Item 1. Business
Business of Company
We were incorporated on January 2, 2013
under the laws of the State of Nevada. Our principal executive offices are located at Level 8, Two Exchange Square, 8
Connaught Place Central, Hong Kong, and we have a backup office located at Flat E , 38/F, Tower 10, Island Harbourview, 11
Hai Foi Road, Kowloon, Hong Kong. We also maintain an office at 1790 Hughes Landing Blvd. Suite 400, The Woodlands, Texas
77380. Our telephone number is 281-668-8266. Our fiscal year end is February 28.
We
plan to be in the business of marketing, distributing and selling pharmaceutical medicines in international tenders managed by
World Health Organization-Geneva (WHO).
On July 3, 2013, we entered into a license
agreement (the “Agreement”), which was amended on July 30, 2013 and again on October 15, 2013, with Luckycom Pharma
Pte. Ltd. based out of Singapore and acquired the exclusive and worldwide rights to manufacture, have manufactured, distribute,
sell, market and promote the antimalarial medicine Cosunate (artesunate-amodiaquine kit tablets). We paid Luckycom Pharma 500,000
shares of our common stock valued at $0.11 per share for the two year license. Under the Agreement, we also acquired an option
to purchase Cosunate intellectual property from Luckycom Pharma for 9,000,000 shares of our common stock.
Luckycom Pharma is owned by our officer and
director, Kingrich Lee, and, as such, the Agreement is considered a related party transaction. The shares paid under the Agreement
belong to Mr. Kingrich through his company Luckycom Pharma. Moreover, the value set at $0.11 per share was arbitrarily chosen,
was not the result of an arm’s length valuation process and does not reflect our book value or any other objective criteria
of value.
Mr. Lee has been instrumental in working with
his Singapore company to establish a business arrangement suitable to both parties. It is intended that Luckycom Pharma will focus
on R&D and generic and renovated drugs development, and we work to gain acceptance with the WHO prequalification program and
thereafter to supply bulk medicines to international tenders. We amended the terms of the Agreement on July 30, 2013 with Luckycom
Pharma to provide that Luckycom Pharma would develop the products, as was envisioned by the parties originally but erroneously
drafted in the Agreement. The Agreement provided that we (and not Luckycom Pharma) acquired the license to “develop”
the products. To remedy this, we entered into the amendment to provide that Luckycom Pharma retained the right to develop the
products.
We again amended the Agreement on October
15, 2013 to restrict the antimalarial medicines subject to our license to only Cosunate (Generic Name: Artesunate+amodiaquine).
The Agreement originally granted us a license to seven antimalarial medicines. The amendment also limited our option to just acquiring
Cosunate intellectual property from Luckycom Pharma. We believe that the focus on just one antimalarial medicine will help reduce
the complexity of maneuvering through the prequalification process with the WHO. It will also enable us to join with only one
MHRA compliant GMP drugs manufacturer instead of multiple manufacturers.
Luckycom Pharma started developing antimalarial
drugs in 2005. At present, Luckycom Pharma has developed a range of antimalarial drugs that includes:
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Artesunate-Amodiaquine
tables; and
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Other
Artemisinine based drugs.
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With our license of Artesunate-Amodiaquine,
in the next twelve months and beyond, we plan to qualify and gain acceptance in international public tenders, through the prequalification
program process with the WHO under the rules of the International Pharmacopoeia. We will focus on the following activities in
the pursuit of our business:
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Establish the management team to work on our pharmaceutical operations ($500,000 by October
2015); and
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Establish a manufacturing agreement with one manufacturer with MHRA(UK) complaint facilities
and working on the application process with the WHO under the prequalification program ($500,000 by November 2015).
On July 3, 2015, our two year license
agreement with Luckycom Pharma will expire. We will have to renegotiate our two year license agreement with Luckycom Pharma or
exercise our option to purchase the Cosunate intellectual property from Luckycom Pharma outright. We have had several setbacks
attempting to raise capital to implement the aforementioned business pursuits. We have not yet decided whether we will seek to
extend the license or acquire the Cosunate intellectual property from Luckycom Pharma under our option, but we intend to select
the alternative that will best achieve our intended goals. Our primary goal is to raise capital.
Because of the evolving nature of the
WHO prequalification program and our lack of capital necessary to commence the process, our timeframes included in this Annual
Report are subject to change. We have recently learned that the WHO has revised the International Pharmacopeia and prequalification
guidelines for antimalarial drugs from 2010-2014. As a result, all antimalarial drug manufacturers must update their drugs to the
latest compliance with WHO these guidelines. This may have a delaying effect on the process.
Malaria
The following information is taken from the
WHO Fact sheet N°94
Updated December 2013
(http://www.who.int/mediacentre/factsheets/fs094/en/)
Key facts:
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Malaria
is a life-threatening disease caused by parasites that are transmitted to people through
the bites of infected mosquitoes.
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In
2012, malaria caused an estimated 627 000 deaths (with an uncertainty range of 473 000
to 789 000), mostly among African children
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Malaria
is preventable and curable.
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Increased
malaria prevention and control measures are dramatically reducing the malaria burden
in many places.
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Non-immune
travellers from malaria-free areas are very vulnerable to the disease when they get infected.
