Vitro Biopharma Inc. January 31st 2021, 1st Quarter ended Financial Results of Operations and Shareholder Letter
GOLDEN, CO / ACCESSWIRE / April 27, 2021 / Vitro Biopharma Inc. (formerly Vitro Diagnostics Inc.) (dba Vitro Biopharma), announced its quarter ended January 31st, 2021, financial results of operations.
Vitro Biopharma recorded quarter ended January 31st, 2021 revenues of $ 127,492 vs $225,921 a decrease of 44% over the prior comparative quarter directly attributed to the COVID-19 pandemic. Revenues in the first quarter of 2021 of $127,492 were down 21% over the $161,888 recorded in the prior fourth quarter. The decrease in the current first quarter revenue was on account of the Research products weak seasonal quarter due to the universities and institutions generally are not as active during the holiday periods.
During the quarter the Stem Cell clinics offshore continued to be shut down and the cosmetic clinics were only partially operating at reduced capacity.
The overall year and business limitations due to the worldwide COVID-19 pandemic have pushed our expectations of growth and revenue recovery out to the 2nd half of fiscal 2021. Feedback from our customers and our partner clinic in the Cayman Islands www.DVCstem.com is that patients awaiting treatments are not dropping off, but merely postponing their treatments and as such, a significant backlog of over 100 patients is building. The cosmetic clinics www.InfiniVive-MD.com have started to open but currently with lower occupancy as regulations have varied state by state. Our partner in the Cayman Islands has started to treat patients in the second quarter of 2021 and we are receiving increased orders from our exclusive distributor of the Infinivive-MD product line.
Gross profit margins held up in the 76% range for the quarter up 1% from the prior comparative quarter while gross profit declined 43% from the comparative quarter due to the reduction in revenues for the quarter.
Overall GAAP operating expenses increased in the quarter ended January 31st, 2020 by $654,199 to $1,018,086 from $363,887 in the prior quarter ended January 31st 2020.The increases in expenses were mainly on account of a one-time settlement agreement of $405,000. As per the statements of cashflows the cash utilized in operations for the quarter ended January 31st, 2021 was $357,930 versus $172,684 for the prior comparative quarter of January 31st 2020. The increase in operating cashflow used in operations for the current quarter was $185,246 reflecting the increased costs of FDA regulatory, legal, consulting, and audit costs.
Now that the Audits have been completed the company is moving forward with plans to regain an exchange listing with the SEC, the process of which is expected to be completed in and around the latter quarter of fiscal 2021.
The company added extra resources to turn its attention to the world-wide challenge of finding therapies to fight COVID-19. Vitro filed an Investigational New Drug ("IND") application and has received FDA authorization to treat several COVID 19 patients under the Expanded Access IND Program with its AlloRx Stem Cells ®. Five critically ill patients have been treated successfully with no adverse events and have since recovered post treatment. Dr. Jack Zamora was recently interviewed with local press coverage of our efforts in successfully treating COVID 19 patients.
During and subsequent to the quarter the company achieved and pursed the following objectives:
- Offering and C.E.O. Jack Zamora M.D.
During the quarter, the company continued with its Series A Convertible Preferred Stock offering to the accredited investors under the SEC Regulation D exemption. The preferred Stock is priced at $25 per share which is convertible at $0.25 cents per share for a total of 100 shares. The minimum investment is $50,000 per unit. The company had sold $1.0 million of the Series A Convertible Preferred Stock in 2020. The offering was sold out at $1.0 million and the company has expanded it to a total of up to $3.5 million to ensure sufficient working capital during the Coronavirus pandemic and to start the regulatory process of current reporting audits and funding for its expanded clinical trial activities with the FDA. During the quarter the company entered into a $2M Series A Convertible Preferred Stock one year subscription agreement with its recently announced new C.E.O., Jack Zamora M.D. During the quarter the subscription agreement has been funded to $330,000 in the first quarter of 2021.
- Established Pathway to Gain FDA Approval of AlloRx Stem Cells® .
