What every USRM investor needs to know!! Below is why U.S. Stem Cell Inc. is going to skyrocket. I know I may sound like the crazy man connecting the dots here, but if you bear with me and read my piece, I promise that you will understand why USRM is such a crazy prospect. Let’s begin with some background to lay the foundation for the puzzle, or to catch anybody that is new here up to speed.
USRM is a Florida corporation and leader in novel regenerative medicine solutions and physician-based stem cell therapies to human and animal patients.
The company focuses on discovering/developing cell based therapy options to treat/cure diseases by repairing/replacing damaged tissues, cells, and organs. The drug being reviewed heavily by the FDA right now and in the clinical trial stage is called MyoCell, a muscle stem therapy that restores the capabilities of the heart of someone with heart damage caused by a heart attack and allows this person to begin to return to normal cardiac strength. The procedure is a minimally invasive operation in which a small amount of tissue is taken from the thigh. The cells from the thigh muscle are then isolated and cultured using U.S. Stem Cell's proprietary cell-culturing process. Then, the muscle cells are delivered to the affected regions in the heart where the cells begin to populate the areas of scar tissue.
So, knowing this, the drug has recently received reactivation status with the FDA. The trials became inactive because patients were not actively being enrolled. During the MARVEL phase 1 trial, the results were quite positive. They showed that patients using the treatment were able to increase their walking distance by a significant amount throughout the 6-minute duration of the test when compared to other patients using a placebo.
So, why is the reactivation status received on April 10th, 2017 so important? Well, this is because USRM has applied to the FDA for Regenerative Medicine Advanced Therapy (RMAT) designation for MyoCell as part of the MARVEL trials. So, according to the FDA, in order to receive RMAT designation, the request must be accompanied by an Investigational New Drug application, and that drug must be in the active stage of its trials. So, when the FDA moved to reactivate the trials, the door then opened for USRM to seek RMAT designation for MyoCell. RMAT designation is granted for a regenerative medicine therapy that is intended to treat, modify, reverse, or cure a serious or life-threatening disease and demonstrates preliminary clinical evidence that the product has the potential to address unmet medical needs for a disease. U.S. Stem Cell feels as if MyoCell meets these qualities, and personally, I agree.
If the RMAT designation is granted, then the approval process for MyoCell would likely be expedited. If my research is correct, then we should have a response from the FDA regarding the RMAT designation by June 10. This is later than I originally projected, and I am aware that this is different from what many others have projected as well. U.S. Stem Cell put out the PR announcing the reactivation on April 10, 2017, so I presume that this is also when the 60-day clock resets for the RMAT designation approval. I may be slightly off on this, and the clock may have reset on March 30, putting the deadline at May 30, or the date could be anywhere in that range. Unfortunately, the clock resets whenever the FDA requests additional information, which is what happened to USRM when they originally applied for the RMAT designation on January 27, 2017 as part of the MARVEL trial. Either way, I would expect to hear about the RMAT designation by late May. The Office of Tissues & Advanced Therapies (OTAT) at the FDA states that they will respond within 60 days of receiving an RMAT designation request. I am not just pulling that out of nowhere.
OKAY… so this is basically all the common knowledge that is out there so far. Next is where we begin to connect the dots and understand why things should come together nicely for USRM.
The man appointed by President Donald J. Trump to head the FDA is named Scott Gottlieb. On the docket for the U.S. Senate Health, Education, Labor, and Pensions Committee on Wednesday, April 26, 2017 at 10AM is “to consider… (among other things)… the nomination of Scott Gottlieb, of Connecticut, to be Commissioner of Food and Drugs, Department of Health and Human Services.” This is massive for the stakeholders in USRM. As soon as Mr. Gottlieb is in, the stance of the FDA regarding stem cells could change drastically, playing in favor of USRM.
The FDA has traditionally had a rather difficult stance when it comes to stem cells, but Mr. Gattlieb wrote an article in 2012 for the WSJ supporting the use of cell-based therapies. He even worked with companies developing such therapies in the past. He has said less is more when speaking with regards to the FDA’s regulation of stem cells. He wants to work in coordination of the new President’s agenda of “slashing restraints” the FDA has put in place. This sounds pretty solid for U.S. Stem Cell, Inc.
Mr. Gottlieb is in favor of the “right-to-try” movement. This allows patients with terminal illnesses to use investigational drugs or treatments. Over half of state legislatures have passed, or plan to pass, such legislation. Those that have passed have had minimal opposition. One state that has passed such legislation is the state of Indiana, with the bill being signed by the current sitting Vice President, Mike Pence. Mr. Gottlieb and President Trump have expressed both support and interest in working with Congress to pass a national “right-to-try” bill. While this does not necessarily line up directly with MyoCell, the technology it brings and the doors it could open for not just USRM, but the entire stem cell industry is fantastic.
The likely next Commissioner of the FDA is a cancer survivor himself, having successfully beaten Hodgkin’s lymphoma. So, it is no surprise that he is in favor of giving terminally ill patients access to drugs that are still in clinical trials to potentially save their own life, and quite possibly millions of other lives down the line.
This could mean crazy jumps for USRM in the near future! Okay, now lets wrap things up.
Financially, the books are starting to look pretty solid for this company as well. Revenues are up 40% from $2,200,000 in 2015 to $3,080,000 in 2016. Total assets are almost doubled, up 86% from $229,000 in 2015 to $427,000 in 2016. Large increases in assets can be scary in larger companies because it can represent stagnation of sales and inventory sitting in your warehouse. If you are new to the OTC, increasing assets is often a good thing because it shows the legitimacy and the expansion of the company when it is paired with increasing revenues like we are here. One of the most encouraging facts to be taken from the financial reports is that this is the first time in the company’s history that they ended the year on a cash positive note, being an impressive $112,000 cash positive to end 2016 compared to being $844,000 cash negative in 2015.
USRM is also beginning to get involved overseas. They reached an agreement with Kuwait-based High Rising Group for the development and launch of U.S. Stem Cell Middle East. The first overseas clinic in Kuwait City is set to open and be operational by the end of 2017. Qatar and Dubai are not far behind, with other locations like Bahrain, United Arab Emirates, Saudi Arabia, Jordan, and Egypt also in the works.
U.S. Stem Cell, Inc. also announced via 8-K that it has entered into an agreement with General American Capital Partners (GACP) in which GACP will invest $2,500,000 to open 10 new clinics in the United States called “Stem Cell Centers of Excellence.” Part of the deal is that USRM sold $500,000 of “equipment” to GACP, but then leased the “equipment” back for basically $500,000. The “equipment” mentioned is the tissue banking facility, which will be leased for 3 years.
Given all of the above information, I would say that USRM is just waiting to explode. We finally had a nice green day today on what is the notoriously horrific day of the week in Tuesday. Once Mr. Gottlieb is given the reins of the FDA, I anticipate a somewhat rapid approval for the RMAT designation and for the eventual approval of MyoCell and other USRM cell-based therapies. The company has solid/improving financials, and I fully expect that the CEO, Mr. Mike Tomás, will propel this company forward. For those reading, hopefully this means financial prosperity. For the United States of America and the entire world, hopefully this can mean lives saved and making the world a better place.
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