Health Enhancement Products, Inc. (OTC:HEPI) (HEPI.OB) is a nutraceutical company engaged in the development of dietary supplements, food additives, and ingredients which are created entirely from pure, all-natural compounds. The Company's premier product is ProAlgaZyme (PAZ), a liquid product drawn from living algae grown in purified water through a process whereby the water in which the algae is grown is drawn off, filtered, and bottled as PAZ (
<font> now marketed with a new name and look as LiquidMD </font> ).
On 7/20/09, HEPI.OB announced the revitalization of its Scientific Advisory Board as the Company is in the process of actively recruiting internationally recognized food scientists, biochemists, nutritionists, and leading medical doctors. The newly reconstituted Board is expected to help address a variety of issues regarding the development and applications of the Company's bioactive compound, ProAlgaZyme (PAZ). The newest invitee is Donald Armstrong, PhD, DSc., a recognized expert in methods for monitoring oxidative stress, antioxidants and inflammation, with noted accomplishments over four decades.
Dr. Armstrong started work in the area of oxidative stress and antioxidant biomarkers in 1970 as a Clinical Chemist, and has received numerous government, private foundation and corporate pharmaceutical research grants whose data have resulted in 200 peer-reviewed publications. He is a Professor Emeritus, SUNY; Courtesy Professor of Ophthalmology, University of Florida College of Medicine; Visiting Professor of Ophthalmology, Showa University School of Medicine, Tokyo.
On 7/15/09, HEPI.OB announced preliminary results of its study to confirm the efficacy of the PAZ bioactive compound in managing LDL and HDL cholesterol levels. The Company awarded a grant on 3/30/09 to the Department of Nutrition and Food Science of Wayne State University (WSU), which ranks among the nation's top 50 public universities engaged in basic and applied biomedical research by the National Science Foundation. The WSU study confirmed that the PAZ organic compound was found to reduce LDL (bad) cholesterol levels from 131.7mg/dL to 79.57mg/dL and improve HDL (good) cholesterol from 105.27mg/dL to 138.67mg/dL in test animals (hamsters).
Upon completion of the study, WSU will publish a scientific paper describing the final results, as well as the means and methods employed, to be authored by the principal investigator, Smiti Gupta, Ph.D., assistant professor of Nutrition and Food Science at WSU. The cholesterol findings are initial results of a larger study, which also includes investigating the effect of PAZ organic compounds on the management of generalized inflammation. Those results are pending and will be released as they are completed by WSU.
Dr. Gupta, Ph.D., commented, "The results show a statistically significant decrease in total plasma cholesterol (TC) and LDL. What was even more interesting was the statistically significant increase in HDL, leading to a marked improvement in the TC/HDL ratio. While these initial findings in the hamster model are exciting and promising, further studies are needed, some of which are currently underway."
The preliminary results are impressive, especially considering the increase in good (HDL) cholesterol levels considering that exercise is widely regarded as the best available option to increase HDL-C levels and very few people are willing or able to exercise based on the growing epidemic of obesity and diabetes in developed countries such as the U.S. Once the study is completed, the Company plans to identify and commercialize the bioactive molecules in its PAZ organic compound in the form of branded functional foods, supplements, sports drinks, and composite nutraceutical products.
The WSU results confirm
<font> a 2007 published study in humans </font> (
Lipids in Health and Disease 2007, 6:20) (
<font> ClinicalTrials.gov </font> NCT00489333) evaluating the effects of PAZ on metabolic syndrome and markers of cardiovascular health such as good (HDL-C) and bad (LDL-C) cholesterol levels. PAZ (four ounces daily) brought about statistically significant (p < 0.001) reductions in this 10-week study for the following health metrics: weight, body fat, total cholesterol, LDL-C, triglycerides, C-reactive protein, and fasting blood glucose levels along with an increase in HDL-C levels. In addition, PAZ was well tolerated and no side effects were noted.
While the sample size is not large in the human study (52 subjects completed the study), it is encouraging to note that the WSU preliminary results have confirmed the beneficial effects of PAZ at lowering bad cholesterol while significantly raising good cholesterol levels – suggesting the possibility for a novel mechanism of action for the bioactive molecule(s) in PAZ compared to well established treatments such as statin drugs. Furthermore, it should be noted that PAZ in its current form as a liquid product represents a very diluted version of the bioactive molecule(s) responsible for the beneficial effects observed in clinical studies on risk factors for cardiovascular and metabolic diseases.
In April 2008, GlaxoSmithKline (NYSE:GSK) acquired Sirtris Pharma for $720 million based on the latter's proprietary formulations of resveratrol (a chemical found in red wine which has demonstrated the ability in animal testing to mimick the anti-aging effects of calorie restriction by targeting a class of enzymes known as sirtuins), in addition to the development of synthetic derivative compounds which are even more potent for the potential treatment of Type 2 Diabetes.
In mid-May, General Mills (NYSE:GIS) ran into trouble with the FDA regarding health claims made on boxes of Cheerios that the Agency believes should be limited to approved drugs (i.e. designed to prevent or treat heart disease and cholesterol-lowering claims). Pending additional studies in humans following the isolation of the bioactive molecule(s) in PAZ, HEPI.OB would be well positioned for a major, global licensing deal with a company such as GIS, Kellogg (NYSE:K), Kraft Foods (NYSE:KFT), or Nestle (NSRGY.PK) to market enhanced, functional food versions of cereals and other packaged foods with regulation as a food additive.
The development of pharmaceutical compound(s) from the molecule(s) in PAZ would be a more time-consuming and expensive process. However, the $720 million Glaxo deal for Sirtris demonstrates that big pharma companies are willing to spend money in the space if the story is a compelling one based on clinical results and safety parameters. PAZ currently retails for about $75 per month at the suggested daily dose of four ounces per day, but the future of HEPI.OB lies in securing global licensing deals for creating functional foods with the addition of the bioactive molecule(s) in PAZ and the development of these compounds along with related derivative molecules for FDA approval as prescription drugs.
In its most recent SEC 10Q filing on 6/15/09, HEPI.OB indicated that it would require $1.25 million over the next 12 months to fund operations and an additional $3 million to conduct planned clinical studies for isolating the bioactive molecule(s) in PAZ, identifying the mechanism of action, establishing the safety + efficacy of the compound(s), and determining the optimal dosing parameters. Subsequently, on 7/1/09, HEPI.OB announced that the Company received a commitment for financing that will double its production capacity from about 38,000 bottles (32 ounces each) to 76,000 per month.
The financing was obtained from a committed group of investors who have supported the Company over the past 12 months, and this is an encouraging sign for obtaining future funding – especially given the remarkable clinical trial results obtained to date for PAZ and the potential for major licensing deals for functional food products. Upcoming catalysts and milestones that I expect to occur for HEPI.OB over the near to intermediate term (a few weeks to six months) include the following:
(1) the pending announcement of final results (initial results were reported on 7/15/09) from the WSU study, including the effect of PAZ on bio-markers of inflammation such as C-reactive protein
(2) the publication of a scientific paper for the WSU study by Dr. Gupta
(3) the isolation and identification of the bioactive molecule(s) in PAZ
(4) the initiation of additional clinical studies to identify the mechanism of action, establish safety + efficacy in humans, and determine the optimal dosing parameters for the bioactive molecule(s) in PAZ
(5) the announcement of a global licensing deal with a major packaged food company such as GIS, K, KFT, or Nestle to created functional food products such as cereals that contain the bioactive molecule(s) isolated from PAZ
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$58.0 (08/05/09)
