kukekov et al., 1996, USP638763B1; and Kukekov et al., 1996).

Early Reporting of CSC Biology in Adult Solid Tumors: In the late 90s, this model was adapted and used for early CSC proof of concept studies to identify a stem-like cancer cell population in solid cancers. This work was done in collaboration with Dr. Tanya Ignatova, a brain cancer cell biologist, and culminated in 2002 in a landmark scientific report to the journal Glia demonstrating for the first time ever the isolation and characterization of CSCs in human high grade brain glioma. In 2005, while at the University of Florida, Drs Kukekov and Ignatova

identified and characterized a similar CSC population in osteosarcoma in collaboration with Dr. Parker Gibbs, and reported this research to the journal Neoplasia where it was widely accepted. Creation of the Nation’s Third CSC Program: At the end of 2005, they were both recruited to Memphis to join Dr. Christopher Duntsch at the University of Tennessee in the Department of Neurosurgery. Shortly after their arrival, Drs Ignatova and Kukekov agreed to merge their CSC labs with Dr Duntsch’s Experimental Therapeutics and Translational Group. Significant resources were raised and combined with existing UT Neurosurgery infrastructure. The collective result of merging the labs and resources of these three researchers was to create

the nation’s third CSC program (behind Stanford and the University of Michigan).

Evolution of the CSC Paradigm: By the end of 2006, the newly formed CSC group could make several claims of productivity including: the creation of a pan-biologic CSC model that was addressing most major aspects of cancer biology; the identification and validation of a series of biologically active and relevant markers for CSCs; and the creation and/or adaptation of several protocols for CSC identification and isolation from the bulk of the cancer cell

population. The end result was these discoveries collectively was the creation of an early pilot

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drug discovery program featuring the ability to identify, isolate, capture, and culture CSCs in vitro for further study, or further manipulation. Although the CSC concept was first developed for high-grade glioma, later research for other types of cancers implied that it was instead a universal solid tumor CSC model. Importantly, these early efforts by NovTx researchers greatly enhanced their understanding of CSC biology, crystallized the solid tumor CSC hypothesis, and illuminated the way forward with respect to more sophisticated modeling and

the development of biotechnology applications centered in CSC biology.

The Formation of Novostem Therapeutics, Inc.: Beginning in 2006, and continuing into the present, a series of patents were filed to protect the results of this productive time

(USP200702922414, USP2008082506, and Provisional Patent P72347, see appendix for formal references and technical summaries). Novostem Therapeutics, Inc. was formed at the beginning of that same year, and a license agreement from the University of Tennessee that was favorable to NovTx and provided for 30 years freedom to operate was granted shortly thereafter. In 2008, Dr. Valery Antonenko, a medicinal chemist with extensive experience with large pharma high-throughput drug discovery programs, was recruited to join NovTx and assume the Director role of its high throughput Pan-Pharma drug discovery program.

In 2008 and 2009, NovTx scientists made signficant technical advances on behalf of the company and its drug discovery program including:

1) The creation of a large volume CSC media and culture system (referred to as the Novopro© media and culture system) allowing for long-term cultures, and expansion culture approaches. This made NovTx the first cancer biotechnology company to claim this capability, and one of only two entities in the world, all groups considered (the other being a MIT-Harvard collaborative stem cell research group, see Ince et al., 2007)

2) The creation and validation of its currently active and highly productive pilot drug discovery platform.

3) The identification of several attractive drugs and compounds with anti-CSC potential, including its first official lead compound, NOVO1, which is currently in early drug development.

A final comment: Although the first manuscripts describing this work have been held while NovTx patents matured, NovTx supports peer-reviewed scientific reporting (primarily in the form of

presentations at key scientific meetings, and scientific manuscripts). NovTx research scientists will

begin submitting (in close cooperation with NovTx business and legal leadership) a series of manuscripts that describe our approach to modeling CSC biology, report our results accurately,

and provide an interpretation an opinion of said results through our unique perspective.

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5 . Basics & Building Blocks: A Decade of Solid Science Infrastructure for CSC R&D

Major subtopics covered in this section include:

5.1. Concise Summary – Research and Results of Early Platform R&D

5.2. Detailed Summary – Research and Results of Early Platform R&D

5.3 A Decade (1998 – 2009) of Research and Development of NovTx’s Approach to Drug Discovery

5.4 Using OCT4 as a Marker for CSCs for the Purposes of Identification and Isolation of CSCs.

5.5. Reverse Validation of OCT4 as a Marker for CSCs, and of the Cell and Molecular Approach Used to Identify and Isolate CSCs

5.6 In Vivo Proof of Concept

5.7. Building Blocks and Core Concepts Derived from Research Activities of 1999 - 2007: A Summary

of the Knowledge Base Used for Creating Biotechnology Applications

5.8. 2007 – 2008: Novopro Media and Culture Protocols – Break-Through Technology that Overcomes all Technical Barriers to Large Volume CSC Culture

5.9. Development of a Pilot Program for CSC Drug Discovery

5.10. 2009 to Present: Pilot Screening Studies to Date – Discoveries and Products

5.1. Concise Summary – Research and Results of Early Platform R&D Development

5.1.1. Supportive Pre-platform observations and experiments: As will be explained in detail below, our group made a series of observations, hypotheses based on the observations, and pilot then definitive experimental studies beginning over a decade ago. As our model and approach developed, eventually it collectively morphed into a basis for creating a CSC drug discovery platform. Some core concepts follow:

1. Solid cancers have CSCs.

2. In vitro and in vivo characterization of CSCs from solid tumors demonstrates that they are a

rare but critical part of the tumor cell population. In the context of a primary cancer, CSCs

represent roughly 0.01% of the cell population, and have the following properties: are pluripotent; have unrestricted proliferation potential; are highly motile and invasive; are capable

of tumorigenesis and metastasis; are highly resistant to chemotherapy and radiation; and are

the source of tumor recurrence after treatment of a primary or metastatic tumor with surgery, radiation, and chemotherapy.

3. CSCs and ESCs have overlapping biology in the form of gene regulation programs (and

the subsequent phenotypic consequences of regulating the presence of the gene, and its protein product), and the level of that gene’s (and its protein product) expression. Thus, specific and important transcription programs, genes, proteins, and pathways are present and active in both cell types,

4. As a specific example, NOS embryonic transcription factors (the embryonic transcription factors NANOG, OCT4, SOX2) are present, active, and required for CSCs to exist and to have their stem-like and malignant properties (clonal self renewal, pluripotency,

invasiveness, metastasis, etc.).

5. The conclusion from the above studies was that CSCs should necessarily express OCT4 (of all three NOS transcription factors, OCT4 was thought the most important, and thus was

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the first tested), and thus OCT4 should be a valid CSC marker (any cells with OCT3 mRNA and protein is a CSC).

5.1.2. Summary of Key Experiments and Results

The next section is a concise summary of the key experiments and their results that were proved and evolved the CSC paradigm, especially with respect to NOS transcription factors,

their use as CSC markers (especially OCT4), and the development and testing of protocols for marking, detecting, isolating, and the capture of CSCs for further in vitro study or manipulation.

Exp = Experiment

KE = Key Experiment

KR = Key Result

Experimental (Exp) Series 1 – Transient Marking/Detection of CSCs in a Cancer Population:

Transient Transfection of NovTx Reporter Transgenes (CSC marker correlates) into Cancer

Cell Lines Identifies the CSC Fraction of the Total Cancer Cell Population.

KE 1: The full length OCT4 promoter was cloned from several human cancer lines (referred to as

pOCT4). The promoter element was verified with DNA sequencing for copy errors. The cloned

promoter element was tested for functional activity as regulatory DNA element with standard

assays. pOCT4 was subcloned into a reporter transgene upstream and operationally linked to the green fluorescent protein (GFP) gene. Bioactivity of the reporter construct was verified with

transient transfection assays and standard fluorescence detection techniques.

KE 2: Representative established cancer cell lines from several different solid cancers (breast

adenocarcinoma, prostate adenocarcinoma, glioblastoma, etc.) were brought into culture. The

pOCT4-eGFP transgene was introduced into the general cancer population using standard transfection approaches.

KR 1: Despite high transfection efficiency (typically 80 – 100%) and the presence of the reporter

transgene in the majority of the cell population (transient transfected cells), each of the representative established cancer cell lines used for these experiments had only a rare cell

population that was competent to drive transcription of the GFP gene as regulated by the pOCT4

promoter (typically 5 – 15% on average).

Technical Note: This percentage is much higher than that of primary tumors in situ in vivo. Analysis of numerous primary tumor tissues and established cell lines of a number of different types of tumors demonstrates this observation to be relatively stable.

KR 2: Cells that took in the transgene (i.e., were transiently transfected) could survive in culture

despite the presence of the cytotoxic selection antibiotic G418 in the media due to expression of the neomycin resistance gene (part of the reporter transgene). Cells that did not take in the

transgene were lysed due to G418 cytotoxicity.

Exp Series 2 – Creation of a Stably Biomarked Total Cancer Cell Population

KE 1: Transiently transfected cancer cells were taken through extended culture and transfectant

selection protocols (takes 2-3 weeks) in order to select for stably transfected cancer cells.

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KR 1: A stable transfectant cell line was successively created for each cancer cell line taken

through this selection process.

KR 2: All cells in each culture have stably integrated the transgene into their genome and have it

functional available to be activated when biological circumstances dictate this event, but only CSCs

within the cancer cell population can activate the reporter transgene, produce a fluorescent biological signal that is detectable.

Exp Series 3 – Detection, Capture, In Vitro R&D: Detection of the reporter gene signal in CSCs, isolation of CSCs from the general cancer cell population, capture of CSCs using

FAC-sorting, introduction into culture for expansion and biological studies.

KE 1: The total cancer cell population from each cancer was expanded exponentially using routine

culture methods. GFP-expressing CSCs were detected and isolated from the total cancer cell

population using FACS-sorting methods.

KR 1: Two new cancer populations different from the parental were created. First, a highly pure

GFP-enriched CSC population (roughly 95 – 96%). Second, a GFP-depleted, CSC-depleted,

nonstem bulk cancer cell population.

5.2. Detailed Summary – Research and Results of Early Platform R&D

5.2.1. Creation of the Concept and Development of the Hypothesis

5.2.1.1. Cancer, ESC, and Adult Stem Cell Biology – Finding the Common Ground: Numerous observations made by us and others led our group in the late 90s and early in this decade to pursue and develop a stem cell hypothesis for solid cancers. For example, a host of embryonic antigens and functional proteins (proteins not expressed in adult tissue stem cells or adult somatic cells, being restricted to germ, embryonic, or fetal cells and tissues) were commonly being reported in the literature as being expressed in various types of adult nongerm somatic cancers (Ignatova et al., 2002). Similarly, antigens and structural proteins whose expression in adult tissues and cells was known to be restricted to a certain germ layer (for example, the expression of glial fibrillary acidic protein in glial cells in the nervous system,

derived from and restricted to neuroectoderm, and thus ectoderm) were being reported in the literature as being expressed in cancers derived from a different germ layer (Ignatova et al., 2002). For example, osteosarcomas (originating in bone, and derived from mesoderm) were found to overexpress the microtubule structural protein B-Tubulin III (normally restricted to expression in differentiated neurons derived from ectoderm) (Gibbs and Kukekov et al., 2005). Indeed, the expression of B-Tubulin III in osteosarcoma is a sensitive and specific cancer marker for aggressive malignant osteosarcoma that is highly metastatic (and associated with a poor prognosis).R! Further, similarities were noted in the differentiation profile of embryonal carcinomas and the normal development of the inner cell mass of a blastocyst, as well as in morphologic similarities between in vitro clonal ESCs, adult stem cells, and cancer spheroid

formation from single cells cultured in semisolid media(Skotheim et al., 2005; Okada K et al., 2003; Sperger JM et al., 2003).

16


These findings strongly suggested that epigenetic events were occurring to unbind embryonic and germ layer restricted genes in cancer, resulting in biologically relevant reprogramming events and changes in cancer phenotype. This was a major clue, because, in addition to the complex molecular events that would have to occur to unbind regions of DNA normally silenced in adult tissue cells, but also the respective transcription factors for these genes, whose expression is typically restricted to early developmental biology (embryogenesis,

gastrulation, germ layer formation, etc.) would have to be transcriptionally expressed themselves, and actively driving the expression of these proteins. As described in detail in the next section, this appeared to be exactly what was happening.

5.2.1.2. NANOG, OCT4, SOX2 (NOS), and STAT3 Coexpression – A Unique Molecular Signature Shared by Normal ESCs and CSCs: Over the last few years, evidence directly linking cancer biology, ESC biology, and CSC biology has continued to accumulate (Glinsky et al., 2005; Klein et al., 2007; Beathy et al., 2004). For our group, once this hypothesis was in play, it was a short leap from the hypothesis that stem cell restricted molecular events and their resultant phenotypic influences were occuring in cancer and likely contributing to various

aspects of the cancer phenotype, to focusing on a small but core group of embryonic transcription factors that are well characterized as master transcriptional regulators of genes that drive development in ESCs, embryonic tissues, and fetal tissues. These transcription factors are NANOG, OCT4, and SOX2, in concert with KLF4 and phosphorylated STAT3. These transcription factors act both alone and in combination with each other and other transcription factors to regulate the expression of a diverse and wide range of gene targets that drive key aspects of ESC biology, embryogenesis, and early fetal development (so called NOS genes, for NANOG, OCT4, and SOX2) (Boyer et al, 2005) (Fig. 2A). The protein products of NOS genes include cell receptors, growth factors, structural proteins, cell adhesion molecules, enzymes, transcription factors, and other protein types. NOS genes drive the major

biological programs of embryonic and fetal development, and are critical for maintaining the undifferentiated state and pluripotent potential of ESCs (Player et al., 2006; Rodda et al., 2005; Chambers et al., 2004; Orin et al., 2005) (Fig. 2B).

FIGURE 2 Schematic diagrams of NOS transcription factors and the genes they bind independently or in

combination to regulate pluripotency and development in embryogenesis. A. Venn Diagram representing the

gene promoter(s) of OCT4, SOX2, and NANOG bound in an independent or combinatorial manner in human

embryonic stem cells to to regulate their activity (from Boyer et al., 2005). B. Schematic demonstrating the role NOS transcription factors have in human ESCs (Li et al., 2005).

A B

17


5.2.1.3. NOS Transcription Factors and Their Gene Targets are Present in CSCs, and

Required for Their Stem-like Properties: During embryonic and fetal development, a natural and predestined balance between cell proliferation and differentiation is achieved in ESCs and their immediate progeny. However, in CSCs, there appears to be defects in proliferation control, differentiation pathways, and in the ability of CSCs to respond to their environment (so called niche independence). NOS genes and their protein products are clearly responsible in

part if not entirely for the gain and loss of function in cancer cells that leads to their destructive phenotype. Early in this decade, we demonstrated that CSCs could be cultured from primary tumors by adapting a previously described adult stem cell culture system (described in detail below). Using standard cancer cell and stem cell culture protocols, we created cell lines from a number of solid cancers (including brain, osteosarcoma, melanoma, prostate, lung, and several others) for study, and performed a series of stem cell and RNA/protein biochemical assays on them. The types of cell substrates represented included established cancer cell lines, tumor tissue sections, and primary cell lines derived from said tissues, and CSCs derived from all of the above. In these studies, we made a series of observations that included the following: NOS transcription factors were expressed in all solid cancers tested; NOS

transcription factors were bioactive and upregulating the expression of select NOS genes (over 40 identified so far) in all solid cancers tested; only a fraction of the cancer cell population expressed NOS transcription factors, and these cells were also restricted with respect to NOS gene activation; cancer cells that express NOS transcription factors have stem-like phenotypy; and finally, that functional transcriptional activity of NOS transcription factors is required for said CSC phenotypy.

5.2.1.4.. Merging ESC and Cancer Cell Biology to Create a Novel Model of CSC Biology: This series of observations was key to our group crystallizing a comprehensive biological model for the role of CSCs in most if not all aspects of solid cancer biology. Creation of this

model involved the labeling of NOS transcription factors as CSC markers, in combination with biotechnical cell and molecular manipulations (some previously described but requiring adaptations to meet our needs, some novel and created de novo by our group). Importantly, once a solid CSC model was hypothesized, studied, tested, and validated, a clear path forward for developing sophisticated, high-throughput, high yield drug discovery became apparent. 5.2.1.5. In Summary: Early observations by our group as far back as the late 90s prompted us to pursue a CSC hypothesis. In early studies, we proved that a CSC population could be identified and extracted for in vitro culture and study using standard adult stem cell culture protocols with minor adaptations. In later studies, we identified ESC NOS transcription factors

to be both present and required for the stem-like phenotypy of CSCs. This introduction and brief summary provides a conceptual foundation on which a detailed review of the research activities that brought us here over the last decade can be built. 5.3. Summary of a Decade (1998 – 2009) of Research and Development of NovTx’s Approach to Drug Discovery

5.3.1. 1998 – 2002: Solid Cancers have a Rare Cell Population with Stem-Like Properties

Creation of the Founder Hypothesis (H1): Solid tumors have CSCs.

Hypothesis Testing: Creation of the Oncosphere Culture System and its application to several types of Cancers.

18


Neural stem cells were first isolated from the adult brain and expanded in vitro under specific stem cell promoting culture conditions that simultaneously suppress the growth of non-stem

or more differentiated cells (originally designated as the neurosphere culture system) (Kukekov et al., 1997; 1999). The key components of this system are low cell density, serum and anchorage withdrawal (lack of attachment to substrate), and the presence of the pleiotropic growth factors FGF2, EGF, and insulin.

This approach has been used to isolate CSCs from a variety of cancers (referred as the oncosphere culture system), including adult high-grade glioma, breast cancer, osteosarcoma, and others (Ignatova et al., 2002; Al-Hajj et al., 2003; Gibbs and Kukekov et al., 2005) (Fig. 3). This culture system was used to

study many aspects about CSCs and much was learned. Some of the observations made about CSCs in this system are as follows: CSCs grow clonally (each cluster derived from a single cell) into CSC clusters that have many characteristics of stem cells and malignant features of cancer cells, and have high

expression of CSC markers, MDR genes, and tumor suppressor genes (Fig. 3). Summary of Results for H1 Founder Hypothesis – Validated and Published: Solid tumors have CSCs.

5.3.2. 2002 - 2005: The NOS ESC Transcription Factors (NANOG, OCT4, SOX2), and in Turn NOS Genes, Are Actively Expressed in Non-germ Somatic Solid Cancers

Creation of a Bridge Hypothesis (CSC Biology <-> ESC Biology) (H2): ESCs and CSCs derived from non-germ somatic solid cancers overlap in part of their genotype, and phenotype. NOS transcription factors are present in solid cancers, present and with increased expression in CSCs, are expressed in a manner that inversely correlate with cell maturity and differentiation, and are required for stem cell phenotypy.

FIGURE 3 The isolation and study of CSCs (oncospheres) from solid

cancers using the oncosphere culture system. A. Phase-contrast images

of monoclonal sarcospheres suspended in methylcellulose and grown under

stem cell promoting conditions (left panel), immediately after allowing

sphere to attached to a substrate coated surface (middle panel), and 3 hours

after attachment to a substrate coated surface (right panel). Demonstrates

the compact, undifferentiated morphology that is typical of this CSC

spheroid cluster while in culture, and the changes that occur over time in

CSCs when they are exposed to serum and allowed to attach (flattening,

proliferation, and migration from the stem cell cluster). B. A high-grade

glioma derived (from LN229) CSC sphere cluster shown 3 hours after

attachment to a substrate coated surface. Demonstrates high proliferative

activity and imaturity in the center of the cluster, and a change in

morphology and maturation (as indicated by the increased expression of B-

tubulin III) in the periphery of the cluster as the cells begin to differente

and migrate from the cell cluster. C. A breast cancer derived (from

MDAMB231) CSC sphere cluster shown 6 hours after attachment to a

substrate coated surface. Demonstrates proliferative and migratory activity

filling the plate with cells, as well as high expression of MDR I in the

center of the cluster in CSCs, and a change in morphology and decreased

expression of MDR in the periphery and beyond the CSC sphere cluster. D.

A high-grade glioma derived (from LN229) CSC sphere cluster shown 6

hours after attachment to a substrate coated surface. Demonstrates

proliferative and migratory activity filling the plate with cells, as well as

high expression of the tumor supressor protein BAD in the center of the

cluster in CSCs, and a change in morphology and decreased expression of

BAD in the periphery and beyond the CSC sphere cluster.

A

D C B

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Hypothesis Testing: Cancer cell and stem cell assays, molecular profiling with RNA and protein chemistry, siRNA assays that target OCT4.

