Interview: RestorGenex CEO Stephen Simes on the Company's Pioneering Cancer, Acne and Eye Treatments

Spotlight Companies  |

In recent years, advances in technology have made nearly every facet of life far more efficient and convenient. We no longer get lost thanks to GPS on our phones, we make payments without carrying a wallet, and we can experience world of entertainment options instantaneously. Yet, it's impossible to enjoy any of these conveniences without your health, so it's disconcerting to learn many of the most common treatments for cancer, macular degeneration and acne have seen few notable advances over the past several years. Pioneering small-cap company RestorGenex is hoping to change that.

RestorGenex has made a name for itself in the biopharmaceutical sector thanks to their impressive portfolio of first-in-class therapeutic ophthalmologic, oncologic and dermatologic products. Their line of treatments and therapies in development are designed to treat some of the most devastating and stigmatizing diseases in ways that are more effective and far less invasive than any option that's currently on the market.

Stephen M. Simes, CEO of RestorGenex (RESX) recently took the time to speak to about the pioneering work currently being done at the company. Read below for Simes' thoughts on why the RestorGenex business model has the company well-positioned to provide exceptional returns for investors while creating safe and effective treatments and therapies for patients.

EQ: Thanks for speaking with me today, Stephen. Could you give our readers a brief overview of the work your team at RestorGenex is doing?

Simes: I'd be happy to, and I appreciate the opportunity to do so. We are a biopharmaceutical company. All of the products we're developing are small molecules in nature, so from a product development point of view, they offer lower cost and potentially lower risk. That said, we're working in very interesting areas led by oncology and our lead indication in oncology is Glioblastoma. Beyond that, we're looking at ophthalmology, specifically with age-related macular degeneration. In addition, currently our portfolio includes a topical product for acne. So, we have a very robust, healthy portfolio of products in very exciting areas, and each of these potential indications is currently over a billion dollars in sales.

EQ: Yeah, these are massive markets. As a layman, it seems these are some of the more broadly reaching fields in all of medicine. Would that be accurate?

Simes: I think that you're quite right. By design, we decided we didn't need to develop another “me too” product, so we've looked at applications where our products can fill an unmet medical need. In the case of Glioblastoma, unfortunately, once these patients are diagnosed and treated with regular supportive care, they will die within about six months. The current approved products will extend that survival out to about 12 months. One could argue it's a doubling of lifespan, yet on the other hand, certainly not very attractive for the patient or the family. In this indication we've already received FDA Orphan Drug Designation for our product RES-529 being developed for the treatment of glioblastoma.  Our pre-clinical data in glioblastoma as we as in prostate cancer, lung cancer and breast cancer and very exciting and encouraging for further development.

EQ: Could you give an overview of what constitutes an Orphan Drug Designation?

Simes: Yes. Many years ago, Congress, in their wisdom, created the Orphan Drug Legislation. An Orphan Drug is a drug that affects fewer than 200,000 people in the United States. Historically, the problem was that drug companies simply would not develop drugs for relatively small markets. Congress then came up with this legislation, which includes incentives like tax credits. There are also two other factors that are perhaps even more enticing.

First, seven years of market exclusivity if and when you get approval for your product. So, there will be no competition for that specific product for seven years from approval. Second, because they're relatively small indications, the number of patients required in the clinical trials potential are smaller, so there are a lot of incentives here.

Of course, in the United States, where pricing is very attractive for a pharmaceutical company, these markets can be quite dramatic in terms of potential size. Glioblastoma is one of those where the market today is about a $1 billion for products that are just not very good. The market research companies predict the market will grow to between $4 and $5 billion in the next several years, not only because we're an aging society, but more importantly because of new products that will be approved, that will be better than the current products.

EQ: Very good, and you guys seem to be on the forefront, in that regard. What does set RestorGenex apart from other companies that might be trying to take the lead in this field?

Simes: As I said, the approved products are not very good. They extend life somewhat, a large percentage of treated patients will have recurrence and so the drug works for a while and then stops working. There's a need for improved products. Our product, RES-529 is what is known as a PI3K/Aky/ mTOR pathway inhibitor. Without getting too scientific here, it turns that this pathway in the body is implicated in up to 80% of tumor types. Our product disrupts, or inhibits this pathway, and has shown in pre-clinical studies to shrink tumor volume.  Of course, clinical trials are key. However, we are very encouraged by the data to date, and we are excited to initiate clinical trials in 2016.  Our goal will be tumor shrinkage and extension of life.

A significant advantage of our product RES-529 is that our drug can be delivered orally, so that in these cancer patients, instead of multi-hour or frequent infusions or IV application of medication, we believe our patients will be able to take an oral tablet, once or twice a day. This would be very attractive from a patient quality of life point of view.  In addition, we have shown in animal models that RES-529 gets into the brain, brain tissue and brain tumors, which of course is critical in treating brain cancer and metastasis.

EQ: Products in a similar field today would generally be taken through and IV or other more invasive methods?

