Genzyme, a biotechnology company based in Cambridge, Massachusetts, announced last week that it will invest up to US$1.4 billion in two adult stem-cell therapies being developed at Osiris Therapeutics.

Osiris, which is headquartered in Columbia, Maryland, is conducting late-stage clinical trials using mesenchymal stem cells harvested from bone marrow and grown in large-scale cultures. Genzyme will pay $130 million up front for the rights to commercialize the products and will fund 40% of the cost of future phase III and IV clinical trials, with the remainder of the sum as milestone and royalty payments.

The first therapy, Chondrogen, is intended to treat osteoarthritis in the knee. The second, Prochymal, has already been approved by the US Food and Drug Administration as a last-ditch treatment for children with a potentially deadly immune response to tissue transplantation called graft-versus-host disease.