Proteonomix, Inc. (PROT-OTC: BB)

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August 22, 2010 Issue

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With Strong Synergies Between Their Five Subsidiaries Leading To The Development And Production Of New Products In The Area Of Cosmecuticals And Cell Regrowth For Cardiovascular Disease, Proteonomix, Inc. Is Well Positioned In The New And Growing Area Of Regenerative Medicine

Company Profile:
www.proteonomix.com

Proteonomix, Inc. is a biotechnology company focused on developing therapeutics based upon the use of human cells and their derivatives. Proteoderm, Inc., a wholly owned subsidiary of Proteonomix, has recently opened its retail web site, Proteoderm.com, and began accepting pre-orders for its anti-aging line of skin care products. StromaCel, Inc.'s goal is the development of therapeutic modalities for the treatment of Cardiovascular Disease (CVD). StromaCel, Inc. is pursuing the licensing of other technologies for therapeutic use. National Stem Cell, Inc. is Proteonomix's operating subsidiary. The Sperm Bank of New York, Inc., engaged in reproductive tissue banking, including sperm, ova, ovarian tissue and testicular tissue, is a subsidiary of National Stem Cell, Inc. Proteonomix Regenerative Translational Medicine Institute, Inc. ("PRTMI") intends to focus on the translation of promising research in stem cell biology and cellular therapy to clinical applications of regenerative medicine. Proteonomix intends to create and dedicate a subsidiary to each of its technologies.
 

Michael Cohen, President, Chief Executive Officer and Chairman of the Board.
Michael Cohen has served as our President, Chief Executive Officer and Chairman of our board of directors since September 12, 2006. Michael Cohen began his career as a paramedic for NYC EMS in 1989. He joined Americorp Securities as a Vice President in its mergers and acquisitions department in 1994. He was instrumental in launching a number of successful IPOs at Americorp Securities. He was recruited by Dafna Construction in 1995 as its CFO and played a principal role in its growth and subsequent purchase. In 1997, Mr. Cohen joined Citigroup as a Vice President of Corporate Finance and managed a department in the risk management division of Salomon Smith Barney. In 2002, Mr. Cohen founded National Stem Cell Inc, our operating subsidiary. Mr. Cohen serves as our Chairman of the Board and President as well as the Principal Investigator for most of our therapeutic developments. Mr. Cohen attended Skidmore College and graduated with a Bachelor of Science from Haifa University in 1988.
 

Interview conducted by: Lynn Fosse, Senior Editor, CEOCFOinterviews.com
Published – August 22, 2010

Healthcare
Biotechnology
(PROT-OTC: BB)

Proteonomix, Inc.
187 Mill Lane
Mountainside, NJ 07092-2909
Phone: 973-544-6116

Print Version

CEOCFO: Mr. Cohen, what was your vision for Proteonomix when you started, and where are you today?

Mr. Cohen: The vision for the company at its inception, which was approximately ten years ago, was based on two documents that I had written. The first document contended that the future of stem cell medicine or regenerative medicine would rely on identification that was based on something called Immunological isolation. The second was really something that was fundamentally more specific to a format of business that was a little different than what existed in the market. It was that any company that endeavored to enter into the regenerative medicine field would be required to have a multifaceted R&D department. For example, if you are attempting  to create a therapy for diabetes you needed to be a company that was going to be able to develop a medium in which to grow the cells, a medium in which to expand the cells, a method for the identification of the cells and then a mechanism to convert and deliver the cells as a part of a therapy. As I mentioned before these were the initial visions that started the company and that have led it to many incidental findings along the way. Today the company has five different subsidiaries that have come from the R & D developments that this company has achieved.

CEOCFO: From a business perspective, why have separate companies and not just groups within your organization?

Mr. Cohen: From a business perspective, it made absolute sense to separate some of our intellectual properties into five different subsidiaries. To begin understanding why we have done that separation, you have to understand that each of these individual products is not within the same field. For example, we have a product that is in the cosmeceutical field, which was an incidental finding from the work that we were conducting in cardiac therapy as well as diabetes R & D. However, it is not related from a business perspective and from a management perspective to cardiac therapy or diabetes research or any of the other business modalities that the company maintains. So as a corporate entity we made a decision that we were going to separate the businesses and the intellectual properties into subsidiaries where each one will be managed by a group of individuals that had the background in that particular field of the entity the managed. For example, Proteoderm, Inc. was created to really be the flagship for our cosmeceutical intellectual property, and it is managed by a team of individuals who come from that field. These are dermatologists, managers, and businessmen who have been involved in the cosmetics industry for many years. This format allows us to create subsidiaries that are very focused on their business.