5.3.3. Solid Cancers Express NOS Transcription Factors: To determine whether NOS transcription factors were expressed in non-germ adult somatic cancers

derived from solid organs, standard RNA/protein chemistry was used to determine expression at the RNA and protein level in cancer cells derived from cell lines (established and primary cultures) and tissues, and in CSCs derived from cell lines (primary and established) and tissues. In these studies, NOS transcription factor expression was

detected in all cancers tested. Figure 4 demonstrates immuno-staining of OCT4 protein expression in tumor tissues derived from chondrosarcoma, glio-blastoma, and from primary breast cancer and breast cancer metastatic to brain. Figure 5 demonstrates the expression of OCT4 and NANOG mRNA (as

detected by semi-quantitative PCR) in tumor tissue derived from glioblastoma and osteosarcoma. Figure 6 shows the expression of OCT4 and NANOG (as detected by western blotting) in tumor tissue derived from glioblastoma and osteosarcoma. The results were confirmed with several related biochemical assays, and in a

number of other tumor types (data not shown). 5.3.4. CSCs are Enriched for the Expression of NOS Transcription Factors: Having demonstrated that solid cancers can be shown to have a CSC subpopulation, and that solid cancers express NOS transcription factors, we postulated

FIGURE 4 OCT4 immunohistochemical staining of various tumor

tissues. Chondrosarcoma, A. Osteosarcoma, B. Glioblastoma, C. Human

fetal testis (positive control for OCT4), D. Primary breast adenocarcinoma,

E. Breast cancer metastatic to brain, F.

E F

FIGURE 5 Semi-quantitative RT-PCR analysis of clinical

specimens and established cell lines of Glioblastoma (A) and

Osteosarcoma (B) for expression of NOS Transcription factors and

Stat3.

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that CSC populations should have significant and increased expression of proteins as compared to the bulk cancer cell population. Using the oncosphere culture system,

we isolated relatively pure CSC cultures from glio-blastoma, osteosarcoma, and breast cancer. These studies demonstrated that (in agreement with our hypothesis) OCT4 and NANOG were expressed at much higher levels in CSCs then what was previously

observed in the general cancer cell population. As shown in Figure 6B, “sp” CSCs (tumor cells grown in stem cell culture conditions) consistently upregulated expression of these factors. Figure 7 demonstrates significant expression of OCT4 in a CSC sphere

cluster that has been attached to substrate, and shows the downregulation of OCT4 exp-ression in peripheral cancer cells as they migrate from the CSC cluster and begin to differentiate. The observation of an inverse correlation of NOS transcription factor expression (as well its target

genes, and as other genes known to be associated with CSCs and immaturity, as induced by serum and substrate attachment, as demonstrated in Fig. 3, Fig. 7, Fig. 8, and later in the text,) with differentiation or maturity is similar to that seen ESCs in developmental biology (Boyer

et al., 2005).

FIGURE 6 Western blot analysis of cells derived from clinical specimens

and established cell lines of Glioblastoma (A) and Osteosarcoma (B).

FIGURE 7 Floating and Attached MCF7-R breast spheroid CSCs (breast

cancer oncospheres, CSC clusters) in (cancer) stem cell promoting culture. A.

Light microscopy of a CSC suspension culture, in methylcellulose, demonstrating

spheroid breast CSCs. B. Attachment of breast CSC spheroid clusters to substrate

demonstrating flattening, migration, differentiation, downregulation of OCT4

(green), and upregulation of the differentiation marker pancytokeratine (red).

FIGURE 8 Inverse correlation of OCT4 (X axis) and NANOG (Y axis)

expression with attachment to substrate and exposure to serum (both induce

differentiation). The expression of both factors in floating bone sarcoma CSCs

(sarcospheres) is significantly higher than in substrate attached cultures

undergoing differentiation (p<0.05).

21


5.3.5. OCT4 is Required for CSC Biology, including Self Renewal and Clonal Growth: The phenomenon of an inverse correlation of NOS transcription factor expression with differentiation or maturity (for example, as induced by serum and substrate attachment) is demonstrated clearly in both Figure 7 and 8. However, these are indirect observations. In order to make the correlation strong enough to suggest OCT4 is not only present, but required for CSC function, and thus is a definitive marker of cancer, direct evidence of a functional

correlation is needed. Small interfering RNA (siRNA) has been used previously to downregulate the endogenous POU5F1gene encoding OCT4 in mouse preimplantation embryos, oocytes, and ES cell lines. Previously it has been demonstrated that a critical amount of OCT4 is required for the formation of pluripotent stem cells in the mammalian embryo (Nickols et al., 1998), and furthermore, that ES cells cannot sustain pluripotency if OCT4 is deleted (Niwa et al., 2000). We have demonstrated

that stem-like cancer cells can be isolated from various solid tumors, and further that CSC cultures are enriched for the expression of OCT4. To determine whether OCT4 was a critical driver of CSC growth in the stem cell culture system, we used siRNA targeting of the POU5F1/OCT4 gene. Cancer cells derived from three representative GBMs (including two cell lines and a primary tumor culture from a

patient) were cotransfected with eGFP and OCT4 siRNA, and plated in the oncosphere culture system. In a set of parallel control experiments, cells were co-transfected with eGFP and scrambled control siRNA. Clones transfected with eGFP and scrambled siRNAs became visible on the 7th day after plating and grew robustly, while the number of clones with detectable eGFP in cells transfected with OCT4 siRNA fell by more

than 60% as compared to controls (Fig. 9).

Summary of Results for H2 Bridge Hypothesis – Validated and Published: All concepts proven as written in H2 verbatim (Fig. 4 – 9). ESCs and CSCs derived from non-germ somatic solid cancers overlap with respect to specific parts of their stem cell genotype, and phenotype. NOS transcription factors are present in solid cancer, present and upregulated with respect to expression, have expression patterns that inversely correlate with cell maturity and differentiation, and are required for stem cell phenotypy.

5.4. 2006 - 2007: Using OCT4 as a Marker for CSCs for the Purposes of Identification and Isolation of CSCs.

Creation of CSC Marker Hypothesis (H3): NOS Transcription Factors are CSC Markers. Their presence in a cell can be used to identify cells as CSCs.

FIGURE 9 Suppression of the clonal sphere forming

potential of Glioblastoma CSCs with OCT4 siRNA to

inhibit transcription of the OCT4 mRNA. A. Suppression of

exogenous OCT4 protein expression in transfected cultures of

293T cells as detected by western blotting with a Myc-tag

antibody. B. A normal eGFP-negative neurosphere clone is

shown next to a eGFP-positive clone that exhibits aborted

development caused by the OCT4 siRNA cotransfected with

eGFP. C. Frequency of clone-formation of Glioblastoma cells

(cell lines MT317, LN-229, MT917) co-transfected with eGFP

and OCT4 siRNA duplexes. Experiments were performed in

triplicate. Bars show the standard errors.

22


Creation of CSC Selection Hypothesis (H4): The expression of NOS Transcription Factors can be used to identify and select cells as CSCs.

Methods of Hypothesis Testing: Cancer and stem cell assays, molecular profiling with RNA and protein chemistry, siRNA assays that target OCT4.

5.4.1. Standard Approaches for Detecting and Isolating CSCs from Certain Types of Tumors: Most studies of CSCs thus far have relied on the use of assays that detect previously known cell surface markers specific for normal adult tissue stem cells such as CD44

+/high/CD24

-/low for stem cells derived from epithelial tissues (for example, breast tissue).

Most studies of CSCs have relied on detection of these cells surface markers on CSCs with FACS methods, and capture of these cells for study with FACS-sorting (for example, CD44

+/high/CD24

-/low for breast adenocarcinoma, and AC133 for neuroectodermal tumors such

as high grade brain gliomas) (Singh et al., 2003; Al-Hajj et al., 2003). These approaches have provided a wealth of information, especially early in the development of the CSC biology field.

5.4.2. Definitive Proof of Concept – A Novel, Efficient, and Real-time Biological System for Detecting, Isolating, and Capturing CSCs from Virtually Any Solid Cancer: The conclusion from all studies described above was that CSCs should necessarily express OCT4

(being found to be both associated with and required for CSC clonal self renewal and pluripotency), and thus OCT4 should be a valid CSC marker. Using a similar approach to that of Boyer et al., (2005),

the full 4.2 KB OCT4 promoter (has all four major transcription regulation response DNA elements) was cloned into vector associated reporter transgene up-stream of, and oper-ationally linked to a GFP-reporter gene to

create a reporter trans-gene DNA construct (pOCT4-eGFP) (see Fig. 10A). The trans-gene was then trans-iently transfected into a parental cancer cell line (parental refers to the original cell line used for said molecular

A

B

= Stably Transfected GFP expressing CSC

= Stably Transfected Nonstem Bulk Cancer Cell

= Nontransfected cancer cell undergoing apoptosis

FIGURE 10 Experimental design for isolating pOct4-eGFP-expressing cells from a total

cancer cell population. A. Schematic of the pOCT4-eGFP reporter transgene (the full length

OCT4 promoter cloned upstream of and regulating the expression of GFP, the reporter gene in

this example). B. Schematic of the experimental design used for identifying and isolating cells

that express GFP as driven by the OCT4 promoter. Briefly, cancer cells from various cancer

types were transfected with the pOCT4-eGFP transgene. Stable transfectants were selected

using resistance to the antibiotic G418, expanded, and then GFP-expressing cells were FACS-

sorted out from the total cancer cell population to create two new cell lines for in vitro and in

vivo studies; a cell population highly enriched for green fluorescence (GFP-enriched, the CSC

population), and a cell population highly depleted of green fluorescence (GFP-depleted, CSC-

depleted, consisting of only nonstem bulk cancer cells). Parental, refers to the original cancer

cell line used to create stable transfectant lines, the parental line contains all subpopulations of

cancer cells from CSCs to terminally differentiated non-stem bulk cancer cells.

Parental Cell Line

23


manipulation, and is always a primary cell culture derived from fresh tumor tissue, or an accepted, well studied, established cancer cell line that is

representative of that cancer type; in this example and as described in the majority of the results of experiments described below, the breast cancer cell line MDA MB 231 was used) (Fig. 10B). Introduction of pOCT4 into the general cancer cell population resulted in most

cancer cells receiving the trans-gene (90%). However, only a fraction of the population was competent to activate or drive the transgene reporter and express GFP as regulated by the OCT4 promoter. By definition, and per our hypothesis, only CSCs will

be competent to activate the integrated stable bioreporter construct. Importantly, all cancer types that were transfected and manipulated in this manner were found to have a small subpopulation of cells (typically 0.01% - 15%) competent to activate the pOCT4-eGFP

reporter construct (Fig. 11A – E and data not shown).

Transiently transfected cells were cultured in the presence of cytotoxic antibiotic (in this case Neomycin, also known as G418) for several passages according to stable transfectant selection protocols (to select for stable transfectants, which are cells that have stably integrated the transgene construct into their genome, and retain and can utilize it for the biological lifetime of the cell). Importantly, expression of the antibiotic resistance gene (part of

the transgene construct) allows for the natural selection of cells that have the transgene, and

conversely, constantly removes cells from the culture that do not (thus, an additional independent selection filter). Once stable transfectants are identified, they are again expanded exponentially in culture, and then, in the final step of this process, they are FACS sorted to isolate and capture the GFP-enriched cancer cell population (i.e., the CSC population), while

FIGURE 11 Fluorescent analysis and sorting for MDA MB 231 breast cancer GFP-

expressing CSCs derived from representative cancer cell line cultures transfected

with the pOCT4-eGFP reporter transgene. MDA MB 231 breast cancer cells (A),

OS521 osteosarcoma cancer cells (B), LN229 glioblastoma multiforme (GBM) cells (C),

MB435 melanoma cancer cells (D), PC3 prostate cancer cells (E), and Ntera-2 cells (F)

were transfected with the pOCT4-eGFP reporter transgene. Rare cells in each population

were found to be competent to express GFP through activation of the OCT4 promoter that

regulates its expression. Transfected cells were cultured and expanded in the presence of

G418 for selection of stable transfectants, and ultimately FACS-sorted for GFP

fluorescence. G. Demonstration in the presorted stably transfected cancer cell population

of the GFP-negative cell population (the MI gate, 78.11% of the total cancer cell

population, with either null or very low expression of GFP), and the GFP-expressing

population (the M2 gate, 21.89%, of the total cancer cell population with moderate to high

GFP expression) that were used for FACS-sorting to create from the stably transfected

parentaly MDA MB 231 breast cancer cell line, GFP-enriched (i.e., CSCs) and depleted

(i.e., nonstem cancer cells) cancer cell populations for further study. H. Flow cytometry

analysis of the post-sorted MDA MB 231 GFP-enriched CSC population derived from the

M2 gate of the FACS plot in G after two weeks of culture, demonstrating a purity of

roughly 96% with respect to a CSC population and expression of the GFP reporter gene

and its protein productd (GFP). CSC lines were created in this manner for multiple tumor

types for use in study protocols and drug discovery development.

24


simultaneously creating a stem cell depleted cancer cell population (referred to as the nonstem bulk cancer cell population) (Fig. 10b and 11F and G). The end result is the creation of a highly enriched and relatively pure CSC population (typically 95 – 96% of cells expressing the GFP reporter), and thus an enrichment of roughly 1000X - 100,00X depending on the nature of the cancer cell selected in the beginning of the experiment (Fig 11G). Summary of Results of CSC Marker Hypothesis (H3) – Validated and Patented, Manuscript in Preparation (was delayed while patent mature, now ready for submission): NOS Transcription Factors are CSC Markers. Their presence can be used to identify cells as CSCs (Figs. 4 – 11).

Summary of Results of CSC Selection Hypothesis (H4) – Validated and Patented, Manuscript in Preparation (was delayed while patent mature, now ready for submission): NOS Transcription Factors are CSC Markers. Their presence can be used to identify cells as CSCs (Figs. 4 – 11).

5.4.3. Technical Notes

Technical Note

With respect to the culturing of stable transfectants, the continual presence of cytotoxic antibiotic in the culture media creates survival pressure on the cells to “maintain” the transgene with respect to:

! The continued stable integration of the transgene in the cell’s genome: Transgenes are

often ejected from the genome, and subsequently diluted out of existence as cells divide. This is especially true of those transgenes that do not carry a construct which provides some survival or

beneficial characteristic to the cells.

! Regarding maintenance of the “transcriptional health” of the integrated transgene: The

word health refers to all such intranuclear activities that would need to occur to maintain the

transgene open and able to be activated if biological processes dictated such activation. This is

especially important in long term experiments. Transgenes are often silenced after stable introduction into the genome. With respect to gene silencing in general, the biological

characteristics are poorly understood (i.e., the biochemical nature of a given transgene [i.e.,

which ones are more likely to experience gene silencing events], the biological mechanisms that recruit silencing mechanisms, the timing of such events with respect to onset and the rate of

progression of silencing events). However, numerous mechanisms for silencing of integrated

stable transgenes have been described. The most simple and commonly encountered mechanism of silencing is DNA methylation.

Technical Note

There are many reasons NovTx chose to develop its own approach to CSC selection. Many are

described in this document in detail, many are beyond the scope of this document. However, some basic reasons and rationale to not use immunostaining and FACS methods include:

! Inter-operator Variability: The technical aspects of immunostaining and FACS operation make

inter-operator variability a significant problem. Thus, it is likely there would be both selection differences and analysis differences within a research group over a few years.

! Technically Difficult: There are inherent difficulties of traditional immunostaining followed by FACS-sorting approaches. This is especially true when a large number of cells are needed, or

when a large number of experiments are planned in a single setting or over a long time frame.

25


! Low Cell Yield: The technical aspects of immunostaining and FACS operation result in a

collective reduction in the overall cell yield. The importance of this technical problem cannot be overstated. This is because the number of cells required to collectively give the proper amount

substrate for in vitro cancer cell and stem cell assays, molecular assays and profiling, and animal

modeling is substantial. In FACS sorting approaches (or in related bioactive column filtration

approaches that use immunostaining and biologically active immunobeads to bind the cells and separate them from the bulk cancer cell population), the number of steps, and the inefficiency of

each step and related loss of cells, leads to a continued loss of cells in a sequential and stepwise

manner. Given that the true CSC cell population is rare to begin with, (1:100000 cells in primary cancers, 1:20 – 1:10 in established cultures, and 1:10 to 1:5 in metastatic and recurrent cancers),

it is not difficult to understand that this approach is simply rate limiting with respect to advancing

research initiatives that are high yield and high-throughput. In other words, the yield per experiment is likely so low that a number of important research paths are by default blocked

(including those that NovTx seeks to follow such as drug discovery).

! Lack of Real Time Analysis: A given cell population must be sacrificed in order to analyze it, or stated in a different manner, and the lack of any real time detection capability.

5.5. Reverse Validation of OCT4 as a Marker for CSCs, and of the Cell and Molecular Approaches Used to Identify and Isolate CSCs

5.5.1. In Vitro Proof of Concept

5.5.1.1. Introduction: Several assays were used to study GFP-enriched CSCs in vitro, as compared to GFP-depleted (thus, CSC depleted) nonstem bulk cancer cells including: cancer cell and stem cell assays and gene and protein expression analysis (for CSC and cancer markers, functional proteins, and NOS genes). The results of these studies are given below for breast cancer and its CSC subpopulation (for this example, the well studied, well accepted breast cancer cell line, MDA MB 231 was used as the founder or parental cell population). Several other types of cancers were studied in this manner and yielded similar results. The results of these studies for breast cancer are given in a summarized from in Table 1

TABLE 1 – Results of In Vitro Cell and Molecular Profiling Assays of Breast Cancer GFP-enriched CSCs Compared to GFP-depleted Non-stem Bulk Cancer Cells

Assay GFP-enr CSCs GFP-depl Cancer Cells

Oncosphere Culture System1 +++++ -/+

Expression of GFP2 +++++ ---

Expression of CD44+/high

/24-/low,3

+++++ + Expression of NOS Transc Factors

4 ++++ +

Expression of Ten-C, MMP1, MMP95 ++++ +

Expression of NOS genes6 +++++ ---

Motility + Tissue Invasion7 +++++ +

GFP – Green Fluorescent Protein, CSC – Cancer Stem Cells, enr – enriched, depl – depleted, Transc – Transcription, Ten-C – Tenascin-C, MMP - Matrix Metalloproteinase, NOS – NANOG, OCT4, SOX2, + - Indicates a positive degree of expression or null activity, --- Indicates null activity or null expression.

26


1 Assay for stem cells (stem cell phenotypy including clonal self renewal, stem cell density in the founder population of cells assayed, size of spheres which roughly correlates to rate of growth) present in a given culture. The culture system supports and promotes the growth of stem cells and early progenitors. The culture system suppresses the growth of late progenitors and terminally differentiated cancer cells.

2 GFP: signal given by cells competent to drive transcription of the OCT4 promoter. GFP

expression by a cancer cell indicates that cell is a CSC. The degree of its expression is roughly proportional to the stemness of a CSC.

3 CD44

+/high/24

-/low: cell surface antigen expression profile of a breast CSC.

4 NOS Transcription Factors: Embryonic transcription factors NANOG, OCT4, and SOX2 5 Known markers of aggressive invasive metastatic breast cancer. 6 NOS genes: Targets of NOS transc-

ription factors, critical implementers of ESC biology.

7 Standard in vitro assays of were used

to quantify cell motility and invasion in CSCs as compared to nonstem bulk cancer cells.

5.5.1.2. Performance GFP-enriched CSCs and GFP-depleted Non-stem Bulk Cancer Cells In In Vitro Stem Cell Assays: As shown in Figure 12 A and B, GFP-enriched cells isolated from the GBM cell line LN229 generated robust and homogenously green

fluorescent CSC oncospheres when cultured under stem cell promoting conditions. Overall, the sphere-forming potential and frequency of oncosphere formation was significantly higher in the GFP-enriched cell population as compared to the GFP-depleted cell population tested (Fig.12C). In addition, Additionally, the overall size of the spheres formed was much higher in the

GFP-enriched CSC population as compared to the GFP-depleted nonstem bulk cancer population (data not shown). Finally, in a dramatic display of the tight regulation between OCT4 expression and CSC phenotypy, Figure 12 D and E (and data not shown) shows the acute downregulation of green fluorescence in the presence of serum and attachment

FIGURE 12 Analysis of the growth characteristics and sphere

forming potential of GFP-enriched and depleted LN229

glioblastoma cancer cells under stem cell promoting culture

conditions (oncosphere culture system). A. Phase contrast

microscopy demonstrating LN229 cells growing as glioma spheres

in stem cell promoting conditions. B. Fluorescent microscopy of

the glioma spheres shown in A demonstrating they are

homogenously enriched for cells expressing GFP. C. Bar graphs

demonstrating the differences in clonogenic ability and sphere

forming potential of LN229 glioma cells enriched (Gr) or depleted

(NG) for the expression of GFP under CSC promoting culture

conditions. D. and E., Phase contrast and fluorescent microscopy

respectively demonstrating the production of more differentiated

clones coupled with the dramatic downregulation of GFP

expression by LN229 glioma spheres grown in the presence of

attachment substrate (laminin and polyornithine) and serum. All

cell lines shown in Figure 11 behaved in a similar manner (data not

shown).

