Noella Alexander-Young: Thank you, Ted. Next, this is a bit of a long one. The question is, “The recent news about Equivir’s preliminary study results show that Equivir helps prevent upper respiratory illness. Doing some research, there is no product that claims prevention of the common cold. All, including vitamin C and zinc, only help lessen the severity and duration of the illness. Will Equivir be able to claim that it helps getting the common cold?”
Ted Karkus: Okay. So first of all, there is no product out there that’s an over-the-counter dietary supplement that will allow you to, say, cure the common cold. Claims like that will always be drug prescription claims. So no matter how many studies we do, unless we’re going to go through the FDA, which takes a very long time and a lot more clinical studies, there are certain claims you can’t make. We won’t be able to make COVID claims, we won’t be able to make cure claims. Other than that, there are lots of other claims that I believe we are going to make when we get the final results, assuming that they’re consistent with the preliminary results. And the preliminary results, they’re already on 159 patients, which most other companies, most other products, 159 patients would be more than they would even study.
So, as far as I’m concerned, that’s a complete study by itself where we got phenomenal results. But we really want to be airtight. We also wanted the study to test it two ways. One, as a preventative, so that you take it daily. The other is a therapeutic, meaning if you catch a cold, flu, virus, I won’t be able to say COVID, but we got results on COVID patients too. So, I can’t say the COVID claim, but the facts are the facts in the studies. So, let’s see what the final results are. But the bottom line is, at least what we’re learning is it’s a broad-based antiviral. We may not be able to make a broad-based antiviral claim on the packaging. Let me be perfectly clear. We are not currently marketing the product. So, class action attorneys, we’re not even selling the product yet.
All right? But we are very confident in what the product does. We will figure out what the right claims are to put on the packaging when we roll it out after we complete this two-pronged study that is going to be completed shortly. Thank you.
Noella Alexander-Young: Thank you, Ted. Next, “Does ProPhase still have an investment position with Lantern Pharma?”
Ted Karkus: We haven’t disclosed that, so I’m not going to disclose that now. And I don’t think it’s appropriate for me to discuss other companies on this call. We did have a substantial position at one time. The reason we made that investment is we were looking at strategic possibilities with that company a long time ago. That did not happen. And I’ll just leave it at that. But we had a substantial position. Obviously, the stock is up. And I’ll just leave it at that for now. Obviously with the stock up, if we sold some stock, it would be a nice windfall.
Noella Alexander-Young: Excellent. Thank you for that response, Ted. Your next question is, “With Pharmaloz, we now have two new additional large potential customers in late-stage discussions. How long is the sales cycle from the time you receive an inquiry until the time you are recognizing revenue?”
Ted Karkus: Boy, that’s a great question. So it’s interesting, smaller brands, smaller companies, the sales cycle can be very quick. These larger brands take a long time. And I’m not going to mention their names, and it really doesn’t matter who they are. But first, we did an enormous amount of formulation work. Then one of the brands, once they were happy with our formulation work, they’re ready to go, they said, “Oh, but we can’t discuss this further with you until you have your FDA inspection.” Now, FDA inspections at manufacturing facilities typically happen once every two or three years. So, we had to wait for that. Then the FDA inspection comes back, no citations, because we happen to be a fantastic facility. We’ve been around for decades.
We know what we’re doing. We’re one of the most reliable lozenge manufacturing companies in the world. And so, we finished, then they say, “Okay, now we have to do a full audit.” After they do their internal audit, then they say, “Okay, now we want an external company to audit you.” They did a full audit. Then they say, “Okay, now we need to review the results of the independent auditing company.” Then they review the results. Then they have questions. Then we answer the questions. And then we get to the final stage. “Okay, what do you want to do?” So, it gives you an idea of what we have to go through. So, in that one example, we are very late in that process, late stage in those discussions. The same thing with the other global brand. So, how quickly they move now, they’re still very, very large companies, we’ll see.
I will also tell you though, that ultimately they could be in competition with each other to get capacity in our manufacturing facility because again we’re building the capacity as quickly as we can, but with our current capacity, they could dwarf — with an order they could dwarf our current capacity, either one of them could. So, if we sign up with one of them and they lock in, they give us some money up front to lock-in some of that capacity. The other one even if they want to do business with us, they may have to wait until we continue to build the capacity. So, it’s a really interesting situation and environment to be in, and we’ll just have to see how it plays out. At the same time, we have two other significant lozenge lines, maybe not quite as large, who have been developing with us.
