While it is true that the cancer death rate has been dropping at a rate of about one percent a year since the early 1990’s, it is still one of the leading causes of death worldwide. In the United States alone in 2012, more than 1.5 million people will be diagnosed with cancer from one origin point or the other and more than 500,000 people will die from different cancer lines.
Companies of all sizes, from the biggest cancer drug maker in the world, Roche (OTCQB:RHHBY), to the smallest junior biotech are maneuvering down the regulatory pathway trying to bring products to market as novel therapies. It’s a multi-billion dollar proposition with unparalleled humanitarian benefits to make it happen. Small molecule developments have always been the primary target of most major pharmas, but the stubbornness of tumors to develop multi-drug resistance is bringing about a paradigm shift towards innovative technologies that offer new tactics to destroy cancer cells either stand-alone or in combination therapies.
Regenerative medicines, filtrations devices and other less invasive procedures that prove a therapeutic benefit to combat cancer are leading the wave of the future in oncology. The modality shift should be putting late-stage clinical and revenue generating companies such as Medifocus, Inc. (TSX:Venture-MFS)(OTC-MDFZF) firmly in the sights of forward-looking investors.
Amongst other things, the Toronto-based company is in the business of development and commercialization of minimally invasive, focused-heat tumor targeted cancer and benign tumor treatment devices and systems. The company is well aligned to raise the bar in cancer care, particularly in breast cancer treatments by using focused microwave heating to enhance neo-adjuvant chemotherapy to provide better tumor shrinkage and control, leading to improved surgical outcomes and ultimately breast preservation. Its microwave treatment can result in tumor necrosis, induced apoptosis (programmed cell death), or cell death and the heat enhances the effects of a chemotherapy drug, resulting in tumor shrinkages within a matter of weeks.
Medifocus has a licensing deal with the vaunted Massachusetts Institute of Technology for their patented adaptive phased array (APA) microwave focusing technology platform which is the foundation of the company’s unique focused heat treatment systems with the capability to direct precision-focused microwave energy at targeted tumor to induce hyperthermia to shrink or eradicate tumors without undue harm to surrounding tissue. In the course of the company’s breast cancer research, its focused microwaves have been used to shrink breast tumors up to 8 centimeters in diameter, significantly decreasing the likelihood of a mastectomy for the patient.
Of course, tumor shrinkage and tumor growth delay is a major objective in any cancer therapy, but damage to surrounding tissue is a downfall of many traditional-style small molecule drugs and other treatments. Referred to as “genotoxicity” in the small molecule arena, the damage of DNA is what stops many drug candidates in its tracks. Medifocus’s technologies are proven to not damage healthy tissue in any material way. Further, the localized electromagnetic radiation has the ability to eliminate microscopic tumors that cannot be seen by surgeons. Effectively, it is designed to work in conjunction with proven chemotherapies to maximize tumor destruction.
In the biotechnology space, the proof is in clinical trials. Medifocus is current running a Phase III pivotal study to provide final data supporting commercialization of its technology. Randomized phase II studies showed a better than 50 percent tumor shrinkage compared to controls, an increase in efficacy that is rarely showcased in a clinical trial by any product candidate.
Additionally, Medifocus completed the purchase of all Prolieve® business assets from Boston Scientific Corporation (NYSE:BSX) in July. Prolieve is approved by the FDA for the treatment of Benign Prostatic Hyperplasia (BPH), a condition that affects more than 50 percent of the male population over the age of 50 with symptoms ranging from weak urinary stream and frequent urgency to the total inability to urinate.
Prolieve® is a patent protected, non-surgical device that employs intra-cavitary catheters to deliver a combination of microwave heating and balloon dilatation of the prostatic urethra which leads to an immediate reduction in BPH symptoms. Prolieve® is the only microwave device to be randomized to drug therapy during its pivotal trial. The BPH drug market is currently more than $8 billion and growing; giving Medifocus a substantial upside for this portion of its portfolio by itself.
Prolieve was originally developed and commercialized by the current Medifocus management, product development, clinical and regulatory teams. The assets acquired by Medifocus include all Prolieve® hardware inventories, Rocky Mountain Mobile Services (making it now available to clinicians) and its mobile distribution assets, as well as the intellectual property portfolio associated with the Prolieve® technology.
This is the tipping point and major milestone as the company is transitioning from a developmental company to report revenue this quarter as a result of Prolieve® sales. That’s not something that many 12 cent per share stocks with a paltry $10.6 million market cap can boast.
To fully capitalize on the Prolieve® business opportunity, Medifocus has hired key personnel to expedite the transition and future revenue growth, as detailed in a press release this morning. Bringing together more than half a century of highly-relevant experience, the company has hired:
- Kurt B. ONeill, CPA, as V.P. of Sales and Finance. ONeill was formerly the Business Development Manager for the Prolieve® system at Boston Scientific.
- Mr. Timothy P. Heyer as Director of Sales. Heyer was formerly the Prolieve® Business Manager and Rocky Mountain Mobile Services Manager at Boston Scientific.
- Ms. Stacey Kjeldgaard as Administrative Manager for the Prolieve® System. Kjeldgaard was formerly the Manager of the Rocky Mountain Mobile Services business unit at Boston Scientific.
Medifocus has a pipeline of products that are independently worthy of a far greater valuation than the company presently has. A private placement of over $5.0 Million was used to purchase the Prolieve® assets and to expand the current Prolieve® business opportunity.
Through bringing one product to commercialization in an $8 billion dollar industry and another into phase III clinical trials for breast cancer, the company has only amassed $3 million in debt while having over $4 million in assets. This goes without mentioning that revenues are now starting to stream-in for the first time in corporate history.
Perhaps it is the fact the Medifocus only became a public entity a few months ago that it is slipping past the radar of investors. It is surely not because of what that the company has to offer as the fundamentals and the market potential signal nothing but upside.
