Decision Diagnostics Corp (DECN)

[nonsequetor]

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.

http://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=177348

There is too much information to post here.

Read the entire report for yourself.

Some excerpts (personally chosen, but by far, not all-inclusive):

A new product,
GenSure! is complete and on August 18, 2017 will enter the initial manufacturing phase under company oversight
with the company’s Korean contract manufacturer. The company’s GenChoice! glucose test strip, is now in advanced
development, a prelude to the September 2017 clinical trials testing. The GenSure! product has completed its clinical
trials, and is currently in registration and we are seeking “CE” marking in the EU. GenSure! will be launched overseas
in September 2017. We have identified International distributors for this product.
When our GenChoice! product enters clinical trials during the month of September 2017, these trials will be
run in Pennsylvania and California. At the conclusion of the clinical trials, the GenChoice! product will be registered
in the EU and with the U.S. FDA through a 510K pre-market clearance. The company has previously contracted with
two expert organizations, one who will manage the clinical trials (the IRB) and another who will write the 510K
document and prosecute this document at the direction of the company.
Another new product nearing completion is the company’s GenPrecis! system product. GenPrecis will consist
of the GenPrecis! Precise glucometer, and the GenPrecis! test strip. The company will sell the GenPrecis! products
in the USA and in all International markets. The GenPrecis! test strip will also serve as an alternative strip that will
also run on an existing legacy meter. The GenPrecis! product is designed to be the most precise meter in the clinical
markets, and is expected to set new standards for precision. Initial testing show that the GenPrecis! product will
operate at a precision level of (better than) +/- 10 mg/dl in repeated samplings 97% of the time, while current published
standards call for precision levels +/- 15 mg/dl in repeated samplings 95% of the time.

In March 2016, prior to its settlement, the company’s Pharma Tech Solutions, Inc. and Decision IT Corp.
subsidiaries brought suit against Lifescan, Inc. in Nevada Federal court for patent infringement, the company alleging
that Lifescan, Inc.’s OneTouch Ultra product was and had been infringing both of the company’s patents. In March
2017, after a protracted battle with J&J where they tried to invalidate the company’s lawsuit, the court in a major
ruling agreed that the company will be allowed to move forward (a major victory so early in the suit) and will also be
allowed to allege the Doctrine of Equivalents, a legal doctrine that would preclude J&J from twisting words through
its pleadings and expert reports to escape justice. In April 2016 the company amended its original suit to include
allegations under the Doctrine of Equivalents.
“The doctrine of equivalents is a legal rule in many (but not all) of the world's patent systems
that allows a court to hold a party liable for patent infringement even though the infringing device or
process does not fall within the literal scope of a patent claim, but nevertheless is equivalent to the
claimed invention(s).”
The company’s case for Patent Infringement is in a short termed but critical discovery phase, where briefs
have been written, expert testimony taken, and the positions of the companies set. We feel that we retain the upper
hand in this lawsuit. We make our penultimate filing on August 28, 2017. This filing will lead to an eventful Fall
schedule and we believe will set the court clock for the prospects of a well earned settlement in early 2018.

The company has been contacted by several chain drug and department store retailers to repackage our products for exclusive sale to these retailers. So, for example, the company has a Trademark on the trade name Alltara, a trade name fiorst
explored for our GenUltimate! product. The company plans to package our GenUltimate! and (eventually) GenChoice!
products under the trade names Alltara Ultimate and Alltara Choice and offer these (trade named) products on an
exclusive basis to the nation’s largest drug store chain. Recently, the second largest drug chain has asked for similar
treatment. The company is in the process of securing a trademark for the trade name Advanc which will be offered to
another large retail chain as an exclusive product(s). By doing these repackaging projects, the company believes we
will have our products on large retailer store shelves in an accelerated fashion.

The company’s capacity for GenUltimate! production is now 625,000 packages per month (50 count and 100 count packages) and manufactured in Korea, for the new GenSure! product 250,000 packages per month (25 count and 50 count packages) to be manufactured in Korea, and the new GenChoice! product 500,000 packages per month (50 count and 100 count packages) to be manufactured in Korea. Recently, a mega- retailer has requested
the company keep minimum inventories of finished product of 350,000 units on hand. We expect other retailers to
make similar requests.

We have been in contact with OTCMarkets and we plan to revive our application, and to that end we have filed for uplist on OTCMarkets as an Alternative Filer. This uplist will move the company’s stock listing to the OTCQB level. The company has received a tentative approval for this uplist pending an audit of the company’s 2016 balance sheet. In July 2016 the company
contacted several auditing firms and has received two engagement letters for our Board’s review. Most recently we
contacted our former auditor (dating to 2011) and with whom we shared an excellent working relationship. This firm
has settled its differences with the U.S. PCAOB owing to a rogue accounting partner who remains barred. We expect
to receive their engagement letter and if forthcoming, the Board of Directors would approve their engagement.

During the 2Q 2017 the company has signed agreements with two distribution outlets, one in New York --
Altro Pharmaceuticals and one in Florida -- Virtue Rx.

Our 12-month business objectives include:

1. The practice of specializing in the distribution of GenUltimate! and GenSure! products, and then completion of the GenChoice! product. We also intend to add several brand-name medical diagnostic and medical disposable products (lancets through our Firefly! Product, as well as several lines of insulin syringes and pen needles, all associated with the on-going care of diabetes-inflicted patients, and the world-wide
distribution of our proprietary diagnostic product GenUltimate! product.

2. Combining our wholesale and retail diagnostics distribution with the major successes we have had in the on-line retail markets, and adding legacy retail organizations (already some legacy retailers of note).

3. Continue to implement the plans provided by our agent MWK LLC, and secure big-box pharmacy chains, chain grocers and nationwide retailers.