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Current
Technology Corp.
– finding their technology for reducing hair loss applicable to women taking
chemotherapy for breast cancer as well as men
Healthcare
Spa Industries
(CRTCF:OTC)
Current Technology Corp.
800 West Pender Street -
Suite 530
Vancouver British Columbia, Canada V6CZVG
Phone: 800-661-4247
Robert Kramer
Chief Financial Officer
Diane Reynolds
Co Publisher
CEOCFOinterviews.com
September 2003
Bio:
Robert Kramer is the co-founder of Current Technology Corporation along with his wife Anne
Kramer. The company was formed in 1987 to research, develop and commercialize
eletrotherapeutic products for the treatment of hair loss. Mr. Kramer has more than
25 years experience in mortgage, corporate and securities financing. Prior to
co-founding Current Technology, he was a joint venture partner in an enterprise that
raised funding for approximately 20 public mining companies conducting exploration
activities in Western Canada. He has served as Chief Financial Officer and Director
of Current Technology since its inception. A graduate of the University of
California at Berkeley (B.A. Economics), he is a member of the Canadian Institute of
Chartered Accountants and earned his designation as a Certified Public Accountant in 2000.
Company Profile:
Current Technology Corporation has developed a patented electrotherapeutic device
which reduces excessive hair loss and can stimulate hair regrowth in those who suffer from
androgenetic alopecia (common baldness). ElectroTrichoGenesis, or ETG Treatment, the
regrowth of hair by means of electrical stimulation, promotes the “healing” of
hair follicles that are dormant, but not dead. Research has recently been conducted
to expand the indications for ETG. For example, a single center pilot trial to
assess the efficacy of ETG in the reduction of hair loss in patients with breast cancer
undergoing CMF chemotherapy has been completed with encouraging results. Psycho-Oncology, a peer reviewed medical journal,
published the results in the May/June 2002 edition (p.244-248)
Over the years, researchers and clinicians have
discovered that certain electrical frequencies and current values stimulate healing
responses in various parts of the body. For example, a research paper published in The Journal of Bone and Joint Surgery in May 1990
by J. W. Sharrard, M.D., University of Sheffield, concluded that electrical stimulation
significantly influenced healing in non-union fractures. In addition, a report
published in the British Journal of Dermatology
in 1992 presented evidence on the healing of recalcitrant venous ulcers by means of
electrical stimulation. Electrical stimulation is now an accepted medical treatment
in a number of specific areas.
The company has focused on developing a treatment for common baldness using electrical
stimulation. It has identified the electrical parameters that reduce excessive hair
loss and stimulate hair regrowth, and it has developed the treatment program. As
hair loss progresses, the hair follicle produces hairs in the normal
growing-resting-shedding cycle that are progressively thinner and shorter.
Ultimately only “peach fuzz” type hair is produced and then the hair follicle
goes into a dormant state prior to its demise. ETG Treatment alters this dormant
state by stimulating the production capability of the follicle and thereby reducing
excessive hair loss and encouraging regrowth.
CEOCFOinterviews: Mr. Kramer, please describe your company
and what it is doing today.
Mr. Kramer:
“Current Technology Corporation was founded in 1987 by my wife Anne Kramer and
I. The name of the company was chosen quite specifically to reflect our primary
interest in electrotherapeutic products as well as to reflect the current or up to
date nature of our technology. We have for a number of years devoted ourselves to
developing a patent protected technology platform that is centered on a product called
ElectroTrichoGenesis (ETG) that delivers a proven treatment for hair loss.”
CEOCFOinterviews:
Exactly how does this work?
Mr. Kramer: “Over
the years it has been known in medical literature that the use of electro stimulation on
the human body has various positive affects. For example, there are several
eletrotherapeutic products today out in the marketplace that are used to treat
subcutaneous ulcers or bed sores and other products that you may be familiar with that are
used in physiotherapy applications to treat, amongst other complaints, muscle-related
issues. We have focused on the issue of hair loss and have delineated the specific
frequencies and current values in an electrotherapeutic product that has been proven to
stop excess hair loss and stimulate re-growth.”
CEOCFOinterviews: How
many treatments would one need to see some results?
Mr. Kramer: “Good question. The first thing that one
must understand is that this is a treatment and not a cure so you have to keep taking
treatments to maintain the benefits. When you start the process you would
expect to see the early signs of less hair in the shower or less hair on the pillow in the
two to three month range. Typically by the third or fourth month, you would start to
notice some new growth.”
CEOCFOinterviews: Does
it work for all patients?
