Todos Medical, Ltd. (OTCQB: TOMDF), a comprehensive medical diagnostics and related solutions company, today provided a corporate update to the marketplace following the filing of its quarterly financials for the first quarter of 2021.
“The first half of 2021 has seen a dramatic shift in the COVID-19 marketplace in the United States,” said Gerald E. Commissiong, President & CEO of Todos Medical. “In light of the emerging Delta variant circulating widely in the US, there is now a clear need for novel COVID-19 antiviral therapies to protect the unvaccinated and those for whom authorized vaccines do not confer immunity, which includes a large portion of the elderly and those taking immune suppressants, against COVID-19 infection. The Biden administration recently underscored this need by pledging to invest $3.2 billion into research for COVID-19 antiviral therapies, similar to the US government’s investments into COVID-19 vaccines in 2020 at the beginning of the pandemic. We believe this government recognition of the need for antivirals will provide a significant tailwind for the development of our Tollovir™ antiviral that is currently undergoing a Phase 2 clinical trial in Israel with plans progressing rapidly to expand the clinical development program to India. We are also optimistic about the interest we have seen from several potential international distribution partners for our dietary supplement Tollovid that provides immune support as a protease inhibitor. We expect to build a significant international distribution footprint in the second half of 2021 as we begin our initial roll-out of this important product.
“As the COVID-19 pandemic remains very fluid, the US has focused its efforts on vaccination in the first half of 2021, which has largely been successful in bringing down daily COVID-19 case numbers and has given confidence to state governments to re-open economies with limited COVID-19 restrictions. We see this vaccination focus creating a significant new opportunity for our recently acquired CLIA/CAP certified lab, Provista Diagnostics. Through Provista we are focusing our COVID-19 diagnostic testing strategy to prioritize delivering diagnostic services, including PCR and neutralizing antibody testing, thereby expanding beyond simply distributing testing supplies. This expansion into testing services serves to diversify our business into higher margin revenue in the COVID-19 space, as well as help us to expand our business development opportunities with the labs we work with by providing reference lab testing services as we increase Provista’s automated testing capabilities. We are especially excited to begin our expansion into COVID-19 neutralizing antibody testing that receives nearly double the reimbursement vs. traditional COVID antibody testing (~$79 vs. ~42). We believe neutralizing antibody testing will become more critical to help determine robust COVID-19 immunity.”
Mr. Commissiong continued, “Going forward, the Company is concentrating its extensive investment in automated lab equipment to the benefit of Provista. We have begun working to substantially expand Provista’s lab sales team to build relationships with healthcare providers prescribing tests to patients, as well as provide reference lab testing services to CLIA labs who are looking to deprioritize internal COVID-19 testing. Due to our lab automation infrastructure and distributor pricing for our reagents, we believe that we can compete for large volume COVID-19 testing business, and we expect to see a resurgence in this testing in the fall as schools seek to re-open in classroom learning for K-12 and college-aged students who are the least likely groups to have been vaccinated, as well as among employers. We believe that the significant strides we have made at Provista will position the Company to accelerate growth into 2022 and build significant long-term value for the benefit of our stockholders.”
Tollovir™ Phase 2 Scientific and Clinical Development Programs
We are continuing to make progress with enrollment of our Phase 2 clinical trial to treat hospitalized COVID-19 patients in Israel, with our TolloTest™ biomarker being used for the first time as a surrogate biomarker to monitor patient response to treatment. The recent resurgence of COVID-19 in Israel, driven by the Delta variant, has increased hospitalizations in both the vaccinated and unvaccinated, and has led to a reimposition of indoor mask mandates to help curb the spread. While the total number of hospitalized patients remains relatively low, we see the Israel program as critical to our overall clinical development strategy because the clinical investigators we are working with in Israel have tremendous international collaborators who think quite highly of the science emerging from Israel, making them willing to collaborate on broader international clinical development programs that will likely be needed for the ultimate regulatory approval of Tollovir.
