Nuvilex, Inc. Real Science Without the Fiction...$65-billion by 2020. The company conducted a six...

Nuvilex, Inc. – Real Science Without the Fiction February 19, 2013

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Nuvilex, Inc. – Real Science Without the Fiction

In Nuvilex, Inc. (OTCQB: NVLX), we’ve found a true diamond in the rough.

Here is a company that is being slowly accumulated for what promises to be

a very bright future. We’ve reviewed the science and the direction NVLX is

heading in, and we’re more than impressed with Science that seems to be

right off the big screen. Nuvilex is like a good book – It has everything!!

We have a weak spot for biotechnology companies because of the work they

do to improve our lives, but we also know they are great investments when

the company is involved in the science for all the right reasons.

Anyone investing in biotech stocks knows the money is in companies

conducting clinical trials that focus on products or therapies for cancer,

diabetes or the heart.

Nuvilex, Inc. with its subsidiary Austrianova Singapore, has already

completed two Phase II pancreatic cancer trials and is currently preparing

for a large scale Phase III trial. The results have been incredible with what

we think is an amazing technology in their unique and proprietary live cell

encapsulation process which we’ll get into further as we move along.

Additionally, the company has just created a new subsidiary in the

medical marijuana arena to enhance its current work, and to take full

advantage of the new legislation passed legalizing marijuana in two states

and expanding its use medicinally in 18 others.

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NVLX has a great deal going on inside the company as it operates its “all

natural” healthcare product and biotechnology enterprises. But, for the

purposes of this Report, it is the successes the company is realizing on the

biotech side of the house with its cell encapsulation technology in clinical

trials combined with its new venture into medical marijuana that has Stock

House Group giving Nuvilex, Inc. a Speculative Buy Rating. We expect

to see shareholders rewarded nicely as this company’s story plays itself out

right before our eyes.

Meadows Corporate Park I

12510 Prosperity Blvd, Suite #310

Silver Spring MD 20904

(240) Own-NVLX or (240) 696-6859

www.nuvilex.com

[email protected]

Company Ticker Symbol NVLX Current Price as of 2/18/2013 $0.0519 52-Week High/Low $0.089/0.019 Est. Outstanding Shares 445.6M Market Capitalization $23,128,158 3-Month Average Volume 484,782 Stock House Group Rating Speculative Buy

Company Overview

Nuvilex, Inc. has been a provider of

all-natural products for many years; however, the company has expanded

to increase its natural product-based footprint as it continues to make

advances.

NVLX is an international biotechnology provider of live, therapeutically

valuable, encapsulated cells and services for research and medicine. New

mailto:[email protected]


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developments by the company and its subsidiaries continue to be

impressive with work on many fronts. Nuvilex’s offerings will ultimately

include treatments for cancer and diabetes, as well as, other treatments

using the company's natural product knowledge, product base, cell and

gene therapy expertise, and live-cell encapsulation technology in addition

to other new products currently under development.

The company just announced its new subsidiary, Medical Marijuana

Sciences, Inc., which will focus on developing treatments for brain cancers,

including glioblastoma multiforme, that are based on cannabinoids.

(Discussed further Below)

Let’s Dig into the Science – What is Cell Encapsulation?

Before we discuss the Clinical Trials NVLX has successfully completed, let’s

dig into the science behind their incredible technology. The company uses

a unique and proprietary technology – Cell Encapsulation.

The process forms a “platform” upon which treatments for many serious,

debilitating, and even fatal diseases may be built. Some of these diseases

include different types of cancer, diabetes, diseases for which stem cell

therapies are being developed, and diseases caused by viruses.

Yes, it does sound confusing but in laymen’s terms, the process uses living

cells, and the company takes a very specific type of cell to address a specific

problem a person has. Company scientists then wrap up cells in a type of

cotton and encase them forming a “platform” or bundled miniature house

of cells about the size of the head of a pin.

At that point, each bundled platform becomes much like a miniature cell

factory with the ability to produce whatever is needed.

For Instance, a diabetic whose body doesn’t produce insulin or enough

insulin, the company could encapsulate living pancreatic cells that produce

insulin – the miniature cell factory – with the ability to produce insulin

anytime it detects the presence of glucose.


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This bundle would be placed inside the diabetic whose body would now

have the ability to produce insulin because of this encapsulated cell bundle

working inside them.

A look at the process and its use in cancer treatments can be seen in the

picture below.

This process is beyond amazing and it can be used for any disease or

treatment by encapsulating a cell type that will deliver what the body may

be lacking or in need of.

Another example would be a cancer patient whose body needs to convert a

chemotherapeutic drug to its cancer-killing form before the drug can be

effective. The company could encapsulate a specific cell type that does the

conversion the patient’s liver does, but place that encapsulated bundle right

at the site of the cancerous tumor.


