CryoHeart Laboratories, Inc.

Raising $3 Million to scale our medical device business to address sternal wound closure issues in support of open heart surgery.

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Who are we?  CryoHeart Laboratories, Inc is a medical device and biotech company dedicated to developing a series of patented medical products for the underserved cardio-thoracic surgical marketplace. Our first entry into this underdeveloped market is ThoraGraft, a game-changing biologic product specifically designed to close the sternum following an open- heart surgery.

The Problem We Address: There are more than 2.5 million, open heart surgeries worldwide (some 500,000+ in the US alone not including the pediatric or trauma markets), that involve open sternal wounds (essentially cutting the sternum down the center and splitting it apart to allow access to the heart). For the past 70 years these sternal wounds are closed with stainless steel wires 95% of the time. This methodology of wiring sternal bone back together is a triage technique left over from WWII. CryoHeart’s ThoraGraft product is a game changing solution that brings this outdated methodology up to modern standards.  With ThoraGraft implanted, patients no longer have to undergo this 70-year- old procedure as the primary closure modality for an incision as complicated as the sternal wound.

The outdated methodology of wiring the sternal bone back together following heart surgery creates the following issues :

  • ➢  Extreme pain (usually a 9 or 10 on a 10-point scale) following surgery. (Closing with wires causes the raw nerves on the sternal edges to grind against themselves producing intense pain levels... similar to sandpaper rubbing against raw, exposed nerves).

  • ➢  Excessive post operative bleeding.

  • ➢  Lengthy ICU recovery time (typically averaging 48 hours per patient at a cost in the range of $300 to $500 per ICU hour.

  • ➢  Extended intubation times that can lead to pneumonia in many patients.

  • ➢  Lengthy post operative hospital stays (between 5 to 8 days depending on each hospital’s protocol).

 Our Solution: CryoHeart’s Flagship Product, ThoraGraft is a multi-functional bone graft technology with a singularly unique patented design. Our proprietary tissue form is implanted between the surgically separated halves of a sternum as the surgeon closes a patient’s chest wound following an open thoracic procedure. ThoraGraft acts as a bone “gasket” implanted just prior to the surgeon closing the chest wall. Traditionally, postoperative complications associated with this wound are frequently very costly and complicated for the patient as well as the healthcare system.

 WHAT DOES THORAGRAFT DELIVER? ThoraGraft has been used successfully in more than 120 procedures during the trial release of the product. ThoraGraft has demonstrated      it provides a simple and effective solution that surgeons claim dramatically improves patient outcomes by addressing numerous post-operative challenges per the following:

  • ➢  Significantly lessens post operative pain.  Pain has been demonstrated to consistently drop from a 9 to 10 level pain to a 2 or less on a ten-point scale.

  • ➢  Decreases post operative bleeding. Post-op bleeding consistently drops from 400 ml, to less than 50 ml's per patient on average.

  • ➢  Provides compression essential to healing and sternal bone fusion.  ThoraGraft sets the sternal bone, initiates the fusion process and provides compression that is vital to promoting bone healing.

  • ➢  Reduces time in ICU from an average of 48 hours to less than 5 hours. By eliminating such a significant amount of ICU time, ThoraGraft saves the hospital more money than it spends on the cost of the graft.

  • ➢  Shortens hospital stay days.  ThoraGraft has demonstrated the ability to eliminate hospital stay days.  By advancing the patient healing process, saving the hospital money, and making additional hospital beds available.

  • ➢  It is anticipated that hospitals will receive higher HCAHPS scores for Patient Satisfaction.  Due to the greatly improved patient outcomes, Medicare reimbursements are available to be increased to the hospital.

Our Team:
  • Frederick (Rick) Thabet: CEO and Founder.  Education: Fisher College of Business The Ohio State University.  32 years surgical implant development, sales, marketing, corporate management and leadership experience. Rick has a diverse and accomplished business background both in domestic and international business development. He has successively launched, built, and taken to exit several medical device companies. His clinical experience extends from general Orthopedics,  Spine and Neurosurgery with a heavy emphasis on Cardiothoracic surgery.

