Dr. Charles Hensley to launch next generation Zicam
"THERAMAX™ Cold Relief homeopathic nasal spray is the next generation Zicam cold remedy product, but without any actual or potential hazards from zinc. Zicam, which was developed by Dr. Hensley in the late 1990s, has been a highly successful product with sales exceeding US$100,000,000 in 2006."
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FORM 10-Q For the quarterly period ended June 30, 2009
Commission file number 000-32733
THERABIOGEN, INC.
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During 2007, we entered into an exclusive licensing agreement with a
California company, Nasal Therapeutics, Inc., to develop, manufacture, market nd sell four homeopathic nasal sprays, THERAMAX™ Cold Relief, THERAMAX™ Flu Relief,
THERAMAX™ Allergy Relief and THERAMAX™ Migraine Relief, on an exclusive basis in
North America and with a right of first refusal for all other areas. The
principal of Nasal Therapeutics, Inc., Dr. Charles Hensley, also developed the
homeopathic nasal product ZICAM. Dr. Hensley also developed Zicam Allergy and the nasal delivery systems used in the Zicam product line extensions. Dr. Hensley founded Geltech, LLC., the company that launched Zicam and made the product a household name. In 2001, Dr. Hensley and his partners sold their interest in Geltech to Matrixx Initiatives (MTXX).
Zicam has been a leading cold remedy in the United States with sales exceeding $100,000,000 in 2006. However, in recent years, the use of zinc in the Zicam product has come under fire. In 2003, reports began to surface that a small number of Zicam users suffered a condition known as anosmia, or total loss of smell. These reports have left questions in the minds of consumers, creating a significant market for a Zicam-type product that does not contain zinc. In May, 2009, the Food & Drug Administration issued a nationwide recall of ZICAM nasal spray products containing zinc. No THERAMAX™ product contains zinc in any form.
Under the terms of the License Agreement, we issued 15,300,000 shares of its
common stock to Nasal Therapeutics, Inc. on September 2, 2008 and paid Nasal
Therapeutics, Inc. the sum of $150,000, as an initial license fee. There is also
an annual license fee of $100, payable on September 1 of each subsequent year of
the license, which has a 20 year term. The shares of common stock issued to
Nasal Therapeutics, Inc. were valued at $0.144 per share, resulting in the cost
of the license being $2,353,200, including the $150,000 cash payment and the
value of the stock issued. This total license cost is being amortized over the
twenty year life of the license. The issue of the shares to Nasal Therapeutics,
Inc. resulted in a change of control of the Company.
In July, 2009, we entered into an Amended and Modified License Agreement with Nasal Therapeutics, Inc. to remove all territorial limits, to extend the terms to 25 years, and to obtain the transfer of the pending trademark application for the THERAMAX™ name. We paid a total of $75,000 for the extension and the trademark.
Business model
Over the next 12 to 24 months, we will launch three homeopathic nasal sprays
into the United States OTC market. We will launch THERAMAX™ Cold Relief in the third quarter of 2009 and THERAMAX™ Flu Relief and THERAMAX™ Allergy Relief in 2009. We have already identified and contracted with manufacturers for the products, and have designed packaging materials. On June 26, 2009, we entered into a marketing, sales and distribution agreement with Elias Shaker Company for distribution of THERAMAX™ and in July, 2009, entered into a logistics agreement with Stratis Healthcare, Inc., a healthcare industry logistics and warehouse management company.
Homeopathic nasal sprays
THERAMAX™ Cold Relief
THERAMAX™ Cold Relief homeopathic nasal spray is the next generation Zicam
cold remedy product, but without any actual or potential hazards from zinc. Zicam, which was developed by Dr. Hensley in the late 1990s, has been a highly successful product with sales exceeding US$100,000,000 in 2006.
Common colds are caused primarily by rhinoviruses and coronaviruses.
Rhinoviruses infect nasal cells by attaching to ICAM receptor sites on the
nasal membrane. The Company believes that THERAMAX™ Cold Relief is superior to other homeopathic cold remedies on a variety of levels. Similar to other remedies, the active ingredients of THERAMAX™ Cold Relief also binds to the rhinovirus ICAM attachment site inhibiting rhinovirus attachment to ICAM receptors. However, unlike other remedies, THERAMAX™ Cold Relief ingredients also inhibits the ability of rhinovirus to increase the amount of ICAM receptors on the nasal membrane. Furthermore, the actives in THERAMAX™ Cold Relief also inhibits the entry coronaviruses making it effective for coronavirus common colds as well. The fact that the actives in THERAMAX™ Cold Relief decreases ICAM levels and inhibits both rhinovirus and coronavirus should result in a more complete suppression of common cold infections than what is seen with other homeopathic products. Human studies on THERAMAX™ Cold Relief are still a few months from being initiated. However, we expect THERAMAX™ Cold Relief to be much more effective than other homeopathic products at reducing the duration of the common cold. Patents protecting the THERAMAX™ Cold Relief intellectual property have been filed with the United States Patent and Trademark Office.
THERAMAX™ Flu Relief
THERAMAX™ Flu Relief homeopathic nasal spray is the influenza equivalent
to Zicam cold remedy. The active THERAMAX™ Flu Relief inhibits influenza
virus infections by blocking influenza virus entry into cells. Furthermore,
the active ingredient of THERAMAX™ Flu Relief inhibits influenza viral
uncoating and replication. Based on the in vitro data and preliminary human
clinical results, we expect the THERAMAX™ Flu Relief to be extremely
effective at treating influenza in humans. Patents protecting the
THERAMAX™ Flu Relief intellectual property have been filed with the United
States Patent and Trademark Office.
THERAMAX™ Allergy Relief
The nasal manifestation of allergies are mediated by ICAM-1 receptors
present on the surface of the nasal membrane. Antigens such as pollen, dust,
animal proteins etc. increase the expression and subsequent presentation of
ICAM-1 receptors on the nasal membranes and provide the attachment site for
inflammatory mediators of the allergic response. The intracellular mediator
of the antigen induced increase in ICAM-1 expression and the rhinovirus
induced ICAM-1 expression is the same. Therefore, active ingredients in
THERAMAX™ cold that inhibit the ICAM-1 expression form the core of the
THERAMAX™ Allergy Relief formulation. By inhibiting the antigen induced
ICAM-1 expression on the nasal membrane, it is predicted that THERAMAX™
Allergy Relief will be extremely effective at treating and preventing nasal
allergies. |
