CEL-SCI Corporation Releases Letter to Shareholders
By PR Newswire
Last Update: 9/20/2006 9:40:30 AM Data provided by
VIENNA, Va., Sept 20, 2006 /PRNewswire-FirstCall via COMTEX/ -- The following letter is being released by CEL-SCI CORPORATION (CVM) to its shareholders:
Dear Fellow Shareholders:
Many of us invest in biotechnology because of its life changing possibilities and its enormous potential for financial return. We all know that the development of a biotech drug takes a long time, is difficult and costs many millions of dollars. Yet most of us are willing to wait for the potential "home run" on our investment as long as the data looks good. However, the cyclical and at times completely illogical treatment of biotechnology stocks by the investment community challenges the commitment of even the most dedicated of investors.
For this reason we are very pleased to point out that CEL-SCI's share price has outperformed the vast majority of its small and mid cap brethrens, albeit with enormous cyclical volatility, over the last few years. Since high volatility will never be eliminated from biotech stocks like CEL-SCI, we must learn to use it to our advantage. I recently purchased more stock in the open market because I believe that the present price represents a great opportunity.
In the spring of 2003 CEL-SCI's financial health looked rather bleak, our stock price hit an all time low and few people believed in our ability to survive, much less rebound. Nevertheless, despite a stock market environment that has been quite unfriendly to small and medium sized biotechnology companies like ours, we have managed to put ourselves on good financial footing and increased our share price by several hundred percent; and that is after CEL-SCI's stock price pulled back from its substantially higher level in the spring of 2006. We survived, and indeed improved our position by persistently and carefully following our plan for building shareholder value and obeying the following rule. "FOLLOW THE DATA, THE DATA NEVER LIE."
The data for CEL-SCI's products point to a very positive future for our company. Furthermore, based upon our most recent survival data and our cautious and deliberate way of proceeding, we believe that we will continue to build value for our shareholders. Management's sizable investment in CEL-SCI gives us added incentive to do so.
We aim to make the first line cancer treatment more successful through the addition of our cancer drug Multikine(R). Multikine will be a major breakthrough in therapy for cancer patients if we can confirm the increased patient survival data from our Phase II clinical studies in the planned global Phase III clinical study that has already received the go-ahead by the Canadian authorities. Simplistically, would you rather have a 65 - 70% chance of survival with our Multikine or a 50% chance of survival without our Multikine? When we can prove this kind of clinical benefit to patients, shareholder value creation will need no further explanation.
We believe that the market for Multikine may quickly expand beyond the original head and neck cancer indication. The product has already been shown to be very safe, and it is very probable that clinical trials will be conducted with Multikine to examine its usefulness in treating other diseases in which the affected patients might benefit by the addition of Multikine to their overall treatment. Furthermore, the use of Multikine, especially in cancer, would save the health care system money, most likely a lot of money, as fewer patients will have recurrence of their cancer, and thus fewer patients will need to be treated. In short, Multikine could become a very important addition to current cancer treatments.
In the last 18 months we have achieved a number of very important milestones for Multikine. We have published the mechanism of action in the Journal of Clinical Oncology, a highly recognized, leading peer-reviewed cancer publication. We have been granted an important new patent on Multikine, and we received a no objection letter (NOL) from the highly regarded Canadian regulators for our Multikine Global Phase III head and neck cancer clinical trial. Last, but not least, we presented data at the "Vaccine Discovery and Commercialization" conference in Philadelphia which indicate that the addition of Multikine prior to the standard of care treatment resulted in a 33-40% improvement in the median survival at 3 1/2 years after surgery. Survival is the "gold standard" for testing in cancer.
Our CEL-1000 drug has also received a fair amount of attention. It has shown protection in animals against a number of diseases such as herpes virus, viral encephalitis, malaria and leishmania. Based on these data, the U.S. government became interested in its potential for use against avian flu. We believe that CEL-1000 may have the best avian flu potential in two areas, one, as an adjuvant to make vaccines more effective and two, as an adjunct to other antiviral therapies. Either of these uses holds great promise for CEL-1000 as a product.
We cannot say that the past years have been without difficulties, far from it, but we have been able to overcome any obstacles that we have encountered. We believe that future obstacles will also be dealt with in the same manner. If developing new medicines for cancer were easy, cancer would have been defeated long ago; after all, President Nixon declared the war on cancer 36 years ago. Yet cancer is the second leading cause of death in the U.S. today and, if the trend continues, it is expected to become the leading cause of death in the next few years.
Today we continue to believe that our CEL-SCI shares are not fully valued by the market place, an unhappy occurrence for existing shareholders, but a great opportunity for new shareholders. This is not an uncommon phenomenon in biotechnology investing and was seen often during the early days of Amgen or Genentech, today's leading biotechnology companies. Now almost everybody wishes that they had been long-term investors in Amgen or Genentech since these companies turned out to be great investments. In hindsight the successes of these biotech leaders may appear to have been easy, but an examination of their early history reveals that things did not always go their way. Until 2003 Genentech seemed to be the only one who believed in Avastin, its new blockbuster cancer drug. These companies succeeded because they were persistent and they followed the data. We plan to do the same.
What is the value of a non-toxic cancer drug that enhances survival? To cancer patients it is immeasurable. To investors it is so big that they want to be invested in the company that owns it. That is why I have invested so much of my own money in CEL-SCI, with new stock purchases just a short time ago.
Our Phase II data suggest that we have a cancer compound that may significantly increase survival in patients with advanced primary head and neck cancer. Our Phase III trial is meant to prove this survival benefit in a statistically significant manner to get Multikine approved for sale.
In short, we hope to be able to build significant shareholder value by conducting our important work in a deliberate and methodical manner and always following the data. This has worked for us in the past few years and it should continue to work for us in the future as well. We thank you for your support.
When used in this report, the words "intends," "believes," "anticipated" and "expects" and similar expressions are intended to identify forward-looking statements. Such statements are subject to risks and uncertainties which could cause actual results to differ materially from those projected. Factors that could cause or contribute to such differences include, an inability to duplicate the clinical results demonstrated in clinical studies, timely development of any potential products that can be shown to be safe and effective, receiving necessary regulatory approvals, difficulties in manufacturing any of the Company's potential products, inability to raise the necessary capital and the risk factors set forth from time to time in CEL-SCI Corporation's SEC filings, including but not limited to its report on Form 10- K for the year ended September 30, 2005. The Company undertakes no obligation to publicly release the result of any revision to these forward-looking statements which may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
CONTACT: Gavin de Windt of CEL-SCI Corporation, +1-703-506-9460.
SOURCE CEL-SCI Corporation
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