27


to substrate (plates coated with polyornithine and laminin), which are both known to induce differentiation.

Importantly, the results of Figure 12 (and Figure 8 as well) highlight the tight correlation of stem cell phenotype, immaturity, and OCT4 expression. This was one of the first important clues generated from our own experimental studies that support the hypothesis for an alternative therapeutic strategy to cell kill. Our collective understanding of cancer as a stem cell disease is that it can also be though of as a developmental disease with an hierarchy of cells that starts with early CSCs and ends with terminally differentiated nonstem bulk cancer cells. Thus, an alternative strategy to attacking CSCs in vivo with cytotoxic drugs might be to instead attempt to differentiate immature CSCs (resistant to chemotherapy and radiation) into terminally differentiate mature non-stem bulk cancer cells (sensitive to chemotherapy and radiation). The concept of differentiation therapy is expanded on throughout the remainder of the document.

5.5.1.3. In Vitro Molecular Profiling: Using standard RNA and protein biochemical assays, in vitro CSC cell lines established as described above were profiled to identify genes and proteins that were upregulated in this group. Several artificially created analytic classes were addressed as follows: 1) Expression of GFP: High in CSCs, low in nonstem bulk cancer cells; 2) Expression of CSCs (CD44

+/high/24

-/low for breast CSCs): High in CSCs, low in nonstem bulk

cancer cells; 3) Expression of NOS transcription factors: High in CSCs, low in nonstem bulk cancer cells; 4) Expression of malignant cancer markers (i.e., Tenascin-C, MMP1, MMP9): High in CSCs, low in nonstem bulk cancer cells; 5) Expression of NOS genes: Over 40 found in CSCs, none were found in nonstem bulk cancer cells; 6) Motility and Invasion: High in CSCs,

low in nonstem bulk cancer cells. Due to the large volume of space needed required for these results, the data is not shown.

5.6. In Vivo Proof of Concept

5.6.1. Introduction: Several animal models of cancer were used to further study GFP-enriched CSCs in vivo (i.e., breast cancer, brain cancer, prostate cancer, etc.). A series of in vivo and in vitro assays (using in vivo tissue or cells as substrate) were used to determine the cell and

molecular properties of CSCs as compared to nonstem bulk cancer cells including: tumorigenesis, metastasis, cancer and CSC marker expression, evidence of EMT, NOS gene expression, and motility and invasion assays. The results for breast cancer using an orthotopic breast cancer mouse model are summarized in Table 2 and given in detail below. Other types of cancers studied in this manner showed similar results, meaning in vitro and in vivo, they behaved like very malignant tumors, expressed the expected CSC markers, were very tumorigenic and metastatic. All cancers tested to date prove the hypothesis that CSCs are the drives of cancer biology.

TABLE 2 – Results of In Vivo Modeling and Molecular Profiling of Breast Cancer

GFP-enriched CSCs Compared with GFP-depleted Non-stem Bulk Cancer Cells

Assay GFP-enriched CSCs GFP-depleted CSCs

Tumorigenesis +++++ -/+ Metastasis +++++ ---

Expression of GFP1 +++++ ---

Expression of CD44+/high

/24-/low 2

+++++ +

28


Expression of NOS Transc Factors 3 ++++ +

Expression of Ten-C, MMP1, MMP94 ++++ +

Expression of NOS genes5 +++++ ---

Expression of EMT Profile6 +++++ ---

Motility and Tissue Invasion7 +++++ +

GFP – Green Fluorescent Protein, CSC – Cancer Stem Cells, enr – enriched, depl – depleted, Transc – Transcription, Ten-C – Tenascin-C, MMP - Matrix Metalloproteinase, NOS – NANOG, OCT4, SOX2,, EMT – Epithelial-Mesenchymal Transition, + - Indicates a positive degree of expression or null activity, --- Indicates null activity or null expression.

1 GFP: signal given by cells competent to drive transcription of the OCT4 promoter. GFP

expression by a cancer cell indicates that cell is a CSC. The degree of its expression is roughly proportional to the stemness of a CSC.

2 CD44

+/high/24

-/low: cell surface antigen expression profile of a breast CSC.

3 Refers to expression of NANOG, OCT4, and SOX2, the putative embryonic transcription

factors in ESCs (and CSCs). 4 Known markers of aggressive invasive metastatic breast cancer.

5 NOS genes: Targets of NOS transcription factors, critical implementers of ESC biology. 6 EMT refers to epithelial-mesenchymal transition. CSCs have a profile of gene and protein

expression that closely resembles that of mesenchymal stem cells in certain animal model scenarios.

7 Standard in vitro assays of cell motility and invasion were used for quantify these biologic

functions in CSCs vs. other non-stem cancer cell populations.

5.6.2. Studying Tumorigenesis and Metastasis in a Mouse Model of Breast Cancer: Using a NOD/SCID orthotopic breast cancer mouse model, the ability of GFP-enriched CSCs or GFP-depleted non-stem bulk cancer cells to initiate breast cancer (tumorigenesis) was tested (See Figs. 13 - 15). In these studies, inoculation of GFP-enriched CSCs into the mouse mammary fat pad resulted in 100% tumor

engraftment (N = 20). Conversely, only one animal in the GFP-depleted (CSC-depleted) nonstem bulk cancer group (N = 20) formed a tumor. Interestingly, the one tumor that did form took roughly twice as long to develop as the average time for the CSC-enriched group (compare roughly 120 days with roughly 60 days),

and did not lead to a significant amount of tumor burden or associated morbidity. Further,

FIGURE 13 Primary and metastatic breast cancer derived from MDA MB

231 cells injected into the mammary fat pad of nude mice. A. Representative

primary breast tumor at 67 days post-inoculation into the mammary fat pad of

GFP-enriched MDA MB 231 breast CSCs. B. Representative metastatic breast

cancer (to lung) at 8 weeks post-inoculation into the mammary fat pad of GFP-

enriched MDA MB 231 cells.

B

29


around 80% of animals in this group had to be sacrificed at some point in the experiment due to heavy tumor burden, associated morbidity, and subsequently imminent mortality. As expected, metastatic events were not found in the CSC depleted group.

5.6.3. Analysis of Cancer and CSC Markers: A combination of microarray, RTPCR, western blotting, FACS-Analysis, and immunohistochemistry were used to study all relevant cells lines pre- and post-incubation in the animal model, as well as tissues derived from these studies for: 1) the expression levels of known CSC and cancer markers; as well 2) to search for new markers that may be relevant to CSCs and their role in cancer biology. In the mouse model described, a significant upregulation at the RNA and protein level of key cancer genes and

proteins in tissue and cells was demonstrated including: 1) GFP; 2) CD44

+/high/24

-/low; 3) NOS Transcription factors;

and 4) Tenascin C, MMP1, and MMP9 (known functional markers of breast cancer metastasis (Singh et al., 2003; Al-Hajj et al., 2003). GFP, CD44

+/high/24

-/low , and NOS

transcription factors were found expressed in the highest levels in metastatic breast cancer as compared to primary and the in vitro CSC culture (typically, metastatic expression > primary expression > in vitro expression). These were confirmed in tissue sections from patients with

primary and metastatic breast cancer where CSC markers and NOS transcription factors were found to be much more highly expressed in metastatic cancer as compared to primary cancer (Fig. 15).

FIGURE 15 Expression of OCT4 in a breast cancer cell in situ in a human

breast adenocarcinoma (primary tumor) and in breast cancer metastatic to

brain. Photomicrographs of immunostaining for OCT4 in human primary (A)

and metastatic (B, to brain) breast tissue. The number of breast cancer cells in

metastatic breast cancer that express OCT4 and thus are CSCs is exponentially

higher in metatstatic breast cancer as compared to primary breast cancer.

A B

FIGURE 14 In vivo analysis of the

tumorigenicity of MDA MB 231

breast cancer GFP-enriched CSCs

and GFP-depleted nonstem bulk

cancer cells cells injected into the

mammary fat pad of nude mice. Bar

graphs representing the percentage of

injected mice that grew primary or

metastatic tumors over a 13-week period

of time. The number in parenthesis

indicates the total number of mice

injected in each group. For both cell

populations (CSC or NSBCC), cells

were derived either from the parental

(heterogenous) or clonal lines (derived

from a single cell using stem cell

cloning techniques) GFP, Green

Fluorescent Protein. CSC, cancer stem

cell. NSBCC, nonstem bulk cancer cell

E, enriched. D, depleted. Het,

heterogenous. Clon, clonal.

30


5.6.4. Demonstration of EMT in GFP-enriched CSCs: GFP-enriched CSCs derived from primary breast and metastatic cancers were shown to have a significant number of markers whose expression was increased or decreased in a manner consistent with EMT (i.e., the: well described EMT expression profile, including increased expression of Vimentin, decreased expression of ESA in GFP-enriched CSCs derived from the primary cancer as compared to GFP-depleted non-stem bulk cancer cells derived from the parental population. Other markers

that were studied included E-Cadherin (decreased expression in GFP-enriched CSCs) and N-Cadherin (increased expression in GFP-enriched CSCs), also supportive of a mesenchymal phenotype in this population. 5.6.5. Demonstration of NOS Gene Expression in GFP-enriched CSCs: NOS genes (genes activated by NOS transcription factors drive the major biological programs of embryonic and fetal development. Over 40 NOS genes were identified reproducibly in GFP-enriched

CSCs as being upregulated. The protein products of NOS genes include cell receptors, growth factors, structural proteins, cell adhesion molecules, tyrosine kinases,

metabolic enzymes, nuclear transcription factors, and other protein types. At least some of these are likely to be

good drug targets for drug development, and will be the focus of near future experiments. Figure 16 demonstrates the number of genes found to be regulated in breast cancer tissue derived from this model by NOS transcription factors independently, or in some

combination. 5.6.6. Demonstration of Enhanced Motility and Tissue Invasion: Assays for differences in cell motility and invasion demonstrated that GFP-enriched MDA MB 231 CSCs derived from tissues of the animal model were significantly more motile and invasive than those of GFP-depleted nonstem bulk cancer cells. The trend reproducibly, for both motility and invasion, was metastatic CSCs (++++) > primary CSCs (+++) > in vitro CSCs (+++/++) > in vitro parental cancer cell line (original cell line, unmanipulated, ++/+) > nonstem bulk cancer cells (stem cell depleted, +).

FIGURE 16 Venn Diagram demonstrating the results of microarray

gene expression studies demonstrating the number of genes regulated by

OCT4, Nanog, or Sox2 (or some combination of these) in GFP-enriched

cancer stem cells as compared to GFP-depleted bulk (non-stem) cancer

cells.

31


5.6.7. Summary of hypotheses proven and validated with in vitro and in vivo studies:

H1 Founder Hypothesis: Solid tumors have CSCs.

H2 Bridge Hypothesis: ESCs and CSCs derived from non-germ somatic solid cancers overlap with respect to specific parts of their stem cell genotype, and phenotype. NOS transcription factors are present in solid cancer, present and upregulated with respect to expression, have expression patterns that inversely correlate with cell maturity and differentiation, and are required for stem cell phenotypy.

H3 CSC Marker Hypothesis: NOS Transcription Factors are CSC Markers. Their presence can be used to identify cells as CSCs.

H4 CSC Selection Hypothesis (H4): NOS Transcription Factors are CSC Markers. Their presence can be used to identify cells as CSCs.

5.6.8. Summary and Discussion: Reverse Validation of the NovTx Biomark and CSC Selection Approach To summarize the preceding review of NovTx’s historical R&D basis for

its drug discovery program; first, the concept of a stem cell role for solid cancers was created; second, cell and molecular evidence for this concept was generated, which led to the understanding that NOS transcription factors may play a role in biology that is central to CSCs derived from solid tumors; third, the presence and importance of NOS transcription factors in solid cancer biology and CSCs derived from solid tumors was proven or verified; fourth, protocols were established to use NOS transcription factors as intracellular markers in concert with and for use in protocols for the identification and isolation of CSCs; fifth, the accuracy, precision, and validity of this approach to select CSCs was proven with in vitro cell assays and in vivo cancer models.

Finally, it is striking and important to note that a similar CSC population can be derived from the total cancer population by NovTx’s identification and selection technology, which is entirely different than the most common approach involving immunostaining of cell surface markers, FACS analysis, and sorting to isolate cells that are positive for the marker (for example, in breast

cancer it is CD44

+/high/CD24

-/low)

(see Fig. 17). These cell populations are similar with respect to their CSC and cancer gene profile, and their in vitro and in vivo phenotype. However, it is

important to note that in depth analysis of both cancer cell populations created by one or the other approach, while very

Reverse Proof of Concept – Isolation of CSCs (from the

total cancer cell population) with a CD44+/high/24-/ low

(CSC) Marker Expression Profile Without FACS-Mediated

Cell Selection using CD44+/high/24-/low

CSC _________

CD44+/high

/24-/low

AND

CSC Phenotype

Tumorigenic, Metastatic

Resistance to Therapy

FIGURE 17 Novostem biomarking and selection protocols identify and isolate a CSC

population that is highly enriched for CD44+/high/24-/low expression, and that has

strong CSC phenotypic properties.

Selection with

FACS-sorting for

cancer cells that are CD44+/high

and CD24-/low

Biomarking, Isolation, and

Selection of CSCs with

NovTx Patented

Methods and Protocols

32


similar, are not identical, and favors NovTx’s selection methods with respect to the intent of identifying and then isolating a true CSC as defined by the CSC phenotype. 5.7. Building Blocks and Core Concepts Derived from Research Activities of 1999 - 2007: A Summary of the Knowledge Base Used for the Creation of all Biotechnology Applications

5.7.1. Core Concepts for CSC Biology Under-standing, All of which Derived from Research Activities from 1999 - 2007

The following is a review point by point of the major building blocks of NovTx’s to approach to drug discovery was generated during this productive time.

1) Solid cancers have CSCs, which exist in naturally occuring primary tumors as a small rare fraction of the total cell population (0.01 – 0.1%, typically higher in cell lines). 2) CSCs contain within their own subpopulation the pan-biologic phenotypy of all aspects of the cancer life cycle. CSCs in solid cancers are responsible for most if not all major biological events such as: tumorigenesis, local tissue invasion and regional spread, metastasis, EMT (early data is supportive but definitive studies are needed), resistance to radiation and chemotherapy, and tumor recurrence.

3) Cancer growth is best quantified at the cellular level as an hierarchical, developmental disease: In this scenario, CSCs are the founder cells of all cells in a given tumor’s cell population. CSCs either clonally/symmetrically replicate or clone themselves, or give rise to non-stem progenitors. Progenitors can roughly be divided into early (immediate progeny of CSCs, typically rapidly proliferate, and have phenotype that is closer to a CSC than to nonstem bulk cancer cell, give rise to late progenitors), and late (the progeny of early progenitors, typically rapidly proliferate, have a phenotype that is more reminiscent of terminally differentiated nonstem bulk cancer cells than CSCs, give rise to nonstem bulk cancer cells which form the bulk of the cancer cell population).

4) Non-stem bulk cancer cells are the progeny of CSCs, and form the bulk of the tumor (93 – 97%). Although these cells retain the ability to grow in situ in primary tissues (even in the absence of CSC subpopulation), these cells typically do not have malignant features. This can be demonstrated by simply extracting the CSC subpopulation from the total cancer cell population (Singh et al., 2004), which converts the remainder of the cells into a tumor with a benign phenotype. This manipulation is all that is required to convert any malignant cell population into a benign tumor cell population (i.e., one that is incapable of tumorigenesis, local spread, or metastasis, and is typically sensitive to radiation). 5) CSCs are very resistant to radiation and chemotherapy (see below). Conversely, non-

stem bulk cancer cells are very sensitive to chemotherapy and radiation. This is due to the overexpression of the MDR genes, and among many other causative factors yet to be defined! 6) CSCs require NOS transcription factors for their stem cell and malignant properties. NOS transcription factors are pro-stem cells and pro-cancer, and mediate these effects through NOS genes which they regulate.

33


7) In CSCs, just like ESCs (for example, in ESC biology, embryogenesis, gastrulation, and early fetal development), the expression levels of OCT4 are tightly regulated. Typically higher expression is associated with an ESC phenotype including: immaturity, unlimited proliferation capability, lack of differentiation or inablity to differentiate, pluripotency, increased expression of MDR genes (ABC transporters), increased motility, more aggressive invasive phenotype, EMT, increased expression of tumor suppressor genes, decreased

sensitivity to DNA damage, and many other biological features. Typically, as expression declines and becomes low to null expression, stem cell features are lost and cell differentiation occurs. This is a one way event, does not reverse, and thus the ESC phenotype is lost. These events lead to differentiation of the cells, and are associated with non-stem phenotypy including: maturity, decreased expression of MDR genes (ABC transporters), decreased motility, decreased tissue invasion potential, limited or fixed proliferative capacity, no EMT capability, decreased expression of tumor suppressor genes, increased sensitivity to DNA damage, and other features of mature restricted terminally differentiated cells. In ESCs, overexpression of OCT4 also induces differentiation. CSCs, like ESCs, require OCT4 and its targets for stem cell phenotypy and most likely for many cancer characteristics as well, and are

subject to the same biological consequences of decreasing OCT4 expression, or its overexpression. 8) The presence and requirement of OCT and other related NOS transcription factors in cancer and CSC biology have been validated. 9) NovTx has created a methodology for indirectly marking CSCs, allowing them to be detected within the background of the total cancer cell population. This approach utilizes a real-time bioactive and biosensitive transgene reporter system. The reporter genes consist of the full length promoter for the CSC marker (OCT4, in this example and as described above

and below) upstream and operationally linked to a reporter gene (for example GFP, red fluorescence protein [RFP], or luciferase genes, or other signal gene of choice). As described above, the stable introduction of the pOCT4-eGFP construct into all cancer cells in a given cancer cell population (using standard transgene introduction methods, see below) results in the transcription of the GFP gene, and thus a GFP protein product in those cells competent to activate promoter activity (only CSCs). Those cells which are competent to do so fluoresce, and can be detected with multiple means. These cells are CSCs, and can be isolated from the total cancer cell population using standard FACS-sorting methods. The result is the creation of a GFP-enriched CSC population.

10) The CSC phenotype of cancer cells selected with NovTx methodology has been validated in vitro and in vivo. Cancer cells selected by stably introducing the reporter transgene and isolating them by FACS methods have a true CSC phenotype, including: activity in in vitro stem cell assays, tumorigenic and metastatic in animal models, expression of CSC markers and malignant cancer genes, and others (see full list below). The comprehensive list* of CSC assays all cancer cells are tested with to validate their true CSC phenotypy are as follows:

1. In vitro stem cell assays

2. In vitro molecular profiling (especially for cancer and CSC markers)

3. In vivo animal modeling (for tumorigenesis, metastasis, etc.)

4. In vivo molecular profiling (of in vivo tissues and cells, especially cancer and CSC markers)

34


5. Assays of migration and motility

6. Serial transplantation.

7. Resistance to Therapy

8. Other, Miscellaneous: EMT profiling, MDR gene expression (isotype and expression

levels), etc.

*The above list is standard and a part of NovTx research protocols (referred to as the CSC Validation panel).

5.7.2. Core Concepts for CSC Drug Discovery Derived from All Research Activities from 1999 - 2007 1. Solid tumors have CSCs.

2. CSCs require NOS Transcriptional machinery and their regulated gene targets.

3. NOS Transcriptional machinery are biomarkers for CSCs, because they are present and

required for a CSC to exist and function biologically. OCT4 Expression defines a cell as a CSC.

4. The CSC fraction of the total cell population is competent to activate expression of a

reporter transgene construct that consists of the full length OCT4 promoter (or SOX2 or NANOG) upstream and operationally linked to the GFP gene (or whatever reporter is used). The pOCT4-GFP reporter transgene, when stably integrated into a given cancer cells genome, provides a means of detection of CSCs (only CSCs are competent to drive activity of the reporter construct).

Thus, the following schematic formula is true:

CSC phenotypy4 ~ OCT4 Expression1,2

and

OCT4 Expression1,2 ~ GFP Expression3

Therefore

CSC phenotypy4 ~ GFP Expression3

1 OCT4 continues to appear to be the best marker, and to provide the best result with respect to the intent of the

biomark, as described in detail in this document. 2 Other similar biomarks have been identified (for example, NANOG and SOX2) and are included in the first series

of platform patents. Their utility as functional biomarkers, and their importance independent of or in addition to OCT4 is currently being researched.

3 Other reporters are being used in addition to GFP in this system. The choice of the reporter used is dependent on

the nature of the experiment, assay, or cell screening protocol (described in detail below). 4 The GFP signal indicates that a cancer cell is a CSC. In addition, the “stemness” of a CSC with respect to

phenotypic properties is directly proportional to the strength of the signal.

