Spherix Announces Second Quarter 2010 Financial Results
Recent and Upcoming Highlights
Financial Results for the Quarter Ended June 30, 2010
Revenue 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. The increase in R&D costs for the three-month period ended June 30, 2010 over the same period in 2009 is related to the close-out procedures the Company is performing for the Phase 3 trial.
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 are expected to be unblinded in mid-September 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.
D-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).
Spherix 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.
This 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.
-- Pharmaceutical Development -- Announced exploration of D-tagatose as a potential treatment for high triglycerides, a risk factor for atherosclerosis, myocardial infraction, and stroke -- Acquired development and marketing rights for D-tagatose for triglycerides from the University of Kentucky Research Foundation -- Goal of the triglycerides program is to develop a formulation, dose and dosing regimen appropriate for the lipid market segment -- Anticipate a robust proof of concept in a Phase 2 clinical study and then seek a pharma partner for further development of the triglycerides drug product -- Announce efficacy results of the Phase 3 trial for the treatment of Type 2 diabetes by mid-September 2010 and anticipated completion of the Phase 2 Dose Range trial by the end of 2010 -- Actively seeking a strategic relationship with a pharma company for the continued development of D-tagatose as a treatment for Type 2 diabetes -- Conducted additional rounds of Medical Advisory Board meetings to provide clinical guidance for the development program for D-tagatose as a treatment for Type 2 diabetes and potential as a triglyceride therapy
SOURCE Spherix Incorporated
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