Ritter Pharmaceuticals Reports Financial Results for the Fourth Quarter and Year Ended December 31, 2019
01 April 2020 - 8:27AM
Ritter Pharmaceuticals, Inc. (Nasdaq: RTTR) (“Ritter
Pharmaceuticals”, Ritter” or the “Company”), a developer of
therapeutic products that modulate the gut microbiome to treat
gastrointestinal diseases, today reported financial results for the
fourth quarter and year ended December 31, 2019.
In January 2020, Ritter and Qualigen, Inc.
(“Qualigen”), announced that the two companies had
entered into a definitive “reverse merger” agreement.
Under the merger agreement, Qualigen will become a
wholly-owned subsidiary of Ritter. Upon completion of the merger,
the Company will change its name to Qualigen Therapeutics, Inc.
"Following our extensive review of strategic
alternatives, we are excited about the recently announced merger
agreement between Ritter Pharmaceuticals and Qualigen.
The merged company will focus on the development of Qualigen’s
nanotechnology therapies for the treatment of cancer and infectious
diseases, while also continuing to operate its revenue-generating
diagnostic business. At the same time, the merger provides for,
among other things, a portion of the net proceeds from any
potential monetization of our RP-G28 technology, a therapeutic
treatment for lactose intolerance, to be distributed to our
pre-merger stockholders,” said Andrew J. Ritter, Ritter
Pharmaceuticals’ Chief Executive Officer. "We look forward to
completing the merger in the second quarter of this year and
continue to work diligently with the Qualigen management team to
achieve that objective."
Financial Results for the Fourth Quarter
and Year Ended December 31, 2019
The Company’s net loss, and net loss per
attributable to common stockholders for the fourth quarter and year
ended December 31, 2019 was $0.4 million and $10.1 million, or
$0.05 per share and $1.06 per share, respectively, compared to $6.6
million and $16.9 million, or $1.73 per share and $3.66 per share,
for the same periods in 2018, respectively. Net loss for the fourth
quarter and year ended December 31, 2019, included non-cash,
stock-based compensation expense of $0.1 million and $0.4 million,
respectively, compared to $0.1 million and $0.6 million, for the
same periods in 2018, respectively. As of December 31, 2019, the
Company had cash and cash equivalents of approximately $1.7 million
compared to $14.8 million in cash, cash equivalents and
investment in marketable securities as of December 31, 2018.
The net decrease in cash and cash equivalents in
2019 was mainly due to the use of cash to fund the Phase 3
“Liberatus” clinical trial of RP-G28. The decrease in net loss for
both the fourth quarter and year ended December 31, 2019 and net
loss per share for both the fourth quarter and year ended December
31, 2019 compared to the same periods in 2018 was primarily due to
the winding down of development efforts as the Liberatus clinical
trial entered its finalization stage.
The Company has significantly reduced its cash
burn, including reducing executive management and board
compensation and non-essential operating expenses to extend its
runway while keeping its core team and expertise intact.
About Ritter
PharmaceuticalsRitter Pharmaceuticals, Inc.
(www.RitterPharma.com, @RitterPharma) develops innovative
therapeutic products that modulate the gut microbiome to treat
gastrointestinal diseases. On January 15, 2020, the Company entered
into an Agreement and Plan of Merger with Qualigen, pursuant to
which Merger Sub will merge with and into Qualigen, with Qualigen
surviving as a wholly-owned subsidiary of Ritter Pharmaceuticals,
Inc.
Forward-Looking StatementsThis
press release may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
that express the current beliefs and expectations of Ritter
Pharmaceuticals’ management. Any statements contained herein that
do not describe historical facts, including statements related to
the proposed merger with Qualigen and Ritter’s ability to monetize
RP-G28 are forward-looking statements. Forward-looking statements
are subject to risks and uncertainties that could cause actual
results, performance and achievements to differ materially from
those discussed in such forward-looking statements. Some of the
factors that could affect actual results are included in the
periodic reports on Form 10-K and Form 10-Q that are filed with the
Securities and Exchange Commission. Ritter cautions readers not to
place undue reliance on any forward-looking statements, which speak
only as of the date they were made. The Company undertakes no
obligation to update or revise forward-looking statements, except
as otherwise required by law, whether as a result of new
information, future events or otherwise.
