What if you never had to inject insulin again? A Japanese biotech startup has begun transplanting pancreatic cells grown from iPS cells into diabetes patients. In February 2025, the world's first such surgery succeeded. More than a decade after the Nobel Prize that started it all, Japan's regenerative medicine is opening the door to a future without needles.

When Your Own Body Stops Making Insulin

Type 1 diabetes is a condition where the immune system mistakenly destroys the insulin-producing "islet cells" in the pancreas. Unlike type 2 diabetes, which is often linked to lifestyle factors, type 1 is an autoimmune disease that can strike anyone, often during childhood. Globally, more than 8 million people live with the condition, including an estimated 100,000 to 140,000 in Japan.

For these patients, daily life revolves around insulin injections, typically several times a day. About 10% of type 1 diabetes patients have what doctors call the "Brittle" type, where blood sugar swings wildly and unpredictably, creating a constant risk of dangerous low-blood-sugar episodes that can cause loss of consciousness or even death.

One existing treatment option is islet cell transplantation, taking insulin-producing cells from a deceased donor's pancreas and transplanting them into the patient. In Japan, this procedure has been covered by public health insurance since 2020, but chronic donor shortages mean only a handful of transplants are performed each year. And even when the surgery is successful, patients typically need multiple transplants before they can stop insulin injections entirely.

This is where iPS cells, induced pluripotent stem cells, enter the picture. First created by Professor Shinya Yamanaka of Kyoto University in 2006 (earning him the 2012 Nobel Prize in Physiology or Medicine), iPS cells can theoretically be transformed into any type of cell in the body, including the very islet cells that type 1 diabetes patients have lost. The potential is transformative: an unlimited supply of insulin-producing cells, no donor waiting lists, and the possibility of ending daily injections for good.

Orizuru Therapeutics: From University Lab to Clinical Reality

At the center of this effort is Orizuru Therapeutics, a startup founded in 2021 to commercialize research from "T-CiRA," a joint program between Kyoto University's Center for iPS Cell Research and Application (CiRA) and pharmaceutical giant Takeda. Based in Fujisawa, Kanagawa Prefecture, the company has raised approximately $62 million through its Series B funding round.

The company's lead product is "OZTx-410", a sheet-type transplant made from iPS cell-derived islet cells (iPICs). The manufacturing process begins with iPS cell stocks produced by the Kyoto University iPS Cell Research Foundation (CiRAF), which are then differentiated into islet cells and formed into thin sheets. These iPS cell stocks are engineered to minimize immune rejection in a wide range of patients, making "off-the-shelf" transplants possible without the need to create custom iPS cells for each individual.

The manufacturing technology behind OZTx-410 is itself impressive. Orizuru has developed a high-efficiency continuous culture system in partnership with Satake MultiMix Corporation, along with a specialized "well bag" for large-scale production of uniform cell clusters created with Toyo Seikan Group. The actual production is handled by S-RACMO (a Sumitomo Chemical Group company). After more than eight years of research and development, the technology has finally reached the clinical stage.

February 2025: The World's First Surgery Succeeds

In January 2025, Kyoto University Hospital officially launched a physician-led clinical trial. Then in February, the world's first transplant of OZTx-410 was performed on a woman in her 40s who had been living with type 1 diabetes for over 20 years.

During the procedure, multiple cell sheets were implanted under the skin of the patient's abdomen under general anesthesia. This subcutaneous approach differs significantly from conventional islet transplantation, which involves injecting cells into the liver's portal vein. The sheet method is less invasive, and additional transplants can be performed more easily if needed.

The patient recovered well and was discharged from the hospital. After one month of safety monitoring, no significant problems were identified. The trial plans to treat a total of three patients, with follow-up observation continuing for up to five years. Preparations for the second transplant are already underway.

Professor Daisuke Yabe of Kyoto University's Department of Diabetes, Endocrinology and Nutrition noted at a press conference that while promising results from iPS-based diabetes treatments have been reported from China and elsewhere, the Kyoto approach offers advantages in terms of shorter preparation time and lower costs.

