As a
general rule, the most successful man in life is the man who has the best
information.
With two out of
three people in the US overweight and one in three obese it's not surprising
that one in four Americans is either pre-diabetic or has Type 2 diabetes.
The International
Diabetes Federation estimates that 285 million people around the world have
diabetes and...
This total is
expected to rise to 438 million within 20 years. Each year a further 7
million people develop diabetes.
Exactly what is Diabetes?
The foods you eat
are broken down into a simple sugar called glucose. In response to a rise in
glucose after a meal your pancreas secretes insulin. Insulin acts to move the
glucose from your blood stream into the cells where it can be utilized for
energy. Diabetes is a condition in which normal blood sugar levels are too
high.
A Type 1 diabetes
diagnosis means your pancreatic beta cells that secrete insulin have been
damaged or destroyed - glucose cannot move from the bloodstream into the
cells.
A Type 2 (insulin
resistance) diabetes diagnosis is a far more common verdict for people than
Type 1. Insulin resistance happens because of chronically elevated blood
sugar and insulin. These elevated levels of sugar and insulin have the effect
of "numbing" the cellular processes which moves the sugar from the
blood stream to the cells - the body cannot respond to the insulin
"requests" to move blood sugar into the cells. Roughly 27% of the
people who start out as Type 2 diabetics, will, in the future, require
insulin injections similar to Type 1 diabetics.
Short-term
complications:
- Hypoglycaemia
- low blood sugar which can lead to coma and death
- Diabetic
Ketoacidosis (DKA) - results from absolutely no insulin, the body
switches to burning fatty acids instead of glucose and low PH ketone
bodies are produced which turns blood acidic.
- Lactic
acidosis
- Bacterial/fungal
infections
Long-term
complications:
- Retinopathy
- eye disease
- Nephropathy
- kidney disease
- Neuropathy -
nerve disease
- Diseases of
the circulatory system
- Amputation
The cost
of Diabetes
- Healthcare
expenditures on diabetes are expected to account for 11.6% of the total
healthcare expenditure in the world in 2010.
- Estimated
global healthcare expenditures to treat and prevent diabetes and its
complications are expected to total at least US $376 billion in 2010. By
2030, this number is projected to exceed some US $490 billion.
- More than
80% of the estimated global expenditures on diabetes are made in the
world's economically richest countries, not in the low- and
middle-income countries where over 70% of people with diabetes live.
- The US is
projected to spend US $198 billion or 52.7% of global expenditure in
2010
- India, the
country with the largest population of people living with diabetes, is
expected to spend an estimated US $2.8 billion - less than 1% of the
global total.
- The American
Diabetes Association estimated that the US economy lost US $58 billion,
equivalent to almost half of the direct healthcare expenditure on
diabetes in 2007, as a result of lost earnings due to lost work days,
restricted activity days, lower productivity at work, mortality and
permanent disability caused by diabetes.
In this article
I'm going to introduce you to two companies actively working towards making
life better for diabetes sufferers - socially responsible investments and
also two investments, capable, in my opinion, of returning many times your
invested capital. Quite simply put, I believe we can maximize our financial
return while also doing some social good.
iCo Therapeutics ICO-TSX.v
Shares Issued:
41,057,301
Warrants: 334,334 agent warrants @ .60
Options: 2,521,429 average weighted price .49
Fully Diluted: 43,612,164
Insider Ownership: 11.77%
Institutional Ownership:
ISIS Pharmaceuticals - 12.3%, Special Situation fund - 14.3%, others - 5-6%
iCo has exclusive
worldwide rights to three products:
iCo-007 is for
the treatment of Diabetic Macular Edema (DME). DME is the swelling of the
retina in diabetes patients due to leaking blood vessels within the macula,
the central portion of the retina that is critical for daytime vision.
Diabetic macular edema (DME) is a serious manifestation of diabetic
retinopathy that involves retinal swelling brought on by the leaking of fluid
from small blood vessels within the macula. As the condition develops,
central vision becomes blurred. DME can progress fairly rapidly and over just
a few years can lead to permanent visual loss. There is a significant unmet
need to both reverse the visual loss associated with DME and to help delay
the progression of this condition.
