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PREMIER BIOMEDICAL, INC. CEO LETTER – DECEMBER, 2016
Recap of 2016 and Look-ahead to 2017
Greetings From The CEO and Staff at Premier Biomedical!
The past year has been a difficult journey, and events during the year have caused us to re-evaluate and adjust our overall business plan. We believe the significant steps taken will result in a much brighter forecast for 2017 and beyond.
Immunotherapy and Biologics.
• Our core technology has always been centered around immunotherapy. How we differ from the principal competitors in this field is that we operate on body fluids extracorporeally (outside of the body) through the use of antibodies against disease antigens.
• The two principal areas of focus initially were Traumatic Brain Injury (TBI)/Post Traumatic Stress Disorder (PTSD) and Chronic Traumatic Encephalopathy (CTE) – most frequently caused by repeated, non-concussive blows to the head – and cancer. Our partners in the development of this technology were the University of Texas at El Paso (UTEP) and the William Beaumont Army Medical Center (WBAMC) at Ft. Bliss.
• Progress on our anti-cancer antibody via extended comparative testing on laboratory mice versus available competitive drugs and chemotherapy indicated a very significant advantage for our patent-pending drug.
• Superior performance of our anti-cancer antibody was acknowledged via presentation at the American Association for Cancer Research Symposia in 2014 and 2016. Most recently we were honored to receive notification that the prestigious British Journal of Cancer would publish a paper on our research in their upcoming publication.
• The next step in our development program is to humanize our patent-pending anti-cancer antibody drug. This humanization process is projected to take 4-6 months to accomplish by an outside laboratory specially equipped. The program is temporarily on hold awaiting access to the required funding to proceed.
• After the humanized anti-cancer antibody drug is available, we will engage in extensive and expensive testing on humanized laboratory animal forms and, if successful as anticipated, move to possible pre-clinical trials on humans after safety and efficacy are established.
• Completion of all of the clinical trials and pre-market development required for certification by the FDA would require extensive capital that is currently not available to the company. Our most logical approach would be to receive offers from large pharmaceutical companies which have the means and capital necessary to complete the development program. In the past, we have been contacted by two large pharmaceutical companies seeking information on our development program; therefore, we are confident that superior performance in laboratory tests followed by aggressive publication of our results will culminate in offers to license our technology for a fee.
• Our very promising initial work on finding a potential cure for PTSD/CTE is in a similar situation — awaiting sponsorship from organizations with a vested interest in a viable cure; i.e., large sports organizations and/or the military.
• Of the several patents that Premier Biomedical has licensed (three issued patients, one European PCT, and approximately ten pending patents), one issued patent covers the unique combination of two synthetic ingredients believed to be an extremely effective pain formulation. Because these ingredients are synthetic, FDA approval will be required prior to market introduction.
• Our strategy from the beginning was to utilize our patented formulation for a pain relief product as a “cash cow” to fund the very expensive work in our Immunotherapy and Biologics research at UTEP.
• Our patented pain formulation consisted of two synthetic ingredients previously approved individually by the FDA. We approached the FDA seeking certification approval of the patented compound and were disappointed to discover that the required series of testing would entail up to two years of testing duration and up to $10 million in cost.
• Our alternate strategy was to seek off-shore partners to help finance the certification with their home country FDA with subsequent approval in the United States. The cost and timing to obtain certification presented a barrier to successful off-shore alignments.
• The most recent developments in the United States associated with opioid addiction – 28,000 opioid-related deaths annually in the U.S. alone – dictated our latest strategy alternative to enter the blossoming pain management market in the United States using all natural ingredients, 50-state legal, opioid-free products that do not require prior FDA approval.
• The obvious problem was our entry into this market required expertise, capital, and experience that we did not possess. To overcome this shortcoming, we engaged in a search for an ideal partner and were fortunate to form a joint venture company with Advanced Technologies Solutions in San Diego, California. The Managing Director of this business, Mr. Ronald T. LaBorde, had developed a CBD-based, opioid-free, 50-state legal, all-natural ingredient formulation which precisely matched our goals.