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Advantages to Using Nuvilex’s Cell Encapsulation Technology

Nuvilex’s cell encapsulation process is a true platform technology. Other

companies’ technologies are often directed at treating a single type of

cancer or a single disease; whereas, NVLX’s technology has many possible

uses.

The Advantages of using the company’s technology include:

It is a true platform upon which treatments for many diseases may be

built - virtually any type of cells… drug-activating cells, drug-

producing cells, stem cells, probiotic bacteria… can be encapsulated

with only minor modifications to the process.

It has been developed and validated using Good Manufacturing

Practices (GMP) standards, a requirement for approval by drug

regulatory agencies such as the FDA.


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The company’s capsules are composed largely of cellulose making

them inert – they do not elicit any damage to normal body tissues

near the capsules, and because of the size of the pores in the capsules,

encapsulated cells aren’t permitted to leave the capsules, nor does it

allow cells of the body's immune system to enter the capsules to

attack, and reject, the cells themselves.

Encapsulated cells can be frozen and stored for long periods without

undue damage – necessary for shipment of cells to distant locations.

Nuvilex, Inc. Clinical Trials – Using the Encapsulated Cells

Two independent Phase II clinical studies in patients with advanced, non-

surgically-removable (non-resectable), pancreatic cancer, have been

performed using the encapsulated cells capable of converting the widely-

used anti-cancer drug, ifosfamide, into its “cancer-killing” form.

The latest results using a broader set of data confirmed the results found in

the first Phase I/II Trial. Both Trials offer sets of data that were done at

different times, with different populations, and in different hospitals. In

the first trial, one location was used; however the second Phase II trial

expanded its database by using 4 different hospitals.

Twenty-seven (27) patients all showed a substantial response in that the

use of encapsulated cells helped those individuals to a better outcome than

that seen with standard single-drug (Gemzar®) therapy. Pancreatic

cancer is difficult to diagnose, and treat until it is at an advanced stage.

Survival of patients with advanced pancreatic cancer is usually only several

weeks or a few months.

Results from these trials included:

Median Survival Time and One-Year Survival Rate were almost

doubled as compared to historical data for Gemzar®.


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The severity of ifosfamide's side effects was reduced because only

one-third of its usual dose was used.

No damage to tissues surrounding capsules was seen.

Cells within the capsules were protected from attack by the patient’s

immune systems.

Cells inside the capsules were alive and functioning – even after more

than two years.

Eli Lilly’s blockbuster drug, Gemzar® is the only drug approved by

the FDA as a single agent for the treatment of advanced inoperable

pancreatic cancer and the drug is considered the “gold standard” by the

market.

To give readers an idea of what that means, in 2008, sales of Gemzar®

exceeded $1.7-billion, and the drug accounts for well over 55% of the

sales of all drugs for advanced pancreatic cancer.

This is significant to Nuvilex as the company is currently preparing for a

large scale Phase III pancreatic cancer trial.

In the future Phase III trial, Nuvilex’s pancreatic cancer treatment will be

compared “head to head” with Gemzar®. Whereas only two cycles of

ifosfamide were used in the Phase II trials, for the Phase III trial, more than

two cycles will be given, as is often the case when ifosfamide is used in

cancer treatment.

If the results obtained with NVLX’s treatment are statistically better than

those obtained with Gemzar®, Nuvilex’s treatment could replace Gemzar®

as the “gold standard” for the treatment of this devastating disease.

Last week the company’s subsidiary Austrianova Singapore, reported the

successful establishment of a research "cell bank" that will ultimately be

used to obtain the numbers of cells necessary for conducting the company's

late-phase clinical trials.


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Nuvilex Technology is Far Reaching – and Growing

Diabetes has been diagnosed in

371-million people worldwide.

The market for diabetes medicines

has been projected to approach

$65-billion by 2020.

The company conducted a six

month study in which pancreatic

islet cells (responsible for

producing insulin) from pigs were

implanted into diabetic rats.

Results showed that within days,

the rat’s blood glucose levels were

normal, and remained so for the

duration of the study. At the end

of the study, the cells were alive

and still producing insulin.

Like the pancreatic cancer trials,

the cells from pigs were protected

from attack by the rat’s immune

systems which would have

undoubtedly occurred if they had

not been encapsulated.

In effect, the company has

developed a type of "artificial

pancreas."

This study is planned to be

repeated, and if successful, will

lead to clinical trials in humans.

Stem cells as treatments are

projected to have a market of

$6.6- billion by 2016.

The development of treatments for

many diseases using stem cells has

been problematic when un-

encapsulated stem cells are

transplanted, about 50% of such

transplantations fail.

Stem cells typically migrate to

distant locations within the body

resulting in "abnormal" growths;

including tumors, occur far from

the transplantation site.