As a part of our overall strategy to target both global and US stem cell markets, Vitro Biopharma submitted a Phase I IND application to the FDA to assess the safety of AlloRx Stem Cells® in the treatment of COVID-19. We have established strong communication channels with FDA officials to facilitate our IND review and are providing additional information to the FDA to complete the approval of our IND that we expect soon. Several clinical centers have expressed interest in our stem cell therapy, and we continue to enlist multi-center sites to conduct our Phase 1 trial. We are also pursuing other avenues for emergency use under the Expanded Access IND Program. No adverse events were reported in our treated patients and one patient who had various comorbidities (diabetes, obesity and cardiovascular disease) stabilized and exhibited enhanced pulmonary, liver and renal function during the six weeks following AlloRx Stem Cell® Therapy. The patient has now recovered and is at home from the hospital after 3 months of intensive care. We have now completed Five eIND treatments without adverse events and resolution of COVID-19 symptoms. MSCs have been shown to block the cytokine storm that occurs in COVID-19 patients in acute respiratory distress through their powerful anti-inflammatory effectiveness. The cytokine storm leads to the need for assisted breathing by ventilators, patient transfer to ICU and related burdens on the global health and systems as the pandemic continues. It is important to note that AlloRx Stem Cells® are a possible therapy for other viral attacks including influenza. Stem cells block acute respiratory distress and repair damage to other major organs including cardiovascular, pulmonary, hepatic, and renal systems. Subsequent to Q1, 2021, we received FDA authorization and clearance to enroll patients in its phase I-IIa, randomized, double-blinded, placebo controlled study of the safety and efficacy of therapeutic treatment with AlloRx Stem Cells® in adults with COVID-19.
AlloRx Stem Cells® have been shown to assist in recovery from failure of various organ systems in COVID-19 survivors, as our case study and results from several other labs are demonstrating. It is thus likely that AlloRx Stem Cells® are effective in treating long COVID-19 and we plan to expand indications of our clinical studies to include long COVID cases. We are in discussions with FDA officials about their preferred strategy for filing a new IND targeting long COVID-19 patients. As variants of COVID-19 evolve and threaten global pandemic expansion, AlloRx Stem Cell® therapy is effective without regard to the viral sequence enhancing its therapeutic utility and compliment to vaccine therapy. During the quarter we filed a patent application with the USPTO regarding our novel technology, methods and compositions related to combining COVID-19 vaccine attributes with AlloRx Stem Cells®.
- Expansion of its manufacturing capacity
The company has delayed the expansion of its laboratory and manufacturing facilities to better reflect the delays in revenue brought on by the pandemic. This expanded facility is expected to be operating in the later part of 2021. During the quarter we have initiated technical upgrades to our AlloRx stem cell manufacturing procedures that will increase cellular yields and further automate manufacturing. Our present facility has approximately $6M of AlloRx Stem Cell™ Vitro Biopharma revenue capacity per year. Furthermore, the completion of the 2nd clean room processing facility would expand our potential capacity to approximately 100 Billion AlloRx Stem Cells® a month or approximately $1.7 Million of AlloRx Stem Cell® revenue capacity per month. This would give Vitro Biopharma a revenue run rate potential capacity of $20M a year.
Our increased capacity is rigorously controlled by our Quality Management System, now certified to the ISO9001 Quality Standard and the ISO13485 Medical Device Standard as well. This provides cGMP-compliant manufacturing of the highest quality stem cells/medical devices for clinical trial testing to provide further evidence of safety and efficacy for treatment of a wide variety of indications. Highly regulated cGMP biologics manufacturing within a BLA-compliant facility provides numerous opportunities to the Company to drive strong revenue growth. We are presently focused on our partnerships in the Caribbean with DVC Stem in Grand Cayman Island, InfiniVive MD, Magellan Stem Cells in Australia and emerging opportunities in the Medical Pavilion of the Bahamas We are actively pursuing other partnership opportunities as well.
