DGAP-News: Advanced Medical Isotope Corporation Announces Three Year Business Strategy Focused on Transitioning From a Development-Stage Company to an Operating Company

ID: 1288250
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(businesspress24) - DGAP-News: Advanced Medical Isotope Corporation /
Advanced Medical Isotope Corporation Announces Three Year Business
Strategy Focused on Transitioning From a Development-Stage Company to
an Operating Company

02.12.2013 / 13:22

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Operations to Center on Yttrium-90 Brachytherapy Products Following Anticipated
Receipt of FDA Clearance of Y-90 RadioGel(TM) Brachytherapy Device

KENNEWICK, Wash., 2013-12-02 13:22 CET (GLOBE NEWSWIRE) --
Advanced Medical Isotope Corporation ('AMIC') (OTCBB:ADMD), a company engaged
in the development, production and distribution of medical isotopes, today
announced that its Board of Directors has approved a three year business
strategy focused on transitioning to full operations in 2014, following the
anticipated receipt of FDA clearance for its patented brachytherapy cancer
product, Yttrium-90 RadioGel(tm).

The business strategy results from the Company's success in developing a family
of three brachytherapy devices and the Company's belief that there is: (1)
strong market potential for these products in the United States and
internationally, (2) the potential for attractive operating margins from the
commercialization of such devices, (3) a considerably smaller capital
requirement to complete the regulatory process and deploy these devices, as
compared to the capital required for most of the other initiatives the Company
is developing and (4) a material potential for the Company to receive advances
and minimum guarantees from international licensees of these products.

The business strategy recognizes the advanced stage of development for certain
other Company initiatives and prioritizes those initiatives based upon
criteria, including: capital requirements and sources; market size and
operating margin; competition and strength of AMIC's intellectual property


protection; probability of implementation; and support for the Company's
immediate goal of deploying its brachytherapy products upon receipt of
regulatory approval and sufficient financing.

The Company's financing efforts, allocation of resources, participation in
industry events, web site and other activities will be modified to implement
the priorities adopted by the Board.

AMIC To Focus on Launch of Yttrium-90 Brachytherapy Products

AMIC announced on November 3, 2013 that it filed a premarket notification with
the U.S. Food and Drug Administration (FDA) pursuant to section 510(k) for a
patented brachytherapy cancer treatment using the Yttrium-90 (Y-90) RadioGel(tm)
device. On November 18, 2013, the FDA notified AMIC that an administrative
acceptance review was conducted and the Company's premarket notification was
found to contain all of the necessary elements and information needed to
proceed with the substantive review. Pursuant to Section 510(k), the FDA has
until approximately February 2014 in which to clear AMIC's Yttrium-90
RadioGel(TM)device for commercial distribution or to seek additional
information. The FDA previously confirmed that it would review the product as a
medical device. Following notification of FDA clearance, the Company would
immediately have the right to commence manufacturing, marketing and sales of
the product in the United States and its possessions.

TheCompany intends to file FDA premarket notifications for two related
Yttrium-90 brachytherapy devices promptly after receiving either clearance from
the FDA for the Y-90 RadioGel(tm) device, or any comments from the FDA to its
application.

Brachytherapy uses radiation to destroy cancerous tumors by placing a
radioactive isotope inside or next to the treatment area. Annual sales of
brachytherapy products exceed $1 billion, about half of which are in the United
States. Among the cancers for which brachytherapy is often selected as a
treatment are prostate, liver, breast, as well as head and neck tumors. AMIC's
products may also offer treatment options for certain pancreatic cancers. Once
it receives FDA clearance, AMIC intends to begin marketing efforts in the
United States for its Y-90 RadioGel(tm) device. In addition, AMIC intends to seek
opportunities to license its products for worldwide sales, subject to the
applicable local regulatory approvals.

The composition and uses of AMIC's brachytherapy products are protected by a
series of exclusive patent licenses from the Battelle Memorial Institute and
the University of Utah.

The three Y-90 brachytherapy devices developed by AMIC are:

- Y-90 RadioGel(tm) Device - combines insoluble Y-90 microspheres and a polymer
carrier that is injected directly into the tumor;

- Y-90 Fast-Resorbable Polymer Seeds - intended as a safer, more effective and
less expensive alternative to existing metal and glass seeds used in other
brachytherapy devices;

- Y-90 Polymer Topical Paste - intended as a supplemental treatment to be
applied into a surgical incision to kill residual tumor cells.

As noted above, the 510(k) application filed by AMIC pertains only to the Y-90
RadioGel(tm) device.