35


5. Standardized methodology for selection of CSCs include: introduction of the transgene reporter construct(s) into the total cancer population, stable transfectant selection with antibiotic supplemented culture and routine selection culture technique, expansion of the stably transfected population (all cells in this population have integrated and made available the transgene reporter construct for activation in the correct biologic situation), and FACS-sorting of cells identify, isolate, and capture CSCs that express the biomark (or

possibly cancer cells that do not, i.e., CSC-depleted cancer cells). 6. The entire process, from introduction of the transgene into the cancer cell population to

FACS-sorting and in vitro culture is referred to as CSC selection, and will be referred to as such through out the remainder of the document.

7. Selection, in this context, refers to all steps required to capture a CSC from a total CSC

population for in vitro culture. This approach has been used exhaustively, and the results demonstrate that it can be described as (when used in combination with the NOS biomarks and protocols, and when done so by a researcher skilled in the art): 1) seamless; 2) reliably

reproducible with use in multiple types of solid cancers, multiple different cell lines of a given cancer type, or with multiple sequential experiments over time in the same cancer cell line; 3) accurate with respect to the type of cell it selects for; and 4) usable with virtually any solid cancer type irrespective of germ layer or tissue type. NovTx researchers have great confidence in the CSC selection process, and the identity and phenotype of the stem-like cancer cells it selects for.

8. The NovTx CSC identification and selection process has been validated in vitro and in vivo

with many cell and stem cell assays, and in animal models of cancer.

9. Regarding NovTx protocols for CSC identification, isolation, capture, and in vitro propagation, and their use for screening the effects of environmental changes and toxic challenge on CSCs:

Concept 1: The signal generated by the stably integrated reporter transgene, when detected with standard technology currently available, sensitively follows cell viability, and an array of

other phenotypic changes over time and in real-time in response to its environment and toxic

challenge.

Concept 2: NovTx biomarking and selection methods select for the correct cell target (i.e., the

CSC fraction of the total cancer cell population) that is needed for study or drug screening.

This has been proven (validated) by NovTx researchers for each cancer and its respective CSC population by testing the selected population against the CSC validation panel described

above.

Concept 3: In addition to marking a cancer cell (a signal whose meaning can be described as

on/off, yes/no, absolute label, quantitative), the degree of expression NOS transcriptional

machinery is proportional to the stemness of a given CSC (a signal that, if present has a

meaning that is additive [additive to the simple label of CSC or non-stem bulk cancer cell] and qualifying).

5.7.3. Core Definitions for Use in the Remainder of This Document:

36


Biomark: The word biomark has several meanings for the purposes of this document, NovTx research, and NovTx drug discovery that directly or indirectly overlap or expression the same meaning or intent. They include: 1) the naturally occuring and biologically expressed functionally active protein in the CSC (i.e., NOS transcription factors, such as OCT4). All cancer cells which express this protein are CSCs. The reporter gene (i.e., GFP, or any one of a number of other possible reporter genes) is regulated by the promoter (i.e., the promoter of

OCT4) of said naturally occuring gene. Thus, the reporter gene, in this context, is the biomark.; 2) in the context of NovTx Drug Discovery, this term also refers to the product of a stably integrated reporter transgene (pOCT4-GFP, as described in detail above) in a CSC. Refers to the end result of biomarking. Namely, a cancer cell population that uniformly has the reporter transgene stably integrated into its genome.

To summarize and clarify

Biomark = Expression of the naturally occuring CSC-associated protein (OCT4, for example)

And/Or

= Expression of the reporter gene as regulated by the promoter for the naturally occuring protein inside the a CSC2 (GFP, for example, as part of the pOCT4-eGFP transgene)

Biomarking, Biomarking System, and Biomarked: Refers to the methods and techniques described above and in detail below for stably introducing the transgene reporter construct (pOCT4-eGFP, as described in detail above) into the genome of a cancer cell. Also refers to the key observation of the process, that only CSCs, which are a rare subpopulation within the total cancer cell population, are competent to activate the transgene reporter construct, transcribe the reporter gene, and generate a signal (i.e., GFP, fluorescence). Finally, it implies directly or indirectly, that the CSC subpopulation can be detected, isolated, captured, and

cultured in vitro for further manipulation using this approach. In summary, the collective process of introducing the transgene, detecting its activity (or lack of activity), and identifying a cancer cell as a CSC (activates reporter transgene) or nonstem bulk cancer cell (does not activate the reporter transgene).

(CSC) Selection: Refers to the comprehensive set of protocols needed to biomark the total cancer cell population, and then detect, isolate, capture, and culture in vitro CSCs derived from the total cancer cell population.

5.8. 2007 – 2008: Novopro Media and Culture Protocols – Break-Through Technology that Overcomes all Technical Barriers to Large Volume CSC Culture

Although our approach to the identification, isolation, and enrichment of CSCs from virtually any CSC type consistently works well, there is difficulty in stably maintaining this high density of CSCs when kept in culture over time with numerous passages for the purpose of expansion. Instead, we found that as enriched CSC populations selected in this manner were cultured and

passaged over time, the CSC fraction (the fraction that expressed GFP) would slowly but steadily disappear (drift) over a few weeks of culture until the percentage of CSCs in the culture approached that of the parental line originally. At that time, the numbers would stabilize and be maintained through all subsequent cultures.

Technical issues such as the fragile stability and highly sensitive dynamic response of stem cells to their environment are common stem cell biology concepts, whether adult or embryonic. Indeed, maintaining stem cells in culture in purity in general for study or expansion without

37


differentiation and loss/change of phenotype is difficult and requires scientists skilled in the art. Typically, a combination of growth factors and culture technique modifications are required to maintain stem cell populations in vitro. The importance of this point with respect to drug screening is highlighted in the fact that the most likely event to occur when an early CSC with full plastic potential is challenged (for example, for adult tissue stem cells – the presence of serum or attachment to substrate induces differentiation) is differentiation events. These

events Typically, a combination of growth factors and culture technique modifications are required to maintain stem cell populations in vitro. The importance of this point with respect to drug screening is highlighted in the fact that the most likely event to occur when an early CSC with full plastic potential is challenged (for example, for adult tissue stem cells – the presence of serum or attachment to substrate induces differentiation) is differentiation events. These events are typically one way (CSC --> differentiated cancer cell), without the possibility of rescue or regaining the stem-like cell phenotype. For drug discovery, this is a terminal event that makes the effort invested and the result obtained from a given experiment wasted and worthless respectively (since our platform by definition targets CSCs, not nonstem bulk cancer cells). Thus, any screening platform that attempts to target CSCs in a high-throughput manner

must be carefully and thoughtfully planned, and include a panel of short, medium, and long range quality control assays built into the system. The assays must provide results that continuously ensure the researcher the CSC phenotype in intact, and the results of the experiment are valid.

This roadblock to large scale drug discovery was overcome by a combination a number of tools including: the vast stem cell experience of our group; modeling from cancer cell, adult

stem cell, and ESC culture systems; and logical multidisciplinary, discovery research that focused on the development of a culture system that was tailored to this undescribed cancer cell subpopulation (CSCs). Importantly, this cell population could not be clearly defined as a cancer cell, an adult tissue stem cell, or an ESC. However, this cell population clearly uses the biology of and has the phenotype of all three to some extent.

Thus, the key components of standard-ized cell culture systems for cancer cells, adult stem cells, and ESCs were separated into variables that could be tested. Subsequently, a large series of small scale culture studies

were initiated in which broad categories of culture media comp-onents (media, serum, growth factors, nutrients,

Culture System Component Parts

Cancer Cell (attached) Serum Surface Attachment

1

Adult Stem Cell Lack of Attachment1

Growth Factors

Embryonic Stem Cell

HFF Modified Media

Other Supplement Categories Growth Factors Nutritional Supplements Biosolid Gel Adh Mx

1,2

Other Unspecified3

TABLE 3 – Summary of Cell Culture Systems (source culture variables were drawn from) and Final Component Parts (components selected).

HFF, Human Fibroblast Foreskin Cells. Adh, Adhesion. Mx, Matrix.

1 – Although these terms are conflicting, the reality actual splits the difference between the

two and the form of a culture modification that is listed in bottom right panel, Biosolid

Gel Adhesion Matrix.

2 – Biosolid Gel Adhesion Matrix is a novel and IP sensitive part of NovTx’s final common

set of protocols for CSC culture.

3 – There are several components that NovTx does not wish to disclose at this time.

38


etc.) were manipulated in a dose escalating manner. The result after months of study of thousands of individual data points was a combination of variables that protected the CSC phenotype (see Table 3). Briefly, the key outcome of each experiment that was measured was GFP expression as regulated by the OCT4 biomarker system (i.e., the signal given off by the biomark) as indicative of a CSC phenotype, AND the appropriate performance of this cell population in the NovTx CSC validation panel.

Interestingly, of the variables tested, a few were identified from each model system (i.e., cancer cell, adult stem cell, and ESC) that were not simply important, but required for maintenance of the CSC phenotype. Some variables were easily predicted and not necessarily novel such as low cell density at the time of initial plating. Others were relatively novel variables such as the need for serum at a very tightly regulated percentage of the total media (pro-ESC, pro-cancer cell, anti-adult cancer cell), certain growth factors (some

previously described in other stem cell model systems, some novel and specific to CSCs), and foreskin fibroblast conditioned media with serum (an important ES variable; again, for CSCs, a certain serum percentage worked best). Some unexpected or difficult variables were also

encountered, such as semi-attachment like activity to substrate-coated surfaces (the nature of the actual substrate is also unexpected). This bizarre phenotype was the result of a chance observation and literally splits the difference between adult stem cells (no attachment), ES Cells (nestled in a bed of foreskin fibroblast cells), and CSCs (attachment to hard coated surfaces).

The end result is an intriguing hybrid media and culture system that supports and maintains highly enriched CSCs cultures derived from any tumor type during expansion and over extended periods of time (referred to as the Novopro media and culture system, see Table 4). At present, this culture system has been used to successively capture, grow, and study CSCs from various types of tumors including breast adenocarcinoma metastatic to lung, melanoma metastatic to lung,

glioblastoma multiforme (GBM), anaplastic astrocytoma, osteosarcoma, prostate cancer, and more recently chronic myelogenous leukemia, and many others. The combination of NovTx biomarkers, selection protocols, and media/protocols to identify, isolate, and culture CSCs is powerful and has many potential uses and

adaptations including the development of drug discovery and alternative therapeutic strategies for virtually any type of solid tumor.

TABLE 4 Differences in expression of GFP over time in GFP-

enriched or depleted MDA MB 231 cells presence of standard (DF10) or specialized (HFF) culture media

DF10, Basic Cancer Cell Media. HFF, Modified CSC promoting Media.

d, day. NG, nongreen or not expressing GFP, indicative of a nonstem

phenotype. G, green or GFP expressing, indicative of a CSC phenotype.

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5.9. 2008 - 2009 - Development of a Pilot Program for CSC Drug Discovery

5.9.1. Cell and Molecular Concepts Relevant to NovTx’s Drug Discovery Approach

5.9.1.1. All Cancer Cells Are Not Created Equal, Thus Not All Cancer Cell Targets Are Created Equal: We and others have discovered and characterized a rare (approximately 0.01% - 0.001% frequency in primary cancers and approximately 0.1% up to 10% frequency in metastatic foci and established cancer cell lines) stem-like cell population within the total cancer cell population of non-germ somatic solid cancers (and established and primary cell lines derived therein) that requires the expression of specific transcriptional molecular machinery (the above described NOS transcription factors, especially OCT4 and NANOG,

which can be considered as here forth as putative markers of CSCs). Solid CSCs are capable of giving rise to two distinct populations from the same cancer (described schematically in Fig. 18).

First, CSCs can give rise to identical clones and thus sustain the CSC population indefinitely (so called symmetric division). These cells

constitute 0.01 – 0.1% of the total cell volume of a primary tumor.

Second, CSCs can give rise to cancer progenitors, which proliferate rapidly to give rise to differentiated non-stem bulk cancer cells (so called

asymmetric division). These cells constitute 95 – 99% of the total cell volume of a primary tumor. 5.9.1.2. With respect to Drug Discovery, Experimental Therapeutics, and Targeted Cancer Drug Development, CSCs are Cellular Target of Choice

CSCs: CSCs are responsible for all important events of a given cancer’s biology, including initiation, development, invasion, and metastasis. CSCs are rare in a primary cancer’s cell population (roughly 0.01 - 0.1% on average in primary tumors). The growth kinetics of this population is typically very slow and atypical compared to the rest of the cancer cell population. Further, this cell population is typically very resistant to the effects of

chemotherapy and radiation.

Nonstem bulk cancer cells: Terminally differentiated cancer cells, while retaining the capacity to grow as part of the cancer body (although much more limited and restricted in this

potential, reminiscent more of benign tumors than malignant tumors), are otherwise restricted in their ability to initiate cancer; transplant cancer between animals; or initiate metastatic

B

C

A FIGURE 18 Schematic diagrams and

photo-micrographs of CSCs

undergoing symetric/clonal and

assymetric division. A. CSCs clonally

divide (also known as symetric division)

to replicate themselves in order to

maintain the CSC fraction of the total

cancer cell population according to the

needs of the environmental niche. B.

CSCs give rise to non-stem

differentiated cancer cells that form the

tissue body. The typical developmental

path is for a CSC to give rise to early

cancer progenitors which are similar to

CSCs but somewhat more restricted in

their pluripotential and proliferation

longevity. These cells typically rapidly

proliferate to give rise to late

progenitors. From late progenitors, non-

stem bulk cancer terminally

differentiated cancer cells are produced.

These cells represent 93-97% of the total

cancer population, and form the tumor

body. C. Photomicrograph of a CSC

(biomarked CSC expressing the GFP

reporter gene as regulated by the OCT4

promoter) shown in process of

assymetrically dividing to give rise what

is likely an early progenitor.

40


events. Further, this cell population is typically very sensitive to the effects of chemotherapy and radiation. Thus, CSCs, not their progeny, are the correct cellular target for cancer drug discovery.

5.9.2. The NovTx Drug Discovery Platform – Breakdown into Component Parts

5.9.2.1. Identifying and Isolating the Correct Cell Target ------------------- NovTx biotechnology can identify and isolate the correct CSC subpopulation from any solid Cancer, and has validated this approach exhaustively: Solid cancer cell heterogeneity reflects the presence of a variety of cancer cell types within any given cancer cell population. All possible subpopulations within a given cancer cell population arise from a CSC is directed by the complex, poorly understood influences of a given tissue niche (may include in number of types of regulation or influence, for example, cell-cell interactions, growth factors, extracellular matrix, etc.). Because of their widespread developmental capacity, the ability to identify and isolate true founder CSCs for in vitro propagation and drug screening is

an absolute requirement. As described above, NovTx has created and streamlined CSC biomarkers and identification/selection approaches to identify the true CSC population in any

cancer tissue or cell line, and select it for in vitro for culture, study, and screening. The purity of the culture with respect to the biomark (and thus the percentage of true CSCs) is typically around 96% at first selection, and is maintained around 93 – 96% over time with Novopro media and culture methods (see the next section). This percentage refers to the ratio of true CSCs to other background cells in the culture such late progenitors and nonstem bulk cancer cells. Thus, the identification and selection process results in an exponential increase of the percentage of CSCs in the culture. 5.9.2.2. Large Volume Culture for All Purpose Drug Discovery ------------------- CSCs from any solid cancer can be cultured in vitro for drug screening purposes in

high purity and with respect to rigorous maintenance of the CSC phenotype during routine manipulations: The dynamic instability of stem cells (whether adult or embryonic) is a mainstay principle in stem cell biology that also applies to CSCs. This phenomenon precludes large scale drug discovery approaches due a constant pressure on CSCs to differentiate into more restricted progenitors and terminally differentiated nonstem bulk cancer cells. The “differentiation event” is rapid, one way, and triggered by numerous categories of environmental influence beyond the scope of this document. Briefly, the list of differentiating influences includes: cell attachment disruption, growth factor exposure (whether putative protocol growth factors, or the exposure of other unknown growth factors, in serum for example, refers to the addition, or removal of such growth factors), changes in serum

concentration, dilution of HFF supplements (see above), mechanical perturbation or disruption, destabilizing environmental changes (temperature, CO2 levels, O2 levels, etc.), over- or under crowding (inappropriate cell densities), many other known factors previously described, and certainly many more unknown factors (some recently discovered by NovTx and not common knowledge). However, as described above, NovTx has created CSC promoting media and culture methods that allow for extended long term high volume culture of CSCs in vitro without loss of the NovTx CSC biomark (thus, in high purity, over 93% on average, tested up to 3 months, see Table 4) or the CSC phenotype. To date, a dozen different cancer types have

41


been tested using NovTx’s approach, and all robustly and uniformly responded to the approach allowing identification and selection to be achieved for further in vitro study and/or drug screening purposes. 5.9.2.3. Industry Standard Approaches to Cell Culture and Medicinal Chemistry -------------------

With the exception of the detection and analysis process, the NovTx approach to drug screening of CSCs and their progeny follows industry standard protocols: NovTx is separated from all other cancer drug screening programs by 1) the CSC target, 2) the large volume culture capability, and 3) the detection system (see next section). However, the protocols NovTx will used for all aspects of introducing CSCs and experimental drugs into a screening system are industry standard and based on core medicinal chemistry concepts and protocols. For NovTx drug screening, a two step approach to screening will be utilized: 1) high volume screening with limitations on dosing and other variables, and 2) more detailed screening of compounds that have a favorable effect on the CSC population with the inclusion of a number of variables and important data sets and outcomes (i.e., IC50, etc.).

5.9.2.4. Continuous Real-time Signal Detection, with Immediate Analysis and Biointerpretation ------------------- The NovTx biomark and detection/analysis system is smart, sophisticated, real time, and high yield: The NovTx biomark is constantly present in all cells in the culture, and is bioactivatable, or at least available to be bioactivated, given the appropriate biological activity in the appropriate cell (only CSCs can activate the reporter transgene and thus produce a biosignal that is detectable). In addition, all cancer cells in the assay contain a second biomark that marks the cell as being a cancer cell or not. The nature of the biomark (a

reporter transgene consisting of the CMV reporter upstream and operational linked to a different reporter, and the signal it gives off, provides a detectable signal that is sensitive and specific, and is roughly in proportion to the total cell population and CSC population. The biological responses a CSC can take in response to an environmental and/or toxic challenge have been hypothesized, recreated, and studied exhaustively in the lab (Fig. 19, an ongoing process). From the predefined types of responses, it is possible to develop predictive biomathematical models, based on the cell compartment method, as well as many other standardized methods previously described (Preziosi et al., 2003; Gamguly et al., 2006). Detection of the signal in the assay, when combined with biomathematical modeling and software enhancement programs, yields a smart signal that is loaded with biologically relevant

information buried in the signal. Thus, the detection process includes: 1) detection (+/- or off/on event) plus 2) basic cell culture information (rough estimate of the number of CSCs and nonstem bulk cancer cells in the assay independent of the other or in combination = total cell population) 3) more complex biological information (timing and degree of cell kill or growth of cell arrest) and 4) higher order biologic information (i.e., the ability to detect a compound influencing a CSC to differentiate into a terminal non-stem bulk cancer cell, and 5) the ability of detect and report all four of these results in real time for CSCs and non-stem bulk cancer cells in the same culture at the same time from the beginning to the end of the same experiment (up to 7 – 10 days of continuous data collection).

42


FIGURE 19 Summary of the possible outcomes

that can occur in the Founder CSC in a

biological assay that challenges all cancer cells

in the assay with a toxin, growth factor,

radiation, environmental change, etc. A.

Schematic depicting the possible phenotypic

changes that can occur in a CSC in response to a

given enviromental challenge such as a toxin, or in

response to other types of drugs such as growth

factors. A, Green Cell, CSC. Red Cell, Progenitor

or other cell type with different phenotype than

the CSC it was derived from. Green cell with

dotted lines that X over it, CSC entering cell

death. Orange cell, progenitor cells downstream

developmentally from the CSC it was derived

from. Blue cell, terminally differentiated non-stem

bulk cancer cells. The T bars indicate growth

arrest. The self pointing semi-circular arrow

indicates clonal division of a CSC. F, founder

CSC. FX, CSC converting to an unspecified

phenotype. Fa, founder CSC entering cell cycle

arrest. Fcd, founder CSC undergoing cell death. P,

progenitor. C, terminally differentiated nonstem

bulk cancer cell. Ccd, cancer cell undergoing cell

death. Pa, progentior undergoing cell cycle arrest.