There are
currently no approved therapeutics for DME, the leading cause of blindness in
working age adults. DME affects approximately 1.6 million people in the U.S.
alone, a number that is expected to grow as Diabetes is forecast to increase
by almost 50% in the US by 2025.
iCo licensed the
worldwide exclusive rights to all therapeutic applications of iCo-007 from
ISIS in 2005. Drug products that prevent the growth of new blood vessels and
inhibit increased vascular permeability may have the potential to treat neovascular
diseases, including diabetic retinopathy and diabetic macular edema.
iCo has just
released its Phase 1 clinical trial results for iCo-007 in patients with
diffuse diabetic macular edema. The primary objective of the phase I trial
was to evaluate the ocular safety and tolerability of iCo-007. Secondary
objectives included assessment of systemic pharmacokinetics, retinal
thickness using optical coherence tomography (OCT) measurements and visual
acuity.
"We
are extremely pleased that iCo-007 successfully met the primary endpoint for
our Phase I trial. In addition, we have seen signs of biological activity in
a very difficult to treat patient population refractory to many other
treatments, including anti-VEGF agents in some cases. The safety and secondary
endpoint information we have gleaned from this trial, including the
biological activity we have seen at various dose levels, will be extremely
useful and fully supports advancing to a Phase II clinical trial program
which is currently in the planning stage." President and
CEO, Andrew Rae
iCo-008 is being
developed for severe ocular allergies. During an allergic response the levels
of eotaxin-1 are elevated. This attracts eosinophils, a type of white blood
cell, into tissues where they can degranulate causing tissue damage that
occurs in a variety of allergic disorders. This condition, known as
eosinophilia, can occur in a number of disorders, such as allergic ocular
disease of conjunctiva and cornea (conjunctivitis and keratoconjunctivitis),
asthma, allergic rhinitis, atopic dermatitis, and other inflammatory
disorders, such as inflammatory bowel disease and Crohn's disease.
Blocking
eotaxin-1 was shown to be effective in inhibiting early phase mast cell
activation as well as late phase eosinophilia. This broad spectrum mechanism
of action is unique and differentiates iCo-008 from other available agents.
Recent evidence
suggests re-orientating the strategic direction of this drug towards
targeting Wet Age-related Macular Degeneration (AMD) would be appropriate.
AMD is the
leading cause of visual loss in the western world. This disease of the aging
eye results in loss of the sharp, central vision that is necessary for
clearly seeing objects and undertaking routine tasks including reading and
driving. AMD occurs in both wet and dry forms, with the wet form accounting
for the vast majority of cases of AMD-related blindness and progressing much
more rapidly than dry. Partnering discussions are ongoing.
iCo-009 is an
oral reformulation of Amphotericin B for sight and life threatening diseases.
iCo-009 also represents a new drug delivery technology with the potential to
re-profile other IV administered drugs to the oral route of administration.
June 25, 2009 -
iCo Therapeutics Inc. (TSX-V: ICO) is pleased to announce that iCo's oral
Amphotericin B (AmpB) oral formulation "iCo-009" has been published
in a leading journal, The Journal of Infectious Diseases. The article
represents the first ever publication of an oral AmpB eradicating the
parasite responsible for Visceral Leishmaniasis (VL), which affects 12
million people worldwide. Administration of the highest dose of iCo-009
resulted in 99.8% inhibition of the parasite.
AmpB has for many
years been the gold standard for systemic antifungal drugs. AmpB formulated
for IV use remains one of the most effective agents in the treatment of
systemic fungal infections, yet no oral formulations are currently
commercially available. Over the past 50 years, many attempts have been made
to formulate AmpB for oral administration, with limited success. The article
indicates that with iCo-009, a self-administered, oral formulation of AmpB is
attainable.
iCo is continuing
with preclinical work.
Sernova Corp. SVA - TSX.v
Common Shares:
78,899,024
Options: 3,693,875 average exercise price of $0.29
Warrants: 5,703,467 average exercise price of $0.19
Fully Diluted: 88,296,366
Insider Ownership: 6%
Sernova is
developing two, novel, closely integrated, proprietary platform technologies.
The first is the Cell Pouch System™ - a medical device providing a
natural "organ-like" environment for therapeutic cells - such as
insulin producing islets for diabetics. The second is Sertolin™ - a
cell-based technology providing an immune-privileged environment for donor
cells which reduces or eliminates the need for anti-rejection drugs.
The Standard of
Care for patients with reduced or missing critical hormones or proteins, such
as insulin, is often monitoring and injecting these proteins multiple times a
day. This has lead to a patient track record of missing dosages and serious
side effects resulting in US $150 billion a year hospital costs for diabetes
alone.
