Nutra Pharma Corporation (NPHC-OTC: BB)

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October 23, 2009 Issue

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Nutra Pharma Is Developing A Unique Drug Platform Using Peptides From Cobra Venom For The Treatment Of A Variety Of Indications, Including Adrenomyeloneuropathy (AMN), Multiple Sclerosis (MS), HIV, And Chronic Pain

Company Profile:

Nutra Pharma Corp. is a biopharmaceutical company specializing in the acquisition, licensing and commercialization of pharmaceutical products and technologies for the management of neurological disorders, cancer, autoimmune and infectious diseases. Nutra Pharma Corp. through its subsidiaries carries out basic drug discovery research and clinical development and also seeks strategic licensing partnerships to reduce the risks associated with the drug development process. The Company's subsidiary, ReceptoPharm, Inc., is developing these technologies for the production of drugs for HIV and Multiple Sclerosis ("MS"). The Company's subsidiary, Designer Diagnostics, is engaged in the research and development of diagnostic test kits designed to be used for the rapid identification of infectious diseases such as Paratuberculosis (para-TB) and Mycobacterium avium-intracellulare (MAI). Nutra Pharma continues to identify and acquire intellectual property and companies in the biotechnology arena.

Rik J Deitsch

Chairman and Chief Executive Officer
Nutra Pharma Corporation

Rik J. Deitsch has been the President, Chief Executive Officer and a Director of the Company since November 7, 2002. From February 1998 through November 2002, Mr. Deitsch served as the President of NDA Consulting Inc., a biotechnology research group that provided consulting services to the pharmaceutical industry. NDA Consulting specialized in the research of peptides derived from Cone Snail venom, Cobra venom and Gila Monster venom. Mr. Deitsch holds both a B.S. in Chemistry and an M.S. in Biochemistry from Florida Atlantic University and has conducted clinical and laboratory research in collaboration with scientists at Duke University Medical Center and the Cleveland Clinic. Mr. Deitsch is an adjunct professor and teaches several courses for Florida Atlantic University's College of Business and Continuing Education Department.


Services
Biotechnology
(NPHC-OTC: BB)


Nutra Pharma Corporation
1537 NW 65th Avenue
Plantation, FL 33313
Phone: 877-895-5647

 

Interview conducted by: Lynn Fosse, Senior Editor, CEOCFOinterviews.com, Published – October 23, 2009


CEOCFO:
Mr. Deitsch, you have been CEO for Nutra Pharma a number of years; what was your vision for the company and has that changed?

Mr. Deitsch: Our vision has remained the same since I took over Nutra Pharma. We continue to seek interesting property, what I call diamonds in the rough. There are some amazing biotech companies, medical device companies, and individuals in the field. There are many companies that are either under-capitalized and/or poorly managed. If they had decent management and access to capital there is no telling what they could accomplish. Over the years, we have acquired these properties. We have acquired medical device technology and put it into our Designer Diagnostics subsidiary and acquired drug discovery technology and put it towards ReceptoPharm. Over the years, we fleshed out that business plan to the point where we now have marketable products and devices and drugs.

 

CEOCFO: Is there a common thread among your past acquisitions and future target acquisitions?
Mr. Deitsch: In the past, we have always looked at untapped marketplaces, especially disease states that were unmet by the current medical devices or drug therapies. For example, one of our primary drug indications is Adrenomyeloneuropathy (AMN), which is a fatal orphan disease with 30,000 patients globally and no treatment options. Big pharma is just not paying any attention to it and we had an opportunity to change lives by helping these people through our drug platform. Similar to Multiple Sclerosis (MS), it is a demyelinating disorder. Working with AMN patients provides a great rationale to other demyelinating disorders, such as Multiple Sclerosis (MS) and Adrenoleukodystrophy (ALD). Our work with AMN allows us to grow the company and, at the same time, help people. Our goal is to build Nutra Pharma to be fiscally responsible, but also help as many people as possible while we are doing it.

 

CEOCFO: What is a demyelinating disorder?

Mr. Deitsch: A demyelinating disorder is the condition where the myelin sheath, the insulation around your nerves, deteriorates. There is a variety of different disorders like that. Imagine that your nerves are like electrical wires. If you strip the insulation off an electrical wire, it will not carry a charge. Similarly, the myelin is the fatty sheath around a nerve that insulates the nerve. When that fatty sheath is gone, your nerves will not function.

 

CEOCFO: Has your business plan changed over the years?
Mr. Deitsch: Our business plan has changed. At first, we would license and buy small parts of companies, but we have evolved to the point where we have acquired a wholly owned drug discovery subsidiary, ReceptoPharm, and have acquired the technology in our medical device subsidiary, Designer Diagnostics. Any further acquisitions we are going to make will be a whole acquisition of the company and its technology.

