Could Yale University and Organovo Solve This Big Problem?

By Markets Fool.com

Continue Reading Below

Source: Organovo Holdings.

In early December, Yale University's medical school announced that it was teaming up with Organovo Holdings on a project that could someday offer hope to thousands of transplant patients. Yale University's School of Medicine, Department of Surgery will use Organovo's bioprinting technology and collaborate with the company to develop bioprinted tissues for surgical transplantation research. If the two can leverage this research, it could one day conceivably eliminate transplant waiting lists.

Big challenge
A person is added to the U.S. organ transplant waiting list every 10 minutes, and there are on average 79 transplants daily in the country.However, 18 people die every day, on average, because no organ was available for transplant. With more than 120,000 people on the organ transplant list, the need for solutions to bridge the gap between donors and recipients is undeniably massive.

Filling that need will not happen overnight, but Yale and Organovo hope that building upon Organovo's existing experience in bioprinting viable human liver tissue will producebreakthroughs that could eventually lead to bioprinting organs for use intransplantation.

Slow but sure
Organovo is miles away from that goal, but its success in bioprinting liver tissue offers some hope. Organovo has been working on developing functional 3D human tissue since its inception in 2007; the company launched its first commercial liver tissue assays in November.

Continue Reading Below

Biopharma companies can use those assays during preclinical studies to determine whether a drug is toxic to the liver, solving a vexing problem that has long frustrated drugmakers. Every year, billions of dollars are wasted researching drugs that end up in the trash bin because toxicity isn't discovered until those drugs are well into costly human trials.

Previously, toxic drugs could advance into human trials because drugmakers had to rely on 2D liver cell assays to determine liver toxicity. Since 2D cells exist outside of their native architecture, they don't produce proteins that are important to metabolizing drugs the same way that a native human liver does. Organovo's liver assays, however, produce proteins similar to those of a normal liver, and the company believes its liver tissue can more quickly and accurately replicate how a drug might impact patients.

Organovo's liver tissue results so far have been impressive. For example, the company announced this past summer that it identified liver toxicity in a drug manufactured by a bog pharma companythat wasn't determined to be toxic until late-stage human trials were under way. Which suggests that if that global pharmaceutical giant had access to -- and paid for -- Organovo's liver tissue assays, it could have saved millions of dollars that could have been spent on other, more viable research programs instead.

Although it took Organovo years to develop its liver tissue assay, the company believes it canleverage what it has learned to develop additional assays. For instance, the company has said it could launch a kidney tissue assay as soon as 2016. Developing working organs for transplants is much further off. But the company is already devoting about 10% of its research budget toward simple tissue development programs, such as blood vessels, and the partnership with Yale could help Organovo's research move more quickly into large tissue development.

Horses before carts
The potential to bioprint a working liver that could be used in transplants is endlessly intriguing, but Organovo investors should avoid putting too much emphasis on that opportunity. Despite the company's hard work, it is still far from achieving that goal.

Instead, investors should concentrate on whether demand for Organovo's liver tissue assays and testing services will drive sales growth over the coming couple years. If so, it would certainly lend support to the argument that there will be similar demand for the company's kidney tissue once it launches, and ultimately success for those products could provide the financing to ramp up research into developing transplantable tissues.

The article Could Yale University and Organovo Solve This Big Problem? originally appeared on Fool.com.

Todd Campbellis long Organovo. Todd owns E.B. Capital Markets, LLC. E.B. Capital's clients may or may not have positions in the companies mentioned. Todd owns Gundalow Advisors, LLC. Gundalow's clients do not have positions in the companies mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.