- STEMulize™ Update:
We have reformulated with our contract manufacturer to produce STEMulize™ in large quantity manufacturing runs. STEMulize™ contains natural substances that activate the body's own stem cells to enhance recovery from injury such as TBI, stroke, MS, PD and other autoimmune, inflammatory and neurological diseases. The STEMulize™ product will be offered as a private label product to InfiniVive MD™ clinics and is being implemented as supplemental support to clinical treatments now ongoing in the Cayman Islands. Patients report positive benefits from STEMulize™ therapy following stem cell transplants including increased overall energy and enhancement of improved motor function in MS patients. Subsequent to the year we have entered into Licensing negotiations with Fitore Nutraceutical for the exclusive license of our STEMulize formulation under private label with Fitore as Stemulife™. The agreement calls for exclusivity minimums over the next three years. The first scalable production and sales are expected in the 2nd quarter of 2021. https://fitorenutrition.com/
- Supporting Revenue from Infinivive MD™ Stem Cell Serum despite closures and reduced capacity of the cosmetic clinics
The Company's cosmetic stem cell serum private labelled as InfiniVive MD™ is being applied as a topical cosmetic serum in medical spas and plastic surgery offices. InfiniVive MD™™ revenue was reduced by the Coronavirus pandemic due to clinic closures and reduced levels of occupancy capacity. While expansion efforts have been on hold during the pandemic, we have continued to receive orders for our topical stem cell serum private labelled as Infinivive-MD™ Stem Cell Serum. These revenues are helping support the company's operations during the pandemic. While this revenue has been flat from the prior quarter and year it nevertheless has contributed to operating cashflow to support the company.
InfiniVive MD™ Cosmetic Serum is revolutionizing the cosmetic industry. Patients are experiencing unparalleled improvements in the appearance of fine lines and wrinkles. This is one of the fastest growing revenue streams for Vitro Biopharma. We work with a variety of regulatory experts to assist us in the appropriate regulatory pathways.
Vitro Biopharma's OEM cosmetic topical serum is being distributed exclusively by InfiniVive MD™ into cosmetic clinics that are providing the topical treatment as a beautification product. To date the company's product is being offered in a number of clinics throughout the United States and soon internationally, but with the clinics just opening again for business and with limited occupancy rules we do not expect this revenue to recover back to peak levels with growth until the 2nd half of 2021.
- New product development InfiniVive Exosome Cosmetic Serum
The company has brought on Dr. Jack Zamora as its new C.E.O. and together with our founder who is now focused on research as our C.S.O. has jointly developed a new exosome based product, InfiniVive MD's Cosmetic Exosome Serum. The product will be distributed by InfiniViveMD along with the topical stem cell serum. The product is also used as a topical application for beautification. The product is a compliment to the topical stem cell serum and will provide the customer with a more competitive price point per application depending on the clinic. The new Exosome product is being marketed and sold into the clinics during the current quarter and we have already received increased exosome orders subsequent to the quarter. We are jointly working on a topical Daily Serum. The Exosome market is part of the billion-dollar cosmetic market in the United States. These products will also be sold offshore around the world.
Update on the Clinical Trial of Musculoskeletal Conditions in the Bahamas.
This initiative broadens Vitro Biopharma's expansion into highly regulated stem cell trials in collaboration with the Nassau-based Medical Pavilion of the Bahamas (TMPB).
Pandemic related travel restrictions have delayed patient enrollment in our IRB-approved clinical trial to treat musculoskeletal conditions with AlloRx Stem Cells®. These include OA of any joint, ACL/MCL tear, Achilles tendon rupture, rotator cuff injury, tennis elbow and herniated disc that are highly prevalent and have few disease-modifying options. The company is partnered with Dr. Conville Brown, MD, MBBS, FACC, FESC, PhD, the founder and CEO of the Medical Pavilion of the Bahamas who is the Principal Investigator of this trial and director of its clinical administration. Dr Brown was instrumental in the establishment of the NSCEC in the Bahamas.
About the Medical Pavilion of the Bahamas: TMPB operates within a 40,000 square foot building as a partnered care specialty medical facility with 10 different centers in various areas including cardiology, cancer, clinical research, and kidney disease. One of the centers is the Partners Stem Cell Centre, where the present trial will be conducted. The Partners Stem Cell Centre provides an environment to conduct stem cell research and clinical trials under the model of ''FDA rigor in a Non-FDA Jurisdiction'' TMPB employs 20 medical specialists in various fields. See www.tmp-bahamas.com for additional information.