Ca, cancer cell undergoing cell cycle arrest. 1,

denotes a cell entering cellc cycle arrest. 2,

denotes the change in pheonotype of CSC into a

cell that is not yet defined by previous research. 3,

Denotes the assymetrically division of a CSC to

give rise to a progenitor cells that is intermediate

in it development from CSC to nonbulk cancer

cells, or the continued differentiation of a

progenitor cancer stem cell into a terminally

differentiated nonstem bulk cancer cell. 4,

denotes a cell denotes the induction of apoptosis,

or other type of cell death by toxin or

environmental challenge. Ai

(inset). Fluorescent

photomicrograph (20X) demonsrating the two

detectable fluorescent biosignals GFP and RFP. In

this example, all cells are stably biomarked with

RFP and GFP, but only CSCs are able to activate

the reporter and express the protein biosignal. B. 2

dimensional plot of the growth of CSCs in

Novopro culture and media (days 1 - 4, followed

by death after challenge with a drug (days 4 – 7)

given on day 4 that is toxic to CSCs. The inset

shows a biomathmatical description of the 2

dimensional plot of the growth of CSCs in

Novopro culture and media. Using sophisticated

software detection capabilities and software

interface programs, the signals can be detected,

analyzed, converted into a in a predefined

biological outcome that is described in real-time

(i.e., cytoxicity, growth arrest), and in the form of

an end result conclusion for both the fate of CSCs and nonstem bulk cancer cells.

F

Fa

Ca

FX

Fcd

C

C

3

Ccd

1

2

Ccd

3

1

3

4

4

Pa

4

P

A

B

Ai

1

Flu

ore

scen

t S

ign

al

43


Technical Note

The importance in the ability to detect all cell subpopulations, and their response to environmental challenge, is highlighted below. Particular emphasis is being put on the ability to detect compounds that induce differentiation of a CSC to a nonstem bulk cancer cell (a less aggressive cell, that is sensitive to radiation and chemotherapy). Similar concepts have been proposed by others (Gupta et al., 2009). This result would allow for standard of care approaches to treatment to have dramatically improved results, for example:

Regarding Chemotherapy and Radiation Sensitivity:

CSC ----> Cancer Cell Progenitor ----> Non-stem Bulk Cancer Cell

(highly resistant) (intermediate, unknown) (sensitive)

5.9.2.5. Drug Development of Compounds that Hit on the Screening Platform: Compounds that are identified as possible drug candidates will be pushed into predefined in vitro and in vivo testing algorithms designed to demonstrate the following criteria as proof of concept:

! Significant toxicity/efficacy against CSCs in vitro and against CSCs and bulk cancer cells in vivo.

! Safety (or lack of toxicity) with systemic and/or local administration in small animal models of

cancer.

! Efficacy (at preventing or killing CSCs) with systemic and/or local administration in small animal models of cancer.

! In vitro and in vivo studies of general parameters of pharmacology, toxicology, metabolism, and otherwise as indicated.

! Selected compounds with high scores in efficacy and safety will be submitted to the FDA for an IND application. Of those approved, the most attractive will be selected for continuance into human clinical testing in the form of clinical trials.

5.9.2.6. Other Qualifying or Important Features of NovTx Drug Discovery:

! First in Class: NovTx’s Drug Discovery approach is first in class in the biotechnology sector.

! Reproducible and Consistent Validation In Vitro and In Vivo: Validated against multiple

cancers of diverse tissue and germ layer origin.

! High-Throughput: NovTx’s approach to CSC selection and Novopro culture technique, coupled with the nature of its biomarks and detection system, make it high-throughput with respect to the total volume of CSCs, the number of different platforms that can run in parallel, and with respect to number of drugs that can be pushed through the screening process in a fixed period of time.

! High Yield: NovTx’s approach to CSC selection, couple with the nature of its biomarks and detection system, make it high-yield with respect to the likelihood of a given hit discovered on the platform to have signficant anti-cancer properties in vivo, especially in man.

! Built in Quality Controls: The accuracy of NovTx technology with respect to cellular level phenotypy is ensured by following selected markers that correlate specifically and reproducibly with the target CSC population, thus providing with industry scale technology that has built-in or inherent quality controls.

44


5.10. 2009 to Present: Pilot Screening Studies to Date – Discoveries and Products

5.10.1. Drug Discovery Platform Screening of CSCs with Standard Chemotherapeutics

Experimental Descriptors (Typical Parameters for This Experimental Series)

! 500 cells plated per well on day 0. Each test variable was replicated in 6 wells, and thus provided 6 data points that could be averaged. The number of cells plated in this assay is

atypically low by design due the high proliferation rate of CSCs in the assay. Higher plating densities resulted in cell overcrowding before the experiments could be executed.

! Drug was added on day 2. Media was replaced each day, with new drug added each time.

! Results (i.e., cytoxicity, no effect, induction of CSC growth) were typically seen around 48 hours post-addition of drug.

! The length of drug challenge in these experiments was 72 hours.

! Data was collect from the time of plating (day 0) to the end of the experiment (day 5)

Result 1: CSCs Selected with NovTx biomarkers and Selection Approach Are Highly Resistant to Standard of Care Chemotherapeutics.

Multiple chemotherapeutics have been screened against CSCs derived from a number of different cancers using the NovTx drug discovery platform. The results are reproducible and uniform among all cancers tested. While parental and CSC-depleted cancer cell populations were consistently sensitive (at IC50 concentrations typical for what is reported in the literature), CSCs were consistently resistant and required dose-limiting concentration of drug to be given to have an appreciable cytotoxic effect. When the results of screening were assayed using a

Caspase 3 assay for activation of apoptosis, CSCs were found to have a high threshold for activating apoptosis (conversely, nonstem bulk cancer cells readily activated Caspase-3 and entered apoptosis).

Result 2 – CSCs are stimulated to both increase in cell number, and overall stem potential, in response to culture in the presence of most standard of care chemotherapeutics tested. In response to challenge with toxic chemotherapeutics:

! CSCs were found to proliferate and increase the absolute number of CSCs cells in the assay.

! CSCs were found to increase expression of the CSC, biomark resulting a stronger signal (the event was independent of change in cell numbers).

! Contaminate CSC populations in CSC-depleted cancer cells tested on the platform for comparison (GFP-depleted nonstem bulk cancer cells) were found to exponentially replicate

and take over the culture over time. This fraction represented .05 - 2% initially, but was typically over 50% at the end of the experiment.

5.10.2. Identification of NovTx’s First Lead Compound – NOVO1

Using a targeted drug discovery approach in combination with NovTx’s drug discovery platform, we have discovered our first lead compound. Based on a number of criteria, formal drug development of this hit has begun.

45


Basic in vitro and in vivo results of early development of NOVO1 are as follows:

! Efficacious against CSCs and again non-stem cancer cells.

! Very good safety and toxicology profile.

! IC50s in the nanomolar range.

! Activity against all cancers tested thus far.

! Excellent in vivo efficacy and safety profile in pilot studies.

! Cost efficient scalability.

! Good parent molecule for derivative synthesis, such that a class of compounds can be tested for even better safety and efficacy profiles.

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6 . Novostem Drug Discovery and Development

Major subtopics covered in this section include:

6.2. Novostem’s Drug Discovery and Development Program – Biosmart Technology

6.3. Operational Strategy

6.4. The Novostem Drug Discovery Platform – Technical Survey

6.4.1. Novostem Drug Discovery “At a Glance”

6.4.2. A Detailed Technical Review – Novostem Drug Discovery

6.1. Formula for Success, and Flow of Development from Discovery to Operations Basic Science Foundation (A Decade of Discovery and Validation) + Multi-Disciplinary Team of Basic Scientists/Clinicians who are pioneers and field leaders in CSC Biology, and experts in related fields : Cancer Biology, Stem Cell Biology, CSC Biology, Experimental Therapeutics, Medicinal Chemistry, Translational Research, Preclinical Drug Development + Innovative Approach Philosophy, Intellect, Logic, Scientific Rigor, Multi-Disciplinary, to Planning Science Dedication, Advanced Think tanks, Experience, Creativity + Ideas, Hypotheses, Discoveries

Rapid Testing/Validation --> Formal Experimental Testing/Validation of Idea Integration into in vitro and in vivo modeling systems Pan-modeling of Concept --> Creation of Knowledge Base

Derivation of Biotechnology Applications from Knowledge Pilot Biotechnology Application Constructed Validation, Testing, Perimeter Exploration Solidification of Application, Streamlining of Variable, Protocols Finalize Application, Upscale, Implement

Execute Operations

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6.2. Novostem’s Drug Discovery and Development Program – Biosmart Technology

NovTx’s Drug Discovery Program is Sophisticated and Advanced Relative to the Field;

This Statement is Based on Four Fundamental Characteristics:

Highly Selective Screening: with respect to the correct cancer cell target to screen drugs against (i.e., CSC).

High-throughput capacity: refers to the volume or absolute number of cells and compounds

that can be run through the system in a given period of time.

Smart biomarking and detection systems: refers to the ability of NovTx to use existing technology that has been adapted to meet NovTx needs to create a detection system that is sensitive to the CSC population, and can detect biologic responses of a given cancer population to a toxic challenge in real-time. NovTx detection technology, in conjunction with its biomarking system for CSCs can detect the biological signal, extract biological information

from it, analyze the information, and interpret it. The end result is the conversion of the signal given off by cells in the assay to a defined biological result (i.e., no effect, growth arrest, cell death, etc.).

High yield small molecule hits: refers to the likelihood that a given hit on the NovTx platform will have efficacy in in vivo animal modeling of cancer, and in humans. 6.2.1. NovTx Drug Discovery Platform for Drug Discovery is Highly Selective, Sensitive,

and Specific: The basis for this statement is NovTx’s ability to biomark, identify, isolate, and expand in culture, without loss of the true CSC phenotype, the most correct representative CSC for a given cancer. With rare exception, the vast majority of past and present cancer drug discovery companies have been testing compounds against the entire cancer cell population. Because the CSC cell component of the total cancer cell population is relatively small (around 0.01% in primary tumors, ranging from 0.01% - 15% in established cell lines and metastatic cancers), the true signal representative of a desired response of a CSC to a given agent is to small to detect if pure (i.e. all background noise was removed), and regardless is buried in the noise created by the non-stem bulk cancer cell population. The end result is not surprising; a compound with the desired anti-CSC therapeutic effect is missed by the observer. To restate

this point, the ever present flaw in present day large volume drug discovery, and that of the last few decades, is the inability to detect the activity of a given agent against the CSC population. Even worse, in this case the signal (the nonstem bulk cancer cell population) is misleading and leads to the continued selection of compound “hits” that are developed along preclinical and clinical paths on the basis of their activity against the non-stem bulk cancer cell population. The futility of developing these drugs lies in the fact this cell population (which typically is 95 – 99% of a given tumors total cell population) is not capable of initiating tumor, cannot metastasize, and is typically the most sensitive chemotherapy and radiation. It is not difficult to imagine the decades of research, and likely billions that have been wasted chasing this presumed signal (the bulk cancer population, which in reality is noise), while missing the

real signal (the CSC population). Much worse is the consideration of the number of lives that have been negatively affected due to the delay in integrating a CSC model into drug discovery.

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6.2.2. NovTx’s Advanced CSC Culture System and Screening Biotechnology is First in Class and High-Throughput: NovTx is arguably the first cancer drug discovery company in the world to be able to identify, isolate, capture, and propagate CSCs in high purity (up to 96%) and in large volume (virtually unlimited quantities). To date, there are no reports of such capabilities in the biotechnology sector. In the academic arena, the only group to make claims of any kind that relate to this capability is a group from the Massachusetts Institute of

Technology who recently reported their results (Gupta et al., 2009, Cell). This component of NovTx’s platform is breakthrough technology discovered two years ago and subsequently streamlined for use with its drug discovery program. It the cornerstone and key technology to large-scale drug screening using high-throughput and robotics driven approaches. Standard industry approaches to large scale drug discovery, when combined with the high-throughput nature of the NovTx’s drug discovery platform, will allow for hundreds of drugs to be assessed for CSC activity on a daily basis, as well a significant reduction in the amount of time, resources, funding, and manpower needed for similar screening to be attempted using industry standard approaches.

6.2.3. NovTx’s Biomarking and CSC Selection Protocols in Combination with the Appropriate Signal Detection System, Creates Synergistic Smart Data Technology: Major changes and/or advances in the detection process include dramatic sophistication and sensitization of the detection process, data collection, data analysis, and data interpretation (of

a given cellular event). This approach will yield analysis systems that can pull biological information about the cancer cell populations in the assay from the signals they generate through their biomarks. Signal detection technologies inherent in NovTx’s drug discovery screening platform in concert with the nature of NovTx’s biomarking system allow the observer to rapidly identify in real time the biological response of the CSC population to the compound or drug being tested. Because this is not possible with current drug discovery approaches and technology (beyond simply, cell death or not), drugs with a number of atypical or diverse mechanisms of actions (yet important and valid anti-cancer drugs) are missed using standard screening approaches (but are detected with NovTx’s approach). For example, in addition to drugs that kill CSCs, other drugs such as those that differentiate (i.e., mature) CSCs into non-

stem bulk cancer cells that are sensitive to radiation and chemotherapy will be identified. Similar concepts have recently been proposed by others (Gupta et al., 2009). Importantly, present day approaches to drug discovery would not be able to detect this very relevant biological effect. The possible outcomes for a CSC when challenged with different types of agents (for example, a growth factor inducing differentiation, a novel compound with an atypical effect, or a known drug that induces cell death) are summarized schematically in Figure 19. In summary, NovTx’s platform technologies for drug screening can be thought of as efficient, high-yield, biologically relevant, and capable of detection of novel drugs that either kill or differentiate CSCs and/or kill the general cancer cell population (conventional chemotherapeutics).

The Double Signal Approach – From 2 Bioactive Signals Much Can Be Learned: Bioengineered cancer cells screened on NovTx’s drug discovery platform will yield either one or two signals (depending on which cell population it is). All cells in the culture (CSCs and nonstem bulk cancer cells) will carry and activate transgene for reporter gene regulated by a constitutively active promoter (CMV). This signal will be roughly proportional to the overall cell health (i.e., promotion of healthy accelerated growth kinetics vs. induction of apoptosis). All

cells will also carry a second transgene, but it will be a reporter gene regulated by a CSC

49


marker gene promoter (in all pilot studies, the OCT4 promoter is used). Only CSCs will be competent to activate this transgene. This signal provides a rough correlation of the number of CSCs in a given culture (CSCs and early progenitors). Additionally, there is some data to suggest is within each the cell, the biomark expression level is regulated in degrees rather than simply as absolutes (on/off) with respect to a cancer cell being a CSC. In other words, the level of expression roughly correlates with the “stemness” of a given cell. The detection of

both signals allows the investigator to compare and contrast the signals and relate it to other data that is collected. The end result is the instant generation of biologically relevant information about each compound tested and its effect on CSCs and the nonstem bulk cancer cell population.

Importantly, the combination of the previous section regarding CSC biomarking, detection, and selection, with NovTx’s Biosmart detection technology, leads to an exponentially higher signal

that relates to the CSC population, than with current approaches. Figure 20 demonstrates (schematically, and for the purposes of making the point) the difference in signal between primary cell cultures from any given solid cancer grown with standard cancer cell culture media and protocols, in comparison with that of the NovTx’s approach which again includes: 1) biomarking 2) detection 3) cell selection; all in conjunction with 4) technical maintenance of the phenotype by using Novopro media and CSC culture protocols.

6.2.4. Novostem Drug Discovery Delivers High-yield Small Molecule Hits: The basis for this statement has been reiterated throughout this document and can be summarized as follows:

CSCs are required for and provide the critical biology needed for the cancer life cycle including tumorigenesis, metastasis, resistance to therapy, and tumor recurrence.

NovTx identification and selection biotechnology can extract the true CSC subpopulation from a cancer tissue or cell line for drug screening purposes.

FIGURE 20 Schematic bar graph

demonstrating the overall ability of

NovTx’s Drug Screening Platform

to detect CSCs in the assay in

response to pharma- cologic

challenge. NovTx’s specific approach

creates cultures that are initially

around 95 – 96% CSCs (relative to

nonstem cancer cells), and maintains

the percentage of CSCs in culture

over time and through serial passages

at around 93 – 96%. Compare with

previous approaches, which typically

result in a signal around 93 – 96%.

Compare with the detection of CSCs

using standard present day approaches

to drug discovery (typically < 10%

when working with primary tumor

cell lines. The signal is higher with

established cells lines but still not

enough for meaningful detection.

50


NovTx biomarks in a cancer cell population yield signals that are detected by NovTx drug screening detection technology, and can identify the CSC and nonstem bulk cancer cells in the cell population (roughly assess the absolute number, and percentage of the culture made up by both populations).

Thus, the correct cell target is screened on the platform. And the signal generated by the target is proportional to the viability of the cells, whether CSC or cancer cells.

6.3. Operational Strategy

6.3.1. Drug Discovery Programs – Smart- and Pan-Pharma: NovTx will utilize its unique and cutting edge technologies to launch a biotechnology company that can efficiently generate revenue, create a valuable product, and become a global partner for the pharmaceutical industry. The primary engine (ARM 1) for NovTx will be drug discovery and development with a goal to take a minimum of one and a target of three of its top drug candidates to clinical trials

within the first five years. ARM 1 will consist of pan-pharma (large-scale screening) and smart-pharma (drug target approaches) approaches to screening of compounds from NovTx’s own internal compound libraries. At the same time, NovTx will partner with pharma and biotech by licensing its additional late stage pipeline drugs. NovTx has already identified its first lead compound and has begun formal preclinical development of this compound and its derivatives with the express purpose of partnering at a strategic early stage of development to maximize NovTx’s value and provide early revenue to the company. Additionally, once NovTx has established its infrastructure, and pan-pharma platform, it will obtain partnerships with large pharma for platform licensing to screen existing compound libraries for anti-CSC activity (ARM 2). The end result will be a company of significant value that will provide great returns to its

investors and those who are affected by cancer. See Figure 21 for a schematic summary of NovTx operations.

6.3.1.1. NovTx’s Pan-Pharma Group will access existing free and/or commercial compound libraries and push these compounds through its CSC drug discovery platform. Similarly, when the terms and implications are agreeable to both parties, NovTx will access the compound libraries of major pharmaceutical companies, and push these compounds through its cancer drug discovery biotechnology platform.

6.3.1.2. Using its Foundational Smart-Pharma Group, NovTx will fulfill its business, research, and development mission in a manner that both complements the pan-pharma group and proceeds in an independent manner by accomplishing the following:

First, this group will continue its groundbreaking basic science discovery approach to provide

new information modules about all relevant aspects of cancer cell biology. This information will be used to identify high yield, potential targets either using known compounds or novel therapeutic approaches. This approach may be a source of new patents for enhancing existing technology, or for creation of new intellectual property for other related technologies that can be developed in the near future.

Second, this group will be responsible for mechanism of action for high priority compounds, a

general requirement of the FDA for entering clinical trials. Those compounds which approach a pre-IND phase of development will be studied by the smart- pharma group using a combination of genomics, bioinformatics, and cell and molecular biology approaches.

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FIGURE 21 Schematic depicting NovTx’s Operational Schema For Drug Discovery. A. Smart and Pan-

Pharma Drug Discovery Covers all Possible Pathways to Identifying the Next Generation of CSC drugs. See

below for expanded review and discussion. B. In vitro development of compounds that hit on the platform with

an emphasis on safety, efficacy, and pharmacology. C. Formal drug development with expanded animal studies,

and eventually FDA approach for approval to begin human testing. D. Clinical Trial testing.

NovTx’s Pan-Pharma Drug Discovery group (Pan-Ph Rx Disc) will consist of a Medicinal Chemistry team,

led by a Medicinal Chemist who is well experienced in large scale drug discovery (already acquired, see NovTx

Leadership, section IV.) and supported by technical staff as indicated. NovTx will screen 7000 – 1400 drugs per

month derived from internal and collaborative compound library screening efforts against strategic cancer

targets. NovTx can operationally screen 2 – 4 different cancers at a given time with high-throughput and high-

yield screening approaches as described in detail in the text above and below. The number of cancer arms

screened by NovTx internally must balance committments to large pharma and biotech screening deals, with a

maximum of 14,000 drugs estimated possible per month. Importantly, the platform can easily be ramped up at

only a fraction of the startup costs by adding capital, funding, and manpower as needed per new project. Thus, it

is expected to screen around 80 – 160K drugs annually, and as these drugs are filtered through a series early

discovery assays and late drug development steps, it is projected that two to four compounds will be identified

on the screening platform as HITs that can be developed and enter a licensing pathway or a drug development

pathway internally by NovTx or in collaboration with interested partners. Briefly, milestones that need to be met

include a strong performance in screening, in vitro development studies, AND in in vivo gateway animal models

of cancer AND meet a number of other predefined criteria for formal drug development.

