EFTA00966599.pdf

From: Steven Victor MD <1 To: Subject: Fwd: Maxim Group: Regenerative Cell Therapy - Osiris Graffix highlights a Back Door. Is there an Achilles heel in Cell Therapy with a KISS (keep It Simple Stupid). Date: Fri, 16 Aug 2013 12:16:37 +0000 Attachments: Cell_Therapy_Industry_8.16.13.pdf; image003.jpg; image004.png Steven Victor MD IntelliCell BioSciences Chairman/CEO --Original Message— From: Steven Victor To: admin Sent Fri, Aug 16, 2013 8:14 am Subject: FW: Maxim Group: Regenerative Cell Therapy - Osiris Graffix highlights a Back Door. Is there an Achilles heel in Cell Therapy with a KISS (keep It Simple Stupid). Steven Victor MD Chairman Intellicell Biosciences Inc From: Jason Kolbert Date: Friday, August 16, 2013 7:44 AM Subject: Maxim Group: Regenerative Cell Therapy - Osiris Graffix highlights a Back Door. Is there an Achilles heel in Cell Therapy with a KISS (keep It Simple Stupid). Regenerative Cell Therapy: Osiris Graffix highlights a Back Door. EFTA00966599 Is there an Achilles heel in Cell Therapy with a KISS (keep It Simple Stupid)! Unlocking a Rich commercial Pathway through a backdoor? Source: Cartoonstock )"This week Osiris Therapeutics Inc. (OSIR - $19.76 NR) demonstrated the utility of Grafix, the company's allogeneic product for diabetic foot ulcers (DFU), long a graveyard of failed therapies. Grafix, is a 3D cellular matrix comprising endogenous mesenchymal stem cells (MSCs) and growth factors. It has been sold in the U.S. to treat chronic wounds, under FDA regulatory pathway 21 C.F.R. Part 1271. We examine this regulatory pathway and try to make sense of what implications does it have in cell therapy space? )"The FDA has allowed this "back door" as a pathway into the market place with no pre-market review or approval. If they are regulated solely under PHS sec. 361 and 21 C.F.R. Part 1271. To meet this criteria: 1) the cells have to be minimally manipulated 2) Homologous use 3) not combined with another article (with limited exceptions) 4) Either (I) cells do not have a systemic effect and is not dependent upon the metabolic activity of living cells for its activity or (ii) does have a systemic effect or is dependent upon the metabolic activity for its primary function, and is for autologous, allogeneic or reproductive use. )"In addition to marketing of Osiris' Grafix under 361, recently RTI biologics (RTIX -$3.52 — NR) may also be in the market shortly with map3 cellular allogeneic bone graft, which incorporates Athersys (ATHX - $1.89) MAPC stem cells, under 361 as well. This opens the question what other cell therapy products can come to the market under 361. For example we believe the stromal vascular fraction that IntellicellBioscience (SVFC) qualifies under these rules. )Our conclusion:Under this regulatory framework, companies can claim that that a product meets the "361" requirements which leaves the FDA to confirm the claim or enforce (block) the products sale. This opens up a backdoor for companies to bring products to market simply by claiming that they fall under the PHS sec. 361 and 21 C.F.R. Part 1271 and then simply wait and see if the FDA agrees or disagrees. In meantime the product can be marketed. We believe many products do meet these standards such as Osiris Grafix and RTIX's bone graft. We also believe that the stromal vascular fraction made by IntellicellBioscience meets this definition. With that said "361" does not allow product claims (without a supporting trial). So is Graffix showing us an Achilles heal and can it be so simple as a KISS of Stromal Vacular Fraction? Only clinical trials will tell us. Jason Kolbert Maxim Group LLC Managing Director - Biotechnology Research 405 Lexington Avenue New York, NY 10174 p: 212 895-3516 c: 516 353-2959 ******************************************************************* This message is intended only for use by the intended party and may contain information that is privileged and/or confidential. If you are not the intended recipient, then any review, dissemination, replication or distribution of this communication is strictly prohibited. If you have received this communication in error, please notify us immediately and delete this message and all attachments. Electronic communications routed to any employee of Maxim Group LLC ("Maxim") are for business purposes only. While messages are confidential, authorized management, legal and compliance personnel may review electronic messages. Electronic messages are also retained and would be provided upon request to an authorized regulatory body. Do not use email to request, authorize or effect the purchase or sale of any security, to send fund transfer instructions or to effect any other transactions. Maxim does not accept responsibility for transmission via electronic means of trade orders. No guarantee can be made by Maxim of timely execution of any trade order transmitted via electronic means. The views expressed herein may not represent the opinions of the Maxim's Research Department. Maxim does not undertake to update information herein or to notify the recipients if underlying views have changed. A copy of the most recent Maxim research report is available EFTA00966600 upon request. Information included in this email does not constitute a trade confirmation or an offer or solicitation of an offer to buy/sell securities. Past performance Is not indicative of future returns. If an third- a research report i.e. non-Maxim research report) is attached to this email message, please go to: for important third-party research disclosures relating to such research report. For an communication concernin. standardized o.tions lease see the 'Characteristics and Risks of Standardized Options" document: My attachment(s) to this electronic communication that was not prepared by Maxim has been unaltered, and is in its original form. Any recommendation, opinion, or advice regarding securities or markets contained in any documentation that was not prepared by Maxim does not necessarily reflect the views of Maxim, and Maxim does not verify any information included in such material. Lastly, Maxim and/or its employees or affiliates may have an interest in, or from time to time trade or make markets in the securities (and/or related derivatives) of the issues discussed in any attachment annexed hereto. an*S**$**$,Intan*S*Mn*n*S**$**$*Santlit*************$**antn EFTA00966601