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TheStreet Open House

Oculus Partner Misleads on Wound Cleaner

The active ingredient in MyClyns and Microcyn are the same -- greatly diluted quantities of sodium hypochlorite and hypochlorous acid.

Hypochlorous acid is a weak acid formed when chlorine is dissolved in water. It is used as an oxidizer and disinfectant. This is the stuff commonly used to keep swimming pools clean. Sodium hypochlorite is known by its more recognizable moniker -- common household bleach.

FDA gave Union Springs 15 days from the receipt of the May 23 warning letter to correct the misbranding of MyClyns or face more serious legal action. The MyClyns web site has been scrubbed of the material FDA considered misleading, with many of the sections describing the product either blank or "under construction."

FDA's action against Union Springs comes two years after TheStreet first raised questions about the drug-like therapeutic claims being made about Microcyn by Oculus.

Microcyn, like MyClyns, is a wound cleaner that can be bought at retail for $20 a bottle, similar to other wound-cleaning products sold commercially for years. But TheStreet report showed how Oculus was marketing Microcyn as a drug with specific medical claims that the product cures infections, accelerates wound healing and reduces inflammation in patients with serious diabetic ulcers, according to comments made by the company's CEO Hoji Alimi and CFO Bob Miller on investor conference calls.

Oculus was making these drug-like claims about Microcyn despite only having FDA clearance to sell the product as a wound cleaner, according to U.S. regulators.

During a presentation to investors at a conference in Sept. 2010, Oculus' Alimi flashed on the screen a gruesome photo of a gaping diabetic foot wound. The patient was saved from having the foot amputated by treatment with Microcyn, Alimi alleged, even though Oculus has no data nor FDA approval to make such a claim.

For the fiscal year ended March 31, 2011, Oculus reported a net loss of $7.9 million, or 30 cents a share, on total revenue of $9.8 million. That compares to a net loss of $8.2 million, or 36 cents a share on total revenue of $7.4 million in the previous fiscal year.

Oculus shares closed Wednesday at $1.78, flat since the beginning of the year.

--Written by Adam Feuerstein in Boston.

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