NovTx’s Smart-Pharma Drug Discovery Program (Sm-PH Rx Disc) will consist of a stem cell and cancer

cell biologist team with extensive backgrounds in cancer biology and CSC biology (leaders in the field, first to

report and publish, true pioneers of the concept), as well as technical support staff as indicated. The Smart-

Pharma Drug Discovery Program is expected to generate around 80 targets from past cell and molecular research

initiatives and new R&D (especially genomic screening approaches) per year to consider, and to bring six to

eight of these into gateway animal modeling studies of cancer. The target goal for this group is the identification

of 1 – 2 drug targets and the subsequent developoment of designer agents against those targets. Additionally, the

Smart-Pharma group will take primary responsibility for biomechanism studies for each compound that hits on

the platform, or that is chosen in strategic smart pharma approach. Thus, drugs that hit and have an favorable

early development profile will be funneled into the smart pharma group where a series of rapid fire assays will

be intiated to attempt to gain biomechanism information quickly, with a goal to have this worked out prior to FDA submission.

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Third, this group will continuously monitor and develop the drug discovery platform. As the nerve center of the platform, this group is NovTx’s main mechanism for maintaining current standards, developing the platform with ever evolving technologic advances, and generating new patents that will insulate NovTx from its competitors who may eventually attempt similar approaches.

6.3.2. Drug Development of Hits: All drug therapies which are promising in the drug discovery platform screening phase will flow into pre-clinical development paths consisting of more sophisticated in vitro testing and therapeutic development in the context of in vivo animal models of cancer. All “post-platform” testing is considered preclinical and will be executed with the specific intent of formally developing lead compounds and pushing them into clinical trials. The flow from drug screening to human testing is described schematically in Figure 21:

6.4. The Novostem Drug Discovery Platform – Technical Survey

6.4.1. Novostem Drug Discovery “At a Glance”

Phases 1 – 4 are summarized and reviewed in detail in Figure 22, and for all phases in the appendix (VIII.5).

PHASE1: Build a Tailored Drug Screening Platform for the Cancer of Choice

a. Selection of cancer type.

b. Establish CSC cultures from cell lines and primary tissues.

c. Bioengineer all cell lines used in the screening process with a stable/functional CSC biomark.

.

d. Expansion of CSC cultures in large volume using the NovTx Novopro Media and Culture System (ongoing process) for use in screening assays.

PHASE2: Platform Screening of Compound Libraries Against CSCs

a. Compound Library Screening against selected biomarked cancer cell lines.

b. Collection, Analysis, and Interpretation of data (From biosignal to phenotypal equivalent).

c. Quality Control Systems

PHASE3: In Vitro Drug Development of Compounds That “Hit” on the Platform

a. Expanded in vitro studies of attractive hits for safety, and efficacy against primary culture panels of the respective tumor type.

b. Standardized pharmacology profiling and related assays.

c. Initiate biomechanism studies

PHASE4: (Rate-Limiting and Gateway Step) Modeling of Efficacy, Safety, Toxicity, Toxicology, and Pharmacology in Nude Mouse Immunodeficient Side/SubQ Tumor Models.

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FIGURE 22 Schematic depicting Phases 1 - 4 of the Drug Discovery Program for Drug

Screening. Black circles, established tumor cell line. Empty circle, primary culture

established from tumor. Green circle, CSC that carries the NovTx CSC biomark. Red circle,

nonstembulk cancer cell that carries the NovTx biomark (but does not activate because it is

not a stem cell). Grey circle, cell in the processing of dying. A. Established cell lines, or

Primary tumor cultures derived from tumor tissue, are transfected with the biomark, cultured

and selected for stable transfectants, and FACS-sorted for the biomark to create highly

enriched (roughly 93-96% in purity) CSC cultures. The cultures are maintained in Novopro

media and culture technique and introduced to the drug screening platform. Compound

libraries are screened against the CSC population. Because of the pluripotent features of a

CSC, many outcomes are possible. The right hand component of A lists some of the

(continued on the next page).

Introduce Biomark

Select Stable TFs

FACS-sort for Biomark

Expand Bioeng Cells

----> R1

----> R2

----> R3

----> R4

----> R5

----> R6

Steady Growth

Steady Growth

Steady Growth

Cell Death

Cell Death

OR

Steady Growth

Differentiation

R1 R5 R6

A

B

Cell Line

Tumor 1’ Cell Line

Rx

In Vitro Drug Development Efficacy Safety Pharmacology Biomechanism

C

In Vivo Early Trans-

lational Studies – Nude Mouse Side Pocket Tumor

Modeling for: ! Efficacy, Safety ! Pharmacology

! Toxicology ! Metabolism

Phase 1 - 2

Phase 3

Phase 4

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possible results (R) or outcomes to toxic challenge. R1, steady growth of both CSCs and non-stem

bulk cancer cells in culture in the absence of toxic challenge (expansion culture). R2, the

compound induces growth of the CSC population, with little or no effect on nonstem cancer cells.

B. Graphic schematic examples of the signal as detected by NovTx technology in response to the

CSC’s and nonstem cancer cell’s biologic response to the environment and toxic challenge of a

given experiment. Green fluorescence is the signal detected in the CSC population. Red

fluorescence is the signal detected in the nonstem bulk cancer cells. The solid line is the

percentage of the specific cell population in the culture, relative to the total cell population. The

dotted line represents the absolute number of cells. The left panel is expansion culture for CSCs

using Novopro media and reflects the typical distribution of CSCs (93-96%) and nonstem bulk

cancer cells (4-7%) in the culture. (Legend continued on the next page) For the purposes of

discussion, CSCs and nonstem bulk cancer cells in the middle and right panel were manipulated to

have an equal number of both cells lines in the culture. Middle panel, the expected signal as

detected by NovTx technology in response to a toxic challenge that induces cell death in the

nonstem bulk cancer cell population (R5) but has no effect on the CSC population (i.e., a

chemotherapeutic such as doxorubicin or Taxol). Right panel, the expected signal as detected by

NovTx technology in response to a toxic challenge that does not affect the nonstem bulk cancer

population but is cytotoxic (R6) to the CSC population. Similarly, the expected signal as detected

by NovTx technology in response to a compound or growth factor that induces differentiation (R3)

of the CSC population to give rise to nonstem bulk cancer cells. C. A small molecule (compound,

known drug, drug target) that hits (has a cytotoxic or otherwise attractive effect on the CSC

population) will then enter subsequent early phases of drug development including: Phase 3 In

vitro studies (In vitro safety, efficacy, biomechanism, and pharmacology studies); and, for those

agents that do well in vitro, Phase 4 Gateway animal modeling of the effect of the agent on cancer

in vivo in a nude mouse side pocket model with basic drug profiling (efficacy, safety, toxicology,

pharmacology, etc.). Agents that do well in vivo in phase 4 and are attractive (as determined in

phase 5 of drug development) in other areas of interest (i.e., cost of synthesis, intellectual property

conflicts) will then enter formal drug development with the intent of entering clinical trials (phase

6 – 7), or will be made available to potential pharma and biotech collaborators for licensing. 1’,

primary. TFs, transfectants. Bioeng, bioengineered. Rx, drug or compound. R, result or outcome

from toxic challenge.

PHASE5: Critical Review, Analysis, Interpretation, and Critique of Compounds with Attractive In Vitro Profiles.

Multidisciplinary Review of all platform, in vitro, and in vivo data, in conjunction with other relevant issues such as intellectual property, medicinal chemistry, etc.

Serves as a gateway for determining which platform hits will provide value to the company in proportion to the costs of formal drug development.

Serves as a gateway for determining which platform hits will provide value to the company in proportion to the costs of formal drug development.

PHASE6: Industry Standard Approaches to Preclinical Drug Development

PHASE7: Phase 1/2 Clinical Trials

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6.4.2. Detailed Technical Review – Novostem Drug Discovery

(Phase – P, Step – S, SS – Substep)

PHASE1: Build a Tailored Drug Screening Platform for the Cancer of Choice P1S1: Choosing the CSC Target and Define Platform Specifics and Variables

NovTx has successfully tested and streamlined CSC identification, selection, and expansion protocols, and its drug screening platform, against numerous cancer types including: breast cancer, brain cancer, lung cancer, prostate cancer, melanoma, osteosarcoma, and chronic myelogenous leukemia. NovTx has generated several bioengineered lines for each type, including primary cell cultures for some. Use of prepared CSC cell lines in conjunction with NovTx’s drug screening platform is available to future

partners and collaborators upon request.

With respect to creating new platforms at the request of a partner or collaborator, there are numerous variables, pitfalls, and issues that must be considered when choosing a type of cancer to build a drug screening platform against. These include but are not limited to: 1) an up front investment by the partner or collaborator of resources and funding (amount as determined by the deal structure); and 2) an inherent delay in initiating compound screening while the appropriate cell lines and tissues are acquired, while CSC lines are generated from

cell lines and primary cultures, and while CSC lines are bioengineered with functional biomarks. Importantly, a multi-disciplinary team approach is required to carefully consider criteria sets for cancer platform design pre-established by NovTx’s scientific leadership based on logic, previous experience, and recommendations of the NIH and other drug discovery leaders in the field.

P1S2: Build a Drug Discovery Platform Tailored to the Target CSC population

P1S2SS1: Bioengineering the Appropriate Cancer Cell lines as Indicated for use with NovTx’s Screening Platform: For those cancers that must have a platform built from scratch, the following steps are required for a given cancer type:

1. Acquisition of all primary and established cancer cell lines of the particular cancer to be developed (source most likely the NIH, ATCC, third party, local hospital tissue IRBs with de novo establishment of primary cultures, etc.).

2. Stable introduction into each cell line used for screening of two separate reporter transgenes, each with a different reporter gene (i.e., GFP and firefly luciferase), but both regulated by the OCT4 promoter as described above. Also, stable introduction of a third transgene that ubiquitously and constitutively biomarks of all cells in the assay (renilla luciferase under the control of the CMV promoter). The purpose and utility of each biomark in NovTx selection protocols and drug screening is described and defined in detail below:

a) pOCT4-GFP - full OCT4 promoter upstream/operationally linked to the GFP gene. This reporter system provides a basis to detect and physically capture CSCs during the initial creation of highly enriched CSC lines from parental cancer cell lines or primary tissues, as well as for future experimental studies where further manipulation is indicated.

b) pOCT4-FFluc

- full OCT4 promoter upstream/operationally linked to the firefly luciferase gene. This reporter system is only activated in CSCs and thus provides a rough correlation

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of the number of CSCs in a given culture (CSCs and early progenitors). Additionally, there is some data to suggest is within each the cell the biomark is regulated in degrees as opposed to absolutes (on/off), and further that the level of expression roughly correlates with the “stemness” of a given cells.

c) CMV-Renluc

- promoter upstream and operationally linked to the renilla luciferase gene. This reporter system provides a detectable signal in real time in all cells, and that correlates roughly with the amount cancer cells in the culture (stem, progenitor, non-stem).

P1S3: Expansion of CSC Cultures in Large Volume Using the NovTx Novopro Media and Culture System

A standardized media and set of protocols have been established for routine CSC culture for short-term academic or experimental purposes, or for large volume, upscaled CSC culture for Pan-Pharma Drug Discovery. For parameters and details, see the following technical section.

Technical Note

Estimated time to the initiation of screening activities of an established, operational drug screening platform for a given cancer type once a final decision has been made (whether for internal screening or in collaboration)

6 – 8 weeks: If the cancer chosen is already a part of NovTx’s Platform Portfolio

6 months: If the cancer chosen is not available, and a platform must be created de novo as described below Technical Note

Novopro Media and Culture Protocols

Major Media Component Categories: HFF modified media supplement (created through a separate culture system), Selection Antibiotic, Pro-CSC growth factors, Media Supplement, Serum.

Cultured Conditions: Substrate prepared plates, Prespecified cell densities at plating and with respect to passage, other parameters not to be specified due to IP restrictions. Technical Note

CSC Growth Kinetics Using Novopro Media and Culture Protocols

Doubling time of roughly 30 hours in vitro

30 million CSCs per 225 sq cm flask

36 flasks per incubator, thus roughly 1 Billion cells per incubator.

PHASE2: Platform Screening of Compound Libraries Against CSCs

P2S1: Execution of Screening Assays: Expansion of CSCs for screening is an ongoing

process. Cell plating, prescreening culture, drug introduction variables (dose, timing, number of replicates) are predefined in NovTx standardized protocols. Generally speaking, NovTx will use a standardized approach in which predefined compound screening assays and filter sets are used to screen compound libraries against one or several reliable established cell lines of a given cancer type. These cell lines are used for initial screening (gateway screen or filter). Compounds that “hit” on the platform are furthered pursued in a second wave of platform screening against pre-established panels of early passage primary cell lines (definitive screen or filter, see below).

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-------------------

A CSC is a master clone cell with a developmental purpose and the machinery to survive anything from lethal radiation to lethal toxins. Because of its diverse and pluripotent nature,

cancer drug discovery is no longer about life and death, it is also about purpose and potential.

------------------- P2S2: Signal detection, Extraction, and Analysis to Identify Biological Information that is Embedded in the Signal

Cell Subpopulations Detected: CSCs, CSC progenitors, and nonstem bulk cancer cells.

Biomark Signal Generation: As described above, stable transfected reporter transgenes with two separate signals (either GFP and RFP, or Firefly or Renilla Luciferase) marking the CSC

population and the entire cancer population, and from the those signals significant data being gathered from the CSC and non-stem bulk cancer cell population, and somewhat more weak data from the progenitor cell population. Signal Detection: Depending on the design of the study, may involve MTS cytoxicity assays, detection of Green and Red Fluorescence, or detection of Firefly or Renilla Luciferase bioluminescence.

Data Extraction: Biomathmatical modeling and software interface pull the biological data from the nature of the signal generated.

Data Analysis: Biomathmatical modeling and software interface analyze the data and provide a meaningful set of data.

Interpretation of Data and Data Analysis: Biomathmatical modeling and software interface can translate the data and its analysis into an interpretation of the biological response detected in the assay (i.e., selective cell kill of the CSC population while progenitor and non-stem bulk cancer cells flourished).

P2S3: Quality Controls are Built into the System

1. Daily monitoring of the biomark within the assays. All assays will have untreated health CSC cultures. The biomark ~ the pan-CSC phenotype.

2. Weekly to biweekly serial checks for expression of the biomark(s) in cultured cells using FACS analysis.

3. In vitro stem cell assays. To prove that the cell cultures are maintaining stem-like phenotypy (assayed monthly).

4. RTPCR of cultured cells against a list of genes previously identified (a fingerprint) as being associated with CSC behavior (i.e., pluripotency, tumorigenesis, metastasis, drug resistance, assayed monthly).

5. In vivo serial transplantation studies to prove the maintenance of tumorigenesis and metastatic potential (assayed semi-annually).

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In this system, with respect to classifying or validating that given cell is a CSC and has the respective properties of CSCs (i.e., tumorigenesis, metastasis, expression of CSC markers, etc.), the following criteria are used to make this assumption:

pan-CSC phenotype1 ~ GFP Expression2

and

pan-CSC phenotype1 ~ RTPCR Gene Fingerprint3

1 The pan-CSC phenotype has been discussed in detail above, and consists of a fairly large number of in vitro and

in vivo assays that CSCs perform well in, and in doing are given the classification of a CSC. These include the expression of the biomark by CSCs, as well as several in vitro and in vivo assays of CSC phenotype to verify a given population of cells, or single cells selected for the creation of a new clonally derived homogenous CSC lines, as CSCs. This panel of assays lasts around 5-6 months for complete study of all cells in all assays (although the bulk of the cells can be 90% characterized in 2 – 3 months.

2 The GFP signal indicates that a cancer cell is a CSC. In addition, the “stemness” of a CSC with respect to phenotypic properties is directly proportional to the strength of the signal.

3 Genomic approaches and other gene/protein assays have been used to create a reproducible, reliable, and highly predictive CSC and nonstem bulk cancer cell gene fingerprint. This fingerprint reproducibly identifies, in a highly accurate manner, a given cell as a CSC.

Technical Note 1

If the cancer chosen for screening is already within NovTx’s portfolio of bioengineered cancer cell lines and primary cultures, this step is bypassed and screening can begin immediately.

Technical Note 2

Estimated # of compounds screened per unit of time:

daily = 233 ----- weekly = 1750 ----- monthly = 7000 ----- annually = 84,000.

At full capacity and in accordance with NovTx’s current operational design, a drug screening platform can handle up to 7000 compounds per month, and NovTx can run up two platforms at a time. Additional platforms can be easily added by the addition of funds, capital, and manpower as needed at a fraction of the cost of setting up the initial two.

PHASE3: In Vitro Drug Development of Compounds That “Hit” on the Platform

Predefined and standardized panels of assays that characterize and quantify basic drug compound parameters of interest:

1. Expanded In Vitro Efficacy Assays: Expanded testing against human primary culture panels of the respective tumor type to verify and characterize efficacy. Determination of the IC599

2. Toxicity, Toxicology, and Safety Assays

3. Pharmacology Profile: biostabilty, route of administration, biodistribution, metabolism and excretion, p450 interaction.

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4. Initiation of Biomechanistic Studies: standard panel of biological assays and tests designed to verify and better characterize the effect of the agent on the CSC and non-stem bulk cancer cell populations, and its mechanism of action.

Summary of Expected Data Profiles for Compounds that Hit on the Platform and Are Taken through Phase 3 In vitro Studies

1. Data is provided in the form of a profile for each compound screened. Briefly, a given profile will include screening results, and an early summary of efficacy, safety, pharmacology, and mechanism, as well as intellectual property status.

2. All data for all subclasses of cancer cells is collected in the same experiment (same microenvironment) at the same time, in real time, thus eliminating technical bias. The different subclasses that can be studied in response to a challenge with a given compound include CSCs, the intermediate progenitor pool, and non-stem bulk cancer cells.

3. For each compound and each cancer cell subpopulation, the response to the compound

will be quantified as: -Cell Death -Arrest of Growth -Differentiation towards cell maturity -Induction of growth -Induction or reduction of the biomark without a change in overall cell number

PHASE4: Modeling of Efficacy, Safety, Toxicity, Toxicology, and Pharmacology in Nude Mouse Immunodeficient Side/SubQ Tumor Models.

Provides pan-pharma information regarding a given compound’s efficacy, safety, and pharmacology in vivo. Compounds that are safe and effective in this model should be considered high value and pushed into drug development or early licensing to the biotech and pharma sector. Technical Note: Typical Time frame for a given experiment is 60 days plus two weeks preparation and one month of analysis = 100+ days per experiment. Up to four compounds can by studied at a time in vivo with the current research infrastructure and resources.

PHASE5: Critical Review, Analysis, Interpretation, and Critique of Compounds with

Attractive In Vitro Profiles

The purpose of phase 5 is for senior science, business, and legal team members to perform an intense review and evaluation of each compound that hits on the platform and performs

well in early drug development studies. The result will be a multi-criteria rating that will be used to decided which compounds to shelf, license, incubate, or continue developing. The parameters to be considered include but are not limited to:

1. Efficacy

2. Safety

3. Biomechanism

4. Toxicology

5. Pharmacology Profile

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6. Ease and cost of synthesis, especially scale-up

7. Derivative potential

8. Intellectual property status and concerns

Early in its business development, NovTx will seek partnerships for codevelopment of attractive hits into late stage formal drug development and clinical testing due to the significant cost and resources required (see PHASE 5 and 6 that follow). Alternatively, if a given hit is deemed attractive, NovTx may instead seek to raise the necessary funding internally. Irrespective, all compounds that perform well in platform screening will be developed through PHASE5. This will provide NovTx with an informative pan-biology profile for each compound and thus allow NovTx to stratify said compound into one of five pathways as follows:

PHASE 1 and 2 PHASE 3 PHASE4 PHASE 5

Compound from In Vitro Gateway MD Review, Stratification: 1) Targeted Approach -Testing Animal -> Internal Development 2) Compound Library -Development Modeling -> Collaborative Development Platform Screening -> License to Pharma* -> Incubation in Pipeline -> No further action *Directly from Phase 5 MD, Multi-disciplinary (indicates, bioscience, legal, business, etc.)

PHASE6: Industry Standard Approaches to Preclinical Drug Development

NovTx will follow industry standard approaches to preclinical development of a given compound, and the attainment of FDA approval for a given compound or atypical agent to

enter into human clinical testing. As discussed, formal drug development of this nature must be done in collaboration with a biotech or pharma partner, or in conjunction with an additional internal raise CRO/SRO services.

PHASE7: Phase 1/2 Clinical Trials

NovTx will follow industry standard approaches to the entry of clinical trials for a given compound. As discussed, clinical trial design, development, and implementation must be done in collaboration with collaborative partner who can provide both financial resources and expertise, or in conjunctions with an internal raise and the attainment of CRO/SRO services for clinical studies.

