Still need help with various questions. Also, if someone would wish to write up a good explanation about the Preferred D shares, it would be extremely helpful.
Commonly Asked Questions & Answers for Pharmstar Pharmaceuticals Compiled by members of the IHub PHAR Board
What is Pharmstar’s product? http://www.pharmstarinc.com/investor_info.html The base product is Aquaprin, a water-soluble aspirin combined with an antacid which dissolves completely in water without any residue in a delicious flavor. It is fast-acting. It is more effective than other OTC pain relievers It eliminates the counter-effect of stomach acid which can bother many aspirin users. The product already has FDA approval. Other products are in the product line include: Instaprin – an emergency use of Aquaprin combined with water which can be administered orally for heart attack and stroke victims. A cough & cold formula A menstrual formula A children’s formula Plans are in the near future to partner with a sports-drink maker and produce a sports drink/pain reliever.
Executive Summary Based on the subsequent analysis in this report, the intellectual property associated with the patent, know-how and trademark positions of PSP is valued at $32 million. Background The worldwide analgesic market is variously estimated at $30 to $75 billion dollars, with the U.S. market being in excess of $10 billion annually. Approximately 84% of the U.S. population regularly uses non-prescription analgesics for minor pain relief for conditions such as headache, muscle ache or backache (Simmons Market Research, 2000). Over $2 billion worth of such analgesics are sold annually by supermarkets, drugstores and mass merchandisers. The non-prescription analgesics market encompasses pain-relief medications having four principal active chemical ingredients, aspirin, acetaminophen, ibuprofen and naproxen sodium. Brand names are well-established in each of these segments, and include Tylenol (acetaminophen), Advil and Motrin (ibuprofen), Aleve (naproxen sodium), Bayer (aspirin or combination), Excedrin (acetaminophen), Midol and Pamprin (varied formulas for menstrual pain relief). There is a significant discrepancy between actual differentiation of near-homogeneous product formulations in this market segment, and the perceived differentiation among different brands, resulting from advertising. The ratio of advertising to sales in the nonprescription analgesics industry among various major manufacturers can range from 20 to 50%. Aspirin has a number of inherent advantages. Like other pain relievers of the type discussed above, aspirin is effective for treatment of pain, fevers, arthritis, and headaches, but unlike such other analgesic products, aspirin is the only pain reliever shown to reduce the risk of heart attack. In addition, aspirin is the oldest and best established of the common pain relievers, with well over a century of use throughout the world. In the field of aspirin pain relievers, effervescent soluble aspirin products such as Aspro or Disprin are quite popular in other countries such as Australia, Canada, Great Britain and New Zealand. In the U.S., Alka-Seltzer, an effervescent formulation including aspirin, sodium bicarbonate and citric acid. Alka-Seltzer is the world's number one cure for hangover and is currently sold in over 100 countries, generating annual sales in excess of $100 million. Overall, the soluble aspirin products market worldwide exceeds $2 billion.
From email on 08/25/2011:
Howard retains all rights to his formula worldwide, and never intends to enter into any agreement that would let another company make the product for him. I like to use the analogy of Coca Cola....they have a secret that no one has ever been able to duplicate, no matter how hard they try. While the formula for cola drinks is widely known, Coca Cola is closely guarded. With Aquaprin, the combination of the ingredients is widely known, the process of what makes it special is not...and Howard intends to keep it that way.
In understanding patents, when a patent is pending, it does not have to be released to the public domain. It used to be that it could be held in a pending status indefinitely, but the rules have since changes that there is a finite period before it has to be released. Nonetheless, there should be no way that another company can come in and make slight changes, and market a like product.
