Fibrocell Science Inc (FCSC)

[ronpopeil]

My notes from the FCSC shareholder meeting. Just got back.


The meeting started around 10:00 AM. There were about 6-7 shareholders at the meeting.
Running the meeting was David M. Pernock & Declan Daly. Both were very nice. They started the meeting announcing the election of 2 directors, Dr. Robert Langer and George Corkus (sp?).

We then went to a question/answer session. The nice thing about having a small group was that we could answer all of our questions. The following are some notes that I took. I did my best to get the “gist” of the answers but I had to write fast as I tried to listen to each questions and answer.

Question 1. Was LaViv submitted to the FDA as a drug or device indication?

Answer – LaViv will be regulated as a Drug. There is a package insert. Labeling, manufacturing, packaging etc will all be included

Question 2 – What may interfere with approval? There was an issue with one patient having basal cell carcinoma.

Answer - All issues with regard to safety and efficacy from the FDA’s CRL were fully answered. The company does not believe the basal cell was at all attributable to LaViv and the results from all patient studies indicates this to be true. It was not abnormal to get something like this in such a large study. The FDA panel was not concerned about this at all in FCSC’s opinion.

Question 3 – How does the company plan to roll out LaViv?

Answer – The company will need to raise capital but will do so slowly and methodically. This is such a new and highly sophisticated science that there is no need to raise $100’s of millions. It must be done methodically. The company plans on using clinical investigators and about 30+ doctors in key areas such as California, Texas, Florida and New York. Doctors will want to offer this procedure to their patients because it adds value to their practice. The company expects a lot of publicity from news stations, cosmetic magazines and their own advertising company which I believe is the same one Dendreon uses. The company expects 5000-6000 patients within the first year.

Question 4 – What is the difference between LaViv and other derma fillers already on the market?

Answer – The method of action is different. LaViv is natural, not synthetic like others which also have toxins. You get a much more natural look with LaViv, better results and it’s longer lasting. It’s better to use something natural than something artificial that is foreign to your body.

Question 5 – When will other indications be pursued such as acne scarring, burns etc?

Answer – As of now, the results for the above indications have been fantastic. The goal of the company is to first receive FDA approval for the nasal fabloids. That is what they are focusing on right now. From there, the company can move the other indications forward. I spoke to Declan on the tour afterwords and he said we could see approval for acne scarring which has an absolutely enormous market potential within 1-2 years from now. there is no other real medical treatment for this like the one LaViv can provide.




Other notes:
- LaViv is safe. Product has been used in over 7000 people. No issues
- Company wants to facilitate relationship with doctors. Not a good idea to hire a bunch of sales people and have them go out and sell the procedure to anyone and everyone. This is such a complicated and specialized procedures, it must be rolled out somewhat slowly and methodically to ensure that everything is done correctly. This will cut costs because the company won’t need to hire such a huge sales force at the outset.
- Company will have a regimented training programs for doctors to ensure they know how to properly do this procedure.
- There are about 107,000,000 shares. This is fully diluted including options, warrants etc.
- Cost of procedure not discussed because of competitive reasons
- 90 day turnaround for the procedure once biopsy is taken.
- Company is pursuing the Chinese market which is enormous. They have a JV with a company in China. If they receive FDA approval, the believe strongly China will approve LaViv. They have a manufacturing facility in Shang Du which is a highly populated area. Apple computer has an office there.
- The issues highlighted in the CRL were really related to SOP changes (Standards of Practice) which the company believes they fully addressed and satisfied. Actual manufacturing plant and how things are done were not mentioned so the company believes everything is fine.
- Company has around 25 employees and looking to hire more.
- After the meeting we were given a tour of the facilities. It was very large and impressive. We noticed several scientists in body suits doing work. The machninery looked very sophisticated. There is a ton of space for the company to expand. They certainly looked ready to go. During the tour you could see how specialized and intricate this process is but I was certainly impressed with it.
- I pressed the company a bit to see if the FDA had alerted them to any outstanding issues but the company seemed very confident that they addressed any potential issues.

Overall I was impressed with the company. Declan and Pernock were very nice and seemed upbeat. Obviously everyone is on pins and needles as they await the FDA decision. I definitely think LaViv could be a very viable procedure. If they can get approval for acne scarring and burns this will really catapult the company as a major force. At this time they are hoping for approval and will take it from there. Pernock and another woman I met, Linda Campbell, were both former employees of Glaxo which is impressive. There was another woman that I did not meet who use to work at the FDA which should help. Hope this helps!