In April, 2007, we announced a collaboration with Grupo Ferrer Internacional, S.A., a leading European pharmaceutical and medical devices company, to commercialize our Celacade™ System for the treatment of chronic heart failure in the European Union (EU) and in certain Latin American countries. Under the agreement, Ferrer will have the exclusive rights to market Celacade for the treatment of chronic heart failure and other cardiovascular conditions in specified countries of Europe, including Germany, Spain, Portugal, France, and Italy, and certain countries in Latin America, including Mexico, Brazil, Argentina, and Venezuela. We have already received EU regulatory approval as a medical device under the CE Mark, which enables marketing of Celacade for the treatment of chronic heart failure in the 27 member countries of the EU.

• For additional details on this collaboration, please click here.

In December 2007, Grupo Ferrer received the initial orders for our Celacade™ System in Germany.

• For additional details, please click here.

Given the results from the ACCLAIM (Advanced Chronic Heart Failure CLinical Assessment of Immune Modulation Therapy) trial in two important pre-defined subgroups, we met with the FDA in May 2007 regarding the next steps in the development of our Celacade technology for the treatment of chronic heart failure in the United States. As a result of the meeting, the FDA strongly recommended that we conduct a confirmatory study, which we have named ACCLAIM-II, to support a U.S. Pre-Market Approval filing for Celacade for NYHA Class II heart failure patients and also recommended that we consider utilizing a Bayesian approach. The FDA indicated that they were recommending this approach specifically because it would allow us to borrow power from the ACCLAIM trial and also because it has the potential to substantially reduce the sample size required for a confirmatory study. As a result of the FDA’s recommendations, we retained Berry Consultants and Dr. Donald A. Berry, Head, Division of Quantitative Sciences and Chairman, Department of Biostatistics, The University of Texas MD Anderson Cancer Center, and a world recognized authority in the area of Bayesian and adaptive trial design, to assist with the development of a confirmatory study. The proposed ACCLIAM-II trial design indicates that as few as 300 patients could provide sufficient data to confirm the finding of the ACCLAIM trial. Furthermore, the use of an adaptive clinical trial design also provides the flexibility to increase the sample size up to 600 patients, should additional data be required.

As in Vasogen’s ACCLAIM study, it is expected that the primary endpoint of the planned ACCLAIM-II study will be death or first cardiovascular hospitalization. The double-blind, placebo-controlled study is also expected to have similar inclusion/exclusion criteria as ACCLAIM, with all patients on standard-of-care medication for heart failure. If successful, this trial is expected to support an application for regulatory approval in the United States of Vasogen’s Celacade technology for the treatment of patients with NYHA Class II heart failure. We have established a Steering Committee that will provide input to the final study design, which will then be subject to approval by the FDA.

How Celacade Technology Works

Our Celacade technology targets the inflammation underlying chronic heart failure. Inflammation is a normal response of the immune system to cellular injury caused by infection, trauma, or other stimuli. During the inflammatory process, immune cells release a number of factors, including cytokines – potent chemical messengers that modulate inflammation and facilitate the healing process. While this inflammatory process is usually self-limiting, it can persist, become chronic, and lead to a number of serious medical conditions.

During a brief outpatient procedure, a small sample of a patient’s blood is drawn into our Celacade single-use disposable cartridge and exposed to controlled oxidative stress utilizing our proprietary Celacade medical device technology. Oxidative stress is a factor known to initiate apoptosis (programmed cell death), a physiologic process that is inherently anti-inflammatory. The treated blood is then administered to the same patient intramuscularly. An initial course of treatment comprising three consecutive outpatient procedures is administered over a two-week period, and treatments are continued once per month thereafter.

During apoptosis, signalling molecules, including phosphatidylserine (PS), normally present on the inner surface of the cell membrane, become exposed on the cell surface. The PS molecules interact with specific PS receptors on the surface of antigen presenting cells (APCs) of the immune system, including macrophages and dendritic cells. The interaction with macrophages leads to an up-regulation in the production of the anti-inflammatory cytokines IL-10 and TGF-β. Dendritic cells that interact with apoptotic cells remain immature and, in the presence of anti-inflammatory cytokines such as IL-10 and TGF-β, cause the differentiation of some naïve T cells to regulatory T cells. These traffic through the tissues and inhibit inflammatory cells such as T1 cells by a process that includes cell-cell interaction and the production of anti-inflammatory cytokines by the regulatory T cells. The end result is a reduction in tissue levels of inflammatory cytokines such as TNF-α, IL-6, IFN-γ, and IL-1β, and a down-regulation of chronic inflammation.

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