As part of the ongoing scientific effort to further elucidate the mechanisms that have enabled Tollovir to achieve its very positive early clinical results, our partners at NLC Pharma identified an anti-inflammatory mechanism of action of Tollovir to complement its 3CL protease inhibiting mechanism. This dual mechanism of action helps more readily explain the significant reduction in symptoms and the biomarker C Reactive Protein (CRP) that was documented in the earliest clinical COVID-19 data sets produced in Israel, which could not be explained by a reduction in viral load alone likely caused by Tollovir’s 3CL protease inhibiting mechanism. As a result of these quite complementary 3CL protease inhibiting and anti-inflammatory mechanisms, given that we are in a race with Pfizer to get to market with the first 3CL protease inhibiting COVID-19 antiviral for which therapeutic claims could be made, we believe it is critical to rapidly expand our clinical development programs to gather additional data in multiple clinical settings to demonstrate Tollovir’s ability to help patients suffering from COVID-19.
As part of that effort, our Israel-based Principal Investigators have introduced us to physician clinical collaborators in India who work with a highly-respected local Clinical Research Organization (CRO) with extensive experience in running COVID-19 clinical trials. This CRO has near-immediate access to 6 clinical sites that have previously enrolled patients into clinical trials for hospitalized COVID-19 patients and 5 clinical sites that have previously enrolled patients into clinical trials for non-hospitalized COVID-19 patients. We believe this CRO relationship will allow for the rapid expansion of enrollment for Tollovir’s clinical data acquisition, and allow us to quickly prepare for a Phase 3 international clinical development program to support regulatory approval under Emergency Use Authorization. We are working closely with NLC Pharma to finalize the agreements needed to bring these clinical programs forward, with the expectation that we will be in a position to begin dosing patients in India in August 2021. We do not expect significant expenses to be associated with the clinical program in India at least through the completion of Phase 2 studies.
We believe that Tollovir may ultimately represent a new standard of care in the treatment and management of COVID-19 patients, and we are working diligently to make certain its clinical development execution will lead to the creation of clinical data that will be extremely valuable for regulators seeking to approve the product’s use, as well as potential partners who may become further interested in the program as additional clinical and scientific data emerges.
Tollovid™ distribution plans
We are very pleased that the Company’s dietary supplement Tollovid received FDA authorization for a new 5-day dosing regimen in April 2021. We believe this authorization underscores the emerging need in the marketplace for immune support supplements supported by strong scientific and safety data, as well as provides international regulatory authorities with a high degree of comfort of Tollovid’s safety profile. We also recently launched the website www.myTollovid.com where Tollovid can be purchased online directly from Todos Medical in the United States, creating a new distribution channel beyond The Alchemist’s Kitchen initial retail footprint for the product.
Going forward, the Company sees two critical areas of expansion in the advancement of Tollovid:
- International distribution partnerships in jurisdictions where high value dietary supplements are distributed by reputable pharmacies and other high-end wellness stores that can engage with consumers directly on the value and underlying science of their products; and
- US marketing campaign to dramatically expand awareness of Tollovid for consumers and distribution partners who are looking for products to further support immune function.
The Company is making steady progress in identifying international distribution partners for Tollovid, and we expect to begin to make announcements on this front in the third quarter of 2021.
With regards to a significant US marketing campaign, the Company is evaluating the best path forward to utilize our resources and create demand in both the investor and consumer community for Tollovid. As part of that effort, we believe that independent funding to support sales and marketing for a Tollovid-focused entity, potentially through crowdfunding, may be the best use of the existing Tollovid commercial material and the best financing path forward in order to mitigate potential dilution of using Todos resources on a marketing campaign. The Company expects to make progress towards independent funding for Tollovid in the third quarter of 2021.
Todos Corporate Profile: Videssa™ Breast Cancer, LymPro Alzheimer’s blood tests and Revenue
As the Company engages with the investor community and NASDAQ as part of a potential listing process, it is important that we crystalize our corporate profile and begin to prioritize our resources towards the areas that will create long-term value for shareholders. For this reason, we are moving in the direction of packaging Tollovir, TolloTest, and Tollovid, three extremely exciting programs that Todos Medical has incubated as part of its push into COVID-19 at the height of the pandemic, into a separate unit of programs that will be ultimately be self-financed, spun-off, partnered and/or sold in order to create maximum shareholder return on the investment made as they make their way through their development and commercialization cycle.