What is Pharmstar’s corporate structure? Executive Leadership Howard Phykitt, CEO http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=46305 All former officers and directors have been replaced; Mr. Howard Phykitt is now Chairman of the Board of Directors and is the Company’s Chief Executive Officer. http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=47788 Effective February 28, 2011, Pharmstar Incorporated became owner of 80% of the outstanding common stock of the Company. Effective March 31, 2011, Howard Phykitt became owner of 100% of the outstanding Series A preferred stock of the Company Don Watson, Vice President
STEVEN J. HULTQUIST FOUNDER & PRINCIPAL Steven J. Hultquist, the founder of Hultquist IP, is a member of the bars of the states of New York, North Carolina, California, and Connecticut, and has been registered to practice before the U.S. Patent and Trademark Office since 1976. He holds Bachelor and Master of Science Degrees in Chemical Engineering from Washington University (St. Louis), and a law degree from Fordham University (New York City). Mr. Hultquist was an Adjunct Professor of Chemical Engineering at North Carolina State University from 1995 to 1997, and has been the Intellectual Property author for the North Carolina General Practice Deskbook since 1996. His chapter on Intellectual Property in the 1997 North Carolina General Practice Deskbook was recognized by a "Project of the Year" award by the American Bar Association, presented at the American Bar Association's 1999 Annual Meeting. Mr. Hultquist is a frequent speaker for Continuing Legal Education programs and entrepreneurship programs, as well as having published in the Journal of the Patent and Trademark Office Society, Genetic Engineering News, Nature Biotechnology, and other journals and publications. He most recently presented on biomarkers as intellectual property at the 2010 program “Personalized Medicine in the 21st Century” sponsored by RTI International and the North Carolina Biotechnology Center, and was a speaker on U.S. nanotechnology patenting at Nanotech 2009 in Houston. In October, 2004, Mr. Hultquist was a principal speaker at Jumpstarting Business Relationships with the Western Bio-Pharmaceutical Industry, at the Shemyakin and Ovchinnikov Institute of Bioorganic Chemistry, Pushchino, Russia, where he presented eight hours of lectures on securing rights in intellectual property and licensing of patents and technology. This program, funded by the Nuclear Threat Initiative and coordinated by the Center for Strategic International Studies (Washington, DC), was presented to bioweapons scientists of the former Soviet Union, as part of ongoing efforts to redirect their expertise to commercial biotechnology and anti-terrorism applications. Mr. Hultquist’s publications include “Patenting bioinformatics inventions: Emerging trends in the United States,” Nature Biotechnology, Vol. 20 (July 2002), pp. 743-744, “Reach-Through Royalties: The Scope of Research Tool Patents,” Journal of the Patent and Trademark Office Society, Vol. 86, No. 4, April 2004; and “Statistical Musings,” Intellectual Property Today, May, 2007. Mr. Hultquist is a member of Sigma Xi, the scientific honor society, and is a co-inventor on the following U.S. Patents: "Dopant Delivery System for Semiconductor Manufacture," U.S. Patent 4,936,877, "Amorphous Metal-Ceramic Composite Material," U.S. Patent 5,543,187, "Adsorbent-Based Storage and Dispensing System," U.S. Patent 6,070,576, “Sorbent-Based Gas Storage And Delivery System for Dispensing High Purity Gas,” U.S. Patent 6,132,492, “Fluid Storage and Dispensing System, U.S. Patent 6,360,546, “Fluid Storage Storage and Dispensing System,” U.S. Patent 6,474,076 issued November 5, 2002, and “Channelized Sorbent Media, and Methods of Making Same,” U.S. Patent 6,764,755 issued July 20, 2004, with other patents pending. Some of the nearly 1000 U.S. Patents that Mr. Hultquist has issued for clients can be viewed at http://patft.uspto.gov/netahtml/PTO/search-bool.html, by inputting Term 1: Hultquist and Field 1: Attorney or Agent. Mr. Hultquist was selected to the 2011 Legal Elite of North Carolina's best lawyers, as identified by their peers in balloting of more than 20,000 active members of the North Carolina State Bar. Lawyers voted for those they rated as the best in 14 business-related specialties. The select group of 598 winners represents less than 3% of North Carolina lawyers. Mr. Hultquist has litigation experience as an intellectual property expert witness in U.S. District Court and state court proceedings. He has argued before the U.S. Court of Appeals for the Federal Circuit, and filed briefs with the U.S. Supreme Court in patent matters. His patent practice is concentrated in biotechnology, chemistry, materials science and microelectronics, and includes technology assessment, technology transfer, and contested matters.
R. Wayne Hendren, Ph.D.
Former U.S. Director, Scientific Licensing, GlaxoSmithKline Worldwide Business Development.
