Fiscal Year -March 31
Shares outstanding as of October 31, 1996 - 20.9 million
Sept. 30, 1996 cash position - $4.12 million
Long Term Debt - None
Vancouver Stock Exchange Listing - IZP
Warrants Listed (Purchase 1sh@C$1.40) expires 9-7-97 - IZP.WT (VSE)
Stock Price as of Nov 17, 1996 - US$1.25
Institutional Holdings - 25%
Insider Holdings - 25%
Average Daily Volume - 105,000 shares
Market Cap - $26 million
Book Value as of Sept. 30, 1996 - 21¢
NASDAQ Listing - Anticipated during 1997
Major Activities - Development of a new class of anti-inflammatory drugs for asthma, allergies, arthritis and at least a dozen other significant inflammatory conditions; unique technologies for TB diagnosis/vaccine development and anti-cancer drugs.
Est. Cash Burn Rate-1996 - $ 1.2 million
Est. Cash Burn Rate-1997 - $ 3 million
Est. Cash Burn Rate-1998 - $15 million
Est. Cash Burn Rate-1999 - $13 million
Anticipates continued equity financing
Shares outstanding by the year 2000 - estimated 40 million
Earnings/share - Anticipated losses through 1999 unless up front royalty or joint venture funding develops.
52 week Range - .14 - $2.25 (US Dollars)


S.A. Advisory, an advisory firm, acts as a consultant to AVIT. We received compensation for production of this anecdotal research report. We may buy and/or sell shares in this issue at our own discretion.

HOTLINE 1-900-990-0909, EXT 192 ($2.00/min)



Inflazyme Pharmaceuticals Ltd. is a bio-pharmaceutical company specializing in the design, discovery and commercialization of novel generations of drugs which combat such major diseases as asthma, allergies, arthritis and numerous other illnesses categorized as inflammatory diseases.
Inflazyme is developing a family of steroid like compounds isolated from a marine sponge, that have demonstrated steroid-like efficacy without the side effects associated with steroids being used as anti-inflammatory agents.
Side Effects of Steroids
Bone Damage, Hypertension, Cataracts, Immunosuppression, Putty Face, Problems in Liver Function, Growth Retardation.
Inflazyme's portfolio of proprietary anti-inflammatory drugs embodies the first completely new class of anti-inflammatories since the discovery of NSAIDS in 1959 (i.e., Aspirin, Ibuprofen, Naproxen).

Corporate Headquarters

Contact: Contact: James King

Officers & Directors

- - Director Harvey Kellman - - -
Dr. Hassan Salari - President, Chairman, CEO
James Rae - Director
Harvey Kellman - Director
Ian Anderson - Director
Dr. Walter Lovenberg - Director



  1. Apanol - Drug for treatment of asthma. Asthma is a serious global health problem. People of all ages in all countries are affected by this chronic airway disorder. The market for asthma drugs is approximately $6 billion annually
  2. Tiesole - Drug for treatment of allergies. This drug has demonstrated efficacy in the prevention and reduction of allergic reactions in an experimental model of allergies, including allergic rhinitis and hayfever. The market for anti-allergy drugs is estimated at $5 billion annually.
  3. Bispan - Drug for treatment of arthritis. Bispan has demonstrated significant efficiency in laboratory models of rheumatoid arthritis. The market for anti-arthritic drugs is estimated to be $7 billion annually.
  4. Sortac - Drug for treatment of psoriasis.

Inflazyme's new compounds, Apanol, Tiesole and Bispan are known by the group name IZP-94005. The company believes that its family of proprietary drugs, including a group of 50 compounds covered by a broad-based patent, can replace steroids as the therapeutic-of-choice for the treatment of inflammatory conditions.
A US patent for the composition of matter and usage for IZP-94005 has been issued, with similar applications filed in Canada, Japan and Europe. This "jumbo" patent covers over 50 compounds and provides meaningful intellectual property for the company.
A synthetic formulation for the production of IZP-94005 has been developed by the company using commercially available and inexpensive basic ingredients. Inflazyme's lead IZP-94005 drug is called Apanol. This highly promising compound is being developed as a treatment for asthma and is currently scheduled to begin a four-month Phase I clinical trial in the United Kingdom by March 1997.

