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November 13, 2013

Nuvilex: The Triple Threat

Emerging biotech stocks typically are one-trick ponies which is one major reason why the likelihood of success is elusive and rare. On the other hand, those with multiple business lines, products, and target markets have a much greater chance of achieving great success.  As the saying goes, “the more the merrier.” With a presence in disparate but potentially related markets, Nuvilex, Inc. (OTCQB – NVLX - $0.1349 – Spec Buy) is a triple threat that offers investors huge potential. With home run potential in three large segments, Nuvilex offers investors a unique opportunity to invest in an emerging biotech that has a presence in arguably the three most important and high profile sectors of the health care arena.  Therefore, for investors seeking to minimize risk by identifying a company with multiple shots on goal, Nuvilex clearly fits the bill.

Target #1: Cancer – a multi-billion dollar market

Earlier this year, Nuvilex acquired exclusive worldwide rights to a novel, live-cell encapsulation-based platform technology for any and all cancer types, including a pancreatic cancer treatment that successfully completed Phase 2 clinical trials.  In those trials, this platform, which essentially serves as an existing therapy booster, has been shown to be very effective while resulting in reduced drug toxicity and enhanced patients’ quality of life.  The cell encapsulation-based treatment now the property of Nuvilex was superior to the current “gold standard” single-agent drug for this disease when the study results were compared to historical data for that cancer drug. The Company is already engaged in steps leading toward a Phase 3 clinical trial for patientes with advanced, inoperable pancreatic cancer.

Separately, the platform has demonstrated a strong indication for the treatment of breast cancer.  In preclinical studies in dogs with spontaneously occurring mammary tumors, the combination of the live-cell encapsulation technology with a commonly used drug for breast cancer was more effective than the cancer drug alone. It is possible that the results with breast cancer could ultimately show that the cell encapsulation technology can also be substantially positive, and perhaps even more so, for this indication than they are for pancreatic cancer.

Target #2: Diabetes - $100B+ market

Nuvilex has acquired the exclusive worldwide rights to use the cellulose-based live-cell encapsulation technology for the development of treatments for diabetes from SG Austria Pte. Ltd. This new treatment category represents an even larger opportunity for the company than its current cancer treatment initiatives.

A proof of principle animal study demonstrated that when cells that produce insulin were transplanted into diabetic animals, the animals’ elevated blood sugar levels became normalized and remained stable for the duration of one six-month study. This event indicates that the encapsulated cells produced insulin in response to the higher than normal blood glucose levels in the animals. Therefore, the encapsulated cells appear to have acted as an artificial or replacement pancreas which has tremendous value in treatment of diabetes.

Armed with these valuable study results, management will likely take steps that will ultimately lead to the initiation of human clinical trials which, in turn, will serve to substantially raise the company’s value and its profile.

Target #3: Medical Marijuana – multi-billion dollar market

With exclusive worldwide rights in the entire oncology space, and with the ability to produce the appropriate live cells for encapsulation, management may elect to study the effects of multiple cannabinoid (active constituents of Cannabis)-based cancer treatments via its subsidiary, Medical Marijuana Sciences, Inc. One possible approach would be to combine the Company’s highly efficacious live-cell encapsulation-based therapies used for oncology with a cannabinoid such as cannabidiol (CBD).  The medical marijuana arena is enjoying a great deal of attention and a growing cadre of investors and entrepreneurs as many prognosticators forecast huge revenue growth over the next 3 years and as more states pass medical marijuana legislation. For example, the independent financial news and data firm See Change Strategy estimates that the U.S. medical marijuana market is worth $1.7 billion and could reach $8.9 billion by 2016.

Nuvilex’s combination CBD-based cancer studies with live-cell encapsulation therapy development might result in bringing a highly effective product and new delivery system for use to treat the most serious and deadly forms of cancer, which would be place Nuvilex near the head of the medical marijuana product development class.

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

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.

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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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