WEST HAVEN, CONNECTICUT -- Thursday, February 20th, 2014 -- NanoViricides, Inc. (NYSE MKT: NNVC) reported today that construction of the modern R&D Lab and cGMP Clinical Production facility in Shelton, CT, is nearing completion with some weather-related delays. The Company reports that the R&D lab section of the facility is ahead of schedule. Once construction of the cGMP Clean Room Production Suite is completed, the project will enter the facility testing and validation phase. The Company is performing certain scale-up studies and production of the quantities of FluCide™ needed for the "Tox Package" study at its current facility, as previously reported. The Company anticipates transitioning staff to the new facility upon obtaining a Certificate of Occupancy.
The new facility project was started by Inno-Haven, LLC, a company whose member, Dr. Anil R. Diwan is also the co-founder of NanoViricides. Dr. Diwan purchased a building in Shelton, CT, in August, 2011, using personal savings as well as funds raised from sale of a portion of his founder's NNVC stock.
"By 2011, when Dr. Diwan went all out and bought the Controls Drive property, we had spent several years searching for a third party contract manufacturer, capable of producing our drug candidates under the rigorous standards required for clinical trials, without success," said Eugene Seymour, MD, MPH, adding, "NanoViricides continued to search for available contract manufacturing capability even after Diwan's purchase of the Controls Drive property. Most facilities we interviewed could not manufacture our novel polymer molecules without extensive renovations. The cost of such custom renovations and equipment would be passed on to us, as is customary. In addition, we would have to train their technicians and scientists and transfer important know how and other aspects of our intellectual property."
NanoViricides, Inc., asked Inno-Haven to handle total renovation of this facility, under guidelines, design and architecture to be provided by the Company, in October 2011. The total renovation project went through many changes of design and scope to fit the budget. Dr. Diwan raised funds for the construction project from high-risk-rated personal loans and other private sources. After a long design, engineering and architecture phase, preparatory work including identification of subcontractors, obtaining quotes, and eventually the identified demolition work, began around February, 2013. Construction began in earnest around August, 2013, as previously reported by the Company. Though generally on schedule, the recent severe winter weather has delayed delivery of certain specialty equipment necessary for the cGMP Clean Room and has created some construction delays.
The Company signed a Memorandum of Understanding with Inno-Haven, LLC, in January, 2013, to lease the facility with an option to purchase. The final lease was due to be signed by March 2013. This date was extended at the request of the Company. Following the successful debenture financing of $6M raised in February, 2013, the Company began to evaluate the possibility of purchasing the facility.
"With our registered direct offering in September, 2013, and the additional raise of $20M that we completed in January, 2014, we are now in a strong position to be able to purchase the building outright," said Dr. Eugene Seymour, CEO of the Company, adding, "I delayed signing of the lease because I always believed that the Company would be better served if it owned the facility rather than leased it."
Dr. Diwan, and Ms. Meeta Vyas, have abstained from, and will continue to abstain from, NanoViricidess' decision-making process with respect to this facility, pursuant to the Company's strong corporate governance practices. This practice of eliminating potential conflict of interest concerns, and many other safeguards, have always been in force at NanoViricides, Inc.
The Company has also continuously strived to improve its corporate governance practices. We started as a "Pink Sheet" company upon a reverse merger with a public shell, in June 2005. We met or exceeded all requirements for becoming a fully SEC-reporting and filed a form 10-SB with the SEC in November, 2006. We underwent an extensive review by SEC and FINRA subsequently, and in June, 2007, we became an SEC-reporting company and our stock began to be quoted on OTC-BB. Prior to 2011, the Company was not subject to the internal Controls provisions of the Sarbanes-Oxley Act (SOX). However the Company planned on up-listing to a national exchange and took the necessary steps to meet the requirements of SOX and the further listing requirements of the national stock exchanges. The Company strengthened its corporate governance by appointing Meeta R. Vyas, (MBA-Finance, Columbia, SB-ChemEng-MIT), an accomplished ex-CEO of a public company, as the interim CFO in May, 2013, as a culmination of our efforts in separating the roles and responsibilities. Until then, Dr. Seymour, our CEO also served as our interim CFO. In addition, the Company also appointed three new independent board members, one in June, 2012, and two more in June, 2013, thereby completing its transition to a fully independent board. The Company has undergone and passed SOX audits as well as audits by our public accounting firm (which is itself audited biennially by the PCAOB). In addition, the Company underwent scrutiny by the New York Stock Exchange (NYSE) MKT Listing Committee before our common stock became listed on NYSE MKT on September 25, 2013. Furthermore, as a NYSE MKT listed company, NanoViricides continues to be under regulatory and compliance scrutiny of the Exchange.About NanoViricides
FDA refers to US Food and Drug Administration. EMA refers to the European Union’s office of European Medical Agency.