  • Ravi Kanagala, MD: Chief Medical Officer and Co-Founder. Ravi is a Cardiologist with 21 years clinical experience in Internal Medicine & Cardiology specializing in electrophysiology and cardiovascular MRI. Education: He received his medical degree from Indiana University School of Medicine, Post-graduate training in cardiovascular diseases and electrophysiology at Mayo Clinic and Cardiac MRI training at Duke University. Past positions include Sr Assoc. Consultant in the Div. of Cardiovascular Diseases & Internal Med. at Mayo Clinic, Assist. Prof. at Mayo Clinic College of Med. and Dir. of Arrhythmia Services at Franciscan Skemp Healthcare - Mayo Clinic. Dr. Kanagala also has numerous publications in peer reviewed journals.

  • Jay Lawson: Lead Business Advisor. Education: Harvard MBA. 30 years surgical implant sales,  marketing, corporate management and leadership experience. Former President of Stryker Spine. An accomplished expert in corporate development who oversaw merger and acquisition strategies and execution for 5 years at Stryker handling deals valued on average of $350 Million and higher.

  • Charles Springer, MD: Lead Orthopedic Advisor.  Education: Dr. Springer graduated from the Lewis Katz School of Medicine At Temple University in 1994. He is a highly regarded specialist in Orthopedic Surgery and Sports Medicine. He is a founding member of the Sports Medicine and Joint Replacement Center in Ft. Meyers, Florida. Dr. Springer is affiliated with Lee Memorial Health Systems and Gulf Coast Medical Center and is considered an expert on the subject of bone biology and bone healing.

  • Keri George, BSN, RN: Director of Clinical Affairs. Education:  University of Calgary nursing program. Highly valued in her field, Keri is a committed Clinical Research Nurse with 22 years' experience implementing and overseeing various clinical research projects. Keri works with clinicians and healthcare facilities to study and publish relevant, evidence-based research to improve patient surgical outcomes. Keri is adept at maintaining accuracy through astute observation and attention to detail.

  • Richard Moss: Advisor, Sales Development. Richard  is currently acting in the capacity of the Vice President of Sales and Sales operations for the Company. Education: Sheffield Hallam University and Nottingham Trent University in Engineering, Mathematics and Business. Rich brings a long history of both national and international experience and success to CryoHeart with over 30 years of experience in Orthopedic, Spine and Cardiothoracic surgical experience.  Rich has been responsible for the successful launch of more than a dozen medical products in the European marketplace and is adept at navigating the complex issues within the European Union and addressing medical marketing/sales internationally.
  • Daniel Gramins, MD: CryoHeart Medical Advisor Board member for sternal applications of ThoraGraft. Education: Dr. Gramins graduated from Georgetown University, School of Medicine and completed his thoracic surgery fellowship at Carolina’s Medical Center, Charlotte, North Carolina. Dr. Gramins is a retired flight surgeon with the US Navy and a leading implanter of ThoraGraft. He is a board-certified cardiothoracic and vascular surgeon who primarily practices in California and Montana. With 29 years of experience, Dr. Gramins has treated and cared for various complex cardiovascular conditions and served as a trauma surgeon in Afghanistan. He continues to work within the Veterans Administration system as well as in private practice. His experiences in Afghanistan with treating wounded soldiers has given Dr. Gramins a unique perspective of the thorac ic cavity. Having an in-depth knowledge of both cardiovascular and orthopedic issues, can address both bone and soft tissue issues effectively as a surgeon and as an advisor.

  • Mohamed Allam, MD: CryoHeart Medical Advisory Board member for sternal applications of ThoraGraft. Dr. Allam is a thoracic surgeon in Lafayette, Louisiana but has practiced in Beirut, Lebanon as well. Education: He received his medical degree from American University of Beirut, Faculty of Medicine and has been in practice for more than 21 years. Dr. Allam is another leading implanter of ThoraGraft and has the expertise to handle a broad array of cardiovascular procedures and treatments. He brings a diverse medical background in both domestic and international training, practice ad experience.

