Boston Therapeutics, Inc. Reports Corporate Update And Financial Results For The Third Quarter And Nine Months Ended September 30, 2013
11/18/2013 12:21:37 PM
MANCHESTER, NH--(Marketwired - November 13, 2013) -
Boston Therapeutics, Inc. (OTCQB: BTHE
) ("Boston Therapeutics" or "the Company"), an innovator of drugs that address diabetes using complex carbohydrate chemistry, reports its corporate update and financial results for the three and nine months ended September 30, 2013.
David Platt, Ph.D., Chief Executive Officer, Boston Therapeutics, said, "During the third quarter, we continued to build upon the positive results for PAZ320 obtained in our Phase IIa safety and efficacy trial. Specifically, with the initiation of our Phase IIb trial in France and the ongoing preparation for our planned Phase III multinational trial, we continue to develop what we believe will be a significant new tool as an adjunctive therapy in combination with metformin to treat Type 2 diabetes. I am especially excited about our new research study at the University of Minnesota, which we believe will give us deeper insights into how well PAZ320's mechanism of action works non-systemically in the gastro-intestinal tract to block the uptake of glucose into the bloodstream.
"We also are enhancing our outreach programs at diabetes conferences, to the media to communicate the importance of our drug development initiatives to address a large unmet medical need, and to build awareness of who we are and what we do to the investment community. I am confident that we are on the right track and will continue to make progress in the months and years ahead," he concluded.
- As of September 30, 2013, we had cash of approximately $3.9 million and current liabilities of approximately $340 thousand.
- Began enrollment for Phase IIb trial in France to assess the efficacy and safety of PAZ320 in patients with Type 2 diabetes as adjunctive therapy in combination with metformin.
- Began preparation for IND submission to the U.S. FDA for Phase III trial in the U.S., Europe, Hong Kong, and China to evaluate the effects of PAZ320 on post-meal glucose levels in patients with Type 2 diabetes as adjunctive therapy in combination with metformin.
- Initiated research study at the University of Minnesota to provide molecular-level data on PAZ320 and its mechanism of action, specifically to better characterize PAZ320 galactomannan and assess interactions of PAZ320 with various carbohydrate-hydrolyzing enzymes.
- Positive results from Phase II clinical trial was published by the principal investigator evaluating the safety and efficacy of PAZ320 (demonstrating significant 40% reduction in elevation of post-meal blood glucose) with no serious adverse events in patients in the July/August issue of peer-reviewed journal Endocrine Practice.
- Appointed Ed Shea, (25 years of bio-pharmaceutical experience in business development, sales and marketing, including 15 years with Glaxo Smithkline), as new Vice President of Business Development and Tina Gagnon (former Corporate Controller for Micronetics, Inc.) as new Director of Finance.
- Featured positive results from Phase II clinical trial at the 2013 American Association of Diabetes Educators Annual Meeting & Exhibition in Philadelphia.
Financial Results for the Third Quarter and Nine Months Ended September 30, 2013:
- Significantly strengthened the balance sheet with the closing of approximately $5.3 million in total gross proceeds from private placement of common stock and warrants to existing and new accredited investors. Use of proceeds is to primarily fund the Company's ongoing clinical trials for PAZ320.
- Revenue for the third quarter was $217,520, compared with $2,520 in the prior year's quarter. Nine-month revenue was $242,974, compared with $23,750 in the prior year's nine-month period. The increase was primarily the result of shipments of the Company's over-the-counter product to one customer.
- Gross margin for the three months ended September 30, 2013 was $99,005 as compared with a negative gross margin of ($6,600) for the three months ended September 30, 2012. Gross margin for the nine months ended September 30, 2013 was $68,550 as compared to negative gross margin of $(17,127). The increase is primarily related to the shipment of product during the third quarter. The negative gross margin for the three months and nine months ended September 30, 2012 was primarily the result of fixed overhead costs related to moving to a new fulfillment operation and manufacturing scale-up from small to production grade equipment exceeding revenue.
- Research and development expense for the three months ended September 30, 2013 was $151,946, an increase of $125,830 as compared to $26,116 for the three months ended September 30, 2012. Research and development expense for the nine months ended September 30, 2013 was $200,428, an increase of $54,760 as compared with $145,668 for the nine months ended September 30, 2012. The increase is primarily the result of increased activity for PAZ320's Phase IIb trial in France and in preparation of PAZ320's Phase III international trial.
