Provectus Pharmaceuticals, Inc. (PVCT-OTC:BB)
Interview with: H. Craig Dees, PhD,
CEO
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Provectus Pharmaceuticals has developed a therapy that will allow oncologists to shrink tumors without radiation, carcinogens chemicals or surgery



Healthcare
Pharmaceuticals
(PVCT-OTC:BB)

Provectus Pharmaceuticals, Inc.

7327 Oak Ridge Hwy.
Knoxville, TN 37931
Phone: (865) 769-4011



H. Craig Dees, PhD
Chief Executive Officer

Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
February 24, 2005

BIO:
Craig Dees, Ph.D. Ė Chief Executive Officer


Craig Dees, Ph.D., has spent more than 20 years in senior management positions at Photogen Technologies, Inc.; the Oak Ridge National Laboratory; LipoGen, Inc.; and TechAmerica, Inc. Dees was a founder, senior scientist and founding director of Photogen before Provectus was formed. His responsibilities have included product design and development in the fields of ethical vaccines, cosmetics, human diagnostics and over-the-counter pharmaceuticals. His development record includes the first live viral vaccine produced by recombinant DNA technologies and the first recombinant antigen human diagnostic assay. Dees has also successfully licensed a number of proprietary cosmetic products. In addition to design and development activities, Dees has been responsible for business and market applications, regulatory affairs, and commercialization of human and veterinary medical products. Awards include an R&D 100 for an industrial enzyme, an Inventorís Forum New Product Award for a skincare product, and a First Saber Award for outstanding research in virology. Dees holds a Ph.D. in molecular virology from University of Wisconsin, Madison. He earned his master of science degree in immunology from Auburn University, and his bachelorís degree in microbiology from Brigham Young University.

Company Profile:
Provectus Pharmaceuticals, Inc. (OTC Bulletin Board: PVCT) is a pioneering pharmaceutical company actively engaged in the design, development and marketing of a diverse portfolio of leading pharmaceutical technologies for the treatment of liver, breast and prostate cancer. In addition, Provectus has developed treatments for skin diseases and psoriasis, as well as developed a variety of other over-the-counter skin care products. Provectus' experienced management team, comprised of several leading scientists, developed and own 12 U.S. patents, and currently are seeking approval for 19 patent applications.

CEOCFOinterviews: Dr. Dees, what was your vision when you started Provectus, and where are you today?
Dr. Dees: "We are close to our strategic plan. We are lucky enough to be working in an area where tremendous economic returns are possible and we are also able to do good for people. We set out to revise how medicines were built and to make them safer and improving their efficacy and also be cost-effective. The companies strategic plan is a little different; instead of going ten years before break-even, we have an OTC division where we have the over-the-counter products, which will help bring us to revenue-positive this year we hope and to stop further dilution of stock and then we will support the longer term bigger ethical products. I would say we are very much on track for that, so we are very excited."

CEOCFOinterviews: What are the areas you are working in today?
Dr. Dees: "We have a number of things; some devices and biotech but those are not our core technologies. Our focus right now is an anti-cancer drug, which has us very excited. What is very different about it is that people have tried to fix the side-effect problems and efficacy problems. Traditionally, the medical community has treated cancer as we use to treat other diseases like Malaria. We would poison it with something like arsenic and with about one out of a hundred patients; we would get a miraculous cure. Nine we would kill with arsenic and the other ninety we would make really sick and not help them. The cancer therapies that are being used today are very primitive; we will hack off a part of your body, mutilation, with loss of function, followed by poisoning with radiation and chemicals. The problem with the chemicals and radiation is that they are very horrific carcinogens; you may get cancer years later from the treatments. The problem is they just donít target the disease. There has been some unwieldy solutions attempted like using monoclonal antibodies or encapsulation techniques. It is very limited and they donít work on all tumors. What we do at Provectus Pharmaceuticals is make that a small molecule that has virtually absolute specificity for diseased tissue, so you have no pain, no side-effects. There may be a hole where the cancer used to be but nothing else. It is amazing, side-effect free and painless."

