Dear Friends and Shareholders,
I want to take this opportunity to give you an update on our progress at Cannasat Therapeutics since my appointment as President and CEO on November 16th, 2009.
My mandate is to bring value to Cannasat’s existing assets while building a limited portfolio of products. The rationale behind this strategy is to increase shareholder value through effectively managing risk, sticking to a core competency of taking projects to Phase 2 clinical proof-of-concept, and making Cannasat more attractive to institutional investors. Creating critical mass will generate analyst coverage, and ultimately bring greater liquidity to our shares.
Based on my experience in the Bio-Pharm industry, and given the renewed optimism in the Biotech sector today, Cannasat’s management has developed a three-fold strategy.
1. The first part of our strategy is to secure pharmaceutical partnerships on Cannasat’s THC formulation technology, for both Relivar (the buccal tablet) and a patented generic prototype. This is a lower risk reformulation approach which benefits from patent protection for a significant period of time.
2. The second part of our strategy is to rebrand Cannasat as a Central Nervous System (CNS) company versus a cannabinoid company. Our cannabinoid drug candidates fit into the CNS profile, and by positioning ourselves as a CNS company, we will distance ourselves from some of the stigma associated with cannabinoids.
3. The third part of our strategy is to in-license or acquire a technology and/or a company that is in the CNS sector, which could drive significant potential value. In our first project for in-licensing, we will be looking to lower the risk by reformulating an approved drug.
These elements will transform Cannasat into a Specialty CNS (Central Nervous System) Pharmaceutical company with an attractive risk return profile. An example of a company in our own backyard that started out with this lower risk approach is Biovail. They used a reformulation strategy to lower the regulatory, efficacy and market risk, and to build multiple revenue streams over a period of time.
I am pleased to report that we are well under way on all three fronts of our plan.
With regard to forming pharmaceutical partnerships for the cannabinoid products, we have identified a number of ideal candidates, and are now in discussions with a few of these companies. Although there are no guarantees we will conclude a transaction, there are a number of pharmaceutical companies that are interested in cannabinoid products, given the increasing demand for innovative pain medications and THC’s long-term safety profile. The pharmaceutical industry is approaching a patent cliff in 2010-2012 where many of the existing products on the market today will lose their patents and be genericized. This puts enormous pressure on Big Pharma to find new products.
Rebranding Cannasat is an important part of our strategy, as it will position Cannasat as a CNS company versus a cannabinoid company. Although we have a committed shareholder base who are very supportive of our cannabinoid program, it is important moving forward that we do not turn off potential investors because of any perceived stigmas associated with cannabinoids. We have begun making changes to our website, and are considering a name change that will better capture Cannasat’s future direction.
The final part of our plan is to in-license products and/or acquire intellectual property that is specific to CNS disorders. My experience in the pharmaceutical industry has been focused on CNS disorders, and I have extensive knowledge in the Parkinson’s, Neuropathic Pain, Alzheimer’s, Migraine and Anxiety fields. Parkinson’s is an area that I believe has great potential, and as a company, we are looking very seriously at acquiring or in-licensing a Parkinson’s asset. Our focus is to identify CNS candidates that are relatively low-risk from a regulatory point of view, and where Cannasat’s management can create sustained growth and value over the next 2-3 years by taking new opportunities through to Phase 2a proof-of-concept studies.
As always, thank you for your support.
Sincerely,
Anthony Giovinazzo
President and CEO