Simes: Yes, it's IV, or an infusion of one sort or another.

EQ: That is a great overview. What are the specific catalysts for the direction that you've taken with your research?

Simes: For all of our products this year - for Glioblastoma as well as macular degeneration as well as acne -we'll be finalizing the respective formulations and working on completing the preclinical work necessary to prepare us to go into clinical trials in 2016.

This year is really setting the table for a breakout year in 2016, when we expect to initiate at least three clinical trials. I should add here that our product for macular degeneration already has completed two phase 1 clinical trials. In order to go to the next phase of expanded trials, we have to produce a little bit more preclinical data, and then we'll be able to move into the bigger, expanded clinical trials.

EQ: I see. It sounds like you guys are on a great path right now. Tell me a bit about your research and developments in terms of acne. I think you know some people might not be aware, or might not think necessarily think of it as a disease to the same extent. What's your perspective on that?

Simes: That's an interesting one, because you're quite right. I mean, people don't die from acne. On the other hand, the social stigma of acne is very difficult for many of these patients. Today in the US, believe it or not, the market for acne products is between $1 billion and $2 billion. That doesn't even include the over the counter market. That's the prescription market. The problem is that the current treatments for acne cause terrible skin irritation and sun sensitivity, so if somebody is using it, they shouldn't go out in the sun.  Another product on the market has been shown to cause birth defects.

Antibiotics also are used to treat acne. Unfortunately, as you know, as with most uses of antibiotics, there's growing resistance to the antibiotics. Doctors are looking for other ways to treat acne. From a corporate point of view, we view it as a lower risk, less expensive entree to market because it's acne versus a brain tumor. But also, there's very clear, definitive published guidance by the FDA in terms of what you have to do to get a product approved, and these are in essence three month clinical trials to show efficacy in this population.

EQ: That's terrific. As far as acne is concerned, it seems there's not any products on the market that really do an effective job without being invasive and causing pretty severe side effects.

Simes: That's right. There's retinoic products like Retin A that cause redness and scaling. Then there's Accutane, which has been shown to be a very effective product, but has been shown to lead to systemic effects, including birth defects in women. Then there's systemic antibiotics. If you don't have to use a systemic product for a local problem that is on the skin, we prefer to avoid that systemic exposure - especially with the growing resistance.

EQ: We're very excited that RestorGenex will be at our conference in June. What can attendees expect from RestorGenex next month?

Simes: Part of why we're going to your conference is that we have great respect for Right now, our company is really “under the radar,” as the saying goes. To date, we have not spent a lot of time in terms of investor relations, or public relations, because we really wanted to make sure that the company was well set for us to tell the story. We have a good product pipeline that is now in development, as well people managing this technology. I'll just talk about one or two people if that's okay with you.

EQ: Absolutely, yes.

Simes: The Chairman of the Board of RestorGenex is a man by the name of Sol Barer. Sol is a PhD. in biochemistry, but perhaps even more important, he was the founder and eventual chairman of Celgene Corporation (CELG) . Celgene today is about a $90 billion market cap biotech company. Dr. Barer founded the Celgene and took it through many levels of success.

I have been CEO of several different companies. In fact, RestorGenex is the fourth company at which I've been CEO, and each of the previous three were sold to others, or merged with others, and the stockholders have done very well over time. I have worked with Phil Donenberg, who is our CFO, for over 25 years in four different publicly traded, small micro-cap biotech pharmaceutical companies. When you have a team that works, you want to keep it together.

We recently added Mark Weinberg, who is an MD by training, as our Senior VP of clinical development. He has over 15 years of clinical development experience. We have a team of people in place who not only have the experience, but they have illustrated consistent success in their prior engagements.

Finally, last year we raised $35.6 million, and to implement any plan, you need to have cash in the bank. As of December 31, in fact, we reported in our 10K that we had approximately $22 million of cash in the bank. We're burning about $1 million a month. We have enough runway to get well into 2016. So, from the point of view of people, products, a plan, and most importantly, the cash to implement the plan, we believe that the story really comes together nicely, and investors should take an interest in our company now that we're prepared to share what we're doing with the public.

EQ: Fantastic, it certainly sounds like it. There are a lot of people there with a proven track record. It sounds like you guys are well on your way toward reaching your goals. Are there any longer term goals that we haven't touched on that you want to share, or anything looking ahead that you are looking to accomplish?

Simes: My job as CEO is to maximize stockholder value. We are dedicated to maximizing stockholder value, not only in the short term, but in the long term as well. We are very careful, not only when it comes to how we spend our money, but how we maximize stockholder value, which could include internal developments, the possibility of M and A transactions, or licensing deals that will help us to maximize the value of our assets.

Right now, we're focused on moving into human clinical trials in 2016, and that will take care of us the next 12 to 18 months. Right now, for us, 12 to 18 months really is the long term and we have high enthusiasm about our potential.

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Symbol Name Price Change % Volume
CELG Celgene Corporation 66.63 -1.50 -2.20 7,588,589 Trade



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