Spring and Growth
Spring is the period of growing and blooming, and I love this season. That is a good theme for this Blog as I believe the next three months will mark a period of productive growth for our company.
First, I would like to report on the progress of our trials abroad. As you know, we had our investigator meeting in Zurich, Switzerland. Neurosurgeons and emergency physicians from the following institutions attended: University hospitals of Aarau, Basle, Berne, Geneva, and Zurich, all Switzerland. Hadassah Medical Organization of Jerusalem, Tel Aviv Sourasky Medical Center, and Sheba Medical Center of Tel-Hashomer, all Israel. Doctors Spiess and Bullock presented the science and the study plan, Dr. Michael Reinert presented the protocol, and the trial manager, Annette Magnin, explained the specifics and logistics of a combined Swiss-Israeli study.
Although the trial will be complicated in terms of patient inclusion and exclusion, informed consents, and equipment involved, we expect enrollment to begin as of June 1. Several hurdles need to be passed yet, of which the next one is regulatory approval. PFC Pharma-Focus AG, our clinical research organization with offices in Zurich and Tel-Aviv, now has taken the lead in the process. They have taken over a well-prepared protocol and are working on the necessary adaptations and inputs from the investigator meeting. We expect the documentation to be filed in due course for a timely trial start.
In a dose escalation study, data will be available after every dose cohort is evaluated. This is important not only from a research perspective, since it influences our research tree directly, but also because it provides a basis to contact potential future partners.
If a trial is conducted under good clinical practices, the data will be accepted in all countries, including by the FDA in the U.S. We are already working on performing the additional platelet studies in parallel, and our new friends and hospital partners in Israel have a lot of inputs to give in that respect. This potentially can save us a lot of time and effort. We consequently have established a “platelet and thrombocytopenia” task force chaired by Dr. Spiess. The task force will design and conduct the studies and has the assignment of coming up with the data requested by the FDA. World-class scientists as they are, they are hopeful of resolving once and for all a big medical challenge. As soon as we have safely reached the 3ml dose level in these trials, it is our plan to add the U.S. to the trial and roll the protocol forward into the next phase. That could still be phase II, or possibly be a combined phase II/III.
The initial supplies of clinical grade Oxycyte will come from a small contract manufacturer close to our labs in California. They, however, cannot make the larger batches we will need as we progress. That is why we explored options for larger-scale manufacturing. Last week we closed on the manufacturing contract for future supplies of clinical grade Oxycyte. As of next year we will be ready for continuous supply and will be able to satisfy all of our forecast demand. Controlling the supply chain is an important part of our strategy. Our licensees and partners will have to buy the Oxycyte from us. It’s like the model Coca Cola uses to control their compound by supplying the syrup to their bottlers.
Our growth plans will require additional capital. In addition to the international clinical TBI trial, we intend to scale up our topical division to produce income from the cosmetic application of Oxycyte and to begin clinical work on the wound care indication. The market potential of topical applications warrants a very aggressive marketing plan for our gel, which we have named OxybiocyteTM, and its many indications. We believe that funds from our topical product could potentially be high enough to carry our operating costs soon.
We also want to accelerate the process to bring at least two other indications into Phase II. We have more than 50 patents and patents pending that we should harvest. Our Sickle Cell Crisis Pain indication is dependent and waiting on the dose escalation data from TBI. As you know, we have very promising data for Stroke and Cardiovascular indications and these indications, from a research perspective, should ideally get on the move now. Those are on top of the initiatives to explore Oxycyte in Decompression Sickness conducted entirely by the U.S. Navy. Dr. Bullock also showed initial promising data about Oxycyte in spinal cord injuries - a sector we intend to push towards a phase I trial.
That all will cost money. So our finance team is working on getting sufficient capital into the company to reach our goals. There are several ways of doing this without triggering further dilution and we are currently exploring several avenues in parallel. It is still our intention to move our listing away from OTC BB to a major exchange to get better access to institutional investors.
Something else we’re doing with a promising financial impact is changing our approach to research and development grants. Previously, we always got the grants for Oxycyte through our research university partners. However, nothing prevents us from getting grants ourselves and not solely through the universities. The fact is that academic institutions typically take between 25% and 45% of the grant for administration. We can do this ourselves.
With the passage of the budget in Congress, we are hopeful of getting the funding for PHIL. That would be another important milestone for the company. For us, PHIL will potentially generate enormous leverage and without significant investments give us exclusive access to what will be one of the biggest think-tanks in the industry. PHIL will have more than 80 researchers and state-of-the-art infrastructure. Dr. Spiess showed a diagram about the planned research on his last slide in Zurich and one can easily imagine what all these initiatives could mean for us.
It now is starting to come together and that thrill is a good reward for all the hard work our people are putting into this venture. In the past we had worked with a lot of consultants to get things done. That is scalable, but it becomes relatively expensive once you engage providers more. As I said at the meeting, we are changing this now. Additional capital and generating revenue will allow us to properly staff our company. This will also take a lot of “people dependency risk” out of the organization and is key to making an aggressive growth plan realistic.
If you haven’t yet done so, I suggest you listen to the replay of the webcast of our Zurich investor meeting. We will leave it up on the investor relations portion of our website through the end of April. It runs more than an hour, but is loaded with information. It will help your understanding of our science, where we’re headed, our business strategy to get there, and why I’m excited about the future of this company.
As always, thank you for your attention. My best wishes for happy Passover and Easter holidays.