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According to the latest estimates, released
in December 2013, there were about 207 million cases of malaria in 2012 (with an uncertainty range of 135 million to 287 million)
and an estimated 627 000 deaths (with an uncertainty range of 473 000 to 789 000). Malaria mortality rates have fallen by 45%
globally since 2000, and by 49% in the WHO African Region.
Most deaths occur among children living in
Africa where a child dies every minute from malaria. Malaria mortality rates among children in Africa have been reduced by an
estimated 54% since 2000.
Malaria is caused by Plasmodium parasites.
The parasites are spread to people through the bites of infected Anopheles mosquitoes, called "malaria vectors", which
bite mainly between dusk and dawn.
There are four parasite species that cause
malaria in humans:
Plasmodium falciparum and Plasmodium vivax
are the most common. Plasmodium falciparum is the most deadly.
In recent years, some human cases of malaria
have also occurred with Plasmodium knowlesi – a species that causes malaria among monkeys and occurs in certain forested
areas of South-East Asia.
Transmission
Malaria is transmitted exclusively through
the bites of Anopheles mosquitoes. The intensity of transmission depends on factors related to the parasite, the vector, the human
host, and the environment.
About 20 different Anopheles species are locally
important around the world. All of the important vector species bite at night. Anopheles mosquitoes breed in water and each species
has its own breeding preference; for example some prefer shallow collections of fresh water, such as puddles, rice fields, and
hoof prints. Transmission is more intense in places where the mosquito lifespan is longer (so that the parasite has time to complete
its development inside the mosquito) and where it prefers to bite humans rather than other animals. For example, the long lifespan
and strong human-biting habit of the African vector species is the main reason why more than 90% of the world's malaria deaths
are in Africa.
Transmission also depends on climatic conditions
that may affect the number and survival of mosquitoes, such as rainfall patterns, temperature and humidity. In many places, transmission
is seasonal, with the peak during and just after the rainy season. Malaria epidemics can occur when climate and other conditions
suddenly favour transmission in areas where people have little or no immunity to malaria. They can also occur when people with
low immunity move into areas with intense malaria transmission, for instance to find work, or as refugees.
Human immunity is another important factor,
especially among adults in areas of moderate or intense transmission conditions. Partial immunity is developed over years of exposure,
and while it never provides complete protection, it does reduce the risk that malaria infection will cause severe disease. For
this reason, most malaria deaths in Africa occur in young children, whereas in areas with less transmission and low immunity,
all age groups are at risk.
Symptoms
Malaria is an acute febrile illness. In a
non-immune individual, symptoms appear seven days or more (usually 10–15 days) after the infective mosquito bite. The first
symptoms – fever, headache, chills and vomiting – may be mild and difficult to recognize as malaria. If not treated
within 24 hours, P. falciparum malaria can progress to severe illness often leading to death. Children with severe malaria frequently
develop one or more of the following symptoms: severe anaemia, respiratory distress in relation to metabolic acidosis, or cerebral
malaria. In adults, multi-organ involvement is also frequent. In malaria endemic areas, persons may develop partial immunity,
allowing asymptomatic infections to occur.
For both P. vivax and P. ovale, clinical relapses
may occur weeks to months after the first infection, even if the patient has left the malarious area. These new episodes arise
from dormant liver forms known as hypnozoites (absent in P. falciparum and P. malariae); special treatment – targeted at
these liver stages – is required for a complete cure.
Who is at risk?
Approximately half of the world's population
is at risk of malaria. Most malaria cases and deaths occur in sub-Saharan Africa. However, Asia, Latin America, and to a lesser
extent the Middle East and parts of Europe are also affected. In 2013, 97 countries and territories had ongoing malaria transmission.
Specific population risk groups include:
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young
children in stable transmission areas who have not yet developed protective immunity
against the most severe forms of the disease;
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non-immune
pregnant women as malaria causes high rates of miscarriage and can lead to maternal death;
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semi-immune
pregnant women in areas of high transmission. Malaria can result in miscarriage and low
birth weight, especially during first and second pregnancies;
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semi-immune
HIV-infected pregnant women in stable transmission areas, during all pregnancies. Women
with malaria infection of the placenta also have a higher risk of passing HIV infection
to their newborns;
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international
travellers from non-endemic areas because they lack immunity;
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immigrants
from endemic areas and their children living in non-endemic areas and returning to their
home countries to visit friends and relatives are similarly at risk because of waning
or absent immunity.
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Diagnosis and
treatment
Early diagnosis and treatment of malaria reduces
disease and prevents deaths. It also contributes to reducing malaria transmission.
The best available treatment, particularly for P. falciparum malaria,
is artemisinin-based combination therapy (ACT).
WHO recommends that all cases of suspected
malaria be confirmed using parasite-based diagnostic testing (either microscopy or rapid diagnostic test) before administering
treatment. Results of parasitological confirmation can be available in 15 minutes or less. Treatment solely on the basis of symptoms
should only be considered when a parasitological diagnosis is not possible. More detailed recommendations are available in the
Guidelines for the treatment of malaria (second edition).
Antimalarial drug resistance
Resistance to antimalarial medicines is a
recurring problem. Resistance of P. falciparum to previous generations of medicines, such as chloroquine and sulfadoxine-pyrimethamine
(SP), became widespread in the 1970s and 1980s, undermining malaria control efforts and reversing gains in child survival.
