UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 15, 2017
Creative Medical Technology Holdings, Inc.
(Exact name of registrant as specified in its charter)
| Nevada | 000-53500 | 87-0622284 | ||
|
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) | ||
| 2017 W Peoria Avenue, Phoenix, AZ 85029 | ||||
| (Address of principal executive offices) | ||||
Registrant’s telephone number, including area code: (602) 680-7439
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 1.01 | Entry into a Material Definitive Agreement |
On May 17, 2017, StemSpine, LLC (“StemSpine”), a newly formed Nevada limited liability company and wholly owned subsidiary of Creative Medical Technologies, Inc. (“CMT”), the wholly owned subsidiary of Creative Medical Technology Holdings, Inc. (the “Company”), entered into a Patent Purchase Agreement dated May 17, 2017 (the “Agreement”), with Creative Medical Holdings, Inc. (“CMH”), the parent of the Company. Under the terms of the Agreement, StemSpine acquired U.S. Patent No. 9,598,673 covering use of various stem cells for treatment of lower back pain (the “Patent”). The inventors of the Patent were Thomas Ichim, PhD and Amit Patel, MD, each a director of the Company, CMT, and CMH, and Annette Marleau, PhD, a Senior Vice-President of the Company and a senior officer of CMT and CMH. The managers of StemSpine are Timothy Warbington, Donald Dickerson, and CMH. The Patent was issued on March 21, 2017.
On or before June 29, 2017, StemSpine has agreed to pay CMH $100,000 for the Patent. Under the terms of the Agreement, StemSpine has also agreed for a period of five years from the date of the first sale of any product derived from the Patent to make royalty payments of 5% from gross sales of such products. StemSpine has also agreed to pay royalties of 50% of sale price or ongoing payments from third parties for licenses granted under the Patent to third parties. In addition, StemSpine has agreed to make progress payments under the Agreement determined by whether the technology represented by the Patent is tested by use of autologous cells or allogenic cells. In the case of pursuit of the technology using autologous cells, StemSpine has agreed to pay CMH $100,000 upon the signing of an agreement with a university for the initiation of an IRB clinical trial; and $200,000 upon completion of the clinical trial. In the event StemSpine determines to pursue the technology using allogenic cells, StemSpine has agreed to pay CMH $100,000 upon the filing for IND with the FDA; $200,000 upon the dosing of the first patient in Phase 1-2 clinical trial; and $400,000 upon the dosing of the first patient in Phase 3 clinical trial. In each case, except for the initial payment of $100,000 on or before June 29, 2017, StemSpine has the option to make these payments in cash or in shares of the Company’s common stock at a 30% discount to the market price of the stock at the time of the transaction. The parties to the Agreement have agreed that in no event will the aggregate royalty payments under the Agreement exceed $2,500,000.
StemSpine has agreed to maintain books and records, and furnish reports to CMH, sufficient to validate the payments due under the Agreement. The Agreement also contains representations and warranties by CMH as to the sole ownership and interest in the Patent at the time of transfer and as to other matters customary to a transaction of this nature.
| Item 8.01 | Other Events |
Press Release
On May 18, 2017, the Company issued a press release announcing the acquisition of the Patent disclosed in Item 1.01 above.
The press release, furnished as Exhibit 99.1 to this Form 8-K, may contain forward-looking statements. Such forward-looking statements are based on information presently available to the Company’s management and are current only as of the date made. Actual results could also differ materially from those anticipated as a result of a number of factors, including, but not limited to, those discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, and subsequent reports filed by the Company with the Commission. For those reasons, undue reliance should not be placed on any forward-looking statement. The Company assumes no duty or obligation to update or revise any forward-looking statement, although it may do so from time to time as management believes is warranted or as may be required by applicable securities law. Any such updates or revisions may be made by the Company by filing reports with the Commission, through the issuance of press releases or by other methods of public disclosure.
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10b5-1 Plan
On May 15, 2017, CMH, the parent of the Company, both of which are controlled by Timothy Warbington, entered into a trading plan in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934, as amended, to sell up to 750,000 shares of common stock of the Company at prevailing market prices, subject to specified minimum price thresholds. Shares will be sold under the plan on the open market over the period of time and according to the other parameters set forth under the trading plan. The plan has a trading period that begins not sooner than May 30, 2017.
Rule 10b5-1 allows persons, when they are not in possession of material nonpublic information, to adopt written, prearranged trading plans to sell securities under specified conditions. Rule 10b51 trading plans are permitted under the Company’s insider trading policy, and, to the extent required, transactions under the trading plan will be disclosed publicly through Form 144, Schedule 13D, and/or Form 4 filings with the Securities and Exchange Commission.
