ETHIGEN's AL-721 WILL BE AVAILABLE OTC AS FOOD SUPPLEMENT

Executive Summary

ETHIGEN's AL-721 WILL BE AVAILABLE OTC AS FOOD SUPPLEMENT with shipments expected to begin by the end of April. Los Angeles-based Ethigen announced in a March 17 press release that it is "in the process of finalizing plans for the distribution of AL-721 into pharmacies and other outlets across the country." Discovered by the Weizmann Institute in Israel, AL-721 is a lipid compound that has been studied as an antiviral in AIDS patients. Ethigen's preliminary distribution plans call for initially selling AL-721 through pharmacies and, possibly, health food stores. The company said that it is "in discussions" on appropriate ways to distribute and market different versions of the compound as a food supplement. The product will carry the AL-721 trademark. AL-721 will be "generally available as a food supplement, with no claims of effectiveness or indications for treatment," Ethigen maintains. The company's position is that marketing the product as a food supplement without health claims exempts the product from FDA drug preclearance procedures. Ethigen said that it would "responsibly market" AL-721 under the appropriate FDA food supplement labeling requirements. However, the company's decision to market the product as a food supplement should attract close scrutiny from FDA. AL-721 reportedly is well-recognized by high-risk AIDS populations as a potential AIDS treatment. In recent weeks, FDA has signaled its interest in attacking what it views as an extra-legal AIDS product market. Earlier this month, the agency issued a reg letter to Culver, Indiana-based Houba, Inc. seeking a stop to marketing of another lipid compound, EL-1020, which was promoted as an AIDS treatment. In addition, at a press conference March 9, FDA Commissioner Young announced a joint public information campaign with the Pharmaceutical Adveristing Council targeted to offset the demand for "quack" remedies for AIDS ("The Pink Sheet" March 14, T&G-6). Ethigen recently completed a Phase I study in lymphadenopathy patients conducted at St. Luke's Roosevelt Hospital in New York. The company indicated that the results of the six-month study, which have not been publicly released, were "promising" but "inconclusive." The National Institute of Allergy & Infectious Diseases is also studying the compound in AIDS patients. An open label, multiple dose ranging trial of AL-721 in lymphadenopathy and ARC patients is underway at a number of centers, including Mount Sinai Hospital, Memorial Sloan Kettering and the University of Southern California. The study has enrolled 25 patients to date. Separately, Ethigen announced that it has completed a $450,000 "interim financing agreement with certain private investors, including the company's chairman." Ethigen said that the proceeds will go toward operations and "ongoing production and distribution of AL-721 while the company continues to seek permanent financing." The company also reported the appointment of VP-Research Allen Laskin, PhD, to president of Matrix Research Labs, a wholly owned subsidiary of Ethigen.