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7. Intellectual Property

7.1 Platform Patent 1 (2006) Compositions Enriched in Neoplastic Stem Cells and Methods comprising the same

Duntsch CD, Kukekov V, and Ignatova T

USP20070292414

Informal Technical Summary Solid cancers have a CSC subpopulation that is the critical cell population for most if not all major biological processes including tumorigenesis, metastasis, resistance to therapy, and tumor recurrence.

Solid CSCs have signficant biological overlap with ESCs, especially at the molecular level. NANOG, OCT4, and SOX2 (NOS transcription factor), which drive ESC biology via the regulation of NOS genes, are present and transcriptionally active in CSCs as well.

NOS transcriptional factors exert their biological influence on all aspect of cancer biology through the regulation or a wide array of diverse gene targets known as NOS genes. They are not only present, but required for CSC stem cell phenotypy. NOS transcription factors are excellent biomarks for CSCs. The NovTx biomarking system consists of stably introducing reporter transgenes into cancer cell populations. The transgene consists of the full OCT4 promoter operationally linked to a reporter gene (i.e., GFP). The activation of the reporter transgene in a cell identifies it as a CSC. FACS sorting for the GFP biomarker system can be used to identify and isolate CSCs in vitro to create highly pure CSC cultures for study and drug testing. In vitro and in vivo study of CSCs selected in this manner demonstrate that meet all phenotypic criteria to be called CSCs including strong performance in stem cell assays, tumorigenic and metastatic properties, the expression of aggressive cancer markers and CSC markers, increased migratory and invasive properties. Establishes the utility of the NovTx Biomarking system for Drug Discovery with basic proof of concept.

7.2 Platform Patent 2 (2007) Neoplastic stem systems and methods


USP2008082506.

Informal Technical Summary

Establishes the concept of a two signal detection system. Covers basic attributes of the biomark, and the nature of the signal it generates. Covers basic attributes of the signal detection process. Covers basic attributes of data extraction from information buried in signal.

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Covers basic attributes of data interpretation, including the use of biomathematical and software interface systems to create instant interpretation capability. Describes all possible outcomes of CSCs in response to challenge with any soluble factor that are detectable on the platform. The expression of aggressive cancer markers and CSC markers, increased migratory and invasive properties.

Establishes the utility of the NovTx Biomarking system for Drug Discovery with basic proof of concept.

7.3 Platform Patent 3 (2009) Neoplastic Stem cell and Methods Comprising the Same


USP72347


NANOG, OCT4, and SOX2 (NOS transcription factor), which drive ESC biology via the regulation of NOS genes, are present and transcriptionally active in CSCs as well (expanded IP coverage).

NOS transcriptional factors exert their biological influence on all aspect of cancer biology through the regulation or a wide array of diverse gene targets known as NOS genes. They are not only present, but required for CSC stem cell phenotypy (expanded IP Coverage).

Identification of an EMT profile in CSCs.

Identification of over 40 active NOS gene targets in CSCs.

Formal introduction of the NovTx drug discovery platform and program, with proof of concept via screening of a number of known standard of care chemotherapeutics.

The NovTx biomarking system consists of stably introducing reporter transgenes into cancer cell populations. The transgene consists of the full OCT4 promoter operationally linked to a reporter gene (i.e., GFP). The activation of the reporter transgene in a cell identifies it as a CSC.

FACS sorting for the GFP biomarker system can be used to identify and isolate CSCs in vitro to create highly pure CSC cultures for study and drug testing.

In vitro and in vivo study of CSCs selected in this manner demonstrate that meet all phenotypic criteria to be called CSCs including strong performance in stem cell assays, tumorigenic and metastatic properties, the expression of aggressive cancer markers and CSC markers, increased migratory and invasive properties.

Establishes the Utility of the NovTx Biomarking system for Drug Discovery with basic proof of concept.

7.4 Compound Patent (2009) NOVO1, a novel safe/effective anti-CSC compound


Patent in preparation.


NOVO1 is:

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Efficacious against CSCs and again non-stem cancer cells. Very good safety and toxicology profile. IC50s in the nanomolar range.

--------------------

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8. APPENDICES

1. NovTx Highlights, Accomplishments, Early Successes, Productivity, Products

2. Bibliography

3. Glossary of Terms

4. Proforma of Current Industry Standards for Drug Development

5. Schematic of Estimated Platform Screening Productivity and Related Parameters

6. Figure List

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8.1.1. NovTx Highlights and Accomplishments, A Brief Summary and Review

First in Class: No traditional cancer company, at present, whether participating in drug discovery for cancer using classical thinking, cancer cell lines, and technical approaches as indicated, or whether a new commercial entity focused on CSC drug discovery approaches, has the ability to culture CSCs in large volume, for extended time frames (as would be needed for example for robotics driven high throughput drug discovery). Conversely, NovTx has the ability biomark, detect, isolate, capture, and push into in vitro culture CSCs from virtually any given solid tumor. Experienced Business Development Team: NovTx’s corporate, legal, and scientific

directors are leaders in their respective fields, and bring a wealth of knowledge and credibility to the company.

Scientific Leadership that Helped Pioneer CSC Biology over a Decade Ago: NovTx R&D is led by a multi-disciplinary team of experienced stem cell biologists, cancer biologists,

medicinal chemists, and clinical scientists. NovTx’s CSC group is led by two pioneers in the CSC field who were the very first to present a CSC model for solid tumors (Neuroscience, Los Angeles, 1999), and the very first to publish this model (for brain cancer, Glia, 2002).

World Class IP Management: NovTx intellectual property is managed by PEARL COHEN ZEDEK LATZER, LLP, one of the largest biologics intellectual property firms in the world, and

by one of the leaders in this field.

8.1.2. Novostem Early Successes and Productivity

(patented) Identified and validated in vitro and in vivo a panel of biomarkers that identify a cancer cell as a CSC by activating detectable biomarkers. (patented) Created protocols for the identification, detection, isolation, capture, and introduction into culture and expanded culture of CSCs from virtually any solid

tumor or cancer cell line. (patented) Developed proprietary methods for long-term, large volume CSC culture with with strict protection of CSC phenotypy, most importantly that associated with its stem cell properties. (patented) Created a drug discovery platform that utilizes NovTx’s CSC biomarking approach with detections systems that allow for the identification of compounds

with anti-CSC activity. (patented)! Bioengineered cancer cell lines and primary cancer cultures from several

cancer types that can be used to screen compounds on NovTx’s drug screening platform.

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(patent in progress) Identified a progressable “hit”, NOVO-1, which eradicates 100% of CSCs in vitro and in vivo, and minimal toxicity in studies to date. (platform advantage) Traditionally, the average time from idea or discovery to human

application is on the order of 1 – 3 decades. Conversely, NovTx will be able to bring a relatively large number of compounds through phase 5 of drug development (see section VI.), at which point it can be licensed to pharma, or pushed into late preclinical development to pharmaceutical companies with only a few years on average estimated to bring a drug from discovery into Phase I clinical trials.

(platform advantage) NovTx technology works by biomanipulations of true CSC

molecular phenotypy. In other words, the technology only works if it is doing exactly what it is supposed to do. This is an important quality control point because NovTx technology both allows for large-scale bulk culture of CSCs, while at the same time uses real-time technology that detects the presence and purity of this culture with respect to CSC phenotypy. Thus, this technology has a built in quality control mechanism allowing data collected on a given drug to be considered valid, precise, and reproducible over time.

8.1.3. Compound Screening Platform Pilot Studies: Proof of Concept Events, Novel Discoveries, and Products Proof of Concept – Selecting the Correct Cancer Cell Target: NovTx’s approach selects for a true and early CSC that is highly tumorigenic, metastatic, resistant to chemotherapy and radiation (shown both through cytotoxic and apoptotic assays), and expresses the correct profile of CSC markers and cancer marker genes. Novel Discovery Regarding CSCs and Standard of Care of Chemotherapeutics: CSCs are resistant to the cytotoxic effects of standard of care chemotherapeutics, and indeed appear to be induced by the survival pressure they create in the assay. Most standard of care chemotherapeutics tested thus far have yielded expected or predictable results, but also some surprising results. Not only were CSCs selected by NovTx approaches resistant to these drugs, but in addition challenging the CSC population with toxic chemotherapeutics appeared to induce it to proliferate (increasing the overall numbers of CSCs in the culture), and to increase the overall degree of expression of the biomark by CSCs. Thus the “stemness” signal increased by inducing CSCs to proliferate, and by inducing CSCs to drive the CSC reporter gene more intensely. This result was entirely unexpected, but possibly can be explained by borrowing from understood concepts in hematopoietic stem cell biology and manipulations that enhance success for bone marrow transplant models. When a bone marrow transplant is performed, 5-FU is first given to induce proliferating hematopoietic progenitors to undergo apoptosis. The eradication of this cellular subcompartment, induced the stem cell fraction to come out of quiescence and begin proliferating in an attempt to rebuild the progenitor pool. At this time, a lethal dose of radiation is given, timed to catch as many stem cells in the act of

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replication as possible, induces apoptosis in these cells, and in doing so create a sufficient graft bed for the donor marrow. Importantly, without this specific biological effect of 5-FU on bone marrow stem cells and progenitors, the stem cell pool would not have been affected by radiation in a manner sufficient to create a suitable graft bed, and the bone marrow transplant would have failed. These principals are likely somewhat in reflected here, such that the CSC fraction senses the destruction of downstream progenitors and terminal progeny and thus is induced to proliferate in an attempt to rebuild the cancer progenitor subcompartment of the culture. This possibility suggests similar manipulations may make sense in the context of radiotherapy for cancer. Novel Discovery – NOS Gene Targets in CSCs: We have identified a network of more than 40 genes and some corresponding proteins that play a key and unique role in maintaining CSC phenotype and malignant features of cancer. Some of these genes and proteins are likely excellent molecular targets for smart-pharma targeting approaches for drug discovery and development. New Product – NOVO1: The identification and initiation of development of NovTx’s first lead compound, NOVO1. Although early in its drug development track, NOVO1 is an exciting discovery for NovTx because it is novel, efficacious against cancer and CSCs in vitro and in vivo, has a good safety profile in vivo, is easily and cheaply synthesized, and has significant potential to serve as the founder substrate molecule for the creation of a derivative class of related compounds.

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8.2. Bibliography

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Al-Hajj M, Wicha MS, Benito-Hernandez A, Morrison SJ, and Clarke MF. 2003. Prospective

identification of tumorigenic breast cancer cells. Proc Natl Acad Sci U S A. 100(7):3983-3988.

Ben-Porath I, Thomson MW, Carey VJ, Ge R, Bell GW, Regev A, and Weinberg RA. (2008) An

embryonic stem cell-like gene expression signature in poorly differentiated aggressive human

tumors. Nat Genet. 40(5):499-507.

Core Boyer LA, Lee TI, Cole MF, Johnstone SE, Levine SS, Zucker JP, Guenther MG, Kumar RM,

Murray HL, Jenner RG, Gifford DK, Melton DA, Jaenisch R, andYoung RA. (2005) Transcriptional

regulatory circuitry in human embryonic stem cells. Cell. 122(6):947-956.

Chambers I. (2004) The molecular basis of pluripotency in mouse embryonic stem cells. Cloning

Stem Cells 6(4):386-391.

Chambers I, Colby D, Robertson M, Nichols J, Lee S, Tweedie S, and Smith A. (2003) Functional

expression cloning of Nanog, a pluripotency sustaining factor in embryonic stem cells. Cell,

113:643-655.

Ganguly R and Puri IK (2006) Mathematical model for the cancer stem cell hypothesis. Cell

proliferation 39 (1): 3–14.

Gerrard L, Rodgers L, and Cui W. (2005) Differentiation of human embryonic stem cells to neural

lineages in adherent culture by blocking BMP signaling. Stem Cells.

Gerrard L, Zhao D, Clark AJ, and Cui W. (2006) Stably transfected human embryonic stem cell

clones express OCT4-specific green fluorescent protein and maintain self-renewal and

pluripotency. Stem Cells. 23(1):124-33.

Gibbs CP, Kukekov VG, Reith JD, Tchigrinova O, Suslov ON, Scott EW, Ghivizzani SC, Ignatova

TN, and Steindler DA (2005) Stem-like cells in bone sarcomas: implications for tumorigenesis. Neoplasia. (11):967-976.

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cancer signature predicting therapy failure in patients with multiple types of cancer. J Clin Invest. 115(6):1503-1521.

Gupta PB, Onder TT, Jiang G, Tao K, Kuperwasser C, Weinberg RA, and Lander ES. (2009) Identification of selective inhibitors of cancer stem cells by high-throughput screening.

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cortical glial tumors contain neural stem-like cells expressing astroglial and neuronal markers in vitro. Glia. 39(3):193-206.

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(2007) Transformation of different human breast epithelial cell types leads to distinct tumor phenotypes. Cancer Cell 12:160-170.

Klein WM, Wu BP, Zhao S, Wu H, Klein-Szanto AJ, and Tahan SR. (2007) Increased expression of stem cell markers in malignant melanoma. Mod Pathol. (1):102-107.

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and Steindler DA. (1999) Multipotent stem/progenitor cells with similar properties arise from two

neurogenic regions of adult human brain.Exp Neurol. 56(2):333-44.

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GATA1. (2005) Li Z, Godinho FJ, Klusmann JH, Garriga-Canut M, Yu C, Orkin SH.

Nat Genet. 37(6):613-619.

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between transcriptional regulation and RNA expression in human embryonic stem cell lines. Stem Cells Dev. (3):315-323.

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Nakamura Y. (2003) Analysis of gene-expression profiles in testicular seminomas using a genome-wide cDNA microarray. Int J Oncol. (6):1615-35.

Preziosi, Luigi (2003) Cancer Modeling and Simulation. CRC Press. ISBN 1-58488-361-8

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Kallioniemi O, Andrews PW, and Lothe RA. (2005) Differentiation of human embryonal carcinomas

in vitro and in vivo reveals expression profiles relevant to normal development. Cancer Res. 65:5588-98.

Singh SK, Clarke ID, Hide T, and Dirks PB. (2004) Cancer stem cells in nervous system tumors. Oncogene. 23(43):7267-73.

Singh SK, Hawkins C, Clarke ID, Squire JA, Bayani J, Hide T, Henkelman RM, Cusimano MD, and Dirks PB. (2004) Identification of human brain tumour initiating cells. Nature. 432(7015):396-401.

Sperger JM, Chen X, Draper JS, Antosiewicz JE, Chon CH, Jones SB, Brooks JD, Andrews PW,

Brown PO, and Thomson JA. (2003) Gene expression patterns in human embryonic stem cells and human pluripotent germ cell tumors. Proc Natl Acad Sci U S A. 100(23):13350-5

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8.3. Glossary of Terms – With Actual and Context Specific Definitions

AC133: Known marker for CSCs that are derived from neuroectodermal tumors. A cell surface

glycoprotein, also known in humans and rodents as Prominin 1 (PROM1). Expressed in normal

stem cells such as hematopoietic stem cells and endothelial progenitor cells and certain types of

ectodermally derived cancers such as glioblastomas, neuronal and glial stem cells.

Bioengineering: The use of standard biologic principals and cell and molecular techniques to create, in the context of biological science and research, and more specifically cell, tissue, animal

modeling, engineering tools that enhance, impede, or provide identity to, some specific cell or

molecular process. To use such tools to create usable, tangible products that can be introduced into a biologic system in an

attempt to create a gain or loss of function at the gene, protein,

pathway, or multi-pathway level, or to modify said system for the purposes of marking or detecting certain biological processes,

followed by the use of such modified systems in experiments and

controlled environments for the purposes of learning something

new about the system from micro- (atomic), macro-tissue or animal, and everything in between (molecule, pathway, cell). For

example, one might introduce a transgene that produces a protein

in all cells at all times. Then when said cells are introduced into other cellular models, the bioengineered cells can be traced in the

new biological system and studied in the context of their new

environment. Figure 23 provides a nice example of F9 glioma cells bioengineered with retroviral vectors that are stably integrated

into the genome of the cell, and constantly express GFP. When

these cells are introduced into the brain of a rat, the tumor and the

brain tissue can be easily discriminated and studied together without confusing which cell type is causing the observed effect.

Biomark, Biomarker, Biomarking: For the purposes of NovTx Drug Discovery, biomarking a

CSC line refers to stably introducing a transgene that consists of a promoter for a given biological

target protein, operationally linked to a reporter transgene that yields a detectable signal when

expressed, and whose expression is regulated by activity at the target protein’s promoter, and thus in proportion to expression of the target protein. Thus, when the target protein of interest is

expressed in a “biomarked” cell, the reporter gene is transcribed, a detectable signal is generated,

and the cell can be identified. For NovTx Drug Discovery, the pOCT4-eGFP biomark is used to

identify cells that express OCT4 (because its expression is restricted to CSCs), allowing those cells

to be detected, isolated from non-stem cancer cells, and captured for further manipulation in vitro.

Thus, in this scenario, OCT4 is the biomarker (or biomark) that is targeted, but the targeting approach is indirect and uses GFP expression as regulated by the OCT4 promoter as an indicator

of OCT4 expression, instead of direct detection of OCT4 expression. Thus, the GFP signal 1)

identifies a cancer cell as a CSC, 2) allows CSCs to be detected in biological assays, and 3) allows the CSC to be separated or isolated from the total cancer cell population and captured for further in

vitro manipulation or study.

Cancer Stem Cell, CSC: Cancer cells (found within tumors or hematological cancers, usually around 0.01% of the cancer cell population) that possess properties of normal stem cells. In

particular, they have the ability to give rise to all cell types found in the tissue of a particular cancer.

CSCs are therefore tumorigenic (tumor-initiating or forming), in contrast to the progeny of the CSCs

FIGURE 23 Photomicrograph

(10X) of the tumor-tisssue interface

of F98 intracranial rat glioma.

Bioengineered GFP-expressing rat

glioma cells were introduced into the

brain of a healthy rat, and allowed to

grow for 15 days. The animals were

then sacrificed and the brain tissues

prepared, sectioned, and studied for

the expression of GFAP using

fluorescent immunohistochemistry.

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(the bulk of the cancer, ~95 – 99%), which are referred in this document as non-stem bulk cancer

cells. Such cells are proposed to drive the development of the primary tumor, persist in tumors as a distinct population, and cause relapse and metastasis by giving rise to new tumors. Therefore, the

development of specific therapies targeted at CSCs holds hope for improvement of survival and

quality of life of cancer patients, especially for sufferers of metastatic disease.

Cancer Stem Cell Biology: Modeling of all aspects of CSCs in Cancer Biology.

Cancer Stem Cell Markers: Markers that identify a given cancer cell population as a CSC. For example, AC133 for high-grade glioma, CD44+/high/CD24-/low for breast cancer, and NovTx’s biomark

of choice, OCT4 (along with other NOS factors), which identifies the CSC population in most solid

tumors.

Cancer Markers of Malignancy: Markers known to be associated with malignant aspects of

cancer such as invasion (for example, MMP1), metastasis (for example, Tenascin-C), and

resistance to chemotherapy (for example, MDR genes, also know as ABC transporters).

CD44+/high/CD24-/low: The expression profile for CD44 (high expression) and CD24 (low or no

expression) that identifies a breast cancer cell as a CSC. Used for identification and isolation of CSCs via immunostaining and FACS-Sorting approaches.

Cancer Cell line, Established: Immortalized cancer cell line derived originally from tumor tissue,

that have naturally or artificially acquired the ability to proliferate indefinitely.

Cancer Cell line, Primary Culture: Cancer cell lines created and cultured directly from tumor tissue, more restricted in the rate and time frame for proliferation. Can be transformed into an

established cell line if cultured on permissive culture conditions.

Cancer cell line (Acquisition of for NovTx’s Drug Discovery Program): The source of most cancer cell lines that will be bioengineered and screened as part of NovTx Drug discovery includes

the National Cancer Institute, ATCC (a cell line vendor), 3rd Party (other researchers, and

collaborators), and local hospital IRB approved cancer tissue collection studies (for the creation of primary cancer cultures).

Clonal Division: The clonal, identical, or symmetric replication of a cell through cell division.

Clonal division is restricted to stem cells (adult tissue and embryonic) and CSCs.

Cytomegalovirus, CMV promoter: The viral promoter commonly used for constitutive or constant

activation of reporter genes. It ubiquitously recruits transcriptional machinery to drive the

expression of whatever gene is operationally linked to it.

Compound Library: A collection of typically novel chemical compounds that have been synthesized randomly or in relation to some strategic compound template. They usually provided by pharmaceutical companies in sets that can range from 100 drugs to thousands. Information about their storage, and use for drug discovery is provided by the vendor. Some are available freely by public entities such as the National Institute of Health, others are provided as for a fee or royalty sharing agreement, others are retained by certain pharmaceutical companies and access in only allowed in the context of bimutual interest and negotiated deal structures. Each chemical has associated information stored

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in some kind of database with information such as the chemical structure, purity, quantity, and physiochemical characteristics of the compound.

