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BioElectronics Investor Updates December 16, 2019
CE Mark/ISO Certification Renewal Status Update
We are pleased to announce that on December 10, 2019 we received the official ISO 13485:2016 certificate from our registrar. This certification is the latest quality management system being utilized in the global medical device industry and will boost the Company’s business credentials. The certificate is valid until December 10, 2022 (3 years) and will be subject to an audit annually.
On Wednesday, November 25 NEMKO informed us that the lead reviewer requested clarification on some of the submissions in the technical file. We are preparing the necessary documentation for submission to NEMKO for further review. We anticipate a conference call with the assessor next week, following which we will be able to send in the responses.
FDA Musculoskeletal Pain 510(k) Status
On December 11, 2019 the lead FDA reviewer of our 510(k) application contacted us via e-mail to request additional information on administrative forms, as well as to seek clarification on the statistical analysis discussion of the cervical osteoarthritis (COA) clinical summary. On December 13, 2019 our R&D team held a conference call with the FDA review team to seek guidance on the responses expected from the Company. The call was very encouraging, and we feel confident in our ability to send the required responses early this week.
Additionally, we were informed that the application has moved into the “Interactive Review” stage of the review, where interactions with the FDA review team take place more frequently and is the final stage before a decision is made on the application. Historically, the Interactive Review stage of the FDA has proceeded relatively quickly when compared to the “Substantive Review” stage.
Allay® Study Status Update
Following study completion in early November, we continue to await the study data from the principal investigator.
Sales Update
Management has decided to prioritize the OEM (Original Equipment Manufacturer) relationships aspects of its business and reduce the focus on direct-to-retail sales. Direct-to-retail and direct-to-consumer sales require a sustained, high-capital, national level advertising and marketing campaign. Since the Company’s current structure does not allow it to create and maintain such a campaign, the focus is to instead align itself with partners who will distribute the ActiPatch® to enhance/differentiate their current product offerings in the OTC space. The ideal partner(s) should be best-in-class, have a strong track record in selling consumer goods like ActiPatch and have ample financial resources to mount a national sales/advertising campaign.
As indicated in our October 16, 2019 Investor Update, we have followed up with several entities, with a history of prior business discussions with BioElectronics, to assess their interest level in potential partnership opportunities. In early November we entered into an NDA with one such partner. An NDA between two companies allows each entity to understand the processes used in each other's business for the purpose of evaluating the potential business relationship. Since NDA’s create a confidential relationship typically to protect proprietary information or trade secrets, we are not at liberty to name the partner until after a deal is signed. The NDA discussions with this partner are ongoing and their management has shared with us that they have a budget meeting scheduled for Wednesday, December 18th. The partner will reach out to us to share their initial thoughts and next steps – we have been informed that final decisions would be made at their January board meeting.
Further, BioElectronics is also in discussion (under an NDA) with a global player in the orthopedic devices industry that specializes in products for rehabilitation, pain therapy, physical therapy, and surgical reconstructive implants. Our intended relationship is as an OEM supplier where, the partner would use ActiPatch technology to differentiate their line of products in the marketplace. They will contribute significant assets for promotional activities of the product, including a direct-sales team of several hundred. The initial contract proposal is for the North American territory and is expected to generate more than $2 million in sales for BioElectronics, in 2020.
Additionally, our discussions to expand territories with Mundipharma are ongoing and we believe our demonstrated ability to deliver 15k products to the SEA region will positively impact our ability to close a contract for the MENA region. Negotiations also continue with our potential partners in both Russia and South America.
Lastly, we are finalizing a budget and schedule for participation in the 2020 VA Medical Center Direct Access Program events. As a reminder, the VA Medical Center Direct Access Program events provide marketing opportunities for verified (Veteran Owned Small Business) VOSBs and other Small Business and Distributor Partners to promote new and innovative products to Clinicians, Physicians and Procurement Decision Makers within the VA Healthcare Marketplace. At this time, we intend to send Company representatives to 12 of the events in 2020 that are taking place in the Northeast region and contract with our Service-Disabled Veteran Owned Small Business (SDVOSB) partners for representation at the majority of the other 45 planned events. Incidentally, one of our SDVOSB partners has made progress with a member of the Department of Defense's Clinical Medical Research team. This individual will begin a new position as the Director of Complimentary and Interventional Pain Management at NIH's Non-Pharmacological Pain Management Interventions program in January 2020. We anticipate being able to set up a meeting in February 2020.
