Capstone Therapeutics Provides Operating Update And Announces 2011 Financial Results

EX-10.30 2 exh_1030.htm EXHIBIT 10.30 exh_1030.htm
Exhibit 10.30
 
 
1275 West Washington Street - Suite 101
Tempe, AZ 85281
(602) 286-5520
www.capstonethx.com
OTCQB:  CAPS
 
Capstone Therapeutics Provides Operating Update
And Announces 2011 Financial Results

Tempe, AZ – March 21, 2012Capstone Therapeutics Corp. (OTCQB:  CAPS) (the “Company”) provided an operating update and announced financial results for 2011.
 
OPERATING UPDATE

We previously announced that:

On October 13, 2011, the Company’s Board of Directors adopted a plan to preserve cash during our ongoing partnering efforts and effected a reduction from 18 employees to four employees.

On January 20, 2012, we took additional actions to preserve cash and move towards winding down operations while we continue efforts to create shareholder value through a development partnership (of clinical or pre-clinical stage assets) or other strategic transactions.  These additional actions included the following:

·  
We will cease clinical development of AZX100, our principal drug candidate, in dermal scarring.  Certain pre-clinical, manufacturing and regulatory projects related to AZX100 that are either required from a statutory perspective or are under contract will continue to their completion.
 
·  
We will cease all activities related to the development of TP508, our other drug candidate, and return the patent and other intellectual property we own related to TP508 to the original licensor, the University of Texas Medical Branch at Galveston, Texas (“UTMB”).  Following the return of the intellectual property, we will no longer have any interest in or rights to TP508.
 
We have completed wrap-up of our AZX100 Phase 2a dermal scarring clinical trials and have returned intellectual property related to TP508 to UTMB. Certain pre-clinical, manufacturing and regulatory projects related to AZX100 that are either required from a statutory perspective or are under contract will continue. We presently have four employees and a few part-time consultants.  Most of our part-time consultants have already terminated due to completion of their wind-down projects.  As of July 2012, we anticipate having only two fulltime employees.  We remain a publicly-traded company, subject to the regulations and reporting requirements of the Securities and Exchange Commission and will continue to bear certain administrative and reporting expenses.

Until resolution of the ongoing qui tam litigation, Capstone is limited in its ability to execute a strategic corporate transaction and is restricted under Delaware Law in its ability to return remaining cash to stockholders.
 
FINANCIAL RESULTS FOR 2011

The Company incurred a net loss in 2011 of $9.7 million compared to a net loss of $10.9 million in 2010.  The decrease in the net loss for 2011 compared to 2010 resulted primarily from reduced clinical costs in 2011 compared to 2010 related to our AZX100 Phase 2 clinical trials, the elimination of our performance- based incentive bonus plan and decreased operating costs after October 31, 2011. Our Phase 2 clinical trials for keloid scar revision were completed in 2010 and our Phase 2 clinical trial in dermal scarring following shoulder surgery was substantially completed in 2010.  These cost decreases were partially offset by severance costs of approximately $1.7 million in 2011.

The Company ended 2011 with approximately $13.8 million in cash and investments.
 
Statements in this press release or otherwise attributable to Capstone regarding our business that are not historical facts are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from predicted results.  These risks include the factors discussed in our Form 10-K for the fiscal year ended December 31, 2011, and other documents we file with the U.S. Securities and Exchange Commission
 
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Editor’s Note:  This press release is also available under the Investors section of the Company’s website at www.capstonethx.com.
 
 
 

 
CAPSTONE THERAPEUTICS CORP.
(Formerly OrthoLogic Corp.)
(A Development Stage Company)
BALANCE SHEETS
(in thousands, except share and per share data)

 
   
December 31,
   
December 31,
 
   
2011
   
2010
 
ASSETS
           
Current assets
           
  Cash and cash equivalents
  $ 13,778     $ 24,387  
  Interest, income taxes and other current assets
    758       643  
       Total current assets
    14,536       25,030  
                 
Furniture and equipment, net
    160       258  
       Total assets
  $ 14,696     $ 25,288  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
               
Current liabilities
               
  Accounts payable
  $ 77     $ 246  
  Accrued compensation
    13       674  
  Accrued clinical and other accrued liabilities
    29       236  
  Share-based payments liability
    -       660  
       Total current liabilities
    119       1,816  
                 
Potentially redeemable equity
    -       15,556  
                 
Stockholders' Equity
               
                 
Common Stock  $.0005 par value;
    20       20  
   100,000,000 shares authorized; 40,775,411 shares in 2011
               
   and 2010 issued and outstanding
               
Additional paid-in capital
    189,074       188,258  
Accumulated deficit ($146,755 at 2011 and $152,600 at 2010
               
   accumulated during development stage period)
    (174,517 )     (180,362 )
       Total stockholders' equity
    14,577       7,916  
       Total liabilities, potentially redeemable equity
               
          and stockholders' equity
  $ 14,696     $ 25,288  
 
 
 

 
CAPSTONE THERAPEUTICS CORP.
(Formerly OrthoLogic Corp.)
(A Development Stage Company)
STATEMENTS OF OPERATIONS
(in thousands, except per share data)

               
As a Development
 
               
Stage Company
 
   
Years ended December 31,
   
August 5, 2004 -
 
   
2011
   
2010
   
December 31, 2011
 
                   
OPERATING EXPENSES
                 
   General and administrative
  $ 3,506     $ 3,240     $ 29,722  
   Research and development
    6,394       8,168       100,049  
   Purchased in-process research and development
    -       -       34,311  
   Other
    -       -       (375 )
      Total operating expenses
    9,900       11,408       163,707  
   Interest and other income, net
    (31 )     (356 )     (13,758 )
   Loss from continuing operations before taxes
    9,869       11,052       149,949  
   Income tax benefit
    (158 )     (181 )     (1,355 )
      Loss from continuing operations
    9,711       10,871       148,594  
                         
Discontinued Operations -
                       
   net gain on the sale of the bone device
                       
   business, net of taxes of $267
    -       -       (2,202 )
      NET LOSS
  $ 9,711     $ 10,871     $ 146,392  
                         
Per Share Information:
                       
          Net loss, basic and diluted
  $ 0.24     $ 0.27          
Basic and diluted shares outstanding
    40,775       40,775