  • Joseph Love, MD: CryoHeart Medical Advisory Board for Thoracic trauma surgery applications. Education: Philadelphia College of Osteopathic Medicine
    Class of 2004. University of Texas Health Science Center San Antonio Joe and Teresa Lozano Long School of Medicine Residency, Surgery, 2004 - 2009. University of Texas Health Science Center San Antonio Joe and Teresa Lozano Long School of Medicine Fellowship, Surgical Critical Care, 2010 - 2011. Dr. Love is engaged in helping CryoHeart developing a suite of other technologies to address rib fractures through various methods of stabilization percutaneous and direct visualization approaches.

  • Mehdi Garti: Director of Engineering. Education:  Tofail University of Morocco. Mehdi is a mechanical engineer and brings 12 years of experience to CryoHeart in developing new technology as well as building engineering teams. Mehdi has extensive experience in prototyping and product development utilizing state-of-the-art 3D rendering technologies.  Mehdi has successfully built highly skilled engineering teams for various companies over time with successfully launching multiple products he and his teams have developed.

  • John May: Advisor, Corporate Development and Finance. Education: Penn State University school of business. John is the founder and President of JCM Capital Partners, LLC. For 32 years JCM has provided financial and business planning services to private and public companies. John has served as board member or senior executive for both. May is currently engaged in the finance, business development and corporate operations functions for CryoHeart.

  • Durand (Randy) Achee: Advisor, Marketing and Strategic Development. Education: University of California, Davis. Achée has 40 years’ experience developing, scaling and operating businesses including launches for AT&T, Disney, AAA, Time Warner, and others. During his career. Achée has created advertising and marketing solutions across most traditional and digital media platforms. He has been responsible for generating hundreds of millions of dollars of sales for products and services for a broad range of industries.

Our Business Model:
Hospitals get paid for these procedures under a DRG reimbursement model from insurance companies. Diagnosis-Related Group Reimbursement. Diagnosis-related group reimbursement (DRG) is a reimbursement system for inpatient charges from facilities. This is a one lump sum payment to the hospital for these procedures from the insurance company and can range from $85,000 to $300,000 plus for an open-heart procedure, depending on the facility.

The revenue opportunity is based on the following process. The surgeon orders the graft for the procedure and the hospital issues a PO Purchase Order for the graft to CryoHeart. CryoHeart ships the product to the hospital while at the same time invoicing the hospital directly for each graft ($4,985 per graft). If a hospital performs 1,000 open heart procedures in a year and uses our product 50% of the time, that one account represents $2.5 million dollars annually for CryoHeart. There are well over 500,000 open sternal wound procedures performed each year just in the US. A 10% penetration of the US Market equates to roughly $250 Million in annual sales that generates gross margins in the range of $200 Million

CryoHeart is the first company to develop a tissue form specifically to address these issues in the sternum and we are the first to come to market with this solution.. Our technology is protected by two broad and comprehensive patents. The first patent is a Utility Patent. As such it is a broader and more expansive patent that protects the business methodology as well as the clinical approach of our technology in a more comprehensive way than a traditional design and materials patent. This means holding a Utility Patent is far more broad in its protection and significantly more valuable.  The second patent on our technology is The System and Methods for fusing bone in the sternum. Together these two patents combined gives CryoHeart broad protection against a competitor coming to market and provides CryoHeart a clear path to grow and establish a well-protected position in the cardio-thoracic marketplace.