In the company’s pancreatic

cancer trials, encapsulated cells

remained where they were

implanted, were not attacked by

the patient’s immune systems, and

survived and functioned for at

least 2 years in the body without

stimulating immune responses

towards them.

Negotiations are in progress with

biotech and pharmaceutical

entities about using Nuvilex’s

encapsulation technology with

stem cells.


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Cell in a Box – NVLX Capitalizing on its Technology

According to Nuvilex President and CEO, Dr. Robert F. Ryan, the market is

substantial and growing with many companies developing cell types –

needing NVLX’s type of encapsulation. The CEO expects this to be at least

a multi-million dollar market.

To address the coming demand, the company has created “Cell-in-a-Box” –

marketed as “Your Cells, Our Delivery.” Any company out there that is in

the process of creating a cell therapy has the potential to use Cell in a Box…

by sending the cell type to Nuvilex and they will encapsulate it – put it in a

“box”, and then it can be put into use, including in clinical trials.

There are many areas where Nuvilex and other companies can use the

technology to develop solutions for a number of diseases and therapies.


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Medical Marijuana – Finding the Green is in the Science

In a well timed move, Nuvilex announced it had created a subsidiary to take

advantage of the recently passed legislation expanding the number of states

legalizing the use of marijuana for medicinal purposes by 18, in addition to

two states – Colorado and Washington, legalizing marijuana altogether.

Medical Marijuana Sciences, Inc. was formed to study the medical

applications of marijuana and develop treatments for serious human

diseases. The company will be focusing initially on developing treatments

for brain cancers, including glioblastoma multiforme, which are based on

cannabinoids.

Nuvilex's CEO said in a February 14, 2013, press release…

"Cancer is one of the most feared diseases affecting mankind. Over the

years, a substantial amount of information has appeared in the scientific

literature illustrating the cancer-killing activity of naturally-occurring

cannabinoids, including THC and CBD.

Therefore, development of cancer treatments by our subsidiary, Medical

Marijuana Sciences, Inc. based on such cannabinoids is a fruitful avenue to

pursue in Nuvilex's effort to enhance the arsenal of treatments currently

available for these devastating and deadly diseases."

Current studies indicate cannabinoids appear to kill cancer cells by

binding to specific receptors on the surface of cells. Following this binding,

cancer cells undergo a series of biochemical processes that ultimately lead

to "programmed cell death," also known as apoptosis.

This appears to be a natural fit for Nuvilex. With its research and the

results driven by two successful cancer trials, this move into the medical

marijuana sector could produce long awaited answers in the world’s fight

against all types of cancer.


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The market liked the announcement as the company’s shares saw a

dramatic rise in price from around $0.035 to $0.065 for an almost 86%

increase – showing just how easily and quickly the company’s stock can

move.

Other well-known plays in the medical marijuana industry, such as

Cannabis Sciences, Inc. (OTCQB: CBIS) and Medical Marijuana, Inc. (OTC

Pink: MJNA) have also made strong moves recently. This interest is clearly

demonstrating the momentum that is building behind stocks focused on the

growing trend of legalizing marijuana in the United States.

There are some fundamental differences between Nuvilex’s move into the

space versus some of its industry peers. While most other medical

marijuana companies are technology companies, Nuvilex is a true

biotechnology company. Although not the exact same, the encapsulation

experts at Nuvilex plan to investigate the use of similar technologies in their

medical marijuana research.

According to American Cancer Society estimates, about 23,000 people will

be diagnosed with malignant brain and spinal cord tumors in 2013 and

about 14,000 people will die from them in the US alone. At present, no

recommended tests are available to screen for brain tumors and many of


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these tumors are only detected when symptoms of their presence manifest

themselves.

Nuvilex, Inc. – Management Team

Dr. Robert F. Ryan – President and Chief Executive Officer.

Dr. Ryan has broad scientific experience in biochemistry, cell and

molecular biology, human genetics, novel therapies, and basic and clinical

cancer research, having received his Masters in Biochemistry, Cell and

Molecular Biology at The Medical College of Georgia, studying sickle cell

anemia. He received his Ph.D. in Molecular Genetics at Thomas Jefferson

University characterizing DNA and RNA binding properties of zinc finger

proteins.

Through his extensive training, his experiences extend across the fields of

aging, hemoglobinopathies, gene expression, human diseases, DNA, RNA,

proteins and their interactions, stem cell research and applications,

oncology, clinical protocols and therapies.

Professionally, Dr. Ryan has become a pioneer in the field of emerging

biotechnology, specializing in assisting small companies with insight and

bringing products to market through the rigorous FDA approval process.