Going forward, the Company will be focused on bringing forward the crown jewel from its recent Provista Diagnostics acquisition: the Videssa Breast Cancer blood test. We believe Videssa could ultimately represent a new standard of care in certain areas for breast cancer screening, a marketplace that remains dramatically underserved both domestically in the US as well as internationally, and for which Todos Medical is extremely well positioned to disrupt. Because of the extensive peer-reviewed clinical data already published on Videssa, the next key milestone is to analytically revalidate the assay at Provista and engage with Key Opinion Leaders on the best intended use to initially launch the product based on the data we have already gathered. Our Chief Medical Advisor Dr. Jorge Leon has become much more heavily involved in the Videssa test over the last several weeks as we have been making key decisions on the corporate profile Todos is presenting to NASDAQ. He has become a very strong advocate for focusing the Company on Videssa where we can begin to generate significant clinical utility data for Videssa in the next 6-12 months and potentially significantly disrupt the $7 billion breast cancer screening market.
Additionally, the recent approval of Biogen’s Aduhelm™ amyloid beta antibody has significantly increased the value of the Company’s proprietary LymPro Alzheimer’s blood test, that has shown to extremely strong correlation data (p=0.000002) with amyloid beta PET imaging SUVR scores in preliminary studies performed by our partners at Leipzig University in Germany under the direction of Dr. Thomas Arendt. We believe that payers will require patients to undergo amyloid PET imaging prior to prescribing Aduhelm. In the effort to identify those patients who are likely to be positive for PET imaging, and mitigate the negative side effects of the radioactive materials used in the conduct of amyloid PET imaging testing for those unlikely to be amyloid positive, payers will want to pre-screen patients with minimally invasive tools that could give them a higher degree of confidence that a patient will be amyloid beta positive by PET imaging. LymPro could fill this emerging need for physicians and payers, as well as fulfill this area of need for pharmaceutical companies seeking to enrich their screening for clinical trials. Given the $250 billion marketplace for Alzheimer’s that is expected to grow rapidly as new treatment options continue to get market authorization in the US, we believe LymPro could also help drive mid-term value for Todos as progress is made.
In support of the Company’s proprietary Videssa and LymPro tests, Todos will continue to be focused on generating revenue through the sale of diagnostic tests, with a greater emphasis being placed on expanding diagnostic testing services provided to the marketplace through Provista’s CLIA/CAP certified lab due to the increased margins vs. the reagents sales business. The reason why lab services represents a much more attractive business than reagents sales is because the margins per test are 10-15x higher per test on revenues that are 4-10x higher per test than selling regents. From a financial forecasting standpoint, free cash flow generated from $10M in sales from lab sales of COVID-19 testing services would be close to $7M on the sale of 100,000-125,000 tests, whereas free cash generated from $10M in sales of reagents would be $4M on sales ~500,000 tests. As such, we see the acquisition of samples for Provista as the next natural evolution in our CLIA testing strategy in order to support the ultimate commercialization and market acceptance of our proprietary Videssa and LymPro blood tests.
Long-term, we expect Todos core TBIA artificial intelligence testing platform that currently has a CE Mark for Breast Cancer and Colon Cancer to be able to replace Videssa and LymPro, while substantially reducing our costs of goods sold (COGS), however because of the data-hungry nature of AI/machine learning in healthcare, we will be focusing TBIA for the foreseeable future on creating equivalency data to Videssa and LymPro as those products are commercialized. We believe TBIA could ultimately represent an entirely new blood testing platform that has the potential disrupt the marketplace when it has achieved the level of data necessary to overcome current AI-driven biomarker objections.
