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Let me explain (again). But first, understanding the remainder of this article would be a bit easier if you simply re-visit the spoken word for about the last 11 minutes, which includes for the more short-term oriented financial investor 4 minutes of explanation on the progress in revenue growth in the 4th quarter 2012 and what Calhoun describes as a "Step shift in Revenue going forward in 2013, which together with expense reimbursement from BARDA should result in a considerable cash burn reduction". The 11 minute audio therefore you will find first. From the presentation slides I would like to draw your attention to one slide, which also (finally) confirmed what I have been writing for years and that is, that some of the UNDISCLOSED third party clinical investigations- i.e. the famous 40 plus translational investigations ARE CLOSER TO MARKET REIMBURSEMENT than Cytori´s own breast reconstruction application, if the image on the left tells the truth!!! (which I am sure it does)

 

Now isnt that something? Surprised? 

Not for me- the IR policy of Cytori has been desastrous for years and will continue to be so until the partner deals, which are supposed to be still on the table are "in the bag"- and I do expect some to close for exactly that reason- the apps are already DEVELOPED in

some parts of the world and ready for prime-time. 

NICE-but much more relevance from a future development perspective were Calhoun´s statements in the Q&A session.

He answered (good) questions from the audience about regulatory issues, cell population and mechanisms, cell manipulation and programming and lastly, but most important- aging of ADRCs. These topics I have discussed on this page for several years, but besides the regulatory issues, were NEVER really expressed clearly by a leading Cytori representative. Even if those statements came from Calhoun, who has zero credibility left- the statements were extremely important, because they obviously come from "the scientific base" of Cytori and CC is just "echoing" their results, which surely must have been the basis of Dean´s 10XWD. CC is more responsible for investor "expectations" in which he simply has done a lousy job. But going down the REVERSE order of those Q&A questions. 

Aging of Cells from Adipose.

Or better- the acceptance by CC&Co that ADRCs dont age or hardly do age, was absolutely new. Of course to protect from material impact to the banking business of which Cytori always have been wanting to pick-up a piece. Well- there never was a business, despite the announcement in 2007 of 250 banks to be sold in Japan alone by 2012. Believe me- the best storage facility is your own belly and ADRCs are un-matched from a quality perspective to other stem cell sources, especially for elder folks. Calhoun´s statement- The ideal cell for the aging population- I believe to be absolutely correct and storing fat or cells make sense only for cosmetic surgeons, where you do a lipo for other reasons than cells anyway. 

Programming fresh cells for optimal therapeutic efficacy.

Probably even more important than the "aging issue" is the fact that the therapeutic performance of the fresh cells can be improved by a short exposure (10-15 minutes) to a growth factor, small molecule compound or other means before administration to the patient. CC indicated that scientists at Cytori already discovered in the pre-clinical setting a 400% improvement (against present conditions, I presume) of blood flow. This is also what I have been writing about for ages- Eckhardt Alt and Kai Pinkernell already wrote about that in 2006 for the cardiac indication (VGEF growth factor exposure for blood flow AND the myocardium i.e transdifferentiation into cardiomyocytes) and Marco Helder uses BMP-2 as stimulator for bone growth. CC mentioned Vitamin D himself for that purpose, which is certainly not unknown either. Of course- doing "more manipulation" changes the regulatory pathway, but KEY here is that is right up the alleyway of BIG PHARMA. You can patent the process of CELLS WITH AN ADDITIVE and have a protected monopoly for a long time. Just ask yourself the question- if I as a large pharmaceutical Company see a STAIR STEP improvement in EFFICACY in apps for unmet needs, which wipes out any pill-competition. Wouldnt you start clinical trials ASAP? Than- how many of the 40 plus investigator trials are doing "fresh cells plus additives" do you think????? Definitely something to think about-

just think of what a 400% blood flow improvement would do to a PRECISE patient- right- not status quo holding and keeping from sliding into heart failure, but re-modeling of the heart- see picture. 

 

Composition of the Celution Cell Population for therapeutic Dosing 

Maybe not so interesting for most of you, but personally very "stimulating" for myself and my conviction of the versatility and capabilities of the GIMISH in respect of other mechanisms than just angionesis or blood flow, was CC´s discussion on the composition of the Celution output. He (and therefore Cytori IR) is "swinging" more to the immune-modulation and anti-inflammatory virtues of the gimish, which I described in detail in my HARDCORE article. Actually in the past year I have read so many scientific papers, which have confirmed my views on this issue, which probably means that a HARDCORE II is not far away in the future. I also strongly believe that the immune-modulation virtues will be the driving force for Astellas to work with Cytori. Transplantation is the core business of Astellas and ADRCs are very potent in respect of helping to protect immune response directed issues with organ transplants. This will be core ahead of liver.

 

Finally- Regulatory Pathway- FDA and DEVICE business model.

In view of the complexity of the device regulatory pathway- which I am very familiar with and have discussed many times- many investors still do not grasp its gory details. Therefore it was good for most folks to hear it confirmed again- that the relation with the FDA and particularly CBER, appears to be very good (thanks to Dean and Thompson probably- since that wasnt the case- lets say 3 years ago). Key to know is simple- Device PMA means 2 stages- pilot and pivotal compared to IND, three stages plus clinics which tend to be much smaller in size. But readers from this page know that already for ages too.

 

TO CONCLUDE

Yes- I believe 2013 will be Cytori year- all we need is execution by management and EXECUTION by Lloyd Dean (picture) to make the changes, he NEEDS to make from a corporate governance perspective. Lets cross our fingers.