CEOCFOinterviews: How did you decide to attack cancer from this unique perspective?
Dr. Dees: "People assume that cancer has a unique marker and it really doesnít. When you go after a cancer it is not like an alien space invader that is totally different in bi-chemistry like a microbe. They may increase the number of lipo-protein receptors or folate (vitamin) receptors, but there is generally no unique markers. We realized that with a very different phenomenon what the sick cells were doing. At Provectus we knew how we could make a chemical solution to it; a very easy-fix solution. Since we know how it works, we have a very rapid screening test; we can screen pre-existing compounds, I donít have to design a new one, we can use one that the FDA approved for someone else and that speeds up the process. We know something unique about the membranes of  the cancer cells. Its so specific that we can prevent cancer from occurring too. We have data in mice that get colon cancer. They have been genetically modified to do that. We let the mice drink the drug at high dosages. The mice drinking it never get colon cancer and after 28 or 30 weeks, all the others are dead. It is 100% too. Essentially, once you solve this problem, at high dosage, it prevents cancer from happening. People think it is too good to be true and when we have scientists fly down from New York and they see this data, their mouths drop open. I say if you stayed all day or two days you would only a fraction of the data and it will pass anybodyís scrutiny once they look at it."

CEOCFOinterviews: Where are you in the process of getting it to people?
Dr. Dees: "We hope it is going to be a relatively short process. People forget that the mandate of the FDA is almost like the Hippocratic Oath; first is do no harm.  Meaning that they are first concerned for our safety, which is a good thing. Our very first compound is an old drug or old compound, which was abandoned for use years ago and we screened for it. The FDA has already approved it for IV injections and use in the eyes, so that hurdle is already over. The quality control tests to release it are done, the stability tests are done. All we have to do is go to the FDA in the clinical trial process and say we are going to use this drug for something different. We are working with in two different areas. In oncology, we have just had and IND allowed for doing breast cancer and melanoma. After that, we will add liver cancer. We just signed a contract with Clinimetrics, a global, full-service contract research firm that serves the pharmaceutical, biotechnology and medical device industries and started the process that call for the first patients. We will have the Phase I studies, the first humans, starting very shortly. Interestingly enough, the first Phase I study is not only a dose escalation safety study, but we have been allowed to increase the dose up to efficacy levels, which normally you donít get to until Phase II. We will get efficacy data in Phase I, so we are already compressing the process. In the first half of the year, you will see the first human patients treated.  It has already been in human use in pre-clinical studies in Denmark, at Aarhus University years ago with Peter Berry, a foremost dermatologist, and has already completed pre-clinical with psoriasis with very nice results. Phase I trials have been completed at multiple sites in the US. It is ready to go to Phase II. That is where we are."

CEOCFOinterviews: Why breast cancer first?
Dr. Dees: "I have been in breast and womenís cancer for years. If you look at the number of patients impacted in the U.S; one in seven or one in eight are going to get breast cancer. I have walked through a room at meetings and asked and numerous women will put up their hand and say, ďI have already had breast cancer.Ē It is one of the major killers behind heart disease and a tremendous impact on the health of woman world wide. In the past there were huge radical mastectomies done. Now they are attempting tissue-sparing surgeries after attempting to shrink the tumors with radiation and chemotherapy before surgery. With Provectus Pharmaceuticals' therapy, you can reach in, put the drug in the tumor and shrinks the tumor. No chance of cancer from the drug.Ē

CEOCFOinterviews: In what other areas is Provectus involved?
Dr. Dees: "One of the questions people ask is if it will work in humans, and we say will it work in spontaneous tumors. The real question is will it work in spontaneously occurring tumors or naturally occurring tumors and the answer is, yes, it will work. We have already been over that hurdle, because it has been used in a number of veterinary patients with spontaneous arising tumors. We have some pictures of a mouse with some huge breast tumors on her and then a picture afterwards where they are completely gone. About 5 years ago our first patient was Rookie, a three-and-a-half year old Shepard that had a sarcoma up in her nose. She had been treated with $8 thousand worth of surgery and radiation nine months before we saw her. Her owners were told to take the dog home because the tumor was back and she would not survive. However, after treatment with our drug I have the oncologists discharge report that says that it's a miracle. It really wasn't, because are drug was designed by a smart chemist and chemical engineer and a biologist. The drug did what it was designed to do that caused the tumor in Rookie to go away. She lived another four or five years after that, to be a pretty old Shepard.

One of the really funny things is when the veterinarian used a very small amount of our drug he kept apologizing and apologizing and I finally said, 'what's the matter'? He told me he used it all up. He was thinking that he had used up a $100 thousand or $200 thousand experimental drug. I laughed and told him that we were truly inventors in here, but we did not invent something that only Bill Gates could use. I looked at the bottle, I had one hundred milliliters of it, ten times more than he had used and I said, 'this bottle cost 17 cents, the label costs a nickel, sterile fill might be a buck total; so you may have used a tenth of a cent on that dog'. Now that's a real invention, one that can actually bring down the cost of fighting breast cancer. We hope it does just as well in the human trials. We also hope to do liver cancer where with current therapies there is about a 30% survival rate at five years. Those are not acceptable odds. We hope to do those where we can reach in and directly ablate them. Outside of the U.S., they are using direct ethanol, which we hope to make that way better. Most liver cancer is outside the U.S. Cirrhosis from the U.S. is usually from drinking and hepatitis. Most of the people outside the U.S. cannot pay $80 thousand or $200 thousand dollars for surgery. However, our drug they can use."