• Our current business plan is to offer our patent-pending, 96-hour pain relief patch, which we believe is the best in the industry, and a roll-on applicator, for sale on our website, www.painreliefmeds.com, beginning January 2, 2017. Additional pain relief products, including creams, sprays, gel pens, and capsules/pills (Pain-ExTM) will follow later in the year.
• Our marketing plan recognizes the fact that pain relief/management products are intended to help chronic pain sufferers, such as the elderly and current and past contact sports participants. With our limited budget, we have decided to focus on advertisements in Central Florida and in players’ association publications. We have also distributed sample products to the Arthritis Foundation in Northern Florida and select healthcare professionals as well as other contacts in the pharmaceutical industry. We will continue to attempt to seek possible distributions through established pharmaceutical and other retail outlets.
• Incorporation of our patented synthetic pain management components into capsules/pills will most likely require FDA approval and be marketed under the name Pain-Ex2TM.
• We are particularly excited about entering into this pain management industry, as the current world market for this entire segment of the healthcare industry is $112 billion annually!
• Ronald LaBorde and I attended a cannabis industry conference in Las Vegas in mid-November of 2016 which was attended by over 10,800 people and included almost 400 exhibits. Just a few years ago, there were only 420 attendees at this conference, so this is an industry with explosive growth potential.
• We have organized the company into two principal divisions:
- Immunotherapy and Biologics Division
- Pain Management Division (Premier Biomedical Pain Management Solutions, LLC)
• Patricio Reyes has been appointed Chief Technical Officer, along with his previous position on our Scientific Advisory Board.
• Heleno Souza has been appointed to the Scientific Advisory Board in recognition of his expertise and key contacts in Latin America.
Stock Price Recovery Program.
• Our stock price has suffered terribly as a result of dilution and overselling the market by conventional lending organizations.
• In the past, we had as many as five toxic lenders at one time, and the results were disastrous. We have reduced the number of lenders to only one, and our plan is to minimize convertible debt by judicious use of capital, recognizing their sell rate is faster than we are borrowing, coupled with the revenue producing sales of our pain management products beginning in January, 2017.
• I want to reiterate the obvious for those few who believe PBI management is enriching themselves through the sale of stock: No active board member, or member of management has sold even one share of Premier Biomedical stock. Because we are a publicly traded company, any such sale of stock by an insider necessitates immediate public disclosure through the SEC. Moreover, no active member of PBI management has received one penny in compensation for services rendered. There are no financial bonuses or company cars for any member of management. All members of management, including board members, have contributed considerable sums of money, time and effort toward the success of this company. Their only compensation is by receipt of stock warrants priced significantly higher than the current market, thus giving them incentive to insure the success of the company.
• We didn’t arrive at this sub-performance stock position overnight, and we are not likely going to pull out of it overnight either. The current business plan that we have enumerated above is very sound and will result in a stock valuation more in-line with its true potential value over time. We believe the path we are on will increase the value of the company, provide revenue from the sale of Premier Biomedical Pain Management Solutions products, and enable us to supplement our sales revenue with borrowing at a much less dilutive stock level. Again, I will restate our confidence that this will happen over time. We have been approached to consider a reverse split to artificially prop up the stock price in the short term. We are resistant to this proposal since there are too many examples where reverse splits result in lost value to the stockholders.
• We are also currently considering other strategic acquisitions and or alignments that will benefit our company on a world-wide basis. It is too early to discuss specifics at this time, but we will keep you apprised via press releases, emails, website postings and CEO letters as developments warrant.
We thank you for your continued support and wish you and your family a very Merry Christmas and a Happy, Healthy, and Prosperous New Year!
William A. Hartman
President and CEO
Premier Biomedical Inc.