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September 25, 2013

Nuvilex: The Quintessential Mid-Late Stage Biotech Opportunity

For investors seeking a well-positioned mid-late stage biotechnology company, one may not need to go any further than Nuvilex, Inc. (OTCQB – NVLX - $0.135 – Spec Buy).  The Company has nearly all of the characteristics biotech and micro cap investors find attractive and actively seek. 

Savvy biotech investors typically engage a checklist of sorts in order to ascertain a given biotech’s standing and worthiness (and occasionally valuation).  These attributes include intellectual property ownership, clinical trial development and completion, trial performance results as compared with competing firms, size of targeted treatment market, mechanism of action of drug or biologics, applicability of approach for other treatment categories, management, third party/strategic partner funding history, and upcoming milestones.

Based on the list above it is clear that Nuvilex stands perched near the top of the mid-late stage biotech standings.

The Company owns exclusive rights to a ground-breaking targeted drug delivery system that may be used to develop treatments for many different types of cancer.  The cancer treatment incorporates live, encapsulated, cancer-prodrug-activating cells implanted intravenously at the tumor site together with well-known anticancer prodrugs.  The treatment used in highly successful Phase II clinical trials in inoperable pancreatic cancer consisted of encapsulated cells plus the anticancer prodrug ifosfamide.  Results such as median survival time and one-year survival rate were significantly better in those Nuvilex predecessor trials than those reported for the 3 approved pancreatic cancer treatments, Gemzar (gemcitabine) in 1996, the combination of gemcitabine with Tarceva (erlotinib) in 2005, and the combination of gemcitabine with Abraxane (albumin-bound paclitaxel) in 2013, in their Phase 3 trials.  Moreover, the striking results in the Nuvilex trials were achieved using low chemotherapy doses, which markedly reduced the side effects from the cancer drug.

The pancreatic cancer treatment market alone is in excess of $1B and given the potential to use the therapy to treat other cancers, Nuvilex is a pure-play cancer treatment stock. Plus, there are indications that the live-cell encapsulation technology can be used to treat diabetes. To that end, the Company is nearing closure of a deal to secure the technology for diabetes as well, substantially increasing the size of the market opportunity for the Company. Clearly, Nuvilex is no one-trick pony.

Management has a wealth of experience in bringing drugs through the clinical trials and FDA process and is currently focused on the steps necessary to obtain the required number of prodrug-activating cells that will be needed prior to the initiation a Phase III clinical trial in advanced, inoperable pancreatic cancer patients.  Other milestone events prior to trial initiation include the encapsulation of the prodrug-activating cells in a GMP (Good Manufacturing Practices)-compliant facility, and the design of the clinical protocol itself.  Such milestones are critical to the Company’s development and a measure of future prospects and valuation.

At the current stage, investors can place a check mark next to all of the boxes with the exception of a strategic partner. However, strategic partnerships usually are accompanied by the commencement or conclusion of major developmental events. As a result, a third-party investment/partnership with the likes of oncology-focused firms such as Celgene (NASDAQ – CELG), Merck (NYSE – MRK), Bristol-Myers Squibb (NYSE – BMY), and others is clearly in the cards, which makes Nuvilex’s shares that much more attractive, ahead of such an event that typically drives stocks and valuations substantially higher.

For more information, refer to our previous sponsored NVLX Reports, Updates and Hot Topics by visiting www.GoldmanResearch.com

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Senior Analyst: Robert Goldman
Rob Goldman has over 20 years of investment and company research experience as a senior research analyst and as a portfolio and mutual fund manager. During his tenure as a sell side analyst, Rob was a senior member of Piper Jaffray's Technology and Communications teams. Prior to joining Piper, Rob led Josephthal & Co.'s Washington-based Emerging Growth Research Group. In addition to his sell-side experience Rob served as Chief Investment Officer of a boutique investment management firm and Blue and White Investment Management, where he managed Small Cap Growth portfolios and The Blue and White Fund.

Analyst Certification
I, Robert Goldman, hereby certify that the view expressed in this research report accurately reflect my personal views about the subject securities and issuers. I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the recommendations or views expressed in this research report.

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