Mr. Kramer: “Nothing works for everyone but our therapy
has been subjected to multi centered clinical trials and the results have been published
in peer reviewed medical journals. By the way, this is very important for your
readers to understand. It has a very high level of success from a statistical standpoint.
For example, in one of the clinical trials that have been published, over 96% of
the participants in a double blind study who were taking the active treatment either had
no further hair loss or an increased hair count at the end of the 36 week clinical
trial.”
CEOCFOinterviews: Will
insurance companies cover this process?
Mr. Kramer:
“Typically the answer to that is no. ETG treatments fall into the general realm of
elective procedures and insurance companies do not typically cover those types of
treatments. Interestingly enough, one of the areas that we have recently done some work in
that your readers may be interested in, is the use of ETG to treat women who are
undergoing CMF chemotherapy treatment for breast cancer. This work was done in New Zealand
at the St Marks Breast Centre. We have found that if we were able to start treating
the women before the CMF chemotherapy regime began, continued to treat them all the way
through and stuck with it after they completed chemo, in most cases it stopped their hair
loss. That is the kind of thing that may be covered by insurance in some countries.”
CEOCFOinterviews: Where
is your ETG device used, in a hospital setting, offices or clinics?
Mr. Kramer: “It
actually varies considerably. Our device in most instances is treated as a medical
product. We have clearance in countries like New Zealand, Mexico, Australia and Canada as
a medical product. It is typically available in a clinic type setting, not
necessarily in hospitals but sometimes in conjunction with doctors’ offices or stand
alone facilities that are dedicated to this type of treatment process.”
CEOCFOinterviews: You
have centers in ten countries around the world. Where is the majority of growth
coming from right now?
Mr. Kramer: “Historically we have focused on countries
outside of the US and we are certainly anxious to continue that process, but we have very
recently developed a product for the U.S. market and that product is called
CosmeticTrichoGenesis (CTG) or the CTG Mark 5 unit. Now, I’m sure that you are aware,
the United States is the largest market for cosmetic type products in the world.
Recent statistics reveal that about two and half billion dollars a year is spent on hair
related solutions in the US. A recent study that was done for the International Spa
Association conducted by Pricewaterhouse Coopers, has indicated sales in the spa field in
the ten billion dollar range and growing. So, we are very excited about entering the
market in the United States with our cosmetic product. We are just at the front end of
that. We have delivered units into Florida and Washington State and have participated in a
couple of shows in the US and are most anxious to see things grow very quickly.”
CEOCFOinterviews: So,
the CTG Mark 5 is not being marketed overseas?
Mr. Kramer: “Right,
the CTG Mark 5 is marketed in the United States. Our plans call for seeking FDA approval
for our ETG medical device and we plan to do that initially for an indication for treating
hair loss that has been induced by chemotherapy treatments. But as far as the here
and now is concerned the CTG cosmetic product is available.”
CEOCFOinterviews: Has
all of the turmoil in the world affected the company?
Mr. Kramer: “Well,
you are certainly correct about that. There is a lot of turmoil in the world today.
We are a small company, a micro-cap company, trading on the bulletin board and
certainly the last several years, as your readers undoubtedly know, have been tough
ones in the marketplace especially in the last 40 months or so. Things have picked up very
recently, but it has been tough to raise money. In fairness, I would have to say the
constraints we face have been related to both gathering the proper financial resources and
on economic difficulties globally. For example, ETG was growing rapidly in Argentina some
years ago when our product was introduced there with a very loyal group of clinic
operators who were doing extremely well. However, they were very adversely affected by the
difficult economic circumstances there such as bank closures, the levels of unemployment
and major devaluations of the currency. They are hanging in there but they have
unfortunately seen a situation turn 180 degrees from one of a very rapid growth to just
holding on with their fingernails.”
CEOCFOinterviews: The
ETG device, when it is placed in the treatment centers, who services them? When the
technology starts to evolve, who updates them and replaces them?
Mr. Kramer: “These
are very good questions, the types we are asked by potential operators. I think we have
developed an answer to that which is rather unique and one that your readers would be
interested in. Recognizing that we would not have the ability to build a global
infrastructure as we are a small company, we have devoted our talents on the front end to
developing a communication system that allows us at our head office to communicate with
the device all around the world via a modem. Once it is hooked up, there are signals
that are sent from the control processing unit which is the brain of the unit to our
computers here in our head offices. We are then able to read all of the historical
treatments that have been given to determine that they have been given in the appropriate
manner. It will carry out a full systems check and if there is something wrong it
identifies exactly what the problem is and allows us to direct a fix on a remote basis. It
is quite an interesting system. It is security controlled and it is working extremely well
for us. Also I think your readers will be interested to note that this allows us to in
most instances participate in downstream revenue. Therefore we not only
generate revenue from the sale of an ETG device at the front end but in most cases
participate on a per treatment basis downstream. We are able to monitor that by monitoring
the equipment through the process that I just described.”