BioElectronics Investor Updates December 16, 2019
CE Mark/ISO Certification Renewal Status Update
We are pleased to announce that on December 10, 2019 we received the official ISO 13485:2016 certificate from our registrar. This certification is the latest quality management system being utilized in the global medical device industry and will boost the Company’s business credentials. The certificate is valid until December 10, 2022 (3 years) and will be subject to an audit annually.
On Wednesday, November 25 NEMKO informed us that the lead reviewer requested clarification on some of the submissions in the technical file. We are preparing the necessary documentation for submission to NEMKO for further review. We anticipate a conference call with the assessor next week, following which we will be able to send in the responses.
FDA Musculoskeletal Pain 510(k) Status
On December 11, 2019 the lead FDA reviewer of our 510(k) application contacted us via e-mail to request additional information on administrative forms, as well as to seek clarification on the statistical analysis discussion of the cervical osteoarthritis (COA) clinical summary. On December 13, 2019 our R&D team held a conference call with the FDA review team to seek guidance on the responses expected from the Company. The call was very encouraging, and we feel confident in our ability to send the required responses early this week.
Additionally, we were informed that the application has moved into the “Interactive Review” stage of the review, where interactions with the FDA review team take place more frequently and is the final stage before a decision is made on the application. Historically, the Interactive Review stage of the FDA has proceeded relatively quickly when compared to the “Substantive Review” stage.
Allay® Study Status Update
Following study completion in early November, we continue to await the study data from the principal investigator.
Sales Update
Management has decided to prioritize the OEM (Original Equipment Manufacturer) relationships aspects of its business and reduce the focus on direct-to-retail sales. Direct-to-retail and direct-to-consumer sales require a sustained, high-capital, national level advertising and marketing campaign. Since the Company’s current structure does not allow it to create and maintain such a campaign, the focus is to instead align itself with partners who will distribute the ActiPatch® to enhance/differentiate their current product offerings in the OTC space. The ideal partner(s) should be best-in-class, have a strong track record in selling consumer goods like ActiPatch and have ample financial resources to mount a national sales/advertising campaign.
As indicated in our October 16, 2019 Investor Update, we have followed up with several entities, with a history of prior business discussions with BioElectronics, to assess their interest level in potential partnership opportunities. In early November we entered into an NDA with one such partner. An NDA between two companies allows each entity to understand the processes used in each other's business for the purpose of evaluating the potential business relationship. Since NDA’s create a confidential relationship typically to protect proprietary information or trade secrets, we are not at liberty to name the partner until after a deal is signed. The NDA discussions with this partner are ongoing and their management has shared with us that they have a budget meeting scheduled for Wednesday, December 18th. The partner will reach out to us to share their initial thoughts and next steps – we have been informed that final decisions would be made at their January board meeting.
Further, BioElectronics is also in discussion (under an NDA) with a global player in the orthopedic devices industry that specializes in products for rehabilitation, pain therapy, physical therapy, and surgical reconstructive implants. Our intended relationship is as an OEM supplier where, the partner would use ActiPatch technology to differentiate their line of products in the marketplace. They will contribute significant assets for promotional activities of the product, including a direct-sales team of several hundred. The initial contract proposal is for the North American territory and is expected to generate more than $2 million in sales for BioElectronics, in 2020.
Additionally, our discussions to expand territories with Mundipharma are ongoing and we believe our demonstrated ability to deliver 15k products to the SEA region will positively impact our ability to close a contract for the MENA region. Negotiations also continue with our potential partners in both Russia and South America.
Lastly, we are finalizing a budget and schedule for participation in the 2020 VA Medical Center Direct Access Program events. As a reminder, the VA Medical Center Direct Access Program events provide marketing opportunities for verified (Veteran Owned Small Business) VOSBs and other Small Business and Distributor Partners to promote new and innovative products to Clinicians, Physicians and Procurement Decision Makers within the VA Healthcare Marketplace. At this time, we intend to send Company representatives to 12 of the events in 2020 that are taking place in the Northeast region and contract with our Service-Disabled Veteran Owned Small Business (SDVOSB) partners for representation at the majority of the other 45 planned events. Incidentally, one of our SDVOSB partners has made progress with a member of the Department of Defense's Clinical Medical Research team. This individual will begin a new position as the Director of Complimentary and Interventional Pain Management at NIH's Non-Pharmacological Pain Management Interventions program in January 2020. We anticipate being able to set up a meeting in February 2020.
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