What is Asthma

  1. Inflammatory disease of the lungs.
  2. Affects 13 million Americans (280 million worldwide)
  3. Has two phases (early 15 mins., late 8 hours)
  4. Affects 20% of children
  5. Affects 8% of adults
  6. It is increasing 14% annually
  7. Causes 5000 deaths annually

Asthma Market

Currently $6 billion Expected to grow by 14% - 17%/year
Due to

  1. Aging Population
  2. Pollution
  3. Earlier Diagnosis
  4. Longer Treatment

Apanol Safety Profile

  1. Safe Drug (nontoxic)
  2. Is not immunosuppressive
  3. Does not have effects on bone metabolism
  4. Does not have effects on hearts
  5. Does not cause hypotension or hyperten- sion
  6. Well tolerated given in multiple doses
  7. No effect on liver or blood



IND (months) 1-3 - IND (Investigational New Drug) application approval refers to the U.S. Food & Drug Administration (FDA) process for approving a compound to advance into human clinical trials. Many regulatory jurisdictions outside of the U.S. are considered to provide the same degree of rigorous review but frequently provide faster approvals. The U.K. is one such jurisdiction. Submissions go before an Ethics Committee, which is roughly the equivalent of the U.S. FDA. (The FDA IND approval process can require five to nine months to complete.)

Phase I - months 5 - 8 - First testing on humans. The subjects are “normal” people, i.e. those not afflicted with the targeted disease. Assesses the compound for toxicity, or unwanted side effects, and more precisely, determines the amount and frequency of doses at which side effects become evident. Submission and approval by regulatory body required to advance to next stage. Involves between 20 - 50 people. Anticipated during March 1997

Phase II - months 6 - Validation of efficacy in humans and confirmation of safety results achieved in Phase I. Involves between 20 -50 subjects afflicted with the target disease. Determination of dosage levels that allow maximum efficacy with tolerable side effects. Regulatory approval required to

Phase III - months 12 - 15 - More rigorous, expanded human testing that may involve hundreds or even thousands of subjects and control groups in multiple centres. Allows the collection of highly objective data on a drug’s efficacy and comparison with other forms of treatment. Allows monitoring for adverse reactions after long-term use.

NDA - months 5 - 10 - NDA (New Drug Approval) is required by the FDA prior to the commercial introduction of a drug. Additional studies in a Phase IV clinical trial may have to take place concurrently with early marketing. For comments regarding the NDA-equivalent in the U.K., refer to IND-Equivalent above.

Marketing Launch - months 2 - 6 - May involve additional market testing to refine a marketing plan in terms of pricing and other variables. Ramping up of commercialization and the marketing launch.


November 12, 1996 - lnflazyme Pharmaceuticals Ltd. (OTC-BB:IZYPF, VSE:IZP) today announced the appointment of Mr. James M. Rae to its Board of Directors. Mr. Rae is the immediate past President and CEO of Cangene Corporation. Prior to that he held key management positions at G.D. Searle, Ltd., E.R. Squibb and Ciba-Geigy Corp.
"By bringing extensive experience in business development, marketing and strategic alliances to Inflazyme, Jim Rae will add significant strength to our management team", said Dr. Hassan Salari, Inflazyme's President and CEO.
October 7, 1996 - Inflazyme Pharmaceuticals Ltd. (OTC BB: IZYPF, VSE: IZP) announced today that it has received approval to trade its common stock on the OTC Bulletin Board, under the symbol IZYPF. The company’s stock will continue to trade on the Vancouver Stock Exchange under its IZP symbol.
Inflazyme’s President and CEO Dr. Hassan Salari stated, “We anticipate that the OTC Bulletin Board listing will expand shareholder interest in Inflazyme, and that it will facilitate trading among our following of U.S. investors, which has been increasing steadily.”
September 11, 1996 - Inflazyme Pharmaceuticals Ltd. (the “Company”) announced today that its Rights Offering To Shareholders, oversubscribed by more than 45%, has been successfully completed.
"It is edifying to see the faith which our shareholders and the investing public have exhibited in our Company,” stated Dr. Hassan Salari, lnflazyme’s President and CEO. “The approximately C$3.2 million generated by this Offering will increase our working capital to in excess of C$4.7 million. Further, our Company is expected to receive an additional C$1.9 million through the exercise of the Warrants which were part of the just completed Rights Offering. With these funds we will proceed at once to initiate and complete the Phase I and Phase II clinical trials of Apanol, our lead anti-asthma drug, in accordance with U.S. FDA regulations.”
More or less simultaneously, Inflazyme would initiate the process of bringing its anti-arthritis drug, Bispan, to the early Phase I trial stage, at which time negotiations would be entered into with one of the major pharmaceutical companies which have already expressed serious interest in forming a joint-venture to co-develop the drug. In addition, the Company plans to expand its research programs for the preclinical optimization of certain other of its anti-inflammatory drugs, especially those targeted as preventatives and therapeutics for allergies and such skin diseases as eczema and psoriasis.
August 27, 1996 - Inflazyme Pharmaceuticals Ltd., (Vancouver Stock Exchange: IZP) and SuperGen, Inc. (Nasdaq: SUPG & SUPGW) jointly announced today that the two companies have signed a letter of intent that grants SuperGen the exclusive worldwide rights to anti-cancer and all other applications, except inflammation, of certain Inflazyme technologies and drugs.
Inflazyme stated that preclinical laboratory studies of its drugs have shown effectiveness against lung, colon and skin cancers, as well as lymphomas and leukemias. Additionally, certain of the drugs target multi-drug resistant (MDR) cancers that no longer respond to available therapies. Based on results to date, the companies said U.S. human clinical trials could begin as early as 1997.
While the terms of the agreement have been defined, they were not specifically disclosed. The companies said the License granted to SuperGen is based on a combination of equity investment in Inflazyme’s common stock, milestone payments and royalties to Inflazyme on net product sales. The final Licensing Agreement between the companies remains subject to mutual review.