Compound Library (Acquisition for NovTx Drug Discovery): The source of compound libraries

that will be screened as part of NovTx Drug discovery (whether internal or external) includes the National Cancer Institute, various proprietary Vendors, and Collaborative efforts with biotech and

pharma.

Differentiation: The process by which a less specialized cell becomes a more specialized type of

cell. Typically associated with restricted proliferation and development potential.

Drug Development: The process of bringing a new drug or device to the market. It includes drug

discovery, product development, preclinical research (microorganisms/animals), and human

studies in the form of clinical trials.

Drug Discovery for Cancer: The identification of candidates, synthesis, characterization, screening, and assays for therapeutic efficacy against cancer cells. With respect to the NovTx

approach, drug discovery involves the biological assay of the effects of a given compound, drug,

toxin, or other small molecule on cancer cells and CSCs (with protocol emphasis on the CSC population).

(The NovTx) Drug Discovery Platform: Refers collectively to all aspects of NovTx Drug

Discovery including but not limited to: 1) Cancer Cell Lines 2) CSC biomarkers 3) CSC biomarking, detection, and isolation for capture 4) Bioengineering protocols 5) CSC culture protocols and

media (to create, maintain, and expand CSC bioengineered cell lines) 6) Screening protocols for

compound libraries against cancer cells and CSCs 7) Signal detection and extraction of biological

information the relates to the effects of a given compound on the CSC and on nonstem bulk cancer cells 8) Early Drug Development Protocols.

Drug Screening, Internal: Refers to targeted and pan-pharma drug screening of compound

libraries and drug targets acquired by NovTx for its own testing program. The goal is to identify

progressable hits with anti-CSC properties that can be formally developed into drugs that can be

tested in human clinical trials.

Drug screening, in Collaboration: Refers to targeted and pan-pharma drug screening of

compound libraries and drug targets acquired by NovTx through collaborative efforts with large pharma. The goal is to identify progressable hits with anti-CSC properties that can be formally

developed into drugs that can be tested in human clinical trials.

DF10: Base media used for the creation of cancer and CSC growth media.

Doubling Time: The time it takes for a cell to divide symmetrically (CSC -> CSC) or

asymmetrically (CSC -> progenitor, or nonstem bulk cancer cell). Typically around 30 – 40 hours for CSCs when cultured in vitro.

Early passage Cancer Cell Lines: Primary cultures recently created from tumor tissue and only passaged a few times.

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Epithelial-mesenchymal transition or transformation, EMT: A program of development of

biological cells characterized by loss of cell adhesion, repression of E-cadherin expression, and increased cell mobility. EMT is essential for numerous developmental processes including

mesoderm formation and neural tube formation. EMT may be a critical event in CSC biology,

especially as metastatic events. Several oncogenic pathways (peptide growth factors, Src, Ras,

Ets, integrin, Wnt/beta-catenin and Notch) induce EMT.

FACS Analysis, and FACS Sorting: "Fluorescence-Activated Cell Sorting", or FACS, is a

technique based on flow cytometry, used to detect, quantify, or sort cells according to the amount of a particular molecule they contain. A "Fluorescence-Activated Cell Sorter" (also termed "FACS")

is the apparatus used to detect or sort cells. The cells of interest typically express a fluorescent

reporter gene, or are stained with a dye that becomes fluorescent when it binds to the molecule of interest: fluorescence is thus proportional to the amount of this molecule in each cell.

Fingerprint (Gene, Molecular): A list of genes, proteins, or pathways that a given cell, cell

population, tissue of interest, or any of the above with a certain phenotype, reproducibly expresses. When such a fingerprint is confirmed for a given biological event, cellular phenotype, or cell/tissue,

the fingerprint itself can be used to reverse identify or validate the cell or cell population as being

that of interest in the experiment.

G418: Aminoglycoside antibiotic similar in structure to gentamicin B1. It is produced by

Micromonospora rhodorangea. G418 blocks polypeptide synthesis by inhibiting the elongation step in both prokaryotic and eukaryotic cells. Resistance to G418 is conferred by the neo gene from Tn5

encoding an aminoglycoside 3‘-phosphotransferase, APH 3‘ II. G418 is commonly used in

laboratory research to select genetically engineered cells (typically using the KanMX selectable

marker).

Genotype: The complete set of genes expressed in a given cell.

Green Fluorescence Protein, GFP, eGFP: A protein that fluoresces when excited with light of a

specific wavelength. The “e” refers to a humanized (less toxic) GFP variant.

Creation of GFP Enriched or Depleted Cancer Cell Populations: Refers to the identification, selection, and removal of cancer cells from the total cell population (that was previously

biomarked) based on whether they express GFP (as regulated by the OCT4 promoter). For the

purposes of NovTx Drug Discovery, GFP-enriched cells are CSCs and early cancer cell progenitors, and GFP-depleted cells are late cancer cell progenitors and nonstem bulk cancer

cells. Each of these populations is easily generated from a parental cell population that stably

carries the biomark transgene using fluorescent detection and cell sorting approaches.

Growth Factors: Cell signaling proteins that induce biological influence on cells that express the

receptor for a given growth factor. For example, the growth factor IL-6 is known to maintain

immaturity, and promote proliferation of hematopoietic stem cells both in vitro and in vivo.

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HFF Media: Another term or name used loosely for Novopro media (although technically it

does not refer to Novopro media, but instead refers to this CSC media at an early stage of production). Specifically indicates media modified by incubating it with human fibroblast

foreskin cells.

High Throughput Drug Screening: The use of robotics, data processing and control software,

liquid handling devices, and sensitive detectors to allow NovTx researchers to quickly conduct thousands of pharmacological tests to rapidly identify active small molecules with anti-CSC effects.

The results of these experiments provide starting points for discovery, drug design, and for

understanding the interaction or role of a particular biochemical process in CSC biology.

Hit: Refers to a compound that is discovered to have anti-CSC activity by performing well on the NovTx Drug Discovery Platform during screening.

IRB for Tissue Collection: An application to the Internal Review Board of a hospital system that provides detailed protocols for human cancer tissue collection, as well as proof of safety and

privacy with respect to human cancer tissue collection.

Luciferase: A reporter protein used as a reporter to assess the transcriptional activity in cells that

are transfected with a genetic construct containing the luciferase gene under the control of a

promoter of interest. NovTx drug discovery commonly uses Firefly and Renilla Luciferase with

transgenes that have constitutive (always active, i.e., CMV promoter) or regulated promoters (OCT4) upstream and operationally linked to them. In the context of drug discovery, luciferase

reporter transgenes are primarily used for drug discovery after a given CSC line has been

established.

(Compound or Drug) Mechanism of Action: Most often refers to the molecular process by which

a given compound affects a CSC (for example, the induction of apoptosis by activating Caspase

Apoptotic Cascades).

Molecular Profiling or Profile: The use of cell and molecular assays to detect RNA and Protein

expression to determine what genes and proteins are expressed, or to search for a given biomarker or set of biomarkers, or to create a molecular fingerprint that can be used to identify a

cell population of interest.

NOS Transcription Factors, NANOG, OCT4, SOX2: Embryonic transcription factors, and

biomarkers of choice for NovTx CSC selection and drug discovery. The expression of a NOS

transcription factor in a cancer cell identifies it as a CSC or early cancer cell progenitor. NOS

transcription factors regulate gene targets (collectively known as NOS genes) independently and in combination with each other, which are critical for clonal growth, maintenance of pluripotency, and

the central biology for ESCs and fetal development (and CSC biology).

Neurosphere Culture System: An adult brain tissue stem cell culture system originally created by

Kukekov et al. (1999, Experimental Neurology). Cells are plated individually in low density in stem

cell promoting conditions and result in the growth of neurospheres in suspension that are clonally derived from single cells, and are high density for stem cells. The stem cell promoting conditions

of this culture system continuously prevent late progenitor and terminally differentiated cells from

growing by both the induction of apoptosis, and the suppression of differentiation development

pathways.

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OCT4: A homeodomain transcription factor of the POU family. Critically involved in self-renewal in

undifferentiated ESCs. As such, it is frequently used as a marker for undifferentiated cells. OCT4 expression must be closely regulated; decreases in expression result in the initiation of

differentiation. OCT4 is a biomarker of choice for NovTx CSC selection and drug discovery. The

expression of OCT4 in a cancer cell identifies it as a CSC or early cancer cell progenitor. OCT4

regulates a number of biologically diverse gene targets independently and in combination with NANOG and/or SOX2 (also embryonic transcription factors). These genes, known collectively as

NOS genes, are critical for clonal growth, maintenance of pluripotency, and central biology for

ESCs and fetal development.

Promoter: Region of DNA that facilitates the transcription of a particular gene. Typically located

near the genes they regulate, on the same strand and upstream (towards the 5' region of the sense strand).

Oncosphere Culture System: An adult brain tissue stem cell culture system originally created by

Kukekov et al. (2002, Glia) and adapted later for use with CSCs. Cells are plated individually in low density in stem cell promoting conditions and result in the growth of oncospheres that were

clonally derived from single cells, and are high density for stem cells, with a small but stable early

progenitor cell population. The stem cell promoting conditions of this culture system continuously prevent late progenitor and terminally differentiated cells from growing by the induction of

apoptosis, and the suppression of differentiation development pathways

Operationally linked: With respect to NovTx reporter transgenes. Operationally linked indicates

that the regulation component (the promoter, OCT4 or CMV for example) is upstream an in close

proximity to the reporter gene (i.e., GFP), and thus will regulate its expression activity.

NOD/SCID mouse: “SCID" mice constitute a laboratory model that does not generate B

lymphocytes or T lymphocytes and thus are immunocompromised, and thus are suitable for the

introduction of human cancer cells to create xenograft models of cancer.

NOS Genes: A group of biologically diverse genes regulated by NANOG, OCT4, and SOX2, that

are found to be activated in and critical for the biology of ESCs, early fetal development, and

CSCs.

Novopro Media: CSC growth promoting media and culture protocols created by combining

specific supplements, growth factors, and culture techniques from cancer, adult stem cell, and ESC culture systems.

Pan-pharma Drug Discovery: The use of NovTx Drug Discovery protocols and platform technologies to screen thousands of small molecules (most often derived from compound libraries)

for anti-CSC properties.

CSC Selection: Refers to a group of related sequential protocols that identify, isolate, and capture CSCs after introduction of the CSC biomark into a cancer cell population.

Phenotype, Phenotypy: Visible, physical, and functional characteristics of a cell/tissue/animal.

Pluripotency: The ability of the human ESC to differentiate into almost any cell type. Pluripotency

in the broad sense refers to "having more than one potential outcome."

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Progenitor: Like stem cells, progenitor cells have a capacity to differentiate into a specific type of

cell. In contrast to stem cells, however, they are already far more specific: they are pushed to differentiate into their "target" cell. The most important difference between stem cells and

progenitor cells is that stem cells can replicate indefinitely, whereas progenitor cells can only divide

a limited number of times. Controversy about the exact definition remains and the concept is still

evolving.

Reporter Construct or Gene: A "reporter gene" is a gene which codes for a protein that does not

exist in mammalian cells, and that generates a detectable protein product, or new enzymatic activity which can be used for detection purposes. By connecting a reporter gene to a promoter, it

becomes possible to obtain an accurate quantification of its expression.

Resistance and Sensitivity of CSCs and nonstem bulk cancer cells respectively to

Chemotherapy and Radiation: CSCs have been shown by NovTx and others to be resistant to

chemotherapy (due in part to the high expression of multi-drug resistance genes and their protein

channel products, ABC transporters), and to radiation (due to inconsistent p53 expression, overexpression of tumor suppressor genes, and atypical growth and cell cycle kinetics).

Reverse Validation of the NovTx Approach to Biomarking and CSC Selection: Validating the nature or phenotype of a given cell or cell population by the use of biomarkers or pre-established

molecular fingerprints. For example, a breast cancer cell population can be demonstrated to be

highly enriched for breast CSCs by FACS analysis to have a CD44+/high/CD24-/low expression profile in the majority of the cells. Thus, it follows that a breast CSC enriched cell population can

be created de novo by using FAC-sorting for breast cancer cells with a CD44+/high/CD24-/low expression profile (the current standard approach by most breast CSC researchers. However,

NovTx biomarking and CSC selection uses an entirely different approach, yet efficiently and

reproducibly creates a CSC population, that when studied with FACS analysis, also demonstrates a predominate CD44+/high/CD24-/low expression profile. This remarkable result confirms and reverse

validates the accuracy of NovTx CSC isolation and selection protocols.

Serum: Blood ultrafiltrate free of cells, but inclusive of all proteins, growth factors, electrolytes, antibodies, antigens, hormones, typically found in blood.

Signal, Signal Detection: Refers to Detection Systems (equipment and software) that can detect NovTx biomark reporter proteins (fluorescence and luciferase) and from their relative expression

levels (in real-time, over time, and at the end of the experiment) extract biological information about

the effect of a given compound on cancer cells and CSCs.

Smart Biomarkers, Smart Biomarking Approaches, Smart Biomarking Signal Detection:

NovTx CSC biomarkers and its biomarking approach is referred to as “smart” biotechnology

because the biomarkers do much more than simply mark a cell as a CSC cell. These biomarkers

identify and distinguish CSCs (higher signal) from cancer progenitors (low signal) and nonstem bulk cancer cells (no signal), as well as detect drugs that influence the stem cell biology and

related developmental biology of CSCs. Further, signal changes in the CSC population (i.e.,

changes in expression of the biomark in response to the effects of a given compound on the CSC and nonstem bulk cancer cell population) are proportional to the nature of the biological event, and

to the degree of its biological effect on the cancer cell. Thus, buried within the signals generated by

biomarked cancer cells and CSCs in a given assay is biological information. Detection and signal interpretation can be enhanced with mathematical modeling of predictable biologic outcomes of

CSCs to environmental challenge (i.e., cell death, cell growth arrest, cell differentiation, etc.), and

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with available software interfaces, that when used in combination provide rapid analysis and

virtually instant interpretation of assay biological events in real time, over time, and at the end of the experiment.

Smart-pharma Drug Discovery: The use of NovTx Drug Discovery Protocols and Platform

technologies in conjunction with our collective experience and expertise to hand pick and test

specific molecular drug targets (for example, a cell surface receptor, or signal transduction enzyme) for anti-CSC properties. Combines basic cell and molecular approaches such as

genomics and molecular chemistry with stem cell biology assays and techniques.

Stem Cell: Undifferentiated cell which gives rise to daughter cells that are either clones of themselves, or differentiated cell progeny of the tissue type said stem cell belongs to.

Transgene: Any DNA sequence, regardless of whether it contains a gene coding sequence or has been artificially constructed, which has been introduced into an organism or vector construct in

which it was previously not found.

Tumorigenesis: The creation of a tumor body from a single cell either naturally or artificially (is

only studied in conjunction with CSC animal models).

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8.4. Proforma of Current Industry Standards for Drug Discovery and Development.

[source, Michael Rosen (2006) The Wisconsin Technology Network]

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8.5. NovTx estimates for time frames, costs, and probability of success for developing an idea or discovery into a human therapy for cancer.

FIGURE 24 Schematic depicting the flow of screening and drug development beginning with an untested compound used to challenge

CSCs, and ending with Phase ! clinical trials. This figure provides somewhat refined estimates of the time frame of each step along the way,

and the number of drugs expected to filter through each step as they move through the discovery and development pathway (compare with the

industry standards provided in the appendix above). The milestones are as follows: 1. and 2. Compound Screening against CSCs. 3. In vitro drug

development. 4. and 5 In vivo development, inclusive of early/pilot studies, critical review by a multidisciplinary team, and and formal FDA

directed expanded preclinical studies. 6. Phase ! clinical trials. Top Panel, Schematic depicting the flow of screening and drug development

beginning with an untested compound used to challenge CSCs, and ending with Phase ! clinical trials, and accounting for the major benchmarks,

milestones, or divisions in the discovery and development path. Middle Panel, Schematic depicting the flow of screening and drug development

beginning with an untested compound used to challenge CSCs, and progressing in a stepwise manner as follows: First, general and focused

platform screening (will filter a 100K compound library down to roughly 400 compounds that have activity that is considered attractive various

obvious and subtle reasons; Second, expanded studies of efficacy, safety, and pharmacology (will filter the Hit group down to around 200

compounds. Bottom Panel, the forty most attractive candidates will enter gateway animal models of cancer using a nude mouse side pocket

approach (will filter the list down to 20 compounds). Second, expanded preclinical studies will be inititated ahead of and in response to FDA

preferences and reccomendations. Finally, from the 4 – 6 drug candidates that do well as in drug development studies, and meet a host of other

relevant criteria, 1 – 3 will be chosen for clinical trial testing, the remainder will go to NovTx’s pipeline for future development of licensing to

Pharma. The P’s placed throughout the figure and associated closely with a number, correlate roughly to the phases of drug development at

NovTx as described above in detail on pages 51 – 59.

2 weeks

6 months

3 months 2 weeks

6 - 18 months

6 - 18 months

P1,2

P3

P4

P6

P7

P5

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8.6. Figure List

FIGURE 1: Analysis of the exponentional growth of CSC biology related research and development

activity in the academic biosciences and commercial biotechnology sectors.

FIGURE 2: Schematic diagrams of NOS transcription factors and the genes they bind

independently or in combination to regulate pluripotency and development in embryogenesis.

FIGURE 3: The isolation and study of CSCs (oncospheres) from solid cancers using the

oncosphere culture system.

FIGURE 4: OCT4 immunohistochemical staining of various tumor tissues.

FIGURE 5: Semi-quantitative RT-PCR analysis of clinical specimens and established cell lines of

Glioblastoma (A) and Osteosarcoma (B) for expression of NOS Transcription factors and Stat3.

FIGURE 6: Western blot analysis of cells derived from clinical specimens and established cell lines

of Glioblastoma (A) and Osteosarcoma (B).

FIGURE 7: Floating and Attached MCF7-R breast spheroid CSCs (mamaspheres,CSC clusters) in

(cancer) stem cell promoting culture.

FIGURE 8: Inverse correlation of OCT4 (X axis) and NANOG (Y axis) expression with attachment to

substrate and exposure to serum (both induce differentiation).

FIGURE 9: Suppression of the clonal sphere forming potential of Glioblastoma CSCs with OCT4

siRNA to inhibit transcription of the OCT4 mRNA.

FIGURE 10: Experimental design for isolating pOct4-eGFP-expressing cells from a total cancer cell

population.

FIGURE 11: Fluorescent analysis and sorting for MDA MB 231 breast cancer GFP-expressing CSCs derived from representative cancer cell line cultures transfected with the pOCT4-eGFP

reporter transgene.

FIGURE 12: Analysis of the growth characteristics and sphere forming potential of GFP-enriched

and depleted LN229 glioblastoma cancer cells under stem cell promoting culture conditions

(oncosphere culture system).

FIGURE 13: Primary and metastatic breast cancer derived from MDA MB 231 cells injected into the

mammary fat pad of nude mice.

FIGURE 14: In vivo analysis of the tumorigenicity of MDA MB 231 breast cancer GFP-enriched

CSCs and GFP-depleted nonstem bulk cancer cells cells injected into the mammary fat pad of nude

mice.

FIGURE 15: Expression of OCT4 in a breast cancer cell in situ in a human breast adenocarcinoma

(primary tumor) and in breast cancer metastatic to brain.

81


FIGURE 16: Venn Diagram demonstrating the results of microarray gene expression studies

demonstrating the number of genes regulated by OCT4, Nanog, or Sox2 (or some combination of these) in GFP-enriched cancer stem cells as compared to GFP-depleted bulk (non-stem) cancer

cells.

FIGURE 17: NovTx biomarking and selection protocols identify and isolate a CSC population that is highly enriched for CD44+/high/24-/low expression, and that has strong CSC phenotypic properties.

FIGURE 18: Schematic diagrams and photo-micrographs of CSCs undergoing symetric/clonal and assymetric division.

FIGURE 19: Summary of the possible outcomes that can occur in the Founder CSC in a biological assay that challenges all cancer cells in the assay with a toxin, growth factor, radiation,

environmental change, etc.

FIGURE 20: Schematic bar graph demonstrating the overall ability of NovTx’s Drug Screening Platform to detect CSCs in the assay in response to pharma- cologic challenge.

FIGURE 21: Schematic depicting NovTx’s Operational Schema For Drug Discovery.

FIGURE 22: Schematic depicting Phases 1 - 4 of the Drug Discovery Program for Drug Screening.

FIGURE 23: Photomicrograph (10X) of the tumor-tissue interface of F98 intracranial rat glioma.

FIGURE 24: Schematic depicting the flow of screening and drug development beginning with an

untested compound used to challenge CSCs, and ending with Phase ! clinical trials.

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