AMIC's analyses support an expectation that its brachytherapy products will
achieve a higher therapeutic index than existing brachytherapy products, while
reducing collateral damage to healthy tissue due to the shorter penetration
distance, shorter half-life and other attributes of the device as compared to
brachytherapy devices that use isotopes emitting gamma radiation. These
features also reduce the risk of radiation exposure to the patient, family
members and medical personnel involved in manufacturing and injecting the
device. In addition, the AMIC Y-90 RadioGel(tm) device uses a biodegradable
carrier with FDA approved components which leaves no metal or glass in the
patient.

In the United States, the Company intends to outsource material aspects of
manufacturing, distribution, sales and marketing. Outside of the United States,
the Company intends generally to enter into licensing arrangements. The Company
will evaluate its alternatives before finalizing its plans.

AMIC also to Expand Sales Capability and Consider Acquisition of German Company

The Board approved of two secondary priorities for 2014 and 2015:

-- Expansion of the Company's sales agency activities for isotopes and related
equipment manufactured by third parties. This activity requires very little
capital, facilitates the Company's interaction with potential partners,
customers and vendors and should be immediately cash positive. In the third
quarter of 2013, the Company derived approximately $115,000 from such
activities. By expanding this activity, the Company expects to be able to
raise less capital through the sale of securities, thereby reducing
dilution for shareholders. Profits from sales agency activities also could
help create greater shareholder value, particularly if the Company is
valued based upon its core brachytherapy business.
-- Potential acquisition of a controlling interest in a specific company
headquartered in Germany with which AMIC has been cooperating for the last
few years. Acquisition of a controlling interest in this company could
facilitate the Company's business progress in Germany and other European
markets. Germany accounts for the largest market share of the European
nuclear medicine market, which is the world's second-largest market for
nuclear medicine, after the United States. The target company presently
derives less than 1% of its sales in the United States. AMIC believes it
could contribute to a significant increase in U.S. sales for this target
company.

Although the parties have reached an agreement in principle on a path forward,
any transaction would be subject to reaching definitive agreements, AMIC
obtaining sufficient financing and any required regulatory approvals. Because
the target company is fully-operational and profitable, a business combination
likely would be immediately accretive for AMIC shareholders.

The Board's business strategy also contemplates that the Company will continue
operation of its linear accelerator located in Kennewick, consider building a
larger cyclotron production facility in Southern California in partnership with
a major medical facility and continue its research and development activities
for other isotopes and technologies, though the pace of all activities will be
subject to the needs and performance of the Company's strategic priorities,
particularly the successful launch and growth of the brachytherapy products.

AMIC's Financial Requirements and Prospects

Over the next year, the Company anticipates a requirement of about $1.5 million
to maintain current operating activities and from approximately $2 million to
$5 million to fund: (1) the FDA approval process and initial deployment of the
brachytherapy products, and (2) a sales capability for third party isotopes and
equipment. The continued deployment of the brachytherapy products would require
additional spending. The principal variable in the amount of near-term spending
for the brachytherapy products will be the nature of the Company's arrangements
with third parties for manufacturing, sales, distribution and licensing of
those products.

The acquisition of a controlling interest in the German company likely would
require up to approximately $3 million of cash and stock. Following its
acquisition, the target company should operate on a cash positive basis. In
allocating its capital between the brachytherapy products and the potential
acquisition, the Company's first priority is the FDA clearance for, and
successful roll-out of, the brachytherapy products. The Company believes that
its acquisition of a controlling interest in the German target company would
help achieve that goal in Europe and Russia.

The Company anticipates funding the initial six months of its requirements for
brachytherapy, sales agency activities and potentially the acquisition of a
controlling interest in the German company through the sale of equity or
equity-linked securities. In support of these efforts, the Company has reached
an agreement in principle with the Company's largest creditors to convert most
of their debt into equity concurrent with the Company's receipt of funds on
pricing comparable to that obtained in any such financings.

Thereafter, the Company anticipates that funding also would be provided by the
Company's business activities, including, potentially, advances from foreign
licensees for the brachytherapy products and proceeds from the sales agency
activities and the Company's linear accelerator in Kennewick.

There can be no assurance regarding the outcome of the Company's regulatory,
financing or commercial efforts. If some of the anticipated results are delayed
or do not occur, the Company's anticipated spending and capability to fund that
spending would decline. Conversely, if the Company has the financial capacity
to do so, the Company could spend additional sums to grow its businesses more
rapidly and to maintain or accelerate research and development activities for
future products and technologies.

Though there are many uncertainties, if the FDA provides clearance for the
RadioGel(tm) device during the first half of 2014, the Company believes that its
operations could turn cash-positive within four to nine months thereafter and
could turn profitable on a GAAP-basis within six to 12 months after clearance
is obtained, in each instance despite increased spending to support the
deployment.

