Brazilian Health Ministry awards BrainStorm Cell $5m

The company is conducting a joint trial of its product with Sao Paolo University.

Brainstorm Cell Therapeutics Ltd. (Bulletin Board:BCLI) is expected to receive a $5 million grant from the Brazilian Ministry of Health. The grant is for the purpose of conducting a trial of its product in cooperation with the University of Sao Paolo, sources inform "Globes". The company declined to respond to the report as it is still awaiting official confirmation,

As of the end of the first quarter of 2014, Brainstorm Cell had $3 million in cash. The company is traded at a $78 million market cap.

BrainStorm completed a $10.5 million financing round a month ago. The offering was at $0.25 per share, reflecting a 15% discount on the market value. Investors also received options at a $0.348 exercise price. These options are in the money, since the share is trading at $0.35.

The company does not have to return its current grant, which will be used solely for the trial for its treatment for ALS (Lou Gehrig's Disease), a deadly disease. BrainStorm Cell is already conducting a Stage IIa Food and Drug Administration (FDA) trial of the product. The company is also seeking promotion from its OTC listing to Nasdaq.

BrainStorm Cell's president and leading shareholder is Chaim Lebovits, owner of the ACC company, which was the first investor in Shemen (and got out before the share fell). Following the offering, Lebovits owns 20% of BrainStorm Cell.

BrainStorm also announced today a development in its manufacturing process: the completion of a bioreactor for commercial production of the stem cells used as a basis for the company's treatment for ALCS. A special production environment is necessary to multiply stem cells; the environment is critical for the treatment's success. The bioreactor was developed together with Canadian company Octane Biotech.

Published by Globes [online], Israel business news - www.globes-online.com - on July 24, 2014

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