In recent years, parasite resistance to artemisinins
has been detected in four countries of the Greater Mekong subregion: Cambodia, Myanmar, Thailand and Viet Nam. While there are
likely many factors that contribute to the emergence and spread of resistance, the use of oral artemisinins alone, as monotherapy,
is thought to be an important driver. When treated with an oral artemisinin-based monotherapy, patients may discontinue treatment
prematurely following the rapid disappearance of malaria symptoms. This results in incomplete treatment, and such patients still
have persistent parasites in their blood. Without a second drug given as part of a combination (as is provided with an ACT), these
resistant parasites survive and can be passed on to a mosquito and then another person.
If resistance to artemisinins develops and
spreads to other large geographical areas, the public health consequences could be dire, as no alternative antimalarial medicines
will be available for at least five years.
WHO recommends the routine monitoring of antimalarial
drug resistance, and supports countries to strengthen their efforts in this important area of work.
More comprehensive recommendations are available
in the WHO Global Plan for Artemisinin Resistance Containment (GPARC), which was released in 2011.
Factsheet on the World Malaria Report 2013
The following information is taken from the
WHO Factsheet on the World Malaria Report 2013
(http://www.who.int/malaria/media/world_malaria_report_2013/en)
Disease burden in 2012
Malaria is an entirely preventable and treatable
mosquito-borne illness. In 2013, 97 countries had on-going malaria transmission.
An estimated 3.4 billion people are at risk
on malaria, of which 1.2 billion are at high risk. In high-risk areas, more than one malaria case occurs per every 1000 population.
There were an estimated 207 million cases
of malaria in 2012 (uncertainty range: 135 – 287 million) and an estimated 627 000 deaths (uncertainty range: 473 000 –
789 000). 90% of all malaria deaths occur in sub-Saharan Africa, and 77% occur in children under five.
In 2012, malaria killed an estimated 483 000
children under five years of age. That is 1300 children every day, or one child almost every minute.
Between 2000 and 2012, the scale-up of interventions helped to
reduce malaria incidence rates by 29% globally, and by 31% in the WHO African Region.
The global malaria mortality rate was reduced
by 45% during the same period, while the decrease in the WHO African Region was 49%.
Between 2000 and 2012, an estimated 3.3 million
lives were saved as a result of a scale-up of malaria interventions. 90%, or 3 million, of these lives saved are in the under-five
age group, in sub-Saharan Africa.
Funding remains inadequate
International disbursements for malaria control
rose from US$ 100 million in 2000 to US$ 1.94 billion in 2012 and US$ 1.97 billion in 2013. National government funding for malaria
programmes has also increased since 2004 but not at the same pace; the total for 2012 was US$ 522 million.
The currently available funding is far below
the resources required to reach universal coverage of interventions. An estimated US$ 5.1 billion is needed every year for this
purpose. In 2012, the global total of international and domestic funding for malaria was US$ 2.5 billion – less than half
of what is needed.
Progress towards global targets
52 countries are on track to reduce their
malaria case incidence rates by 75%, in line with World Health Assembly and Roll Back Malaria targets for 2015. These 52 countries
only account for 4% (8 million) of the total estimated malaria cases. 59 countries are on track to meet the Millennium Development
Goal target of reversing the incidence of malaria (between 2000 and 2015).
International targets for reducing malaria
cases and deaths will not be attained unless considerable progress is made in the 18 most affected countries, which account for
an estimated 80% of malaria cases. About 40% of malaria deaths occur in just two countries: Nigeria and the Democratic Republic
of the Congo.
Trends in the scale-up of malaria interventions
In 2013, an estimated 136 million long-lasting
insecticidal nets (LLINs) were delivered to endemic countries, a major increase over the 70 million bed nets that were delivered
in 2012. About 200 million LLINs have been funded for delivery in 2014, suggesting an even stronger pipeline for 2014.
Population access to LLINs remains below the
target of universal coverage and has not appreciably improved over the last two years because of the low numbers of LLINs delivered
in 2011 and 2012.
In 2012, 135 million people (4% of the global
population at risk of malaria) were protected by indoor residual spraying worldwide.
The expansion of access to rapid diagnostic
tests (RDTs) and quality-assured artemisinin-based combination therapies (ACTs) has been increasing.
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The volume of RDT sales to the public and private sectors of
endemic countries has increased from 88 million in 2010 to 205 million in 2012. Between 2010 and 2012, the proportion of suspected
malaria cases receiving a diagnostic test in the public sector increased from 44% to 64% globally, and from 37% to 61% in
Africa.
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The number of patients tested by microscopic examination increased
to 188 million in 2012, with India accounting for over 120 million slide examinations.
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In 2012, 331 million ACT courses were procured by the public
and private sectors in endemic countries – up from 278 million in 2011, and just 11 million in 2005. ACTs are recommended
as the first-line treatment for malaria caused by Plasmodium falciparum, the most deadly Plasmodium species that infects humans.
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Malaria surveillance
The number of malaria cases detected by surveillance
systems increased from an estimated 10% in 2010 to 14% in 2012. In 41 countries, it is not possible to make a reliable assessment
of malaria trends due to incompleteness or inconsistency of reporting over time, changes in diagnostic practice or health service
utilization. WHO urges endemic countries to strengthen their surveillance systems and vital registration systems.
