BETHESDA, Md., Nov. 15, 2010 /PRNewswire-FirstCall/ -- Spherix Incorporated (Nasdaq: SPEX), an innovator in biotechnology for therapy in diabetes and the metabolic syndrome, and a provider of technical and regulatory consulting services to food, supplement, biotechnology and pharmaceutical companies, today reported results for the three months ended September 30, 2010.
Recent and Upcoming Highlights
Financial Results for the Quarter Ended September 30, 2010Revenue and direct costs are directly related to the Company's health sciences consulting segment. The Company's consulting business provides technical and regulatory consulting services to biotechnology and pharmaceutical companies, as well as critical technical support for the Company's own R&D activities.
The Company's ongoing research and development activities have been focused on the development of D-tagatose as a new treatment for Type 2 diabetes. The Company announced in June that it would also explore D-Tagatose as a potential treatment for high triglycerides, a risk factor for atherosclerosis, myocardial infraction, and stroke. The R&D expenditures for 2010 and 2009 consisted of both a Phase 3 clinical trial and a related Phase 2 Dose Range study on the use of D-tagatose as a treatment for Type 2 diabetes.
D-Tagatose is believed to depress elevations of blood sugar levels in diabetic patients by increasing glycogen synthesis while decreasing glycogen utilization, resulting in an improvement of blood sugar control and modulation of HbA1c. The Phase 3 efficacy trial results were announced in October 2010 and the Dose Range study is expected to be completed by the end of 2010.
The increase in selling, general and administrative costs between 2010 and 2009 is primarily related to the expansion of the Company's market development efforts of D-tagatose as a treatment for Type 2 diabetes and the decision to explore D-Tagatose as a potential treatment for high triglycerides. The Company intends to continue expansion of its market development activities and simultaneously search for a sale, license, partner, or other strategic alliance to fully take D-tagatose through the FDA approval process and to bring Dtagatose to market.
During the third quarter of 2010 the Company used $1.8 million of cash to fund operations. As of September 30, 2010 Spherix had cash and cash equivalents of $2.9 million. Subsequent to the close of the quarter the Company raised approximately $4.8 million in net proceeds from the sale of Series B Convertible Preferred Stock and warrants.
About D-TagatoseD-tagatose, a naturally occurring sugar, is a low-calorie, full-bulk sweetener previously approved by the Food and Drug Administration ("FDA") as a GRAS (Generally Recognized As Safe) food ingredient. It is a true sugar that looks, feels, and tastes like table sugar. During human safety studies supporting food use, the Company discovered and patented a number of health and medical uses for D-tagatose. The Company holds the patents for use of D-tagatose as a treatment for Type 2 diabetes and a license for treatment of hypertriglyceridemia. The use patents for D-tagatose as a treatment for Type 2 diabetes expire in 2012, not including extensions. If approved for use as a drug by the FDA, the Company believes it will be eligible for a five year New Chemical Entity ("NCE") exclusivity period following FDA approval. Similar legislation in Europe could provide seven years of market exclusivity in the European Union, if approved by the European Medicines Agency (EMA).
About SpherixSpherix Incorporated was launched in 1967 as a scientific research company, under the name Biospherics Research. The company now leverages its scientific and technical expertise and experience through its two subsidiaries -- Biospherics Incorporated and Spherix Consulting, Inc. Biospherics is currently running a Phase 3 clinical trial to study the use of D-tagatose as a treatment for Type 2 diabetes. Its Spherix Consulting subsidiary provides scientific and strategic support for suppliers, manufacturers, distributors and retailers of conventional foods, biotechnology-derived foods, medical foods, infant formulas, food ingredients, dietary supplements, food contact substances, pharmaceuticals, medical devices, consumer products, and industrial chemicals and pesticides. For more information, please visit www.spherix.com.
Forward-Looking StatementsThis release contains forward-looking statements which are made pursuant to provisions of Section 21E of the Securities Exchange Act of 1934. Investors are cautioned that such statements in this release, including statements relating to planned clinical study design, regulatory and business strategies, plans and objectives of management and growth opportunities for existing or proposed products, constitute forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the forward-looking statements. The risks and uncertainties include, without limitation, risks that product candidates may fail in the clinic or may not be successfully marketed or manufactured, we may lack financial resources to complete development of D-tagatose, the FDA may interpret the results of studies differently than us, competing products may be more successful, demand for new pharmaceutical products may decrease, the biopharmaceutical industry may experience negative market trends, our continuing efforts to develop D-tagatose may be unsuccessful, our common stock could be delisted from the Nasdaq Capital Market, and other risks and challenges detailed in our filings with the U.S. Securities and Exchange Commission, including our current report on Form 8-K filed on October 10, 2007. Readers are cautioned not to place undue reliance on any forward-looking statements which speak only as of the date of this release. We undertake no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances that occur after the date of this release or to reflect the occurrence of unanticipated events.Spherix IncorporatedConsolidated Statements of OperationsThree Months Ended Sept. 30,Nine Months Ended Sept. 30,2010200920102009Revenue$
,071,276Operating expenseDirect costs
(121,841)(125,653)(353,740)(365,318)Research and development expense
(1,453,987)(1,435,282)(4,310,471)(4,130,633)Selling, general and administrative expense
(933,507)(974,972)(3,214,257)(2,383,338)Total operating expense
(2,509,335)(2,535,907)(7,878,468)(6,879,289)Loss from operations(2,140,497)(2,157,542)(6,850,200)(5,808,013)Interest income
1,0545,3865,27035,233Loss before taxes
(2,139,443)(2,152,156)(6,844,930)(5,772,780)Income tax expense
----Net loss$ (2,139,443)$ (2,152,156)$ (6,844,930)$ (5,772,780)Net loss per share, basic
(0.12)(0.15)(0.40)(0.40)Net loss per share, diluted
(0.12)(0.15)(0.40)(0.40)Weighted average shares outstanding, basic
17,150,64814,385,81017,150,64814,371,452Weighted average shares outstanding, diluted
17,150,64814,385,81017,150,64814,371,452Spherix IncorporatedConsolidated Balance SheetsASSETS Sept. 30, 2010
(Unaudited) December 31,
2009 Current assetsCash and cash equivalents
9,026,002Short-term investments, held to maturity
-375,003Trade accounts receivable, net
34,837948Prepaid expenses and other assets
43,854209,255Total current assets
3,294,7249,885,361Property and equipment, net of accumulated depreciation
171,967225,958of $180,165 and $126,174Patents, net of accumulated amortization of $49,208 and $44,657
,155,308LIABILITIES AND STOCKHOLDERS' EQUITYCurrent liabilitiesAccounts payable and accrued expenses
,714,140Accrued salaries and benefits
255,41390,915Total current liabilities
3,042,0992,883,432Commitments and contingencies
--Stockholders' equityPreferred stock, $0.01 par value, 2,000,000 shares authorized; none issued and outstanding
--Common stock, $0.005 par value, 50,000,000 shares authorized; 17,237,110 and 17,231,086 issued, and 17,156,672 and 17,150,648 shares outstanding at September 30, 2010 and December 31, 2009
86,18586,155Paid-in capital in excess of par value
33,636,56433,599,510Treasury stock, 80,438 shares, at cost at September 30, 2010 andDecember 31, 2009
(32,793,933)(25,949,003)Total stockholders' equity
464,0307,271,876Total liabilities and stockholders' equity
|SOURCE Spherix Incorporated|
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