CEOCFO: Would you tell us about your subsidiaries?
Mr. Cohen: We have several subsidiaries. Proteoderm, is our Cosmesutical division and has developed our first product to come to market Proteoderm NC 138. The product is unique because of the nature of its action on facial tissue StromaCel, Inc., is our newest subsidiary and focuses on cardiac therapy and is where StromaCel NC is being developed. StromaCel NC is a unique product that is based on technology that we have developed to assist in the regeneration of damaged myocardial tissue post MI. StromaCel NC is unique because 1) it has the potential to reduce myocardial inflammation 2) increase angiogenesis at the site of the MI 3) repair of damaged myocardial tissue. StromaCel NC is our first therapy and we hope to bring it to market as quickly as possible through formal FDA trials, as well as other business modalities that we have designed. Our other subsidiaries include SBNY (Sperm Bank of New York, Inc.), which is a tissue bank that is involved in the cryo-preservation of sperm, eggs and other tissues as well as in IVF (in vitro fertilization) procedures in the United States. SBNY is a revenue generating business we purchased SBNY in 2005 and have been developing it very slowly. From what we have learned at our laboratories and based on what we believe will be the future of cellular therapy we have created the PRTMI (the proteonomix regenerative translational medicine institute). The PRTMI has developed a mobile cellular laboratory. This particular business focuses on what we believe will be the future of cellular therapy. Cellular therapy differentiates itself from what we know as Pharmacological therapy. Pharmacology requires a single manufacturing plant to produce its drugs Cellular therapy, requires multiple sites in order to produce cellular products more efficiently but also more homogenous with the local population in which the facility services. For example, when we manufacture cells that we are going to use to treat patients in the Asian continent, we would like to produce a cellular product that will be closely matched to the Asian population. A PRTMI laboratory is a CGMP facility that manufactures cellular products under specified SOP and QAQC. SOPs refers to standard operating procedures and QAQC refers to Quality Assurance and Quality Control. We intend to build multiple facilities based on our current model throughout the globe. Once these facilities are operating, we intend to use them to produce multiple cellular products. Further, we intend to utilize these facilities to assist in our future clinical trials

CEOCFO: You have some moneymaking projects; what is the financial picture of Proteonomix today?

Mr. Cohen: The company has been in the red for several years because it was developing new innovative products. However, unlike other small research and development companies that are cash-hungry and tend to burn up cash. Our business model relied on internal growth and thus did not burn cash at a very rapid rate. We have reached a plateau in our development where we are looking forward for substantial revenue in the near future. Our Proteoderm division is projected to launch its first product this year. The product will launch in the United States first and then expended to the global market .We have already began to accept preorders online. StromaCel is seeking approval for its lead product globally. Further, the company has forayed into Medical Tourism in order to begin generating revenue. We anticipate that our cash flow will improve dramatically in the next year based on these two subsidiaries. In the long term, we anticipate that both these products as well as other products that we intend to bring to market as early as 2011, will grow our cash flow.

CEOCFO: So things are getting exciting for you!

Mr. Cohen: We believe that this is the tip of the iceberg if you will. We have been working for this particular moment for about ten years and our team is very excited..

CEOCFO: You recently became a bulletin board company; how has that changed things for you?

Mr. Cohen: It has been a very long and difficult process to get to this point. For many years did not look at the stock market as a major mechanism for finance. However, we are entering a new age where the growth of the company depends on its valuation and obviously on its ability to increase its disclosed information to the rest of the market. Therefore, by being a public company, we felt that moving to the Bulletin Board would be one mechanism in which we can validate ourselves to funds and banks and investors. The bulletin Board is an essential step in the ability of the company to reach other markets. (For example the Nasdaq).

CEOCFO: What would you tell potential investors about the company and what might they not understand that they really should?

Mr. Cohen: I think there is a general misconception of what this company is about, the misconception arises from the multiple businesses that company owns. I believe that most investors should be aware of the synergy that exists between our subsidiaries. For example, our R&D in our subsidiary National Stem Cell Inc., utilized material from our other subsidiary SBNY to develop products for our Proteoderm subsidiary. What we would like to express to potential investors is the fact that when you invest in Proteonomix you really invest in several companies that are leading the way into the age of cellular medicine. When you invest in Proteonomix, you invest in a synergistic business model that reduces the cost of development and increases revenue.

CEOCFO: Regenerative medicine is something people are looking at a lot, but there are also many people that still are concerned about stem cells and don’t understand. What do you say to people that are a little leery?

Mr. Cohen: The fear that makes someone leery of regenerative medicine is based on the notion of cloning and the destruction of life. Regenerative medicine utilizing stem cells is the first step toward the future of medicine In the early part of this decade Regenerative medicine was thought as a mechanism to recreate or rebuild tissue utilizing stem cells. The initial discoveries were based on embryonic stem cells, which demonstrated that a single cell can be replicated into every other cell in the body. Later studies demonstrated that other cells that are derived from a non-embryonic source might have the ability to do the same. The true future of regenerative medicine is yet to be demonstrated; it lies in something called the Proteome. The Proteome is the makeup of our genes. It is where we derive our name and where our future research is heading. Gene therapy is the future of regenerative medicine. Gene therapy will be able to correct malfunctioning genes that are responsible for many diseases internally. A recent publication of the Wall Street Journal, has begun to demonstrate the ability of this science. The future of regenerative medicine does not rely only on embryonic stem cells but rather on the corrections of our genes.
 

CEOCFO: Final thoughts, what should potential investors remember most about Proteonomix?

Mr. Cohen: Regenerative medicine and the potential of regenerative medicine really lies in the companies that have the foresight to develop technology and business model that will succeed in the new era of medicine. Proteonomix was developed specifically from that perspective. Potential investors should understand that our goal is to develop therapies that may be used in short term as well as long term solutions to diseases. We have achieved our initial goals by bringing to market our first products in a long pipeline of product. Further investors should understand that an investment in Proteonomix is and investment in a business model that has several companies in its portfolio.

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I believe that most investors should be aware of the synergy that exists between our subsidiaries. For example, our R&D in our subsidiary National Stem Cell Inc., utilized material from our other subsidiary SBNY to develop products for our Proteoderm subsidiary. What we would like to express to potential investors is the fact that when you invest in Proteonomix you really invest in several companies that are leading the way into the age of cellular medicine. When you invest in Proteonomix, you invest in a synergistic business model that reduces the cost of development and increases revenue. - Michael Cohen

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