- Sales and marketing expense for the three months ended September 30, 2013 was $102,840, an increase of $9,321 or 10% as compared with $93,519 for the three months ended September 30, 2012. Sales and marketing expense for the nine months ended September 30, 2013 was $251,236, an increase of $23,639 or 10% as compared with $227,597 for the nine months ended September 30, 2012. The expense consists primarily of costs incurred with third parties for product marketing and public relations.
- General and administrative expense for the three months ended September 30, 2013 was $954,261, an increase of $719,629 as compared with $234,632 for the three months ended September 30, 2012. Approximately $407,000 of the increase is related to non-cash stock-based compensation which includes $252,000 of expense due to the future vesting of stock options of a terminated employee and expense associated with stock option grants. Consulting and professional services increased $135,000 for investor relations and maintenance of the SUGARDOWN® website, accounting and legal professional fees increased $91,000 and payroll and payroll related expense increased $82,000 due to additional personnel.
- General and administrative expense for the nine months ended September 30, 2013 was $1,904,008, an increase of $1,405,405 as compared with $498,603 for the nine months ended September 30, 2012. Approximately $677,000 of the increase is related to non-cash stock-based compensation which includes $252,000 of expense due to future vesting of stock options of a terminated employee and expense associated with stock option grants during 2012 and 2013. Additionally, consulting and professional fees increased approximately $345,000 for investor relations and maintenance of the SUGARDOWN® website, payroll and related payroll expense increased $162,000 due to additional personnel, accounting and legal professional fees increased $114,000 due to increased business operations and rent expense increased $50,000 due to the new office facility.
- Net loss for the third quarter 2013 was $1,116,863 or $0.04 per share, compared with a net loss of $366,334, or $0.02 per share in the prior year's third quarter. For the nine-month period, net loss was $2,303,532, or $0.11 per share, compared with $905,728 or $0.05 per share in 2012. Non-cash stock-based compensation of $472,820 and $857,851 is included in the net loss for the three months and nine months ended September 30, 2013.
About Boston Therapeutics, Inc.
Boston Therapeutics, headquartered in Manchester, NH (OTCQB: BTHE), is an innovator in designing drugs using complex carbohydrate chemistry. The Company's product pipeline is focused on developing and commercializing therapeutic molecules that address Type 2 diabetes, including: PAZ320, a non-systemic chewable therapeutic compound designed to reduce post-meal glucose elevation, and IPOXYN, an injectable anti-necrosis drug specifically designed to treat lower limb ischemia associated with diabetes. More information is available at www.bostonti.com.
Forward Looking Statements
This press release contains, in addition to historical information, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to future events or future financial performance, and use words such as "may," "estimate," "could," "expect" and others. They are based on our current expectations and are subject to factors and uncertainties which could cause actual results to differ materially from those described in the statements. Factors that could cause our actual performance to differ materially from those discussed in the forward-looking statements include, among others, that our plans, expectations and goals regarding the clinical trials are subject to factors beyond our control and provide no assurance of FDA approval of our drug development plans. Our clinical trials may not produce positive results in a timely fashion, if at all, and any necessary changes during the course of the trial could prove time consuming and costly. We may have difficulty in enrolling candidates for testing, which would affect our estimates regarding timing, and we may not be able to achieve the desired results. Any significant delays or unanticipated costs in the trials could delay obtaining meaningful results from Phase II and/or preparing for Phase III with the current cash on hand.
Upon receipt of FDA approval, we may face competition with other drugs and treatments that are currently approved or those that are currently in development, which could have an adverse effect on our ability to achieve revenues from this proposed indication. Plans regarding development, approval and marketing of any of our drugs, including PAZ320, are subject to change at any time based on the changing needs of our company as determined by management and regulatory agencies. To date, we have incurred operating losses since our inception, and our ability to successfully develop and market drugs may be affected by our ability to manage costs and finance our continuing operations. For a discussion of additional factors affecting our business, see our Annual Report on Form 10-K for the year ended December 31, 2012, and our subsequent filings with the SEC. You should not place undue reliance on forward-looking statements. Although subsequent events may cause our views to change, we disclaim any obligation to update forward-looking statements.
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