Three companies blazing fresh tracks with unprecedented mechanisms and novel medicines made a splash at Proactive Investors’ Biotech and Life Sciences conference in New York on Wednesday.
It's a great adrenaline-filled time to be in biotech, and the scientific entrepreneurs spearheading Callitas Health Inc. (CNSX:LILY), ChemioCare USA Inc and Pressure BioSciences Inc (OTCMKTS:PBIO) shared their stories in an event held Wednesday evening at the 3 West Club in New York City.
The presentations by the three CEOs was met with enthusiasm by a full house of institutional and retail investors, high net-worth individuals, fund managers and analysts.
Investors perked up as the companies talked about clinical trial results and potential orphan drugs that offer rare opportunities to make money.
“Biotechs are still popular with investors for all the right reasons: there’s a lot of M&A activity, solid clinical data, regulatory reviews, upcoming scientific conferences and orphan drugs,” said Sheldon S. Traube at Kareg Research, who attended the event. “They offer so much opportunity.”
Patching the problem of chemo-induced nausea
The biopharma sector is discovering and developing new transformative therapies for patients across a huge range of diseases.
In March, industry veteran Pedro Lichtinger and Dr. Fotios Plakogiannis, who operates a lab in Long Island City, bootstrapped a biotech start-up called ChemioCare USA Inc. It’s working on novel skin patch technology for treating chemo-induced nausea and vomiting.
It leverages transdermal technology using adhesive patches to deliver medicines through the skin. ChemioCare’s product pipeline includes four different single active ingredient patches using proprietary formulations. Its chemio-ondan patch which delivers a sustained dose over three to five days is furthest along the development process.
The company is also working on a combination patch involving a mixture of two or three agents dosed over to two-to-five days.
“The revenue potential of each patch is between US$400mln and US$1bn,” pointed out ChemioCare CEO Pedro Lichtinger, who has an MBA from Wharton and an engineering degree from the National University of Mexico.
“Compared to new molecular entity drug development, ChemioCare is low risk, fast to market with limited capital needs. We are reformulating well known generic drugs with the objective of achieving on label meaningful improvements,” he added.
The CEO said the biotech’s development programs “are designed to follow the 505(b)2 pathway” and require a relatively low financial investment.
In plain terms, a company using the 505(b)(2) FDA drug approval pathway relies on clinical data or literature produced by other companies.
Eyes set on IPO in 10 months
Lichtinger, who has an impressive 37-year career in biotechnology, is taking the up-and-coming biotech public by March 2019.
“In 10 months, we will be in a position to launch an IPO. We are going to do a dual listing in Nasdaq and Canada,” said Lichtinger who has a proven track record of building commercial and R&D capabilities at aspiring companies that need cash to develop.
No stranger to taking companies public, Lichtinger was formerly the CEO of Asterias Biotherapeutics Inc. (NYSEAMERICAN:AST) and Optimer Pharmaceuticals Inc (NASDAQ:OPTR). He also has a 16-year stint with Pfizer Inc. under his belt.
“I think there will be terrific demand for ChemioCare’s patches because the existing regimens have a lot of side effects. There’s significant unmet medical need,” said Irma Calara Nielson, a savvy investor looking for ground-floor investments.
Callitas Health focuses on innovation
Callitas Health, a clinical-stage company focused on weight management and female health, has big plans for a broad product portfolio. It is developing innovative remedies for weight management, female sexual health, cannabis delivery technologies and other proprietary drugs.
In February, it hired Freyeur & Trogue (F&T) to provide development consulting to help optimize its large product portfolio development and commercialization.
“We have two blue sky assets which have massive revenue potential,” said Interim Callitas Health CEO James Thompson.
Notably, late last year, Callitas received a successful response from the US FDA on its pre-investigational new drug (IND) application for its Extrinsa topical gel to treat female sexual dysfunction (FSD).
Sitting pretty on a large market
Thompson said that Extrinsa could be a US$1bn opportunity. Addyi, the only drug currently approved for the treatment of female sexual desire disorder was purchased by Valeant Pharmaceuticals International Inc (NYSE:VRX) from Sprout for more than US$1bn in 2016.
Valeant had estimated that sales would ramp up to US$1bn annually for this drug, and it makes no claims to treat orgasm disorders, so the potential market for Extrinsa should be higher.
The company is also working on C – 103, the reformulated weight loss treatment, which was Orlistat (which had unwelcome side effects). The firm has targeted US$500mln in revenue from C-103 from the US market alone as first-year revenues, once it is approved by the FDA.
“We have patent-pending pharmaceutical status from the US patent office concerning the orally dissolvable delivery technology concerning cannabinoids branded as CannaMint Strips by Callitas,” said Thompson.
The firm is planning to license the technology to manufacturers and distributors in North America.
The company recently signed partnership agreements with two undisclosed Californian companies, which permits Calitas to market and sell its CannaMint strips for both tetrahydrocannabinol (thc) and cannabidiol (cbd).
2018 is the year for Pressure BioSciences
In 2017, the company pulled in revenue of $US2.24mln by selling 300 pressure cycling technology (PCT) machines to over 175 customers.
However, 2018 is already shaping up as a banner year. The company’s total revenue for the opening three months of 2018 rose 11% to US$610,774, up from US$551,357 in the year-ago quarter, thanks to booming sales of the company’s lab instruments which utilize pressure to control bio-molecular interactions.
“We have expanded our sales force from one to five and this will boost our 2018 revenue,” said Schumacher.
Hundreds of labs utilize the company's pressure-based systems to extract proteins from cells and separate lipids, DNA, RNA and smart molecules from biological samples.
The Harvard Medical School trained serial entrepreneur who has founded four companies is extremely enthusiastic about the first contract Pressure BioSciences has signed to sell its PreEMT platform and expects more deals to follow.
The Pre-EMT platform – which uses high pressure to help drug companies develop protein-based therapeutics – is being contracted out to an international biopharma company that intends to use it to improve the quality of a key protein drug. The platform is one is the assets Pressure Biosciences acquired as part of its acquisition of all the assets of BaroFold Inc. last December.
“In our wildest dreams, we didn’t think we’d be securing such an important contract so soon after the acquisition,” said Schumacher. “It’s all coming together this year.”
A sixth sense for biotech can make investors a lot of money as the margins are high and the opportunities are very big.
“All three companies had exciting technologies in emerging growth areas and they are all looking to take new technologies to market or improving existing technologies,” said Kevin McGarth of strategic advisory firm TraDigital IR, who attended the event.