During his 13-year tenure at GSK, Dr. Hendren: • Assessed in-licensing & partnering opportunities; • Negotiated agreements to access therapeutic candidates, targets and platform technologies in diabetes, obesity and viral diseases (HIV and HCV); • Coordinated the out-licensing of selected non-strategic assets; • Led the International Product Development Team for a therapeutic peptide product, while serving as Director of U.S. Biotechnology Product Development in Glaxo Wellcome, • Co-founded Amgen Pharmaceutics and Drug Delivery Department and served as Lab Head from 1987-92. • Developed formulations for therapeutic proteins; Initiated PEGylation program that ultimately led to the development of Neulasta® (pegfilgrastim) • Technical and management positions at the Research Triangle Institute and the Union Carbide Corporate Research Laboratory (1977-87). • Managed bioanalyses and represented client in FDA presentation supporting the first approval of a generic oral contraceptive. • Ph.D. in chemistry from Harvard University; B.S. summa cum laude in chemistry from the University of North Carolina 35 Publications; 4 Issued Patents
Dr. Antonio M. Hernandez, M.D. http://ih.advfn.com/p.php?pid=nmona&article=48777256 http://www.ameripath.com/display.aspx?catid=1,9,32&pageid=178 DR. ANTONIO M. HERNANDEZ, M.D. Hematopathologist , AmeriPath Florida Dr. Antonio Hernandez is a Diplomate of the American Board of Pathology with board certification in hematopathology, as well as anatomic and clinical pathology. Upon graduation from the University of Miami Miller School of Medicine, he completed a pathology residency at The University of Texas Southwestern Medical Center at Dallas/Parkland Memorial Hospital, Dallas, Texas. Subsequently, he accepted a fellowship in hematopathology at the University of Southern California Keck School of Medicine, Los Angeles. Dr. Hernandez's hematopathology expertise is derived from the evaluation of bone marrow and lymph node specimens at high volume hematopathology services during the last 14 years. He has served with distinction in several academic and clinical positions, including Clinical Assistant Professor, University of Southern California, Los Angeles; staff hematopathololgist, Department of Pathology, Kaiser Permanente, Los Angeles; and currently, as a staff hematopathologist, AmeriPath Florida, Orlando, Florida. Dr. Hernandez conducted research for 14 years, including several studies with Dr. Bharat Nathwani related to Hodgkin and non-Hodgkin lymphoma. Particular interests include myelodysplasia, AIDS-related lymphomas, and marginal zone lymphomas. He authored/coauthored scientific articles that were subsequently published in some of the more distinguished medical journals. A Fellow in the American Society of Clinical Pathologists (ASCP) and the College of American Pathologists (CAP), Dr. Hernandez is an active member of regional and national professional societies, including the Society of Hematopathology and the Florida Society of Pathologists. Board Certifications Hematopathology Anatomic and Clinical Pathology American Board of Pathology Fellowship Hematopathology University of Southern California Keck School of Medicine of USC Los Angeles, CA Residency Pathology The University of Texas Medical Degree University of Miami Miller School of Medicine Miami, FL
Lanny Roof
Medical Advisory Board The Medical Advisory Board will oversee protocols for the company’s 3rd party claims testing and develop testing protocols for future product offerings by the company, as in a prescription strength version of the future product line. Additionally, the Medical Board will assist in guiding products to the medical community to help ensure doctors’ endorsement of the Aquaprin product line.
Chairman: Dr. Antonio M. Hernandez, M.D. (Hematopathologist)
OTHER NAMES?
What are the details on the share structure of Pharmstar Pharmaceuticals? http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=48798 SHARES OUTSTANDING: 998,879,352 shares issued and outstanding http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=52066 SERIES OF PREFERRED STOCK On May 2, 2011 the Board of Directors of Pharmstar Pharmaceuticals, Inc. (the “Company”) approved the authorization and designation of a Series D Preferred Stock. The Board of Directors had previously approved (March 2011) amendments to the Company’s Series B and Series C Preferred Stock. The three series, designated “Series B,” “Series C,” and “Series D,” were created to allow the original investors of the Company to convert their collective investment into the Company’s public equity, to allow certain existing investors to invest additional capital into the Company, and to provide a mechanism for new investors in the Company, respectively. The three series of preferred stock have a conversion to common stock feature, which shall be non-dilutive to the current shareholder base, as certain issued and outstanding blocks of common stock shall be retired to the Company’s treasury, thereby providing room for the conversions under the current authorized shares of common stock (1,001,184,352 shares). Until buyers of these preferred series exercise warrant options that come with the offerings, (at a strike price of $0.25/share), the