To bolster its capability to seek funding and to structure and negotiate
outsourcing and licensing agreements, in October 2013, the Board elected Kenin
M. Spivak to be a Director and Vice-Chairman. Mr. Spivak has extensive
experience securing, structuring and negotiating complex transactions,
including financings, manufacturing, sales, marketing, distribution, licensing,
joint ventures and business combinations and directing roll-outs for a range of
technologies, products and services. Though Mr. Spivak will not be a full-time
Company officer or direct the Company's roll-out of its brachytherapy products,
the Company believes that Mr. Spivak's advice and support will materially
benefit the Company's effort.

If the Company obtains the financing it seeks, the Company anticipates that it
will be able to employ more of its part-time scientists on a full-time basis
and that it will be able to engage marketing professionals with experience
directly pertinent to its brachytherapy products.

AMIC's Longer-Term Business Strategy

The business strategy adopted by the Board mandates that the Company's first
priority after 2015 would continue to be the deployment of its brachytherapy
devices. Second, the Company would continue to nurture and grow the other
business activities undertaken in 2014 and 2015. Subject to the success of the
Company's business and the availability of sufficient resources, by 2016, the
Board has directed that the Company take steps toward the commercialization of
other isotopes, businesses and technologies intended to help improve the
diagnosis and treatment of cancer and other illnesses.

Among those longer-term projects being considered by the Company are potential
solutions for the impending severe shortages of Molybendum-99 and its
derivative product Technetium-99m, the most widely used isotopes for diagnostic
purposes.

Conclusions

AMIC Founder, Chairman and CEO James C. Katzaroff commented: 'The business
strategy mandated by the Board is intended to focus AMIC on smoothly and
profitably transitioning from a development-stage company into an operating
company with a series of products that will help improve lives, can be
commercially introduced with limited capital requirements and can reach
positive cash flow and profits within a reasonable period after we receive
clearance from the FDA.'

Mr. Katzaroff added: 'Though AMIC will continue to progress our growth as a
sales agency and will continue discussions for a possible acquisition in
Europe, we will do so in support of our core mission to obtain FDA clearance
and funding for our RadioGel(tm) device and other brachytherapy products so that
we can commercially roll out these products commencing in 2014. We also will
continue discussions for a cyclotron production facility and development of
other products and technologies. However, the resources allocated to all AMIC
activities will now be assessed against the impact on a successful deployment
of our brachytherapy products and using that deployment to deliver therapeutic
value to patients and financial value for our shareholders.'

About Advanced Medical Isotope Corporation

Advanced Medical Isotope Corporation (OTCBB:ADMD) is a late stage development
company engaged primarily in the development of brachytherapy devices and
medical isotopes for diagnostic and therapeutic applications. AMIC's focus is
on transitioning to full operations upon receipt of expected FDA clearance for
its patented brachytherapy cancer product, Yttrium-90 RadioGel(tm). AMIC intends
to file FDA premarket notifications for two related Yttrium-90 brachytherapy
products. Brachytherapy uses radiation to destroy cancerous tumors by placing a
radioactive isotope inside or next to the treatment area. Annual sales of
brachytherapy products exceed $1 billion, about half of which are in the United
States. The Company intends to outsource material aspects of manufacturing,
distribution, sales and marketing for its products in the United States and to
enter into licensing arrangements outside of the United States, though the
Company will evaluate its alternatives before finalizing its plans. For more
information, please visit our website, www.isotopeworld.com.

The Advanced Medical Isotope Corporation logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=5139

Safe Harbor Statement

This release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. You can identify these
statements by the use of the words 'may,' 'will,' 'should,' 'plans,' 'expects,'
'anticipates,' 'continue,' 'estimates,' 'projects,' 'intends,' and similar
expressions. Forward-looking statements involve risks and uncertainties that
could cause results to differ materially from those projected or anticipated.
These risks and uncertainties include, but are not limited to, AMIC's ability
to successfully execute its expanded business strategy, including by entering
into definitive agreements with suppliers, commercial partners and customers;
general economic and business conditions, effects of continued geopolitical
unrest and regional conflicts, competition, changes in technology and methods
of marketing, delays in completing various engineering and manufacturing
programs, changes in customer order patterns, changes in product mix, continued
success in technical advances and delivering technological innovations,
shortages in components, production delays due to performance quality issues
with outsourced components, regulatory requirements and the ability to meet
them, government agency rules and changes, and various other factors beyond the
Company's control.


CONTACT: Advanced Medical Isotope Corporation
James C. Katzaroff
(509) 736-4000
6208 W. Okanogan Ave.
Kennewick, WA 99336
News Source: NASDAQ OMX


End of Corporate News

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02.12.2013 Dissemination of a Corporate News, transmitted by DGAP - a
company of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

DGAP's Distribution Services include Regulatory Announcements,
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Language: English
Company: Advanced Medical Isotope Corporation


United States
ISIN: US00765X1028


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242673 02.12.2013



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Date: 12/02/2013 - 07:22
Language: English
News-ID 1288250
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