Our Vision:
To redefine the systems and methods currently utilised by the Cardiothoracic community to treat, fix and heal sternal wound as well as  thoracic cavity as a whole.  Our plan includes the following steps:

Innovative and Leading Edge Product Development:  The innovation that has taken place in the thoracic cavity has been minimal over the past 5 decades.  CryoHeart has identified this space as a major opportunity and has taken a systematic approach to developing new technologies for sternal healing, sternal fixation, percutaneous fractured rib stabilization, rib fixation, as well as thoracic spinal issues.  Quite simply, our vision is to establish CryoHeart as the  world leader in innovative thoracic applications and solutions.

Direct Sales Distribution: We sell directly to hospitals through our contracted network of distributors. We engage third-party distributors that have established relationships with the thoracic surgeons and pursue customer relationships through our support of these distributors. Our distributors work directly with these surgeons and hospitals on a regular basis and sell our product through initialising contact with those surgeons and getting their commitment to ThoraGraft. 

Surgeon to Surgeon Interaction and Promotion: We have built and active group of respected surgeons who sit on our Board of Surgical Advisors (BSA). These surgeons in turn interface with other surgeons on behalf of CryoHeart to promote our product by discussing the outstanding clinical outcomes they have experienced using ThoraGraft with their patients.  This peer-to-peer communication to essential to maintaining necessary and proper clinical standards and focus. 

Clinical Studies: CryoHeart is writing up our retrospective clinical data now and will publish those results in a peer reviewed White Paper.  In addition, our objective is to launch a 500-patient clinical trial towards the end of this year to formalize the consistent patient outcomes we are seeing. This larger study will add significant value to the company.  Companies such as Medtronic, J&J and others highly value this kind of data and upon an acquisition of this technology would use it to plug into their massive worldwide sales forces to make ThoraGraft a Standard of Care product for thoracic surgery.

Trade Shows/Conferences: CryoHeart attends leading trade shows and conferences as an exhibitor or as an active participant throughout the year. Presently we are planning to attend 3 to 4 trade shows each year. At these trade shows we will have presence through a booth staffed by key members of our team, representatives from of our Board of Surgical Advisors. Our Distributors, Founders, and Sales Team will also actively “work” the events and we will use the event provider’s media and other onsite marketing to gain additional exposure. The overall objective is to directly engage with and impact the many doctors, surgeons, hospital administrators, and medical industry influencers, who regularly attend these trade shows and conferences.

Marketing: CryoHeart has a robust marketing plan mapped out to help promote the awareness of ThoraGraft to each of our five target audiences:

  • Cardio-thoracic surgeons (especially those who are influential at the hospitals where they practice),

  • Cardiologists (who are the daily point of contact for patients in need of heart surgery),

  • Hospital management (who are key to decision process for purchasing medical products),

  • Patients (and their family, friends, and caregivers),

  • Medical Product Distributors/Sales Representatives (that are key to the expansion of our

  • sales efforts nationally and internationally).

  • Elements of the Marketing Strategy:
  1. Interactive Website: our website ( is designed to be a platform

  2. on which surgeons, doctors, patients, hospital administrators, distributors/salespeople can communicate as well as to get resource information on ThoraGraft, our growing suite of medical products, and on out company generally.

  3. Digital, Search, and Social Media: As a fundamental piece of CryoHeart’s marketing strategy and are planning our launch of a comprehensive digital, search, and social media campaign. Search key words, and AdWords will anchor the overall effort since search is often the first place that doctors or the public goes to find information. We will then drive that traffic back to our Website.

i. Geo and Demographic Targeted Messaging: Will initially focus on smaller vibrant secondary markets with our media aimed directly to our audience segments. In this effort we will use a series of short videos with patient and surgeon

testimonials, blogs, video content, and links to grass root discussions to help generate an organic awareness of and demand for ThoraGraft. This will be cross promoted with our P/R efforts with social media (see below).

c. P/R and Media Exposure:
  1. P/R: We plan to engage a “guerilla” P/R expert, that will help us gain local in-

  2. market interviews and media exposure as well as utilizing blogs, online posting (LinkedIn, Facebook, Snap Chat, Tik Tok, etc.) to align with a paid social media and search campaign.