Drug and insecticide resistance
Parasite resistance to artemisinin –
the core compound of ACTs – has been detected in four countries in South-East Asia: in Cambodia, Myanmar, Thailand and Viet
Nam. For now, ACTs remain effective in almost all settings, so long as the partner drug in the combination is locally effective.
The Global plan for artemisinin resistance containment, released in 2011, contains strategic guidance from WHO on how to manage
this global threat.
WHO currently recommends chloroquine for the
treatment of P. vivax malaria where the drug remains effective. Parasite resistance to chloroquine
has been confirmed in 10 countries thus far. WHO recommends ACTs for the treatment of chloroquine-resistant P. vivax malaria.
13 additional countries have observed treatment or prophylactic failure with chloroquine but further studies are required to confirm
resistance in those countries.
Mosquito resistance to at least one insecticide
used for malaria control has been identified in 64 countries around the world. The Global plan for insecticide resistance management
in malaria vectors, released in 2012, contains a five-pillar strategy on managing the threat of insecticide resistance.
Our Pharmaceutical Products under License
Cosunate is fully developed under the standards
of the FDA in India and is available for sale there, but has not been approved under the prequalification program of the WHO.
Luckycom Pharma has never sold any of its drugs commercially in any jurisdiction, including Consunate.
Our licensed product Cosunate will undergo
further testing and may need refinement under the standards of the WHO. We are not certain what it will take to make our currently
developed medicine “ready” for international tenders. Therefore, the anticipated costs of testing and refinement are
unknown at the present time, but will be unveiled as we move forward with the preliminary activities and application process.
Below is the current information we have on Cosunate.
Artesunate-Amodiaquine (Our Brand Name:
Cosunate)
Artesunate-amodiaquine is a fixed-dose artemisinin-based
combination therapy (ACT) indicated for the treatment of acute uncomplicated Plasmodium falciparum malaria. It was launched in
2007 as an affordable treatment for malaria, devised by DNDi in partnership with Sanofi-Aventis. At present, Sanofi Aventis, Cipla
Pharma, Ipca Pharma passed WHO PQP for Artesunate-Amodiaquine, in 3+3,6+6,12+12 tablets forms for child, Junior, Adult forms.
Our Business Strategy
We have licensed the antimalarial drug Cosunate
from Luckycom Pharma. We now plan to qualify and gain acceptance in international public tenders, through the prequalification
program process with the WHO under the rules of the International Pharmacopoeia.
We aware of only a few firms that are approved
under the WHO prequalification program for antimalarial drugs as of October 2013. Despite there being 30,000 or more pharmaceuticals
companies, there are only a few approved WHO-Geneva qualified firms for antimalarial drugs. While the Chinese have been using
effective medicines for centuries to treat Malaria, like artemisinin, these drugs have only been used beyond China in the pharmaceutical
industry in the last decade. (
http://www.patient.co.uk/doctor/malaria-pro
). Furthermore, the WHO has stated that “The
pre-qualification of artemisinin pharmaceutical products by WHO is hindered by the lack of "originator products" for
most ACTs, i.e. medicines approved by stringent drug regulatory authorities against which generic companies are compared through bioequivalence
studies.”
(http://www.google.com/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=2&ved=0CDAQFjAB&url=http%3A%2F%2Fwww.who.int%2Fmalaria%2Fpublications%2Fmtgmanufacturersartemisininderivatives.pdf&ei=VuIDU5GCK8X6oAT2lICAAQ&usg=AFQjCNG-YHWwhjyuHVT-K_jqlMBYAiJDBQ&sig2=1ffj9eMewNhvZbM5c2JuCg)
The few number of WHO qualified firms may
also be the result of the proliferation of substandard artemisinin based medicines. The lack of regulation in underdeveloped
countries has resulted in substandard artemisinin medicines and counterfeit drugs entering the market to compete with WHO approved
companies.
(http
://www.who.int/malaria/publications/atoz/9789241500838/en/index.html)
(
http://www.google.com/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=10&ved=0CHIQFjAJ&url=http%3A%2F%2Ffightingmalaria.org%2Fpdfs%2FAFMTreatmentPolicyPaper.pdf&ei=EcEDU6HwFJLBoATPqICoAQ&usg=AFQjCNGLaZ4-6myVHQF8BzXkpgforK532w&sig2=fLN55bP9MfskecZTGus-9g
).
Luckycom Pharma has developed the full range
of antimalarial drugs. As such, we, through our license with Luckycom Pharma, have some knowledge in antimalarial drugs. Moreover,
our product, Consunate (Artesunate-Amodiaquine), is an artemisinin-based combination therapy (ACT) that does not lack originator
products to hinder bioequivalent studies as with some other ACTs. Several firms have already prequalified Artesunate-Amodiaquine
with the WHO. As for the lack of regulation and substandard medicines in the market, we realize that we will have to
spend a lot of time and energy to prequalify with the WHO and, if and when that process is completed, we may very well have to
compete with companies offering substandard or counterfeit drugs at cheaper prices in underdeveloped areas of the world. While
this is an obstacle, we feel that making Consunate WHO qualified will benefit us in the long run as countries focus on better
regulations to combat unsafe and drugs, effectively weeding our unsavory competition.