  • A. Lack of Commercial Products: IZYPF was founded to discover and develop new pharmaceuticals for inflammatory conditions and related diseases. The company has yet to gain marketing approval for any product and may never gain such approval.
  • B. Government Regulation: The approval, manufacturing, marketing and labeling of the company’s potential products are subject to regulation by governmental authorities in the United States and abroad. This regulatory process can be unpredictable, causing delays or rejections of new products, which could have a material impact on the company.
  • C. Dependence on Key Personnel: The company is dependent on its management team and staff. Loss of credibility could impair the raising of additional capital necessary for future success.
  • D. Technological Change and Competition: The company is involved in an intensely competitive field. There are many companies and institutions that are engaged in developing products for human therapeutic applications. These companies and institutions may be able to successfully develop and produce products of superior quality, therefore gaining access to the commercial market with a competing product prior to any success rate IZYPF, eroding potential profits.
  • E. The company will need to raise substantial additional capital before turning profitable. If IZYPF is unable to raise additional funds via equity financing or form a corporate alliance, it will severely affect corporate growth.


We have seen over the course of the last 10 years a dramatic increase in the rate of change of new technology platform within the biotech industry.

Over the course of the last year, buoyant capital markets have allowed most of the biotech companies to issue new stock and, therefore, recapitalize their balance sheets such that we now have a biotech industry that is considerably broader with a couple of hundred public biotech companies that have strong balance sheets. These strong cash positions are really the fuel for the research engine over time. In addition, we have an environment where the pharmaceutical industry is in a position to very aggressively enter a new phase of its corporate strategic alliance activity. Obviously, Inflazyme Pharmaceuticals, LTD is an ideal candidate to continue to benefit from this industry-wide development.

When we consider second and third tier biotech companies, we are seeing a major shift in the business model versus several years ago. Five years ago, every third-tier company's goal was to become the next Amgen. That theme has all but disappeared. The new approach is collaboration and licensing of products to the first-tier biotech companies. This is a lower-risk strategy. Again, this strategy fits well with Inflazyme Pharmaceuticals Ltd.'s overall growth plan, which, of course, can and will speed up revenue and earnings.


Three Criteria that Enhance IZYPF as an Investment Opportunity

  1. Valuation - very low market cap and technology valuation due to limited exposure to US investors.
  2. Science - Exciting new compounds that potentially offer significant efficacy against inflammation disorders with little or none of the side-effects that NSAID's or steroid exhibit.
  3. Near-term milestones: Phase I testing of flagship compound, APANOL, within 120 days.


Geared towards "risk tolerant investors". Dramatic upside potential exists near term if corporate alliances are forged, additional funds raised or biotech group as a whole moves higher.

Investor types that are long-term oriented should realize that a 3 to 4 year horizon may exist before revenue and earnings are derivable from sales of current products being developed.

IZYPF is considered speculative, and all risk adverse accounts should fully understand all the adversities of investing in micro-mini caps.

Conservative Accounts should consider a mini portfolio of 1/4 IZYPF, 1/4 ICOS, 1/4 ARRS, 1/4 ARIA.

More Speculative Accounts: 1/3 IZYPF, 1/3 ICOS, 1/3 ARRS. Most Speculative Accounts: 1/2 IZYPF, 1/8 ARIA, 1/4 ICOS, 1/8 ARRS.

We intend to monitor IZYPF in our 900# portfolio for percentage gain performance.


Copyright © 1996 S.A. Advisory