CHA Biotech, a Kosdaq-listed cell therapy company, said Tuesday that it has signed a contract development and manufacturing organization (CDMO) agreement with Frombio, a Kosdaq-listed health functional food company, to develop stem cell therapy for hair loss.

Under the accord, CHA Biotech will establish a master cell bank and a working cell bank of adipose-derived stem cells at its subsidiary, CHA Biolab, and Frombio will be able to accelerate the development of hair loss cell therapies.

A master cell bank is a suspension culture of tissue cells grown under optimal conditions as a single culture and distributed in equal amounts to multiple containers, while a working cell bank is an additional culture from a master cell bank.

Establishing a cell bank lays the foundation for producing cell therapies without altering the cells, ensuring the safety of the drugs and moving it to the commercialization stage.

Frombio is developing a hair loss treatment using dermal papilla cells, which are made by differentiating adipose-derived stem cells.

Dermal papilla cells are hair seed-like cells located at the lowest part of the hair root that is responsible for supplying oxygen and nutrients to the follicle cells, which in turn regulate hair growth and the hair follicle cycle.

When the proliferation of dermal papilla cells is activated, hair becomes healthier and hair growth is promoted, preventing hair loss.

"We are developing a safe and effective cell therapy for hair loss by utilizing technology that can differentiate hair papilla cells from adipose-derived stem cells," said Shim Tae-jin, CEO of Frombio. "We plan to conduct clinical trials targeting the global market using the master cell bank and working cell bank provided by CHA Biotech."

"With this agreement, we look forward to expanding our strategic partnership with Frombio in the entire process from cell therapy clinical trials to product production," said Oh Sang-hoon, CEO of CHA Biotech. "We will utilize the capabilities of CHA Biotech Group to support our US clinical trials and global expansion."