NASDAQ Listing Plans and Corporate Profile
On June 28, 2021, the Company disclosed the agenda for the Annual General Meeting of its stockholders that will be held on July 26th, 2021. As part of the agenda for the meeting, several proposals were put forward to shareholders to vote on by proxy to allow the Company to be positioned to achieve a Nasdaq listing in the third quarter of 2021, depending on market conditions. Two of the key proposals for shareholders to vote on in the proxy are an increase in authorized Ordinary Shares, as well as a reverse split of Ordinary Shares. It is important to note that under Israel law, there can only be a proportional split of issued and authorized shares, meaning that if there is a reverse split of the outstanding shares 1:10, then there must be a proportional reverse split of the authorized shares by the same 1:10 ratio.
The Company is working closely with its Nasdaq listing consultants, and as part of that process, management and the Board of Directors was given the advice that in negotiations for a potential listing with Nasdaq it is critical that the Company has stockholder authorization to execute whatever corporate actions are necessary to allow its common stock to meet the initial Nasdaq listing standards. This in no way means that the Company is required to execute a maximum reverse split to achieve those listing standards. Given that market forces in the OTC marketplace, it is important that the market is aware that the Company is able to achieve a Nasdaq listing under any circumstances in order to protect the Company and its shareholders.
Management continues to believe the Company is substantially undervalued and we see important corporate milestones being achieved in the third quarter of 2021 that will ultimately drive fundamental value, especially driven by our Tollovir clinical development program. We are excited about the path forward for Todos given the consolidation of all the Company’s programs into a focused strategy centered on our industry leading diagnostics programs that have an emerging revenue base to support their development, with the tremendous potential upside of an antiviral therapy for COVID-19 that could dramatically alter the standard of care for patients worldwide and potential applications beyond COVID-19.
The Board of Directors and management would like to thank our shareholders for their tremendous support as the Company embarks on the next exciting chapter of its progress, and we look forward to communicating with our shareholder on an ongoing basis in the weeks and months ahead as the Company achieves key milestones that will help drive it forward in its mission to help patients.
For information related to Todos Medical’s COVID-19 testing capabilities, please visit www.todoscovid19.com.
For COVID-19 testing inquiries, please email firstname.lastname@example.org.
About Todos Medical Ltd.
Founded in Rehovot, Israel with offices in New York City, Todos Medical Ltd. (OTCQB: TOMDF) engineers life-saving diagnostic solutions for the early detection of a variety of cancers. The Company’s state-of-the-art and patented Todos Biochemical Infrared Analyses (TBIA) is a proprietary cancer-screening technology using peripheral blood analysis that deploys deep examination into cancer’s influence on the immune system, looking for biochemical changes in blood mononuclear cells and plasma. Todos’ two internally-developed cancer-screening tests, TMB-1 and TMB-2, have received a CE mark in Europe. Todos recently acquired U.S.-based medical diagnostics company Provista Diagnostics, Inc. to gain rights to its Alpharetta, Georgia-based CLIA/CAP certified lab currently performing PCR COVID testing and Provista’s proprietary commercial-stage Videssa® breast cancer blood test.
Todos is also developing blood tests for the early detection of neurodegenerative disorders, such as Alzheimer’s disease. The Lymphocyte Proliferation Test (LymPro Test™) is a diagnostic blood test that determines the ability of peripheral blood lymphocytes (PBLs) and monocytes to withstand an exogenous mitogenic stimulation that induces them to enter the cell cycle. It is believed that certain diseases, most notably Alzheimer’s disease, are the result of compromised cellular machinery that leads to aberrant cell cycle re-entry by neurons, which then leads to apoptosis. LymPro is unique in the use of peripheral blood lymphocytes as a surrogate for neuronal cell function, suggesting a common relationship between PBLs and neurons in the brain.
Todos has entered into distribution agreements with companies to distribute certain novel coronavirus (COVID-19) test kits. The agreements cover multiple international suppliers of PCR testing kits and related materials and supplies, as well as antibody testing kits from multiple manufacturers after completing validation of said testing kits and supplies in its partner CLIA/CAP certified laboratory in the United States. Additionally, Todos has entered into a joint venture with NLC Pharma to pursue the development of diagnostic tests targeting the 3CL protease, as well as 3CL protease inhibitors that target a fundamental reproductive mechanism of coronaviruses.