There is no assurance that we will be able
to prequalify under the WHO program.
Cosunate has gone through the Indian FDA registration
process. While we are legally registered in India and will be ready for sales once we have established an outsource manufacturer,
distribution channels and end consumers, our business strategy is not focused in this direction at the present time.
Our officer and director, working for Luckycom
Pharma has discovered from previous experience that a business model based on sales in a limited geographic area is unfruitful.
In 2009, Luckycom Pharma visited different distributors covering around 20 countries in Africa, Asia, and Sudan under the “Luckycom
UK” brand name. Also at the time, Luckycom Pharma engaged in the FDA registration process in Malawi and, although
an inspection of its facilities was made and approved, Luckycom Pharma never finished the registration process. During this time
and at present, the WHO prequalification guidelines for antimalarial drugs revised a more large scale operation was not possible
for these venues and the company needed additional financing. The normal drug exporter strategy was unsuitable for Luckycom Pharma.
Luckycom Pharma has never sold any of its drugs commercially in any jurisdiction. As a result, Luckycom Pharma decided to hold
off, seek additional funding, and reevaluate its business model.
The problems experienced by Luckycom Pharma
are summarized by limited resources, a limited geographic sales market, and the burden to register under each country’s
FDA laws before expansion was possible.
Learning from past experiences, we have opted
for a more international approach and focus on the public sector. We believe that a viable and more lucrative market exists for
us in this space than to focus on any regional private sector. We hope to qualify and gain acceptance in international public
tenders, through the prequalification program process with the WHO under the rules of the International Pharmacopoeia and seek
public opportunities in this venue.
Preliminary Activities before Applying
for the Prequalification Program
The prequalification project was started in
2001 to assure medicinal products supplied for procurement meet WHO norms and standards with respect to quality, safety and efficacy
(http://www.who.int/medicines/)
. Specifically, it is a requirement that the submitted product dossier is assessed and found
acceptable, and that the manufacturing sites for the finished pharmaceutical product, as well as the API (Active Pharmaceutical
Ingredient) manufacturer are both inspected and found to comply with WHO Good Manufacturing Practices (GMP).
In order to apply, we will first engage a
regulatory affair consultant firm lead by a licensed pharmacist to help guide us through the WHO Prequalification Program. The
pharmacist responsible for regulatory affairs will take care of the farming out and the completion of CRO, GCP and GLP activities,
defined below, and prepare the dossier according to WHO norms.
Clinical Research Organization (CRO): A scientific
organization (commercial, academic or other) to which a sponsor may transfer some of its tasks and obligations. Any such transfer
should be defined in writing.
Good Clinical Practice (GCP): A standard for
clinical studies which encompasses the design, conduct, monitoring, termination, audit, analyses, reporting and documentation
of the studies and which ensures that the studies are scientifically and ethically sound and that the clinical properties of the
pharmaceutical product (diagnostic, therapeutic or prophylactic) under investigation are properly documented.
Good Laboratory Practice (GLP): A quality
system concerned with the organizational process and the conditions under which non-clinical health and environmental safety studies
are planned, performed, monitored, recorded, archived and reported (OECD).
The regulatory affair consultant will represent
our interests to coordinate different parties to collect all the necessary data and then to prepare the dossier for the WHO prequalification
program. Since we have no prior experience in submitting an application for the prequalification program, the hired consultant
will be invaluable in the process, and provide us the know-how to complete preliminary activities and submit the dossier. We therefore
do not have more information on this aspect of the business plan, but instead, we plan to rely on the information and advise we
gather from our consultant.
Secondly, we need to join with active pharmaceutical
ingredient (API) manufacturers for Artesunate and amodiaquine that we will need for Cosunate.
Under our plan, we intend to submit the antimalarial
drug Cosunate into the WHO Prequalification Program. Accordingly, we need to engage with Artesuante,Amodiaquine APIs manufacturers
with WHO prequalification. This means the API manufacturers will have already submitted their ingredients and gained acceptance
under WHO prequalification program. Several to our knowledge have done this from January to August of 2013. We have not contacted
any of them, however, nor do we have any agreements or understandings in place. We will have to raise money first.
Thirdly we will engage with one MHRA compliant
GMP drugs manufacturer, with tablet facilities. With the samples manufactured in this MHRA plant with the ingredients from the
API prequalified manufacturers, we plan to manufacture the samples and complete the CRO, GCP and GLP requirements. We plan to
then appoint a Quality Control Laboratory (QCL) to conduct testing and analysis of medicine samples consistently and reliably.
Finally, we plan to hire a Clinical Research Organization (CRO) firm to complete the bioequivalence and bioavailability studies
to confirm following issues:
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Products to be prequalified are multisource (generic)
products;
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Therapeutic equivalence generally demonstrated by
bioequivalence study in CROs
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Findings of deficient and discrepant bioequivalence
data and non-compliance with norms and standards for GCP (WHO) and GLP (WHO GPNPCL, and OECD as appropriate)
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The work involved in completing the bioequivalence
and bioavailability studies is a joint effort among our contract manufacturers that will provide samples and the QCL and CRO to
provide the testing of samples. The timeframe for completing this and any other steps in the preliminary activities phase are
unknown at this point in the process. We will need to retain a consultant, and contract with an API manufactures and an MHRA-UK
approved drug manufacturer to manufacture the samples, finish the bioequivalent and bioavailability studies and prepare the dossier
and then submit the Expression of Interest to the WHO. All these steps will uncover what additional testing and refinements will
be needed for our drug, Consunate. We hope to have more information as we moves through the process. We hope to be underway conducting
studies by October 2015. We believe that it will take us 2 to 3 years to complete the prequalification process.
