Notes from the Celsion sharholder's meeting... very good stuff:
By: Celsi_own
Reply To: None Thursday, 1 Jun 2000 at 11:33 PM EDT
Post # of 392
My Humble SH Meeting Notes!!
OK you guys and gals...I brought my little notebook and wrote as fast as I could just to bring you the following info. Hope you enjoy it. I may have gotten some of this stuff wrong, not on purpose, but please retain that as a caveat!! By the time I'm done writing this maybe some others will have had a chance to post other definitive info. If I reveal anything sensitive about anyone I met or heard, I apologize in advance. Had to drive back to Northern VA in ghastly rush hour traffic...glad I don't do that any more on a regular basis! I'm leaving tomorrow morning for my 30 year Air Force Pilot Training Reunion in Las Vegas for the weekend...hopefully our other faithful who were able to attend the SH meeting can fill in any blanks or questions from these notes. These follow in roughly chronological order.
FROM RAGS' LUNCH! Many thanks to Rags for putting on the luncheon. People came in an introduced themselves, paid our $21 bucks each for the food + plus a room fee. Then found out afterwards that Celsion Corp had provided a free buffet right down the hall in the meeting room!! (Note to self for next shareholder's meeting!!!) But we did have a good time, and reasonably good salad, chicken fetuccini, and "death by chocolate" cake. Futura surrepticiously took pictures of everyone, so we'll probably see a rogues' gallery set of photos on the web before long I expect!
Lunch talk involved a little friendly by many folks whose interest in CLN is driven by having cancer in their immediate families and wanting to see this promising technology on the market. There was some light spamming for COII which was tolerated, I was mildly amused to see. There is an RB board for general cancer related stocks called "Gang Talk" Barb Philbeck told us. George, the original underwriter for Cheung Labs (very distinguished looking grey headed fancy suited gentleman) sat in on our lunch, and talked about how Revlon purchased 1.5 million shares of Cheung Labs stock in the early days, and recently (probably because they are in financial trouble) gradually sold 1/2 their holdings at about $4 level...he felt this was responsible, among other events, for CELN missing the NASDAQ listing threshhold. They still hold that other 750K...so be aware of that. Guess Tanny Boy Wonder is not the only large share holder that may need to dump stock for one exigent reason or another.
Other comments and trivia from the lunch. If you don't know it, Jon Mon is either a brother-in-law or son-in-law to Dr. Cheung. Ragazzi knows a lot about peanut butter and how it took the FDA over a year to approve his company grinding broken peanuts, as opposed to pristine whole peanuts as a cost saving measure. Doesn't that just sound like a government organization?? Rags works for Haagen-Daz now, but didn't bring us any free ice cream. Thanks again for the lunch Rags! BTW...1st D mentioned that he worked for 10 years for McDonalds...was heavy into the McDLT launch, and (on the subject of bureaucracy) talked about how it took him months to get approval for McD's to switch from a mayonnaise applicator with 12 holes to 18 holes so the lettuce would stick to the open face bun!
OK, the meeting, THE MEETING!! People dribbled in to the fairly fancy (a la Hilton), but not too large meeting room, and the Spencer Volk, Dr. Cheung, Jon Mon and others were up front trying to make the computer generated slide screen work and figure out where the light dimming switches were. It was mildly amusing to watch this going on as 1:00 pm came and went. The meeting finally was called to order by Mr. Volk at 1:11 and 50 seconds on my Military Type III-Class A Self Luminous Autoranging Chronograph (aka, my watch!). The meeting was video taped by someone hired by CLN to do all their video stuff. There were also two TV's at the front that were used later to play the old Oct 99 news footage from West Palm Beach at the beginning of the Breast Cancer trials.