Company will continue with its plan to not increase authorized shares. Such exercise of warrants cannot occur sooner than 12 months from the date of issuance of theses series of preferred stock. Series B (issued to the original investors) is structured so that its shares convert into the Company’s common stock over a period of 8 quarters (1/8 of their Series B shares each quarter), at market price at the time of conversion, beginning one year after the issuance of the Series B shares. This series also provides for five-year warrants to purchase 5 common shares for every share of preferred stock owned at a strike price of $0.25 per share. Additionally, holders of Series B preferred stock have the right to receive a proportionate share of 5% of the Company’s net profits during the first three years of operations. This Series B is only available to the original private investors in the Company since its inception in 1993. Series C (issued to current existing shareholders, by mutual agreement) is structured so that its shares convert into the Company’s common stock at $0.10 per share one year after the issuance of the Series C shares. This series also provides for five-year warrants to purchase 5 common shares for every share of preferred stock owned at a strike price of $0.25 per share. This Series C is limited to certain accredited investors that helped to fund the Company at the time of the merger in March 2011. Series D (issued to new investors who will be investing new capital directly into the company) is structured so that its shares convert into the Company’s common stock at 80% of the market price at the time of conversion, one year after the issuance of the Series D shares. This series also provides for five-year warrants to purchase 5 common shares for every share of preferred stock owned at a strike price of $0.25 per share. Additionally, holders of Series D preferred stock have the right to receive a proportionate share of 5% of the Company’s net profits during the first three years of operations. This Series D is the only preferred stock series that is available to new accredited investors. http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=50440 PUBLIC FLOAT On May 10, 2011 Pharmstar Pharmaceuticals, Inc. (the “Company”) updated its corporate profile on the OTC Markets website to reflect the maximum number of shares available to be traded without restrictive legend: 92,000,049. There are a total of 92,000,049 shares issued and outstanding that are not restricted, and although the Company does not know how many of these are being held by shareholders versus being traded in the markets, the Company has elected to post the total number of shares that are non-restricted. The company previously reported its float as those that were held in DTCC, which was reported as 12,400,000 on April 8, 2011. DTCC reported 12,900,00 on May 3, which represents the shares deposited with the Depository Trust Corporation.
Raise $2,800.000 million dollars, which will accomplish the following: Use of Proceeds (Phase One) 1. Complete construction of R&D laboratory and Pilot production facilities. 2. Provide laboratory and pilot production equipment. 3. Scale up to pilot production capacity. 4. Register Facility and products with the FDA 5. Validate processes & equipment. 6. Do 90 day stabilities to get 2 year dating. 7. Write “Standard Operating Procedures”. 8. Expand laboratory area to be able to develop follow on products and line extensions. 9. Establish the manufacture, marketing, and sale of AQUAPRIN in limited quantities with phase 1 funding. Thoroughly engage its professional marketing team to get AQUAPRIN into distribution channels and in to drugstore shelves, hospitals, nursing homes, and into the prescription drug markets and or make licensing and distribution agreements as soon as possible. 10. Continue to develop advanced formulations, improvements and line extensions 11. Complete development of the Insta-Prin Emergency administration technology. 12. Develop several line extension of AQUAPRIN , such as: AQUAPRIN Cough & Cold, AQUAPRIN Cold & Flu, AQUAPRIN Menstrual Pain. AQUAPRIN Migraine Pain. 13. Conduct clinical claim trials to make specific claims for the product.
Phase Two
Raise $3,600.000 million dollars, which will accomplish the following: Use of Proceeds (Phase Two) • Initiate full scale clinical studies in order to meet FDA and FTC requirements to make claims of “fastest acting, Safest, and most effective” analgesic on the market. • Make leasehold improvements to a physical plant. • Establish full-scale production capability with phase 2 funding. • Continue to develop advanced formulations, improvements and line extensions. • Thoroughly engage its professional marketing team to get AQUAPRIN into retail distribution channels and in to drugstore shelves, hospitals, nursing homes, and into the prescription markets and or make licensing and distribution agreements as soon as possible. • Complete development of the Insta-Prin emergency administration technology. • Develop several line extension of AQUAPRIN, such as: AQUAPRIN Cough & Cold, AQUAPRIN Cold & Flu, AQUAPRIN Menstrual Pain, AQUAPRIN Migraine Pain. • License distribution for European and Asian markets.