Heading to the US: Company-Sponsored Trials Targeted for 2027

The current physician-led trial is focused on confirming safety, but Orizuru Therapeutics has its sights set on a much larger goal. The company plans to launch company-sponsored clinical trials in both Japan and the United States by fiscal year 2027 (April 2027–March 2028). These trials will focus on evaluating efficacy, a critical step toward regulatory approval and commercial availability.

CEO Takeshi Nonaka has also indicated that the company is targeting a stock market listing in 2026, a move that would provide the capital needed to fund the expensive later-stage trials. Full commercialization is envisioned for the 2030s.

Beyond diabetes, Orizuru is simultaneously developing iPS cell-derived cardiomyocytes (heart muscle cells) called "iCM" for treating chronic heart failure, positioning itself as a multi-pipeline regenerative medicine company.

The Global Race: How Japan Stacks Up Against Vertex

Japan is not alone in the quest to cure diabetes with cell therapy. The most formidable competitor is Vertex Pharmaceuticals, a Boston-based biotech giant.

Vertex's lead candidate, zimislecel (formerly VX-880), is a stem cell-derived islet cell therapy currently in Phase 3 clinical trials. The company completed enrollment of approximately 50 patients in early 2025 and plans to file for regulatory approval in the US, Europe, and the UK in 2026. Data presented at the American Diabetes Association conference in June 2025 showed that all 12 patients in the Phase 1/2 portion of the trial had restored insulin production, a remarkable result.

However, Vertex's parallel program VX-264, which aimed to eliminate the need for immunosuppressive drugs by encapsulating cells in a protective device, failed to meet its efficacy goals and was discontinued in early 2025.

In China, researchers at Peking University and Nankai University reported in 2024 that they had successfully treated a type 1 diabetes patient using islet cells derived from the patient's own iPS cells, a different approach that avoids immune rejection entirely but is more costly and time-consuming.

What makes Orizuru's approach unique is its sheet-based delivery method. While Vertex infuses cells directly into the liver, Orizuru implants thin cell sheets under the skin, a less invasive procedure that allows for easier repeat transplantation. Additionally, by using pre-made iPS cell stocks rather than patient-specific cells, Orizuru can potentially reduce both time and cost significantly compared to autologous approaches like China's.

Japan's Biotech Startup Challenge

Orizuru's journey also highlights broader challenges facing Japan's biotech startup ecosystem. Despite giving birth to iPS cell technology, Japan has historically struggled to turn groundbreaking research into commercial products. Vertex alone has poured billions of dollars into research and development, dwarfing the budgets of Japanese biotech startups.

Yet Japan has unique strengths. Government agencies like AMED (Japan Agency for Medical Research and Development) provide targeted funding for translational research, the crucial bridge between laboratory discovery and clinical application. Japan's regulatory framework includes fast-track pathways for regenerative medicine products. And in February 2026, QOLiPS (an Osaka University spinoff) received what was reported as the world's first approval for iPS cell-derived cardiomyocyte sheets ("ReHeart") for heart failure, demonstrating that Japan's regenerative medicine ecosystem is maturing.

The close collaboration between academia (Kyoto University), industry (Orizuru, along with manufacturing partners), and government (AMED funding) represents a model that could help smaller Japanese startups compete against better-funded international rivals.

A Future Without Needles

Nearly two decades have passed since Professor Yamanaka first created iPS cells. Now, that technology is on the verge of transforming into a practical treatment that could free diabetes patients from the burden of daily injections.

Orizuru Therapeutics stands at a pivotal moment, not just for the company, but for iPS cell technology itself. With company-sponsored trials in Japan and the US on the horizon, an international race against Vertex and others, and commercialization targeted for the 2030s, the future of regenerative medicine has never been closer.

In your country, what new approaches to diabetes treatment are being researched? Do you have hopes or concerns about regenerative medicine and cell therapy? Share your thoughts in the comments!

References