  3. Advertorial: This will involve MSNBC television programming themed to innovation in medicine hosted by Ted Danson with interviews of our founders and to air in all the major metropolitan markets towards the end of this year. We will link this and other video interviews to our Website. Additionally, we plan to run long form advertorials in an interview format (10 to 15 minutes) promoting ThoraGraft benefits directly to patients in off peak times when sick and elderly, who have sleeping issues, are often up late or up early watching TV. This helps to drive our patient-to-doctors sales model. (Please see below.)

d. Direct to Consumer Media to Drive Patient-to-Patient and Patient-to-Doctor Organic Growth: Patient to patient testimonials have already proven to be one of the most powerfulmeansbywhichourproductisgettingtractioninthemarketplace. Itislife- changing when any patient finds out that they need heart (lung or other cardio-thoracic surgery) and will have their sternums "cracked" for the surgeon to surgically address their issue. They and their friends and family are often in a state of shock, fear and confusion, especially as they begin to grasp the trauma this kind of wound is going to cause them.

  1. How this works: Upon discovering that is now a product (ThoraGraft) available to them that will mitigate most of all the dramatic effects of this wound, they naturally embrace ThoraGraft! Patient testimonials through social media are an extremely effective way to promote our product and resolve patients’ (and family members’) anxiety, fear, and confusion in an organic, genuine, and authentic manner. We have already seen evidence of this happening simply through word- of-mouth without any involvement from our company. Patients who have had ThoraGraft implanted are sharing their experiences on social media now. We will use our marketing, especially social media, to encourage and build on that. Plus, In some cases, patients in need of heart surgery (which requires a sternotomy) are requesting that their surgeon use a ThoraGraft for their procedure. Well known surgeons are reaching out to our company asking to use ThoraGraft at their hospitals without any sales or marketing efforts on our part. An example of this is at Northwestern Memorial Hospital in Chicago. The renown, head of Cardiothoracic surgery was asked by his patient to use a ThoraGraft for the patient’s surgery. The Surgeon sought us out and requested that the hospital order ThoraGrafts because his patient specifically asked for the

  2. product. Subsequently their operating nurse group requested training using ThoraGrafts and the hospital is planning to start ordering ThoraGrafts. We now are setting up distributor in Chicago due to the impact of word-of-mouth (both patient-to-patient and patient-to-doctor) communication.

  3. Scaling with Direct-to-Consumer/Patient Marketing; This marketing/advertising model has been very effectively used by the pharmaceutical companies. Their

Current Traction:
CryoHeart introduced ThoraGraft to the market on a limited release basis at the end of 2020. Despite the Pandemic, we established a controlled release of ThoraGraft so that we could analyze our market, generate sales tools, establish implantation protocols, as well as to understand the products handling characteristics. However, the most important reason for the limited release was to create enough clinical data to support a general release of ThoraGraft.  With our patents now in place, this will allow us to quickly develop into a dominant player in the cardio- thoracic space. We can now scale ThoraGraft into a “standard of care” product that will grow over time into the optimal method for treating and closing a sternal wound.

As we are now poised to scale ThoraGraft, here is where we have solid traction:
1. We have sales firmly established at several test bed hospital and clinical facilities with an annual revenue run rate of $600,000.

2. We are in the process of establishing sales at another 12 targeted hospitals with the opportunity to achieve an annual revenue run rate of $7.2 Million.

3. We have unsolicited word of mouth activity occurring on the patient-to-patient and patient-to- doctor levels.

4. We are building a very seasoned Sales Management team with a network of third-party Distributors and Sales Reps to scale ThoraGraft sales on a national and international basis.

Clinical Product Performance:
1. In more than 120 successful surgeries we have established the clinical relevance of ThoraGraft into a proven, safe and highly effective product that significantly improves patient outcomes and quality of life!

2. We have firmly established the market for ThoraGraft at a price point of in the range of $5,000 per graft (which yields exceptional gross margins to CryoHeart).