Mr. Volk took a couple of minutes to explain the NASDAQ/AMEX switch and how that had happened. He told how he and Gordon Macklin (the original president of the NASDAQ and now a board member of CLN) had gone to the NASD (which owns both the AMEX and NASDAQ BTW) back about March 9th of this year, and asked about getting on the NAS and how long it would take. They were told 4 weeks. Volk called NASDAQ on March 29th and they said they had just received their application on March 20th! Why the delay he asked, astounded? No explanation was given. Volk began to realize he was dealing with a ponderous bureaucracy, I sensed, from his tone. Nasdaq processors asked 20 questions based on the CELN application...17 of the questions had been answered in the application! Weren't these guys even reading the stuff CELN sent over? The application lead time grew from 4 weeks, to 8-10 weeks to 10-12 weeks, then the NASDAQ and the rest of the market swooned, CELN stock fell below $4 and the whole process began to collapse on itself with the shareholder's meeting and some serious announcements coming up. Volk and Macklin had to do something fast to get CELN off the BB! Enter AMEX Senior VP for Equity Sales, Global Sales and Member Affiars, Mr. Perry Peregoy (peregoyp@nasdaq.com). Mr. Peregoy had been hired by Gordon Macklin 24 years earlier, so his affection for Mr. Macklin goes way back. He said to them..."How would you like to be on the AMEX in 2-3 days from now!" The rest is recent history. Peregoy said that the AMEX loves to provide visibility and exposure to tech companies with sound science and business principles, and he felt that CELN fell into that category. Grooming, visibility, sponsorship...AMEX will provide these. AMEX will find investors at the retail, institutional and large individual levels. Two specialists have been assigned to CLN for AMEX. They are father and son, Joseph Giamanco, Sr and Jr. of GHM, Inc, members AMEX (212-943-4277) Jr is actually the youngest of 3 sons and a sharp looking young man who gave me his engraved business card. They will be working to see that CLN from now on, experiences narrower spreads in bid/ask price, and lower volatility, and steady growth. That was it on the AMEX.
Mr. Volk then came up and talked some personal issues on himself, I think as an example of the reasons why most of the big wigs are into Celsion. All of his immediate family members have had cancer. He works for stock in lieu of salary (along with Dr. Cheung and Mr. Mon). He's already had a distinguished career with Proctor and Gamble, Pepsico, Tropicana and Sunbeam, among others. He has found his work with Celsion exhilarating and frustrating!
Then, Mr. Volk went to the computerized slide show and began clicking the advance key and talking to the screen. We all read along. He pointed out that since Dec 98 when approval to begin testing on Breast Cancer, Celsion has been spending the majority of its funds on Research and Development. Options and warrants have been cut in half. He explained with a video how the company took MIT's adaptive phase array technology (developed by Dr. Fenn, who was also there) from a "warfare" to a "healthcare" technology.
Mr. Volk then introduced Dr. Robert Gardner and Dr. Arnold Melman (who arrived late...they had fit this meeting into a busy patient schedule) and they talked about their progress on their breast cancer and BPH trials. While the Doctors showed their slides and talked alternately, Mr. Volk and Mr. Mon jumped up and down adjusting the lights for them...kind of funny, kind of homey, kind of unrehearsed, but the info was interesting. Dr. Gardner said that he has completed 5 breast cancer treatments with the Celsion machine, and they have been accomplished safely, with no complications, and with excellent results. However, none of these tests have been submitted to the FDA yet. They've refined the BC treatment time from 40 minutes initially, to 12 minutes. The most exciting slide meant nothing to most of us, but it got Dr. Gardner all tingly...it was a slide of a breast treated by the Celsion machine, showing that most of the cancerous tissue had been turned into deat tissue or scar tissue, without damaging the surrounding tissue. The first patient, a brave lady, had come in without the support of her family, she took no pain medication, and when she had been treated, she drove herself home! Dr. Gardner had homemade chicken soup and a bouquet of roses for her to take home with her...it was an emotional experience.
The goal is to someday treat patients in the early stages of breast cancer with the Celsion machine so effectively, that they never need to undergo surgery of any kind.