 

CEOCFO: Would you tell us about Cobroxin?

Mr. Deitsch: Cobroxin is for the treatment of moderate to severe chronic pain. We have been studying pain for several years, but it was not our primary application. It was simply an indication we were working on as part of our background technology for our drug platform. More recently, we published a study that we were conducting at Soochow University in China that showed that our pain drug outperforms morphine in an animal model. In fact, it lasted four times longer than morphine and was more than twice as effective. If you match it against morphine molecularly, there is so little Cobra venom peptides needed that Cobroxin was actually 600 times more potent than morphine. That really was a revelation for us and told us we needed to move in this direction. Additionally, because the amount of peptides utilized are so few, it qualifies as a homeopathic drug in the United States, under the United States Homeopathic Pharmacopoeia. This allowed us to bring it directly to market as an over-the-counter pain drug.

 

CEOCFO: If Cobroxin can accomplish the same pain relieving effects of morphine, but without the side-effects, that is huge!

Mr. Deitsch: It is absolutely huge! But understand this it is not a new idea, as Cobra venom has been used for literally thousands of years in China as a therapeutic agent for a variety of different purposes with a variety of different extracts. We have been studying different proteins from various animals including the Cobra for the last ten years. Additionally, Cobra venom had been used as a painkiller even by the United States government. It was used by soldiers during World War II, but when cortisone became popular and then other pain killers became accessible, people just stopped using Cobra venom. I think the biggest reason it stopped being used in the 1940s and 1950s was that it lacked standardization. We didn’t have the tools back then to measure the amount of peptides, the type of peptides that were in it and contamination, such as bacterial and fungal contamination. We also did not have the tools to properly clean, sterilize and standardize the solution, so you wound up with bad batches and ineffective batches. Now, with the technology we have today, we can tell you exactly what is in every batch and verify that it is sterile, clean and is going to be effective. We are really bringing back an old technology with a new delivery system that will make the product successful in the marketplace.

 

CEOCFO: What are your plans for marketing and distributing Cobroxin?

Mr. Deitsch: We have outsourced this to a company called XenaCare Holdings, which will do all of the marketing and distribution in the United States. They start their marketing campaign in November (2009) and our Cobroxin product will be on store shelves as an over-the-counter treatment for Stage 2 pain, which is chronic persistent pain. When I say Stage 2 that is a little hard for people to understand. Stage 2 pain is pain that interferes with either sleep and/or work. For the most part people are taking a prescription of Vicodin, Percocet, or Oxycodone. Cobroxin gives them a new choice for an over-the-counter product that is non-narcotic, non-addictive, non-opioid, and is relatively inexpensive compared to many of the other alternatives. We will roll out in the United States with XenaCare, but we are continuing to seek distributors in other countries. We expect a full national rollout by January through television commercials and advertising and then we are looking at expanding to Canada, Australia, Europe, and South America throughout 2010.

 

CEOCFO: How do we know there are no side-effects?

Mr. Deitsch: There were 46 published studies on the use of cobra venom and this particular dilution of cobra venom since the early 1900s. All those studies are available on the drug’s website, www.Cobroxin.com so people can see the clinical safety profile. Additionally, as a homeopathic dilution, it is considered safe and non-interactive. Because the active components are peptides, they are not toxic to the liver. They get absorbed very easily, so there are no issues with GI distress unlike the NSAIDS: aspirin, ibuprofen and naproxen. It eliminates the GI issues, the liver issues you get from Tylenol based products and acetaminophen products and it eliminates all the narcotic effects from opiates. Conservative estimates in the clinical studies suggest that it will be at least 80% effective, but there will be some people that will be resistant to it, so there are still going to be some people that are going to need to use these other products.

 

CEOCFO: What else is in the pipeline?

Mr. Deitsch: This is where I really want to make sure people understand that Nutra Pharma is a platform company. We have technologies that will allow us to launch a variety of different drugs for different indications over the next ten years. Our primary indication after pain is Multiple Sclerosis. We have been studying Multiple Sclerosis for more than ten years and have an incredible drug that has shown in open-label clinical studies to reverse the symptoms of Multiple Sclerosis. There is currently no drug available on the market for the treatment of Multiple Sclerosis that reverses those symptoms. All of the drugs for MS only slow the forward progression of the disease and have many side effects. Our drug has been through Phase I trials and has shown in early open-label clinical studies to not only have a very limited amount of side-effects, but, in many patients, reverse the symptoms where people can start to live normal lives as long as they stay on the drug. It is our goal over the next twelve to eighteen months to initiate Phase II clinical studies in Multiple Sclerosis and then seek a licensing partner for the Phase III study or to begin a Phase III study and to market the drug ourselves.