According to WHO Prequalification of Medicines
Program-Application Fee issued by the WHO effective on September 1, 2013, the fees for applications to prequalify a finished pharmaceutical
product (FPP) are as follows:
First application accepted for evaluation in relation to an EoI medicine (FPP)
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No fee
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Second application accepted for evaluation relation to an EoI medicine (FPP) OR Application to prequalify a medicine that has been approved by an SRA
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USD 3,000
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Third application accepted for evaluation in relation to an EoI medicine (FPP)
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USD 6,000
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All other applications to prequalify an EoI medicine (FPP)
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USD 8,000
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(http://apps.who.int/prequal/info_general/documents/guidelines/application_fees/PQP_application_fees_September2013.pdf
)
As such, we do not have to pay for our first
application.
We have identified a qualified regulatory
affair consultant, several API ingredients manufactures, and one MHRA complaint medicine manufacturer. We have not contacted any
of them, nor have we entered into any agreement or understanding. We will have to first raise money.
Steps of the Prequalification Program
After we complete the above activities, we
will file Consunate in an application under our name to participate in the WHO Prequalification Program. The application and drugs
will be ours, under our license agreement, and the relative APIs and MHRA manufacturers will be participating parties within our
WHO tender project. We will therefore be the “applicant” in the prequalification application, but will be part of
a cooperation with the API manufacturers, MHRA manufacturers, CRO and others to work together to participate in international
tenders. Manufacturer can certainly be competitors with us if cooperative terms are not fixed by agreement, but in the case of
the contract manufacturers we plan to deal with, they are not interested in the marketing and distribution efforts involved in
international tenders and instead focus on contract manufacturing work and the benefits of that long term cooperation. To further
protect our interests, we plan to include non-compete provisions in our agreement with the contract manufacturer.
We will act as quarterback in the prequalification
program. With the assistance of our hired consultant, we will establish relationships with the cooperative, delegate tasks, including
testing and samples, prepare the dossiers, and field comments and requests from the WHO.
In close cooperation with national regulatory
agencies and partner organizations, the Prequalification Program aims to make quality priority medicines available for the benefit
of those in need. This is achieved through its evaluation and inspection activities, and by building national capacity for sustainable
manufacturing and monitoring of quality medicines.
The strategy of the WHO Prequalification Program
is as follows:
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Apply unified standards of acceptable quality, safety
and efficacy.
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Comprehensively evaluate the quality, safety and
efficacy of medicinal products, based on information submitted by the manufacturers, and inspection of the corresponding manufacturing
and clinical sites.
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Prequalify sources of active pharmaceutical ingredients
by comprehensively evaluating the quality of the API based on information submitted by the manufacturers, and inspection of
the corresponding manufacturing sites.
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Prequalify quality control laboratories of pharmaceuticals.
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Build the capacity of staff from national regulatory
authorities, quality control laboratories, and from manufacturers or other private companies, to ensure medicines quality.
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The list of prequalified medicinal products
used for malaria produced by the Program is used principally by United Nations agencies including UNAIDS and UNICEF to guide their
procurement decisions. But, the list has become a vital tool for any agency or organization involved in bulk purchasing of medicines,
be this at country level, or at international level, as demonstrated by the Global Fund to Fight AIDS, Tuberculosis and Malaria.
The Prequalification Program, set up in 2001,
is a service provided by the WHO to facilitate access to medicines that meet unified standards of quality, safety and efficacy
for HIV/AIDS, malaria and tuberculosis. From the outset, the Program was supported by UNAIDS, UNICEF, UNFPA and the World Bank
as a concrete contribution to the United Nations priority goal of addressing widespread diseases in countries with limited access
to quality medicines.
Prequalification was originally intended to
give United Nations procurement agencies, such as UNICEF the choice of a range of quality medicines. With time, the growing list
of products (i.e. medicines) that have been found to meet the set requirements has come to be seen as a useful tool for anyone
bulk purchasing medicines, including countries themselves and other organizations. For instance, the Global Fund to Fight AIDS,
Tuberculosis and Malaria disburses money for medicines that have been prequalified by the WHO process.
Any applicant wishing their medicines to be
included in the prequalified products list is invited to apply, provided the medicines are on the invitation for Expression of
Interest (EOI). Each applicant must present extensive information on the product (or products) submitted to allow qualified assessment
teams to evaluate its quality, safety and efficacy.
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The applicant must also make its contract manufacturing
sites to an inspection team which assesses working procedures for compliance with WHO Good Manufacturing Practices (GMP).