ContactsInvestor Contact:John Beck 310-203-1000
john@ritterpharma.com
RITTER PHARMACEUTICALS,
INC.STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME (LOSS)
|
|
For the Year Ended |
|
|
|
December 31, |
|
|
|
2019 |
|
|
2018 |
|
Operating costs and
expenses: |
|
|
|
|
|
|
|
|
Research and development (a) |
|
$ |
6,126,972 |
|
|
$ |
12,259,940 |
|
Patent costs |
|
|
146,281 |
|
|
|
204,396 |
|
General and administrative |
|
|
4,570,932 |
|
|
|
5,425,033 |
|
Total operating costs and expenses |
|
|
10,844,185 |
|
|
|
17,889,369 |
|
Operating loss |
|
|
(10,844,185 |
) |
|
|
(17,889,369 |
) |
|
|
|
|
|
|
|
|
|
Other
income: |
|
|
|
|
|
|
|
|
Interest income |
|
|
123,052 |
|
|
|
126,835 |
|
Settlement of accounts payable (a) |
|
|
588,114 |
|
|
|
893,823 |
|
Total other income |
|
|
711,166 |
|
|
|
1,020,658 |
|
Net loss |
|
$ |
(10,133,019 |
) |
|
$ |
(16,868,711 |
) |
|
|
|
|
|
|
|
|
|
Other comprehensive
gain (loss): |
|
|
|
|
|
|
|
|
Unrealized gain (loss) on debt securities |
|
|
923 |
|
|
|
(923 |
) |
Comprehensive loss |
|
$ |
(10,132,096 |
) |
|
$ |
(16,869,634 |
) |
|
|
|
|
|
|
|
|
|
Net Loss |
|
|
(10,133,019 |
) |
|
|
(16,868,711 |
) |
Deemed dividend of preferred
stock |
|
|
― |
|
|
|
(2,537,844 |
) |
Net loss applicable to common
stockholders |
|
$ |
(10,133,019 |
) |
|
$ |
(19,406,555 |
) |
Net loss per common share –
basic and diluted |
|
$ |
(1.06 |
) |
|
$ |
(3.66 |
) |
|
|
|
|
|
|
|
|
|
Weighted average common shares
outstanding – basic and diluted |
|
|
9,570,061 |
|
|
|
5,304,667 |
|
(a) For comparative presentation
purpose, settlement of accounts payable of $893,823 for the year
ended December 31, 2018 was reclassified out of research and
development and into settlement of accounts payable under other
income.
RITTER PHARMACEUTICALS,
INC.BALANCE SHEETS
|
|
December 31, 2019 |
|
|
December 31, 2018 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
1,699,971 |
|
|
$ |
7,812,259 |
|
Accrued interest receivable |
|
|
771 |
|
|
|
54,456 |
|
Investment in marketable securities |
|
|
― |
|
|
|
6,988,780 |
|
Prepaid expenses and other current assets |
|
|
509,519 |
|
|
|
421,522 |
|
Total current assets |
|
|
2,210,261 |
|
|
|
15,277,017 |
|
Other assets |
|
|
|
|
|
|
|
|
Right-of-use assets |
|
|
93,032 |
|
|
|
― |
|
Other assets |
|
|
478,075 |
|
|
|
22,725 |
|
Total other assets |
|
|
571,107 |
|
|
|
22,725 |
|
Property and equipment,
net |
|
|
15,656 |
|
|
|
20,160 |
|
Total
Assets |
|
$ |
2,797,024 |
|
|
$ |
15,319,902 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
1,417,317 |
|
|
$ |
4,512,316 |
|
Accrued expenses |
|
|
179,258 |
|
|
|
1,407,843 |
|
Lease liabilities |
|
|
100,471 |
|
|
|
― |
|
Other liabilities |
|
|
― |
|
|
|
13,359 |
|
Total current liabilities |
|
|
1,697,046 |
|
|
|
5,933,518 |
|
|
|
|
|
|
|
|
|
|
Stockholders’
equity |
|
|
|
|
|
|
|
|
Series A preferred stock,
$0.001 par value; 9,500 shares authorized; 0 and 4,080 shares
issued and outstanding as of December 31, 2019 and 2018,
respectively |
|
|
― |
|
|
|
2,289,324 |
|
Series B preferred stock,
$0.001 par value; 6,000 shares authorized; 1,850 and 5,608 shares
issued and outstanding as of December 31, 2019 and 2018,
respectively |
|
|
1,288,956 |
|
|
|
3,906,931 |
|
Series C preferred stock,
$0.001 par value; 1,880 shares authorized; 240 and 1,880 shares
issued and outstanding as of December 31, 2019 and 2018,
respectively |
|
|
240,000 |
|
|
|
1,880,000 |
|
Common stock, $0.001 par
value; 225,000,000 shares authorized; 19,108,331 and 6,036,562
shares issued and outstanding as of December 31, 2019 and 2018,
respectively |
|
|
19,108 |
|
|
|
6,037 |
|
Additional paid-in
capital |
|
|
79,885,078 |
|
|
|
71,505,160 |
|
Accumulated other
comprehensive loss |
|
|
― |
|
|
|
(923 |
) |
Accumulated deficit |
|
|
(80,333,164 |
) |
|
|
(70,200,145 |
) |
Total stockholders’ equity |
|
|
1,099,978 |
|
|
|
9,386,384 |
|
Total Liabilities and
Stockholders’ Equity |
|
$ |
2,797,024 |
|
|
$ |
15,319,902 |
|
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