Sernova's Cell
Pouch System is a versatile, credit card-sized device made of FDA approved
materials. Placed under the skin in a simple inexpensive procedure it
develops organ-like characteristics for delivery and natural housing of
therapeutic cells. A key feature of the device is its ability to stimulate
natural microvessel development, thought to be essential for long-term
survival and function of therapeutic cells.
Cell therapy (a
projected yearly US $8 billion market) is a new and increasing alternative
for patients with severe disease.
At this time
there is no approved device to house and protect therapeutic cells in the
body. Instead, cells are often injected into vessels in an extremely
expensive and risky procedure - most of the injected cells die from
inflammation and clotting, an instant blood-mediated inflammatory reaction
(IBMIR) - resulting in the need for reoperations. Currently cell therapy is
limited to expensive procedures, poor cell survival and inappropriate
delivery as well as lack of available donors.
Sernova's first
application of its proprietary Cell Pouch System is islet transplantation for
treatment of insulin-dependent diabetes - think of the Cell Pouch
System™ as a potential natural insulin pump with the added benefit of
fine-tuned glucose control. The Cell Pouch System is expected to prevent
IBMIR (which is believed to rapidly destroy up to an estimated 90% of the transplanted
islets) and in addition eliminate serious complications such as islet-induced
blood clotting and liver thrombosis. The reduction in islet loss, once
verified, could lead to improved safety and efficacy of islet transplantation
and the potential of treating multiple patients from a single pancreas
donation.
While the initial
primary focus of the Company's development efforts will be assessment of the
Cell Pouch System for insulin-dependent diabetes (which includes all Type-I
diabetics and about 27% of Type-2 diabetics), the Company is planning to
develop partnerships with academic and corporate collaborators to further
develop the Cell Pouch for other applications including:
·
Chronic
metabolic, hematologic and neurological diseases - Parkinson's disease and
Haemophilia are two candidates
·
Implantation
of multiple cell types including natural cells, stem cells and genetically
engineered cells
·
The
Cell Pouch System may be used for autograft cellular transplants
·
Allograft
cellular transplants with the use of immunosuppressive drugs or in
conjunction with co-transplantation of islets and Sertoli cells
Sernova recently
released interim results from a key porcine (pig) diabetes study evaluating
the safety and efficacy of the cell pouch system.
These interim results
were presented at the American Society of Artificial Internal Organs 56th
annual conference, Baltimore, Md., May 2009 and confirm that:
·
Sernova's
Cell Pouch system establishes a biological environment capable of preserving
the functionality of therapeutic cells
·
The
Cell Pouch system allows for safe and efficacious cell-based therapy and may
offer a revolutionary improvement over the current practice of injecting
therapeutic cells into blood vessels
·
The
Cell Pouch can provide glucose control with only about 10% of the equivalent
functioning islets that are used to achieve normal blood glucose levels in
the current standard of care involving injection of cells into the veins
suggesting that the device may be islet-sparing
Sernova's second
technology, Sertolin, is for patients who have had therapeutic cell therapy
and who want to avoid toxic and expensive anti-rejection drugs (US
$10-15,000/yr). Sertolin, when combined with therapeutic cells protects them
from attack by the immune system. Animal models have shown that the
combination of these protector and therapeutic cells leads to long-term
functional survival of the therapeutic cells without drug therapy.
Conclusion
There is no
market cycle for bio-technology drug or device stocks. The need is always there
and demand is growing at an alarming rate. More and more people are receiving
medical coverage while at the same time big pharma's number of patents and
pipeline of new drugs has been drastically reduced.
Both iCo
Therapeutics and Sernova Corp. management teams have very realistic end game
plans - their objective is to add substantial value to existing assets and
subsequently monetize them for the benefit of shareholders. This could take
the form of an acquisition or such other mechanism whereby the value can be
transferred to shareholders. It is not the objective of either company to
build a large permanent, integrated pharmaceutical company. I'm in complete
agreement, build as much value into each product as is reasonable, then sell,
let your shareholders reap the rewards and move on.
Both these
companies should be on every investor's radar screens.
Are they on
yours?
Richard Mills
Aheadoftheherd.com
Richard
is host of www.aheadoftheherd.com and invests in the
junior resource sector. His articles have been published on over 60 websites
including - Wall Street Journal, 24hGold, Kitco, USAToday, Safehaven,
SeekingAlpha, The Gold/Energy Reports, Gold-Eagle and Financial Sense.
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