Alternatively, the inspections carried out by stringent regulatory bodies are recognized and their work is not duplicated
by WHO. The standards against which the assessment teams evaluate both the quality specifications of medicines and the manufacturing
sites are based on the principles and practices agreed by the world’s leading regulatory agencies and adopted by the
WHO Expert Committee on Specification for Pharmaceutical Preparations. In other words: The applicant provides a comprehensive
set of data about the quality, safety and efficacy of its product, including details about the purity of all ingredients used
in manufacture, data about finished products, such as information about stability, and the results of in vivo bioequivalence
tests (clinical trials conducted in healthy volunteers).
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The team of assessors evaluates all the data presented
and if satisfied with the evidence sends the product to professional control testing laboratories contracted by WHO in France,
South Africa or Switzerland for analytical verification of quality.
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If the product is found to meet the specified requirements,
and the manufacturing site complies with GMP, both the product linked to this manufacturing site and company are added to
a list hosted by WHO on a public web site.
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All product and manufacturing site requirements,
standards used in evaluating the product and the profile of the inspection teams are outlined on this web site. The site also
includes the list of prequalified medicines and their manufacturers.
The prequalification process takes a minimum
of three months if the product meets all the required standards. When products do not meet the appropriate standards the process
can be longer and if the manufacturer fails to prove the quality, safety and efficacy of its medicine it will not be prequalified.
Inclusion in the list does not mean that the prequalified status of a product lasts forever. All medicines are re-qualified after
five years, or earlier, if needed. WHO also carries out random quality control testing of prequalified medicines that have been
supplied to countries.
Medicines which have been found to meet the
required standards so far are from both brand name and generic manufacturers and include antimalarials.
Even though some larger firms are able to
complete the process in a matter of months, we believe that it will take us 2 to 3 years to complete the prequalification process.
The following are the general steps taken
under the WHO Prequalification Program.
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Step 1. Submission of dossiers. The dossier details
the product, including the product information, patient information and package inserts, interchangeability (bioequivalence
studies), stability testing, and summaries of pharmacology, toxicology, and efficacy of the product. The dossier explains
the regulatory status in other countries, indicates the active pharmaceutical ingredient(s) (API), lists the properties of
the APIs, states the sites of manufacturing, explains the container/closure system and other packaging requirements and provides
other specifications.
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Step 2. Initial screening of dossiers. The dossier
is initially screened for completeness and the applicant is notified of deficiencies.
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Step 3. Assessment of dossiers. A team of experts
(pharmaceutical development, bioequivalence, etc.) evaluates the dossier and provides the outcome to the applicant.
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Step 4. Site inspection. An inspector is appointed
that is technically qualified. An inspection team visits the manufacturing site and inspects according to WHO current good
manufacturing practices (cGMP)
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Step 5. Report on findings and recommendations.
Reports are generated from the dossier assessment and inspection of site findings. These results are communicated to the applicant,
API supplier and manufacturers. Additional information is often requested.
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Step 6. Publication of evaluation results. If the
applicant meets the standards, they are added to the prequalified suppliers’ list. The outcome is communicated to the
applicant and the WHO Public Assessment Report is published on the WHO website.
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Step 7. Sampling and testing. Random samples of
product are supplied and further inspections continue. Any failures are communicated to the applicant.
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Step 8. Reevaluation and reinspection. At regular
intervals (minimum every three years), reavaluation and reinspection occurs, unless changes are made to the product by suppliers
and/or manufacturers or there are other instances of complaints or misconduct revealed.
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Post Prequalification Strategy
We have no assurance that we will meet the
requirements necessary to be accepted under the prequalification program. We expect to be in the application process for at least
two or three years, and maybe longer. If we are able to gain acceptance and prequalify with the WHO, our long term plan is to
seek out public opportunities in this venue and participate in bulk supplying of medicines once we pass the Prequalification of
Medicines Program managed by World Health Organization-Geneva (WHO). We do not have any agreements or understandings with any
reputable agencies.
If we are unable to raise the necessary funds
to implement our business, at best we will have to scale back our operations, which would mean it could take longer than 2 or
3 years to complete the prequalification program, and at worst we could go out of business. While our CEO, Kingrich Lee, has experience
in the pharmaceutical industry, we have never applied for or been accepted in the WHO prequalification program. Our lack of resources
combined with our lack of know-how makes it more difficult to gear up for and maneuver through the prequalification process.
If we are unable to complete the prequalification
program, we will consider the opportunity we have to market Consunate in the local Indian market, since we are approved there
to sell our product. We will consider this option as an alternative to going out of business. If we reach that point, we would
have to weigh the benefits of the Indian market against our limited resources, a limited geographic sales market, and the burden
to register under each country’s FDA laws before expansion would be possible.
If, however, we are able to raise the money
we need, engage a regulatory affair pharmacist firm to prepare the dossier and complete CRO, GLP and GCP activities, locate APIs
manufacturers with WHO prequalification and a manufacturer with UK MHRA complaint facilities, we believe that we will be able
to participate in international public tenders and become a WHO-Geneva qualified medicine maker and marketer. We plan to submit
Consunate to the program.
Manufacturing and Supply
We have identified one MHRA(UK) compliant
contract manufacturer in India for manufacturing activities. We currently do not have any arrangements or understandings in place
surrounding the use of any facilities at the present time. Given our stage of development, we have not yet established any agreements
or arrangements with any manufacturers. However, in the next twelve months, if we are able to obtain funding, we plan to work
with one MHRA(UK) compliant facility manufacturer to start the process of retrofitting its facility to meet WHO standards.