3. We have validated with hospitals and healthcare providers that there is an excellent economic case for ThoraGraft as it saves the hospital far more than it costs to implant per patient.

4. We have clinically proven ThoraGraft performs consistently on every patient independent of the comorbidity with which each patient may be challenged.

5. Every Doctor using ThoraGraft raves about the ease of use and that it yields meaningful improvement in patient outcomes and healing.

6. The clinical results are clear... ThoraGraft has the potential to be a Standard of Care product. As such, it is ready to be scaled into a billion dollar marketplace...

Intellectual Property:

 ThoraGraft is protected with both a Utility Patent as well as a System and Methods Patent. Both kinds of patents significantly add to the value of ThoraGraft and protect our product and the market we've established from competition!

2. We recently received patents on two additional technologies that further support ThoraGraft unique position in the medical marketplace.

3. We have another four unique technologies in the patent process that have been designed to address other unmet needs in the thoracic cavity.

4. We have a robust product development and prototyping program we are cultivating to work with our surgeon base to create new medical implant technologies.

Critical Human Resources:
The Team we have gathered within CryoHeart is highly experienced, technically capable, and clinically sound with hundreds of years in cumulative medical experience. On the business side all our four advisors in finance, investment, sales, and marketing each have a minimum of 35 years of experience in their fields. We are extremely excited and pleased that we have been able to attract the best and brightest minds in our industry to CryoHeart! We also have assembled an outstanding group of outside legal professionals that have successfully guided us through the process of patenting ThoraGraft, along with additional products that support ThoraGraft. Plus, they have prepared patent filings for our upcoming products that will continue to help CryoHeart be a dominant player in the Cardio-Thoracic medical products space well into the future.

Corporate Message:
Our corporate message has gained a very warm and heart felt acceptance in our industry. We take human donor tissue and create lifesaving and life-giving implant technologies to enhance the quality of life and improve outcomes for the patients, doctors, and hospitals we serve.  All our Team values the selfless gift of life from donors that makes our technology possible. The sacred relationship we hold with our donors carries with it a profound sense of responsibility and the commitment to honor their desire to pass on the gift of healing to those in need. It is part of our mission to honor that desire in the work we perform daily at CryoHeart.

Funding Ask:
1. We have completed the first half of our $4 Million Series A Preferred angel/friend & family, seed round. Therefore, there is currently the remaining 1,950,000  Series A Preferred shares available at $1.00 per share. We intend to close that Series A seed round by early Fall.

2. When this seed round has closed, we will immediately introduce a secondary round  to raise an additional $5 Million of funding at $3.00 per share of Series A Common shares.

Our Projected ROI: Our vision is to rapidly grow ThoraGraft to 5% penetration of the sternal grafting market.This equates approximately 30,000 surgical procedures (based on a total US market estimated of 600,000 annual open sternal wounds) This is roughly $125 Million in sales and would generate an estimated Gross Margin of $75 Million.  Our model is to spin out products one by one for acquisition by large established medical products companies.

At just $25 Million in sales, we anticipate that we will generate serious interest from larger companies like Medtronic, Johnson & Johnson, Zimmer Bio Met, Globus, Stryker, and SOARIN to acquire our ThoraGraft product technology (including its patents and revenues). CryoHeart provides a projected EBITDA for the product line of at least 40% on ThoraGrafts’s gross sales and the average minimal multiple on an acquisition of this nature will be around 10 x on EBITDA. Doing the math... 40% on $125 Million is $50 Million. This translate into roughly a $25 per share return on investment.

In Conclusion:
ThoraGraft is poised to become the first major advancement in treating sternal wounds since World War II. It represents a game-changing technology in cardio-thoracic space and clearly has the potential to become a “Standard of Care” product. Given that ThoraGraft has clinically shown that it will , significantly reduce pain, dramatically improve patient outcomes, advance healing, save costs for hospitals... ThoraGraft will positively transform Cardiothoracic surgery in the future..

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