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StemCells Closes Australian Facility in Wake of SCS Acquisition

NEW YORK (GenomeWeb News) — Stem cell therapeutics and research tools firm StemCells said today that it has transferred the Melbourne, Australia-based operations of recently acquired Stem Cell Sciences to StemCells' facilities in Cambridge, UK, and Palo Alto, Calif.

The move is part of StemCells' efforts to streamline operations following its estimated $4.8 million acquisition of SCS, which it originally announced in March and closed on April 1.

StemCells also said that the restructuring will support the growth of its SC Proven stem cell culture business and the development and commercialization of central nervous system cell-based assay platforms for use in drug screening and drug development.

StemCells, which previously focused solely on developing tissue-derived cellular products for therapeutic uses, inherited the SC Proven and CNS cell-based assay technologies as part of its SCS acquisition.

The company said that it will now refocus and add to its research and development of cell-based assays, and better align those efforts with its manufacturing of cells and assays for drug screening and development, including using its automated cell culture platform for large-scale production for medium-throughput screening of drug candidates.

"The acquisition of the SCS operations solidifies our leadership position in the neural cell field and provides us with nearer-term commercial opportunities through non-therapeutic applications of our combined cell-based technology platforms," StemCells President and CEO Martin McGlynn said in a statement.

"The actions we are taking now will centralize and focus specific platforms and personnel at specific sites to more effectively leverage our various capabilities," McGlynn added.

It is unclear how many workers were employed at the former SCS facility in Melbourne. Company representatives could not be reached for comment. According to an SEC filing, the closure cost StemCells approximately $310,000, including payment of employee benefits and costs associated with terminating its lease prior to its original expiration date of Dec. 31, 2010.

StemCells said that sales of the SC Proven cell culture product business have "grown rapidly" in 2009 compared to the same period in 2008. StemCells will continue to expand this business by focusing on "increased penetration into the growing US stem cell research market."

Development and manufacturing of the StemCells' SC Proven products will continue to be based in its Cambridge location, the company said.