CEOCFOinterviews: You talked about your over-the-counter product; what is happening for you in this arena?
Dr. Dees: "We are excited with that and it has really started to take off the. In the last quarter, we have probably doubled the amount of stores we are in. We hope to get into a number of new large chains this year."

CEOCFOinterviews: What are you selling?
Dr. Dees: "It is an anti-bacterial/anti-viral hand spray. There is a major market out there for a gooey sort of gel. One of the ways you can get a cold virus is to touch the phone headset where others have picked up the phone, a television remote in a hotel room; the toilet is actually cleaner. The amount of organisms around a hotel room will astound you. It leaves a barrier to re-infection and from bacteria growing back. We have taken a competitorís gooey gel put it on a surface, washed it three times and did the same thing with our spray. I would put 500, 000 antibiotic resistant ďnasty, flesh-eating staphylococcus on the treated surfaces. Where the competitorís gel was, I get all of them back, where our stuff is, you get zero back."

CEOCFOinterviews: What are your challenges going forward?
Dr. Dees: "One challenge is the explosive growth on the OTC side, being able to manage it, and the advertising. We are negotiating with a big marketing company to take care of that.  For example, a very big chain store approached us for 4000 new stores in 2005. We are adding on help to try and take advantage of these growth opportunities. There is nothing worse than receiving the orders and not be able to get them into the stores, or to get them into the stores and not have the advertising in-place. We have already taken care of that, anticipating the growth.  On the ethical side, we are quite certain about the technical performance of the drug. But there are potential problems outside of our control. For example, you have to call for patients, what if nobody there has liver cancer; there may be a delay that you donít have control of. You are going to a regulatory agency and they have their own agendas and things they want to see. We are very good at anticipating that. Even then, they may think of something else that they want to see done. When you are doing diseases, it is not like when you are doing animals here; I create the disease you canít do that with humans, you have to wait for it to appear. Those are probably the two biggest challenges."

CEOCFOinterviews: What would you like to say to potential investors?
Dr. Dees: "They approach us once they get a good look at our analysis of the net worth of our properties. We have a tremendously deep patent portfolio and its growing. We have thirteen issued patents and a number of allowances as well as nineteen or twenty more in the pipe in the process. We are deep in property. We had to do a survey of the things we had on the books. Our external auditor had us prove it to them. We had it booked at that time for $20.5 million. We did a very conservative analysis of the business. We did not even put in any OTC. We did one cancer, psoriasis, and we came up with the number of $406 million. That was before multiple more patents had been issued and before we got the new IND. That is now obsolete. If you look at our number of shares outstanding which is only 15.9 million, and divide it into 400-600 million, you immediately see that we are one of the most undervalued stocks out there."

CEOCFOinterviews: In closing, do you do much outreach to investors?
Dr. Dees: "We speak to people all the time. We speak to the fund managers in New York and other places. We will go to Europe to speak to them as well. People that have seen what we are doing, know the under-value. People approach us all the time. We just made a raise here of high net worth individuals. We actually did it about 20 cents over the stock price. Once people do get a look they agree with us on the under-value. They look at the data and at us and realize we have two good old-fashioned values and that is making products that people want and need and we have good margins. Plus, we are tremendous believers in hard work and honesty.Ē


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"Our very first compound is an old drug or old compound, which was abandoned for use years ago and we screened for it. The FDA has already approved it for IV injections and use in the eyes, so that hurdle is already over. The quality control tests to release it are done, the stability tests are done. All we have to do is go to the FDA in the clinical trial process and say we are going to use this drug for something different. We are working with in two different areas. In oncology, we have just had and IND allowed for doing breast cancer and melanoma. After that, we will add liver cancer. We just signed a contract with Clinimetrics, a global, full-service contract research firm that serves the pharmaceutical, biotechnology and medical device industries and started the process that call for the first patients. We will have the Phase I studies, the first humans, starting very shortly. Interestingly enough, the first Phase I study is not only a dose escalation safety study, but we have been allowed to increase the dose up to efficacy levels, which normally you donít get to until Phase II. We will get efficacy data in Phase I, so we are already compressing the process.Ē - H. Craig Dees, PhD

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