Dr. Melman then got up and gave his progress on the BPH treatments using Celsion technology. He works at the Motefiore Medical Center in the Bronx, NY...the Albert Einstein College of Medicine. He's the Chairman of an Advisory Panel on Urology. He and Dr. Gardner both have impressive credentials. Dr. Melman showed a video of a patient, a New York lawyer, who went from having to unrinate 5 times a night, and getting almost no restful sleep, to getting up only once or twice, and having much improved urinary flow after one Celsion treatment. Dr. Melman has treated 20 such patients, and 14 of them had marvelous results. The other 6 he later explained, had good results on the BPH, but due to bladder problems not treatable by the Celsion machine, their overall results were not as successful. He said that a normal urinary flow rate was 16 mili-liters per second, and that problem BPH sufferers had flow rates of 5.9 mili-liters per second usually requiring surgery to correct. A very highly popular drug marketed by Merck got rave reviews for improving the flow by 1 to 1.5 mili-liters per second. The Celsion BPH treatments in Dr. Melman's patients improved three months after one treatment from 5.9 ml/sec to 10.9 ml/sec!! This is remarkable recovery. Dr. Melman sees the great advantages of the Celsion BPH machine as these...it's outpatient treatment; it can be done in the physician's office, not a hospital; there's no anesthesia required; there's no catheter required (exception for one patient for just a few days); there's no post treatment required; there have been NO failures! They don't have data on the long term effectiveness of the Celsion BPH treatment yet, but the treatment can be repeated if necessary.
Mr. Volk then showed several slides talking about when stockholders could expect revenue streams to begin being generated from these technologies. It largely depends on the approvals from the FDA which could be longer or shorter than expected depending on how they interpret the results of Phase I and II testing, however, after lengthy caveats, he stated that he expected (hopefully) that revenues would begin flowing in on these treatments as early as 18 months from now for BPH, and as late as early 2002 for BC. Celsion desperately needs these revenue flows to continue R&D of even more promising technologies in gene therapy and targeted drug therapies. These were discussed next.
Dr. Cheung talked to the promise of these new therapies, and said that revenue from gene and targetted drug therapies would begin coming in in 3-5 years. He said that studies at Sloan Kettering will show that Celsion has exclusive technology that is a biological multiplier of conventional and chemo therapies. The Celsion treatments prevent cancerous cells from having the ability to repair their DNA after radiation and chemotherapy as is the sad case in cancer treatment now. The Celsion technology will enable drugs to ge given to cancer patients with lower side effects due to targeting. He expected large animal trials to begin in 12 months and human trials to begin in 18-24 months.
Dr. Cheung really got excited then talking about liposome delivery, and the tests at Duke University. He described a test using a common cancer drug called doxombicn (as I recall) on cancers implanted in rats. There were four tests using four delivery methods, ABC&D each trial on 11 rats. Celsion's targeted liposome was the D treatment. In AB and C while initial tumor growth was slowed, the tumors ALL recovered grew rapidly after a few days and death of ALL rats in all three cases took place within a few weeks. In the Celsion trial, with targeted delivery of the same drug, ALL the tumors on ALL the rats regressed in 12 days, virtually disappearing, and they didn't regrow AT ALL during a 60 day followup period. Celsion's targeted drug delivery using liposomes, Dr. Cheung referred to as "the Holy Grail" of drug therapies. He announced that National Institutes of Health wants to participate and underwrite the costs of further clinical tests by Celsion.
CELSION...RESTORING HEALTH THROUGH FOCUSED HEAT!!! This is the CLN motto.
Mr. Volk then had a reading of the balloting results on the three measures the stockholders voted on:
1--to approve the nominated Board of Directors for one year. Shares outstanding were 60,693,216 present or by proxy. 53,766,191 or 87% were voted for the directors. Elected!
2--to ratify the appointment of Stegman & Company as independent public accountants for Celsion Corporation. 53,571,317 for, and 68,847 against. Ratified!
3--to incorporate in Deleware and authorize increase in shares from 100M to 1560M common and an additional 100K preferred stock. 37,392,411 for and 786,680 against. Approved!
The meeting then turned to questions from the floor:
William Tucker asked Dr. Cheung what type of hyperthermia equipment was used for animal studies on the liposomes? Was it the same as what would be used for the human trials? He answered basically, yes it was. He also asked if there was a real deep seated cancer machine in existence like we see on the Celsion web page. Dr. Cheung answered that an engineering team had been assembled and that a design was in work and would be completed in 12 months and would begin R&D for animals in 2001.
