A Cleveland Clinic spin-off that is developing stemcell therapies to repair damaged hearts has landed $1.5 million from mostly Northeast Ohio investors.

AcelleRX Therapeutics Inc. will get the biggest partof its pre-seed investment - $700,000 - from Cleveland's North Coast Angel Fund and itsmembers. Another $500,000 has been committed by JumpStart Inc., the venturedevelopment organization in Cleveland.

The balance of the investment will come from XgenLtd., a Clevelandinvestment partnership primarily owned by the family of radio and dot-com mogulTom Embrescia. The balance also will come from Cincinnati venture capital firm Blue ChipVenture Co. and some individual investors, according to the Cleveland Clinic,which announced the investment.

AcelleRX, known as RegenRX when the Clinic spun itoff in 2005, will use the investment to get its leading therapy to its firstclinical trial, likely by next fall, said Dr. Marc Penn, company founder andtherapy developer. The company will need more money to do the trial, he said.

When asked about his hopes for AcelleRX, Pennanswered quickly. "Hopefully, we're going to cure heart disease,"said the director of the Clinic's Bakken Heart Brain Institute, as well asmedical director for the hospital's coronary intensive care unit.

Penn and his colleagues identified substances thatthe heart uses to recruit stem cells from within the body to repair damage. Thestem cells home in on the heart to rebuild muscle and blood vessels, Penn said.

The researchers are using their lead product - StomalDerived Factor 1, or SDF-1, for short - to enable stem cells to deliver thehoming substances, as well as to develop the homing substances as a stand-alonetherapy, Penn said.

Unlike stem cell therapy, which involves the preciseand costly process of farming cells, a stand-alone therapy would be "anoff-the-shelf vial," Penn said. "It's not living, so it's availableat virtually any hospital that does interventional cardiology."

Rahul Aras, president and chief executive ofAcelleRX, said his company will use its investment - and some state grant moneyfrom the Third Frontier Project - to complete pre-clinical animal studies ofits lead product and to figure out how to make enough of it to support trialsin humans.

Aras also said he is looking to hire "a person tolead our product development team."Christopher Coburn, executive director of CCF Innovations, thecommercialization unit of the Cleveland Clinic that spun out AcelleRX, said theinvestment in the company "is a wonderful harbinger for the future."

Investors from the east and west coasts wereinterested in investing in the stem cell company, Coburn said."But the better route here was to havelocal investors. We are all pleased to see that these plans were executed in Cleveland."

For North Coast Angel Fund, which with its membersinvests in early stage technology companies, AcelleRX "is a strongindicator of the high caliber of biotechnology companies emerging in thisregion," said Clay Rankin, managing member.

The fund committed $200,000 of the $700,000investment, and 14 of its members committed an additional $500,000, said ToddFederman, its executive director. Angels are wealthy individual investors.

AcelleRX also is exciting because it is an industrypioneer. "Regenerative medicine represents a new and growing field ofmedicine," said Lynn Ann Gries, chief investment officer for JumpStart, ina written statement.