PhytoMedical -- Pass the Doobie to the Left

| About: Ceres Ventures, (CEVE)
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PhytoMedical Technologies, Inc. (PYTO.OB) ($1.06), an early stage research-based biopharmaceutical company, is focused on the development and commercialization of innovative plant derived pharmaceutical and nutraceutical compounds. Currently, the Company is involved in the identification, research, and development of plant-derived compounds for diabetes and cachexia (which is characterized by dramatic weight loss, particularly in AIDS or end-stage Cancer patients).


PhytoMedical is not the first biopharma company looking to develop novel drugs based on the science of ethnobotany.

Do any readers recall a company called Shaman Pharmaceuticals? Founded in 1989, this Company aspired to be a model of bioprospecting—staking its ventures strongly on the knowledge of traditional healers (shamans). At one time, Shaman had a diabetes program that resulted in the discovery of multiple new compounds, and formed the basis for a collaborative relationship with Ono Pharmaceutical Co., Ltd. The Company also had two compounds in the later stages of clinical development, Virend, a topical antiviral for the treatment of herpes, and Provir (SP-303), for the treatment of AIDS/HIV-associated diarrhea.

For all its millions spent on R&D—and salaries—the Company had nothing to show in the way of commercial successes. Shaman did market its once-promising prescription drug, SP303, as a dietary supplement, for which prior FDA approval was not necessary. The product was temporarily sold in health food stores, under the name, NSF, for normal stool formula. In 2001, Shaman Pharmaceuticals lost its ‘magic’ and filed for bankruptcy.

So forgive us for laughing when we read about Phytomedical’s decision to expand the scope and scale of its research efforts.

If you have nothing to show—obfuscate. Or, if you really have nothing and want to boost the price of your company’s share price—use sizzle and buzzwords—talk about ethnomedical investigation and proprietary, sophisticated screening models which can result in a more efficient drug discovery process.

In news story filed on February 15, 2006, PhytoMedical trumpeted the news that the Company was expanding its research activities to include new plant-derived drug candidates for obesity, Cancer, and Alzheimer's disease.

PhytoMedical has only one plant-derived compound in development. Named, BDC-03, the compound has shown success in increasing lean muscle mass and reducing body fat –in animal studies!

Through ‘make me legitimate’ contracts called, Cooperative Research and Development Agreements (CRADAs), PhytoMedical is also working towards synthesizing the active components of several polyphenolic compounds found in cinnamon bark—the end objective being to develop a commercially viable compound that can lower the blood sugar levels in diabetics. CRADAs, by Federal Law, are limited to partnerships that do not exceed a combined dollar value total of $150,000 over the life of the agreement.

For the nine-months ended September 30, 2005, PhytoMedical had spent a whopping $132,815 on research and development!

Now how is PhytoMedical going to fund its so-called expanded R&D activities with a one-dollar share-price and a cash balance of $95,538?

To quote from our friends at the blog, , I have made money from no money. I have lost money with money, and I have made back the money I lost. Now I must learn to make money with money.

The 10Q Detective suggests that if PhytoMedical Technologies really wants to be taken seriously by the investment community—Perchance the Company could design a clinical trial that examines the safety and efficacy on the potential appetite-stimulating properties of a well-known plant-derived compound on the cachexia of cancer, HIV/AIDS symptomatology, and other wasting syndromes. This medicinal plant is called , cannabis sativa.

To be blunt—given the Company’s current fundamental outlook—one would have to be smoking cannabis daily to even consider buying this stock.