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Cleveland BioLabs is
currently in clinical trails with their Protectan 502 for protection against radiation and
their Curaxin 102, designed to target the two regulators of apoptosis to kill solid tumor
Cleveland BioLabs, Inc.
11000 Cedar Avenue
Cleveland, OH 44106
Michael Fonstein, Ph.D.
Co-Founder, Chairman, President and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
Published - January 18, 2007
Michael Fonstein, Ph.D.
Chief Executive Officer and President
Dr. Fonstein has served as our Chairman of the Board, Chief Executive Officer and
President since our inception in June 2003. He served as Director of the DNA Sequencing Center
at the University of Chicago from its creation in 1994 to 1998, when he left to found
Integrated Genomics, Inc. located in Chicago, Illinois. He served as CEO and President of
Integrated Genomics from 1997 to 2003. Dr. Fonstein has won several business awards,
including the Incubator of the Year Award from the Association of University Related
Research Parks. He was also the winner of a coveted KPMG Illinois High Tech Award.
Cleveland BioLabs, Inc. (Nasdaq: CBLI) is a drug discovery and development company
leveraging its proprietary discoveries about programmed cell death to treat cancer and
protect normal tissues from exposure to radiation and other stresses. The Company has
strategic partnerships with the Cleveland Clinic Foundation, ChemBridge Corporation and
the Armed Forces Research Radiobiology Institute.
Fonstein, what was your vision when you founded the Cleveland BioLabs and where are you
When we started the company we envisioned developing drugs against radiation.
Radiation first is a threat and second is a cure because radiation is used in the
treatment of cancer. The current understanding is that the damage of healthy tissue limits
the potency of radiation as a treatment. The idea was that if you can protect healthy
tissue from radiation, you could drastically change therapeutic outcomes in cancer.
Therefore, this was our initial driving force. However, when we started thinking that if
you have something that protects from radiation in todays world, it has a value and
importance of its own. We were thinking of the Chernobyl firefighters who ended up in the
reactor trying to rescue people and 80% of them died. Today, if they would have first had
our Protectan 502, most of them would have survived; so this is why we started the
company. Today we are happy to say that we have a product that is practically developed.
We have shown efficacy of our product in lab animals and we are ready, relatively
speaking, to start human efficacy trials and to bring the product to the final stage of
approval by the FDA within 20 months.
CEOCFO: What have you developed that is
different than what is already available?
In radiation protection the only product that is on the market is an Ethyol, which
has limited protection from radiation and sizeable side-effects. In humans, it is used in
head and neck radiation therapy for head and neck cancer. There are a several drug
candidates that are being developed by other companies, but in our eyes, they are
infinitely less important than what we have. What is behind our product is a very
innovative way of looking at cell biology. There is a process in each and every cell of
our organism called apoptosis (this is a term that means controlled cell death) and each
cell decides whether to live or commit suicide, depending on the damage of it components.
The reason for this process is to protect us from cancer. It is easier for an organism to
eliminate a potentially pre-cancerous cell than to try to repair it. However, in the case
of radiation, damaged cells, which can potentially be repaired, are pushed into suicidal
death. That is why we die when we receive a certain amount of radiation. However, by
suppressing apoptosis, 80 or 90% of people affected by radiation in cases of contamination
or nuclear attack can be rescued. Therefore, we are able to save a life from certain
levels of radiation, including a super killing dose. The most fascinating part of our work
is protection from radiation in the case of radiation treatment for cancer. The more you
start understanding cell death; you understand how cancer escapes cell death. There is a
whole other branch of our development, which is dedicated to pure anticancer drugs. Here
we have a drug candidate that is currently in Phase II for humans.
CEOCFO: You are getting closer and closer!
Yes and we are keeping our fingers crossed. We started 3½ years ago with concepts
and some prototypes, and we have come a long way.
CEOCFO: Will you bring us up to date on the
most recent happenings of the company?
The most important events are focused on the business and our customers. When you
are developing radiation protection, the government is the first customer you think about
and very recently, the Department of Defense issued an RFI, where they defined
gastrointestinal syndrome, as a prerequisite for acquisition. It is important, because if
you receive around 6 grays of radiation, you would die because blood can no longer be
supported and this is called hemapoeitic syndrome. What we are developing is something
that can save lives under these circumstances. If you receive higher doses, you are dying
from gastrointestinal syndrome, which over simplifying it, you can call destruction of the
gut by radiation. We believe that our drug is the only drug candidate that protects from
both of these syndromes, and the customer understands that this puts us in a good position
for marketing and selling our product. We have done many press releases presenting our
data. Another critical finding, which was reported last month was that we demonstrated
that our drug not only works when applied before an event of radiation, but also saves
people from radiation when applied more than one hour after the event.
CEOCFO: What is the timetable going
The government will be ready to acquire our Protectan 502 product within a year. By
then, we will be very close to the end of formal development and FDA approval. On Curaxin
102, we recently announced the start of a Phase II trial and we expect to report on its
efficacy within the next year.
CEOCFO: Will you be manufacturing product
yourself or are you looking to bring in partners?
We are addressing manufacturing in collaboration with a very well established
company called SynCo Bio Partners B.V. We have a process in place and we are close to the
end of it. We believe that we should be done some time in April (2007).
CEOCFO: Will you tell us about the
financial picture of Cleveland BioLabs today?
The Company recently raised $10 million in a small IPO. We have also received a
number of grants and we recently announced that we are conducting negotiations for a very
sizeable development grant from the Department of Defense. We envision additional funds
going into the development of the company, but we believe that we are quite solid for a
couple of years.
CEOCFO: Why should potential investors be
looking at Cleveland BioLabs and what sets you apart?
Investors should consider these two facts: a short development cycle and biotech
upside. When you combine the excitement of our biotech pipeline, where potential success
hits very sizeable markets, with the short development cycle of our products in the
defense arena, it is very compelling. In the defense arena, because you cannot expose
people to radiation in order to show that we can protect them, we use animals in our
trials, which is faster and somewhat cheaper. To date, we are less than 2 years from the
end of the development of our first product.
should people know about Cleveland BioLabs that they may miss when they first look at the
I think that our story about protection from radiation captures peoples minds,
but they only see it in terms of defense applications. However, there is a huge market in
radiation therapy for cancer and this market potentially dwarfs the defense market. The
second thing that I would like to add is that we do have a separate pure anti-cancer drug
in Phase II.
closing, what should people take away from the interview?
I would like to see people share our excitement about our development achievements,
which we have accomplished over a very short period of time. We really believe that what
we are doing will change the lives of millions of people; both cancer patients and people
who may potentially be exposed to radiation from terrorists or accidentally.
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