The company has entered into an operating agreement with the Partner's Stem Cell Centre and the pandemic has delayed expects patient enrollment for the clinical trial, revenue expectations are on hold until the Bahamas open-up without quarantine restrictions.
- Temporary hold on revenues from the clinical trials in the Cayman Islands:
Due to the Corona virus pandemic the Cayman Islands closed itself and its businesses down for the quarter ended January 31st 2021. Subsequent to the quarter DVCStem has started to treat some patients who are willing to quarantine for 10 days, these therapies will start to contribute to revenues in the 2nd and beyond quarters. There is currently a backlog of over 100 patients seeking treatment which exceeds all of the treatments performed in 2019 and 2020 by over 200%. We expect to see a surge in revenues from this backlog to bring back our revenue stream in the into the second half of 2021.
- Expanded our Patent & Intellectual Property Portfolio
The Company has 6 patent applications pending in the US and foreign jurisdictions. These patents cover our AlloRx Stem Cell® line and various aspects of our STEMulize® stem cell activation products for treatment of a wide variety of medical indications. During the quarter, the Company has responded to office actions and continues to vigorously prosecute & expand its patent filings. During prosecution, some previously pending applications that were expanded due to restriction actions by the US patent office were abandoned without altering the Company's ability to achieve patent protection of its key IP related to AlloRx Stem Cells®, STEMulize® for treatment of a wide variety of medical conditions and its novel stem cell therapy based on the combination of AlloRx Stem Cells® and STEMulize®. Also, our pending applications have opportunities for subsequent filings in other jurisdictions and we have filed a new application related to the engineering of vaccine properties into AlloRx stem cells.
We believe our stem cell products are distinctly superior to stem cell treatments offered in the USA. The latter usually involve use of impure products lacking validation as stem cells and containing insufficient numbers of stem cells to achieve therapeutic benefits. These are produced without regulatory oversight and have been known to cause serious adverse effects. Hence the use of highly purified and well characterized stem cells (AlloRx Stem Cells®) is needed to provide safety and efficacy in regenerative medicine therapies.
In summary, Vitro Biopharma is advancing as a key player in regenerative medicine with 10+ years' experience in the development and commercialization of stem cell products for research, recognized by a Best in Practice Technology Innovation Leadership award for Stem Cell Tools and Technology and a growing track record of successful translation to therapy. We plan to leverage our proprietary technology platform to the establishment of international Stem Cell Centers of Excellence and regulatory approvals in the US and worldwide.
Vitro Biopharma has supplied major biopharmaceutical firms, elite university laboratories and clinical trials worldwide with its Umbilical Cord Mesenchymal Stem Cells (AlloRx Stem Cells®), and it's MSC-Grow™ Brand of cell culture media along with advanced stem cell diagnostic services.
Jack Zamora M.D.
Statements herein regarding financial performance have not yet been reported to the SEC nor reviewed by the Company's auditors. Certain statements contained herein, and subsequent statements made by and on behalf of the Company, whether oral or written may contain "forward-looking statements". Such forward looking statements are identified by words such as "intends," "anticipates," "believes," "expects" and "hopes" and include, without limitation, statements regarding the Company's plan of business operations, product research and development activities, potential contractual arrangements, receipt of working capital, anticipated revenues and related expenditures. Factors that could cause actual results to differ materially include, among others, acceptability of the Company's products in the marketplace, general economic conditions, receipt of additional working capital, the overall state of the biotechnology industry and other factors set forth in the Company's filings with the Securities and Exchange Commission. Most of these factors are outside the control of the Company. Investors are cautioned not to put undue reliance on forward-looking statements.
Except as otherwise required by applicable securities statutes or regulations, the Company disclaims any intent or obligation to update publicly these forward-looking statements, whether as a result of new information, future events or otherwise.
Dr. Jack Zamora
4621 Technology Drive
Golden, CO 80403
SOURCE: Vitro Diagnostics, Inc.
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