CEOCFOinterviews: How
much time do you focus on the security issue?
Mr. Kramer:
“Security is a big issue there is no question about that. I think that it would be
foolish in today’s world to say that something is absolutely one hundred percent fool
proof. However, it is not an open system receiving random internet messages that
could be dangerous, but rather a closed system focused on communication between two known
points, A and B. This allows us to be specific in terms of the way this security system
was designed and basically if the two points can’t satisfy each other that the proper
protocol has been reached or achieved then the system simply shuts down. To date we
haven’t had any problems.”
CEOCFOinterviews: Where
are you in the financial development of the company?
Mr. Kramer: “Well,
we have not yet achieved break even. The development cycle has been funded by the
usual means of debt instruments and private placements to raise required financing. As I
have communicated earlier, we are at the front end of our entry in the marketplace in the
US. We are hopeful that as the pace picks up and as we move forward into the next fiscal
year that we will achieve break even and the wonderful point of profitability so that
those earlier development stage issues will be a thing of the past.”
CEOCFOinterviews: The
company was founded in 1987 and you and your wife Anne have been there since the
beginning. What has been the biggest challenge that the two of you have faced?
Mr. Kramer: “Being
very candid about it, one has to recognize that when you have a product that is primarily
focused in the area of treating hair loss there is very understandably a high level of
skepticism and that is something that we expected. When we first heard about the
technology and decided to get involved we were highly skeptical but we also recognized the
other side of the coin is tremendous upside if you get it right. So we recognized very
early on that we had to attract a very talented group of people around us. We also felt
that we had to subject the technology once it was fully developed to our satisfaction to
independent clinical testing and when that testing was completed we would attempt to have
very credible people write up the results submit those results to medical literature and
hopefully achieve peer reviewed publication. We have done that and we feel very strongly
that these publications combined with the patents that are issued and pending around the
world form the basis for the company as a whole.”
CEOCFOinterviews: Where
is your ETG device manufactured?
Mr. Kramer: “It is
manufactured here in British Columbia where our head office is located. We are working
with a company that has major customers like General Dynamics (NYSE: GD) and General
Motors. (NYSE: GM) We were actually just going through a process of having all of the
drawings and manufacturing input information reviewed and brought up to date to
today’s technologically advanced standards and are ready to push the button on a
pre-production run that will apply new and more sophisticated manufacturing techniques.
That is not my area in the company as chief financial officer but it is one that I am
aware of because of its financial implications.”
CEOCFOinterviews: I
think more and more people, especially here in the US, are more attracted to natural
remedies vs. chemical or invasive ones.
Mr. Kramer: “You are absolutely right. This is totally
non-invasive situation, there is no sensation and it does not involve the use of chemicals
or anything like that and people today are very much directed towards things that are
natural. This is very important to us in terms of product acceptance.”
CEOCFOinterviews: What would you say to a potential investor
looking at this company for the very first time?
Mr. Kramer: “That
is a great question and one that we hopefully have a good answer for. We are at the front
end of what we see as a successful launch of our cosmetic CTG Mark 5 product into the
largest market for cosmetic products in the world. In the world today you have two things
that are converging that I think are very exciting for Current Technology. The first is
you have a population generally but most typically in the United States that is very
sophisticated and aware of concepts of wellness and physical appearance and as people get
older, they want to maintain their youthful look and feel as long as possible and we are a
part of that. Secondly, looking at it from an operator standpoint, we live in a world
today where individuals who are in business are searching for different areas of revenue
that may be available to them for modest investments and we feel we really fit the bill.
There are a number of different situations that we could describe where we could see
someone who is now involved in the aesthetics field adding CTG Mark 5 to their particular
situation, substantially increasing the amount of revenue generated and therefore, their
own bottom line. So I see this driven by those two factors and therefore see this as being
a very exciting point for someone looking seriously at Current Technology as an investment
based on the fact that we are right on the front end of what we believe to be a
significant growth of revenues.”
CEOCFOinterviews: In
closing, what would you say is the most significant change in the marketplace?
Mr. Kramer: “When
my wife and I co-founded the company, we saw this technology platform as one to be
directed at males and I think that was probably a reasonable assumption on a first look
basis. However, as we have gotten further into it we feel it is going to be significant
for women and are very excited about its prospects. Definitely on the cosmetic side, this
relates to how concerned women are of any issues relating to the appearance of their
hair.”
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