Subsequently, we will need to acquire samples
from the MHRA(UK) manufacturers of Artesuante,Amodiaquine using ingredients from APIs manufacturers with WHO prequalification,
finish the bioequivalent and bioavailability information from the GCP & GLP accredited CRO, and the regulatory affair pharmacist
will prepare all relative drugs dossiers and filed to WHO-Geneva under the name of LUCKYCOM Inc. to participate international
antimalarial business.
Sales and Marketing
Given our stage of development, we have not
yet established commercial organization or distribution capabilities, nor have we entered into any partnership or co-promotion
arrangements with an established pharmaceutical company. We plan to join with a European international tender distributor to carry
out our distribution efforts, which can reduce the sales and marketing expenses we would otherwise have to incur alone. We do
not have any agreements or understandings with this distributor at this moment.
We plan to register and sell the antimalarial
drug Consunate in direct participation with international tender business.
Competition
Our industry is highly competitive and subject
to rapid and significant technological change. Our potential competitors include large pharmaceutical and biotechnology companies,
specialty pharmaceutical and generic drug companies, academic institutions, government agencies and research institutions. Key
competitive factors affecting the commercial success of our product candidates are likely to be efficacy, safety and tolerability
profile, reliability, convenience of dosing, price and reimbursement.
The market for antimalarial drugs business
is especially large and competitive. The products we are going to acquire will face intense competition. Many of our existing
or potential competitors have substantially greater financial, technical and human resources than we do and significantly greater
experience in the discovery and development of product candidates, obtaining FDA and other regulatory approvals of products and
the commercialization of those products. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result
in even more resources being concentrated among a small number of our competitors. Accordingly, our competitors may be more successful
than we may be in obtaining FDA approval for drugs and achieving widespread market acceptance. Our competitors' drugs may be more
effective, or more effectively marketed and sold, than any drug we may commercialize and may render our product candidates obsolete
or non-competitive before we can recover the expenses of developing and commercializing any of our product candidates. Our competitors
may also obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours. We anticipate
that we will face intense and increasing competition as new drugs enter the market and advanced technologies become available.
Finally, the development of new treatment methods for the diseases we are targeting could render our drugs non-competitive or
obsolete.
Regulatory Matters
Due to the fact that artemisinine based antimalarial
drugs were innovated by Chinese herbal professionals, no traditional patents have been properly applied in international markets,
and the drug ranges have not been included in British Pharmacopoeia or US Pharmacopoeia. Hence, the WHO has spent more than ten
years to develop its International Pharmacopeia for each molecular standard for artesunate, artemether, artemisinine and dihydroartemisinin.
The history of the International Pharmacopoeia
dates back to 1874 when the need to standardize terminology and specify dosages and composition of drugs led to attempts to produce
an international pharmacopoeia compendium. The International Pharmacopoeia now constitutes a collection of recommended procedures
for analysis and specifications for the determination of pharmaceutical substances, excipients, and dosage forms that is intended
to serve as source material for reference or adaptation by any WHO member state wishing to establish pharmaceutical requirements.
The International Pharmacopeia, or any part of it, shall have legal status, whenever a national or regional authority expressly
introduces it into appropriate legislation. The Fourth Edition of the International Pharmacopoeia comprises Volumes 1 and 2, published
in 2006, the First Supplement, published in 2008, the Second Supplement published in 2011, as amended and augmented by the text
of the Third Supplement published in 2013.
Luckycom Pharma has strictly followed WHO
norms to develop its antimalarial drugs and has received approval by the Indian Food and Drugs Administration that its antimalarial
drugs can be manufactured and marketed in India. Because antimalarial drugs are one of the three special essential drugs supervised
by the WHO, we will have to apply to the WHO prequalification program if we want to participate in international public tenders.
For private markets, we will have to register in different countries and sell through medical distributors. We plan to register
after we have engaged pharmaceutical distributors in the countries we plan to target. Each target malarial epidemic country requires
drug registration and approved by that target country’s FDA before marketing and sales can occur. For now, we are registered
to market and sell in India.
Luckycom Pharma started the development of
antimalarial drugs in 2005. Luckycom Pharma has achieved the license to manufacture and sell overseas in 2007, according to the
International Pharmacopoeia standards developed by the WHO, but due to policy changes in the use of antimalarial drugs and revised
guidelines, Luckycom Pharma has had to put marketing plans on hold until these new policies and guidelines can be adhered to.
For now we are unable to engage in public
tenders. We will need to apply for and meet the requirements of the Prequalification Program of the WHO.
Environmental Regulations
We are not aware of any material violations
of environmental permits, licenses or approvals that have been issued with respect to our operations. We expect to comply with
all applicable laws, rules and regulations relating to our business, and at this time, we do not anticipate incurring any material
capital expenditures to comply with any environmental regulations or other requirements.
While our intended projects and business activities
do not currently violate any laws, any regulatory changes that impose additional restrictions or requirements on us or on our
potential customers could adversely affect us by increasing our operating costs or decreasing demand for our products or services,
which could have a material adverse effect on our results of operations.
Employees
We do not have any employees, other than Mr.
Kingrich Lee. We also engage a number of consultants.