Since 2002, Dr. Ryan served as the Chief Executive Officer of RFR

Consulting where he focused on helping businesses in the biotech industry

through providing information, grant writing, business management,

scientific guidance, FDA regulatory advice, advising investors, and

investment acquisition opportunities. With 25 years experience, including

excellent training at the Wistar Institute, NIH, and NCI, he has participated

in basic and clinical investigations and has published and edited research

articles in several peer-reviewed journals.

Dr. Gerald W. Crabtree – Chief Operating Officer

Even in his short time at the company, he has provided a significant benefit

and impact for Nuvilex clearly matching not only the commitment to


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repositioning Nuvilex into the biotechnology area, but also adds to the

strength of NVLX’s existing products and pipeline.

He has extensive experience in the areas of natural and synthetic drug and

device research and development, having worked in both academia and

small and large company environments. His business and financial acumen

together with his research and development background combine to make

him an invaluable addition to Nuvilex.

Since 1985, Dr. Crabtree has been involved with various biopharmaceutical

companies where he has alternatively supervised and coordinated the

development of multiple drug candidates, prepared clinical protocols,

investigator brochures, monographs, research and review articles, and

served as project manager for development of major oncologic agents. He is

a Member of the American Society of Clinical Oncology and also is a past

member of research grant review committees for the National Institute of

Health and the American Cancer Society.

Dr. Crabtree established and directed, from inception, a department that

monitored and coordinated the development of oncologic and immunologic

drugs from initial discovery through regulatory approval in a major

pharmaceutical company and served as project manager for the

development of the anti-cancer agent, Taxol®.

Dr. Crabtree received his Ph.D. in Biochemistry from the University of

Alberta, Edmonton, Alberta, Canada and has published over 80 articles in

peer-reviewed journals. He is a National Cancer Institute of Canada

Research Fellow. In addition, he served as Department Head of Molecular

Pharmacology for the Nucleic Acid Research Institute and prior to that as

Associate Professor of Medicine with the Roger Williams Cancer Center at

Brown University. He has also served as Director of Project Planning and

Management (Oncology/Immunology) at Bristol-Myers Squibb and as

Vice-President of Research and Development at ETEX Corporation.


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Most recently, Dr. Crabtree served as Interim CEO of PhytoCeutica, Inc.,

where he assisted in preparation and review of FDA documents, clinical

study protocols, investment acquisitions, and contracts and business plans.

Nuvilex – Some Parting Shots

In this report, we have only touched on the Biotechnology Division within

Nuvilex, Inc. – which is only one side of the house inside this company.

The stock is currently priced at $0.0519, and this entry doesn’t begin to

reflect the worth of Nuvilex and the host of subsidiaries that fall under its

brand and contribute to the company’s revenue stream.

The market clearly hasn’t fathomed the true value to medicine that the

powerful encapsulation cell technology brings, but it has now gained a new

audience of interested investors and onlookers who follow medical

marijuana stocks religiously.

Don’t be surprised if Big Pharma isn’t keeping close tabs on Nuvilex. Major

pharmaceutical firms are notoriously bad at developing their own pipe-

lines, and prefer to acquire juniors when the time is right. They will

presumably have their eyes locked on the limited number of biotechnology

companies in the medical marijuana space – especially multi-dimensional

companies like Nuvilex as they enter late-stage clinical trials. Anyone who

has ever enjoyed the explosive bonanza that is a Big Pharma buyout would

probably see Nuvilex is a true candidate – the science is undeniable!

Disclaimer:

This Stock House Group Research Report was prepared for informational

purposes only. All information contained in this report was provided by the

Company. Stock House Group is responsible only to the public, and is paid

in advance to eliminate pecuniary interests, retain editorial control, and

ensure independence. Analysts are compensated on a per report basis and

not on the basis of his/her recommendations.

The information used and statements of fact made have been obtained from

sources considered reliable but we neither guarantee nor represent the


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completeness or accuracy. Stock House Group was compensated by the

Company in the amount of one-thousand five hundred dollars for its

research, writing and dissemination of this report. Stock House Group does

not accept any equity compensation. Stock House Group did not make an

independent investigation or inquiry as to the accuracy of any information

provided by the Company, or other firms.

Stock House Group relied solely upon information provided by the

Company through its filings, press releases, presentations, and through its

own internal due diligence for accuracy and completeness. Such

information and the opinions expressed are subject to change without

notice.

A Stock House Group Research Report, CEO Interview, News Feature, or

Press Release is not intended as an offering, recommendation, or a

solicitation of an offer to buy or sell the securities mentioned or discussed.

This report does not take into account the investment objectives, financial

situation, or particular needs of any particular person. This report does not

provide all information material to an investor’s decision about whether or

not to make any investment.

Any discussion of risks in this presentation is not a disclosure of all risks or

a complete discussion of the risks mentioned. Stock House Group is not

registered as a securities broker-dealer or an investment adviser with

FINRA, the U.S. Securities and Exchange Commission or with any state

securities regulatory authority.

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