 

CEOCFO: What are you doing with your medical device division, Designer Diagnostics?

Mr. Deitsch: In Designer Diagnostics, we have eleven patents for test kits for the rapid identification of mycobacteria, which are a specific type of bacteria that is very hard to culture and very hard to grow. In fact, there was an article recently about people getting mycobacterial infections through showerheads, especially women that take long hot showers and breathe in steam. These infections are terrible because they can be fatal. The worst part is they are very hard to diagnose. The bacteria grow so slowly that a normal test for something like Paratuberculosis can take 10 to 12 weeks. With our test kits, it takes less than 10 days. Therefore, we greatly cut down the amount of time it takes to test for some of these infectious agents. In addition, Mycobacterium avium complex (MAC) is one of the leading causes of death among AIDS patients. It causes AIDS wasting syndrome and by the time it is discovered in an AIDS patient, it is far too late to treat the patient and it becomes a fatal condition. With our test kits, you can test an AIDS patient on a monthly basis and, in less than 10 days, have an answer. If the patient has Mycobacterium avium complex, you can treat that before it becomes an issue.

 

CEOCFO: What is the financial picture of Nutra Pharma today?

Mr. Deitsch: For the last three years, we have been financing the company internally and through small private placements. It always looked like we had no money because we never wanted to raise more than we needed, especially when our share price was so low. Now we are in a great situation because we are no longer pre-revenue; we have a revenue stream. Even before Cobroxin, we started utilizing our lab space and clean room to do clinical research (CRO) services for other companies and that brought in a few hundred thousand dollars through Clinical Filling and CRO services. Additionally, we now have Cobroxin and rough estimates are, even at a minimum, several hundred thousand dollars a month in sales. This should certainly cover our burn rate and our future clinical trial expenses. If Cobroxin does what we expect it could do and capture a percentage of the market, it could certainly fund us without any need for capital raises in the future.

 

CEOCFO: A very exciting time!

Mr. Deitsch: It is a great time for Nutra Pharma and I just hope everyone keeps watching us and see how we do.

 

CEOCFO: Is the investment community starting to pay attention?

Mr. Deitsch: It is, but we are still considered a penny stock even though we have gone from $0.02 a share to $0.55 a share over the last seven months. As such, many analysts won’t touch us and many people won’t watch us as a company. However, what is so funny is that as we generate revenues and this company grows and becomes even $4 or $5 a share in the years ahead, suddenly all these analysts will discover us and think that ‘oh what an overnight success.’ They do not realize it might have been a much better investment at $0.02.

 

CEOCFO: Why should potential investors choose Nutra Pharma out of the crowd?

Mr. Deitsch: I would say that of all the sectors out there, biotech is the sexiest sector. With drug discovery, with the aging population, with the understanding of diseases that we never knew before, biotech is really a draw for well-informed investors. When you look at biotech, the biggest problem is the burn rate and the fact that 99% of biotech companies are pre-revenue, as they are R&D level companies. Here we have a company that is already in revenues, paying their bills, and that is going to stop, cease or greatly reduce the possibility of dilution now and in the future. When you consider that, we stand head and shoulders above any other small biotech companies in our field.

 

CEOCFO: What would you like to say in closing?

Mr. Deitsch: If people want more information about Nutra Pharma, I invite you to visit our corporate website at www.nutrapharma.com. For more information on Cobroxin, we have detailed product information available at www.cobroxin.com. Finally, in addition to Cobroxin, we will be launching a prescription drug called Nyloxin in late-2009. This prescription medicine will be for people with severe Stage 3 pain. We will continue to release information about Nyloxin over the coming weeks.

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In the past, we have always looked at untapped marketplaces, especially disease states that were unmet by the current medical devices or drug therapies. For example, one of our primary drug indications is Adrenomyeloneuropathy (AMN), which is a fatal orphan disease with 30,000 patients globally and no treatment options. Big pharma is just not paying any attention to it and we had an opportunity to change lives by helping these people through our drug platform. Similar to Multiple Sclerosis (MS), it is a demyelinating disorder. Working with AMN patients provides a great rationale to other demyelinating disorders, such as Multiple Sclerosis (MS) and Adrenoleukodystrophy (ALD). Our work with AMN allows us to grow the company and, at the same time, help people. Our goal is to build Nutra Pharma to be fiscally responsible, but also help as many people as possible while we are doing it. - Rik J Deitsch

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