Lee Yost asked about FDA concerns...could we get around FDA restrictions by going overseas for trials and treatments. Dr. Cheung said there were some overseas trials going on, but that Celsion had no desire to try to bypass the largest and most lucrative market for its technologies, the good ol' USof A. He said, "We know Celsion technologies work. How can the FDA deny us when they see this? He thinks they won't. It's just a matter of time. Mr. Volk added that the breast cancer treatment system already had FDA pre-market approval, and that Celsion was going for a change in "indication of use" approval from the FDA which could be obtained in a more timely manner. Dr. Barnette, Medical Director at Hammersmith said that Phase II breast cancer trials would be going on in Europe soon...not limited by FDA.
Scott Adler (aka Telephonics) asked about a CE mark...making FDA approval easier. Mr. Volk responded that Celsion knew about this, and was working on it.
Joel Morse asked about BSDM...were they serious competition. Mr. Volk mentioned their "copy cat" PRs, that Celsion Corp was annoyed by it, that Duke had indicated they were annoyed by it, but that, for now, it appeared that the market did not believe BSDM...even their biggest PR of late brought only 7000 shares total volume traded in one day...NOT a threat. They do not have the same technology as Celsion, and they are not doing the same tests at Duke as Celsion.
Robert Davidson asked for a round of applause for our hard working CEO and the Celsion team, and they got it!! He asked if Celsion intended to manufacture its technological machinery. Mr. Volk said that Celsion would form alliances to do that, and would save costs in the process.
Barb Philbeck asked how often a BPH treatment could be given? Dr. Melman responded that he was hopeful that the treatment could be refined to where it would only have to be given once! But that it could be given as often as once every 3 months if needed in extreme cases.
Wally Wethe asked if Celsion was working to get Hospital Corporation of America (an HMO) primed to use Celsion technology when approved. Mr. Volk said that they were working with the Southeast division of HCA and they wanted to participate with Celsion towards that goal.
Bob Whitmore (1st Diogenes) asked about how long current $9M funding would last and what impact the dilution of shares would have. Mr. Volk said that costs were going down, as he explained earlier, and were more focused than ever on R&D. Current funds would last for 4 years at the current burn rate. He indicated that some new people would be hired to speed up the gene therapy and liposome technologies that might shorten that to 2 1/2 years. But by then...we should be getting revenue from BPH and possibly breast cancer treatments. The extra shares will be held as long as possible! Mr. Volk and Dr. Cheung said that they had not sold any of their shares to date. Mr. Volk hoped that Celsion would increase it's growth through strategic alliances (like NIH) rather than dilution of shares.
What about Dr. Alan Fenn? What else is up his sleeve invention wise? He said he was working on other radiation technologies, but that the adaptive phase array technology of Celsions was viable and mature! All it needs is commercialization!
Jerry Friedman asked if Celsion was losing its entrepreneurial aspects? Mr. Volk said, on the contrary, Celsion directors had just had a three day strategy seminar where they concluded that they need help in certain areas, and are going to hire new people with "fires in their bellies!!" Mr. Volk said that he had personally turned around 7 companies and made them profitable, and implied that Celsion would be his 8th. "We have 5 of the 10 best hospitals in the world helping us!" he said.
Ludlow Adams asked about the UCLA work. Dr. Gardner said that Dr. Vargas at UCLA had treated 2 patients so far. That they were having more difficulty finding eligible candidates with large tumors. Then Adams asked about the radioactive seeds therapy at UCSF (a BPH treatment). Dr. McRoads said that more that 1/2 of the patients still had urinary obstructions, but that with the addition of Celsion's BPH treatment, they expected to have synergy. Celsion's tech would provide a radiation sensitizer that would give a much better efficacy outcome, said Dr. Cheung.
Barb Philbeck asked if any major companies had approached Celsion about their techs...hinting at possible buy outs. Mr. Volk said that two companies had called Celsion with questions, but that they did not want to be identified, and that there was no further info that he could give at this time.
And folks...if you haven't gone blind by now...that's the end of my notes! If I made mistakes or inaccuracies, I apologize...I might have copied some things wrong or spelled people's names wrong in haste to get as much down as possible.
Thanks for listening...remember...color me gone for 4 days! Vegas!!
GO CELSION!!
|