How can the company increase in value before the product is even being manufactured? The patents alone have value – company has reported offers to buy only the patent. Each step of validation provides a better groundwork for proving themselves. With a small float – 92 million – once more investors keep their shares due to the potential, the share price should rise
What is the marketing strategy for Pharmstar Pharmaceuticals? http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=48798 Plan of Operation Market conditions favoring the new field of Pain Management are now assuming an expansive dimension of therapeutic and commercial opportunity, and PharmStar’s AQUAPRIN is primed to assume a position of market leadership. It is especially noted that other major analgesic products are introducing liquid versions of their pain relievers. Liquid versions are beginning to take hold, which is especially good for AQUAPRIN, since it is in liquid form, although much more effective and competitive. Indeed, AQUAPRIN, uniquely fast acting and safer to the stomach, exhibits many important pharmacological, and commercial advantages over all other aspirin products including, especially, aspirin itself. Rapid market penetration is expected owing to AQUAPRIN ’s unique selling proposition. AQUAPRIN is also superior in effectiveness than any other OTC pain reliever. In the US, no oral competing products exist, in terms of potency, rapid onset of action, and gastric tolerance. Neither does any competing product exists that can deliver a comparably high percentage of un-degraded salicylates per analgesic or cardio protective dose.
1. It will, for this reason, be strategically launched in such target sectors as AARP, hospitals and nursing home pharmacies, and by direct marketing, with detail samples and technical data, to medical professionals, as well as via special “2-for-1” buying incentives for distributors. Internet banners, infomercials, and consumer hot-lines will likewise be deployed after the initial 6 months, as will dedicated e-commerce, permitting direct purchase of AQUAPRIN from the Company. A special information and product campaign will be aimed toward emergency medical service organizations.
2. The Company recognizes the difficulty for a new product to secure prominent shelf space in drugstores. Its strategy will, therefore, depend on vigorous sales promotion and highly visible point-of-purchase displays at high-traffic consumer corridors. The company feels that the product is so superior to all other OTC pain relievers, that once tried with free samples, the public will demand the product. Also, local-media coupons and direct marketing will be creatively deployed by the Company to get its products distributed. The Company will also attempt to make a strategic alliance with a major pharmaceutical manufacturer and/or a pharmaceutical distribution company.
3. The Company’s strategic marketing plan includes English/Spanish promotional, packaging and medicinal insert formats. Overall Hispanic growth demographics show manifold increases in every quadrant of this population sector over the past 3 decades. AQUAPRIN’s bilingual debut also translates into easier brand-recognition and penetration of Mexican, Central and South American markets as soon as practicable, and without having to revamp or redesign product packaging or advertising.
4. Once The Company’s brand name is established in the market, the public is expected to express its awareness of AQUAPRIN’ s benefits by seeking out and purchasing the product on its own initiative. Since there exists no alternative sodium-free soluble analgesic product, AQUAPRIN should enjoy a market dominance.
5. A prescription dose form will be marketed through doctors.
Is the company proceeding with audited financials? There is nothing in writing to validate, but the notes from the CC on 7/25/11 Pharmstar is in the process of uplisting. They are presently interviewing independent auditing firms which are also knowledgeable about the pharmaceutical process. OTC requires 2 years audited financials before listing. 2nd Quarter of 2012 will give 1 year private financials & 1 year public financials
If Pharmstar does not receive financing, will they dilute share structure to raise capital? http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=52066 The three series of preferred stock have a conversion to common stock feature, which shall be non-dilutive to the current shareholder base, as certain issued and outstanding blocks of common stock shall be retired to the Company’s treasury, http://www.otcmarkets.com/stock/PHAR/news Mr. Phykitt continued, "This was a monumental day for me, and for the Company. It is a day that we have worked so hard for and have endured to create. I feel that I now can get on with my work of bringing this new product to life and building a great company." The Company did not issue any type of a new debt instrument, nor did the Company dilute its existing common share capital structure in order to finance the transaction, which is consistent with the company's objective of minimizing future dilution of its shareholder base. http://ih.advfn.com/p.php?pid=nmona&article=47333789 The Company has received an offer to purchase the building, and is currently assessing the offer. Mr. Phykitt concluded, "I made a commitment to shareholders when we restructured the capitalization table that the Company has no need to dilute its common stock for at least the next six months. This decision will not affect that commitment."
How does one know that Mr. Phykitt will accomplish his goal? No one knows for certain – any investment involves risk. The company is transparent to its investors and ready to answer questions. info@pharmstarinc.com (919) 794-7000 They have always filed their financials on time or early. Mr. Phykitt has experience building a successful business already. Mr. Phykitt personally has a lot invested in this endeavor. So far, the company or Mr. Phykitt has been honest and forthright in his dealings.