The Company does not undertake to report 10b5-1 plans that may be adopted by any officers or directors in the future, or to report any modification or termination of any trading plan, whether or not the plan was publicly announced, except to the extent required by law.
| Item 9.01. | Financial Statements and Exhibits |
| (d) | Exhibits. |
| Exhibit No. | Description | |
| 99.1 | Press Release dated May 18, 2017 |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Creative Medical Technology Holdings, Inc. | ||
| Date: May 18, 2017 | By: | /s/ Timothy Warbington |
| Timothy Warbington, Chief Executive Officer | ||
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Exhibit 99.1
Creative Medical Technology Holdings to Expand into 10 Billion Dollar per Year Lower Back Pain Market with Acquisition of Issued US Stem Cell Patent
Clinical Stage Stem Cell Company Continues Aggressive Pursuit of Personalized, Rapid to Implement, Autologous Regenerative Medicine Procedures
May 18, 2017 Creative Medical Technology Holdings, Inc. (OTCQB:CELZ) announced today the acquisition of issued US patent #9,598,673 covering use of various stem cells for treatment of lower back pain through healing of perfusion defects.
The Company believes, based on various scientific studies, that a large number of patients with lower back pain undergo progression to disc degeneration due to suboptimal levels of oxygen and nutrients entering the disc. This is believed to be a process similar to what happens in the heart, when the arteries feeding the heart thicken, resulting in reduced heart function. Thickening of arteries feeding the disc is believed to result in starving the disc of nutrients and oxygen, resulting in eventual deterioration and pain. Through administration of stem cells in proximity to the disc, the process is designed to stimulate production of new blood vessels, which will assist the disc to regenerate.
“Creative Medical Technology Holdings will develop this patent through the same process that we are using for our clinical-stage Caverstem procedure for erectile dysfunction,” stated Timothy Warbington, President and Chief Executive Officer of the Company. “We plan to identify and engage key opinion leaders who will lead clinical trials, which will serve as the basis for accelerated commercialization.”
The Company is currently running a clinical trial using autologous non-manipulated bone marrow stem cells for patients suffering from erectile dysfunction that are non-responsive to standard approaches such as Viagra. Once the trial is completed, the results will serve as the basis for marketing of disposables utilized in administration of stem cells.
“Although numerous companies are injecting stem cells directly into the disc, direct injection may only cause temporary benefit because the root cause of the pathology, in our opinion, is the reduced blood supply,” stated Dr. Amit Patel, Director of Thoracic Surgery at University of Miami and co-founder of Creative Medical Technology Holdings. “By recreating in the microenvironment of the lower back the same thing that we do in atherosclerotic heart patients, we believe we have a novel way to treat this terrible condition that wreaks havoc on our health care system.”
Several studies have shown that administration of stem cells possesses a therapeutic effect in cardiac conditions associated with poor circulation by stimulation of new blood vessel production, a process termed “angiogenesis”. The current patent covers stimulation of angiogenesis in the lower back using mesenchymal stem cells. These cells can be used from the same patient, which is considered an “autologous therapy” as well as using stem cells in a universal donor manner, which is termed “allogeneic”.
“The acquisition of this patent not only positions the company to expand into the disc degenerative space, but also provides a powerful platform for collaboration with other companies that are administering regenerative cells directly into the nucleus pulposus of the disc,” commented Thomas Ichim, Ph.D., Chief Scientific Officer of the Company and inventor of the technology. “Stem cells are like seeds, they need to be planted into fertile soil. We feel that in certain patients it is essential to treat the lumbar ischemia, which is present in some patients suffering from disc degenerative disease, which will then allow the stem cells administered directly in the disc to perform their regenerative effects.”
About US
Creative Medical Technology Holdings, Inc. is a clinical-stage biotechnology company with two focus areas; 1) personalized stem cell procedures for sexual dysfunction and infertility, and 2) universal, off-the-shelf amniotic fluid-based stem cells that possess superior healing potential without negative medical or ethical issues. Through our own research and collaborations with leading academic institutions, we have developed proprietary protocols, built an extensive intellectual property portfolio, developed complete treatment offerings for erectile dysfunction and are performing ground-breaking research with our amniotic fluid-based stem cell.
For additional
information visit www.CREATIVEMEDICALTECHNOLOGY.com
Forward-Looking Statements
This release may contain "forward-looking statements." Forward-looking statements are identified by certain words or phrases such as "may", "aim", "will likely result", "believe", "expect", "anticipate", "estimate", "intend", "plan", "contemplate", "seek to", "future", "objective", "goal", "project", "should", "will pursue" and similar expressions or variations of such expressions. These forward-looking statements reflect the Company's current expectations about its future plans and performance. These forward-looking statements rely on a number of assumptions and estimates which could be inaccurate and which are subject to risks and uncertainties. Actual results could vary materially from those anticipated or expressed in any forward-looking statement made by the Company. Please refer to the Company's most recent Forms 10-Q and 10-K and subsequent filings with the SEC for a further discussion of these risks and uncertainties. The Company disclaims any obligation or intent to update the forward-looking statements in order to reflect events or circumstances after the date of this release.
Investor Relations
Andrew Barwicki
516-662-9461 / andrew@barwicki.com