EKO International Inc (EKNL)

[21ZNA9]

NeuroVasc Medical Inc SCAM

On July 24, 2012, EKNL entered into a joint venture agreement with NeuroVasc Clinic Inc (an entity controlled by Dr. Paul Ziemer) to form a new entity called NeuroVasc Medical Inc which would be used to distribute a device known as FREMS (Frequency Rhythmic Electrical Modulation System). The joint venture entity, NeuroVasc Medical Inc, is 51% owned by NeuroVasc Clinic Inc and 49% owned by EKNL.

The FREMS device is manufactured by Lorenz Biotech S.p.A. of Modena, Italy and supplied by Lorenz Neurovasc Inc who is a company in Canada.

http://www.lorenzneurovasc.ca/aboutus.html

What is unclear is if EKNL through its joint venture entity, NeuroVasc Medical Inc, purchases the FREMS device from Lorenz Neurovasc Inc then resells it or if NeuroVasc Medical Inc works for Lorenz Neurovasc Inc as a distributor of the device in the US. All indications seem to point to EKNL being a reseller since there is no mention of NeuroVasc Medical Inc on the Lorenz Neurovasc Inc website. All the same I have an inquiry in to Lorenz Neurovasc to see what I can learn.

What is clear is that as a distributor/resaler only, EKNL does not own or manufacture the FREMS device and does not benefit by the success of the device beyond the actual sales that EKNL is involved with.

Dr. Paul Ziemer, who has been added as a director of EKNL, breaks down the joint venture arrangement more clearly in his radio interview found below. Paul Ziemer explains that NeuroVasc Clinics Inc's 51% will involve supplying the equipment to medical centers and then educating the medical centers that purchase the equipment on how to use it. EKNL's 49% will involve providing financing and infrastructure (ie the transportation and workers needed for shipping).

http://smallcapvoice.com/blog/10-19-12-smallcapvoice-interview-with-eko-international-corp/

According to EKNL, the sale of each FREMS device will equate to $8000 in profits for EKNL.

In a September 27, 2012 press release, EKNL announced that two months after the formation of their joint venture agreement, NeuroVasc Clinics Inc got its first commitment. The Mayer Institute in Hamilton, Ontario (Dr. Perry Mayer) has allegedly committed to the purchase of the FREMS device upon the completion of their would treatment center which is currently under construction. EKNL anticipates that the Mayer Center will have use for 5 FREMS devices when construction of their new wound treatment center is completed. EKNL says the construction of the clinic should be complete by the end of October and promises an update at that time. Dr. Paul Ziemer has worked with the Mayer Institute in the past.

http://ekointernational.com/neurovasc-clinical-inc-to-supply-frems-to-first-clinic/

To date this is the only actual sale announced by EKNL and it still remains only agreement in principal. The actual sale has not been executed.

To meet their commitment to provide the infrastructure, EKNL has Oebin Ltd on stand by to be used for distribution needs in Florida and New York, but since FREMS sales aren't exactly soaring I don't see any trucks needed for transportation any time soon, if ever.

Going into the agreement, as of June 30, 2012, EKNL had not even a penny in cash so how they are going to manage financing this joint venture is a mystery. Apparently it will be done through the issuance of shares. On September 25, 2012, EKNL announced that it would be issuing 1,000,000 shares to EuroVasc Medical Inc to meet its obligation to the joint venture.