[ X ]
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended
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March 31, 2012
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or
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[ ]
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from ______________________________
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to ____________________
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CAPSTONE THERAPEUTICS CORP.
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(Exact name of registrant as specified in its charter)
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Delaware |
86-0585310
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(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
1275 W. Washington Street, Suite 101, Tempe, Arizona |
85281
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(Address of principal executive offices) | (Zip Code) |
(602) 286-5520
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·
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the impact of our recently adopted plan to preserve cash during ongoing partnering efforts, including the reduction from eighteen employees to four employees and additional steps taken towards winding down operations;
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·
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unfavorable results of our product candidate development efforts;
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·
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unfavorable results of our pre-clinical or clinical testing;
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·
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delays in obtaining, or failure to obtain FDA approvals;
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·
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increased regulation by the FDA and other agencies;
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·
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the introduction of competitive products;
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·
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impairment of license, patent or other proprietary rights;
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·
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failure to achieve market acceptance of our products;
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·
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the impact of present and future collaborative or partnering agreements or the lack thereof;
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·
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failure to successfully implement our drug development strategy;
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·
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failure to obtain additional funds required to complete clinical trials and supporting research and production efforts necessary to obtain FDA approval for our product candidates; and
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·
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effect of the ongoing qui tam litigation on our stock price, liquidity, and our ability to execute corporate or other transactions, or our ability to continue operations.
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March 31,
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December 31,
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|||||||
2012
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2011
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|||||||
(unaudited)
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||||||||
ASSETS
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||||||||
Current assets
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||||||||
Cash and cash equivalents
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$ | 13,117 | $ | 13,778 | ||||
Other current assets
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532 | 758 | ||||||
Total current assets
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13,649 | 14,536 | ||||||
Furniture and equipment, net
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136 | 160 | ||||||
Total assets
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$ | 13,785 | $ | 14,696 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY
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||||||||
Current liabilities
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||||||||
Accounts payable
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$ | 144 | $ | 77 | ||||
Accrued compensation
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10 | 13 | ||||||
Other accrued liabilities
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2 | 29 | ||||||
Total current liabilities
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156 | 119 | ||||||
Stockholders' Equity
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||||||||
Common Stock $.0005 par value; 100,000,000 shares authorized; 40,885,411 shares in 2012
and 40,775,411shares in 2011 issued and outstanding
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20 | 20 | ||||||
Additional paid-in capital
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189,102 | 189,074 | ||||||
Accumulated deficit ($147,731 at March 31, 2012 and $146,755 at December 31, 2011, accumulated during
development stage period)
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(175,493 | ) | (174,517 | ) | ||||
Total stockholders' equity
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13,629 | 14,577 | ||||||
Total liabilities and stockholders' equity
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$ | 13,785 | $ | 14,696 |
As a Development
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||||||||||||
Three months ended
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Stage Company
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|||||||||||
March 31,
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August 5, 2004 -
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|||||||||||
2012
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2011
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March 31, 2012
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||||||||||
OPERATING EXPENSES
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||||||||||||
General and administrative
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$ | 424 | $ | 1,165 | $ | 30,146 | ||||||
Research and development
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556 | 2,082 | 100,605 | |||||||||
Purchased in-process research and development
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- | - | 34,311 | |||||||||
Other
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- | - | (375 | ) | ||||||||
Total operating expenses
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980 | 3,247 | 164,687 | |||||||||
Interest and other income, net
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(4 | ) | (10 | ) | (13,762 | ) | ||||||
Loss from continuing operations before taxes
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976 | 3,237 | 150,925 | |||||||||
Income tax benefit
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- | - | (1,355 | ) | ||||||||
Loss from continuing operations
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976 | 3,237 | 149,570 | |||||||||
Discontinued operations - net gain on sale of the
bone device business, net of taxes of $267
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- | - | (2,202 | ) | ||||||||
NET LOSS
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$ | 976 | $ | 3,237 | $ | 147,368 | ||||||
Per Share Information:
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||||||||||||
Net loss, basic and diluted
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$ | 0.02 | $ | 0.08 | ||||||||
Basic and diluted shares outstanding
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40,865 | 40,775 |
As a Development
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||||||||||||
Three months ended
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Stage Company
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|||||||||||
March 31,
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August 5, 2004 -
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|||||||||||
2012
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2011
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March 31, 2012
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||||||||||
OPERATING ACTIVITIES
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||||||||||||
Net loss
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$ | (976 | ) | $ | (3,237 | ) | $ | (147,368 | ) | |||
Non cash items:
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||||||||||||
Deferred tax expense
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- | - | 770 | |||||||||
Depreciation and amortization
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24 | 32 | 3,966 | |||||||||
Non-cash stock compensation
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28 | 67 | 4,852 | |||||||||
Gain on sale of bone device business
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- | - | (2,298 | ) | ||||||||
In-process research and development
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- | - | 34,311 | |||||||||
Change in other operating items:
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||||||||||||
Interest, income taxes and other current assets
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226 | 180 | 1,176 | |||||||||
Accounts payable
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67 | 386 | (827 | ) | ||||||||
Accrued liabilities
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(30 | ) | (175 | ) | (3,005 | ) | ||||||
Cash flows used in operating activities
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(661 | ) | (2,747 | ) | (108,423 | ) | ||||||
INVESTING ACTIVITIES
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||||||||||||
Expenditures for furniture and equipment, net
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- | - | (1,044 | ) | ||||||||
Proceeds from sale of assets
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- | - | 7,000 | |||||||||
Cash paid for assets of AzERx/CBI
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- | - | (4,058 | ) | ||||||||
Cash paid for patent assignment rights
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- | - | (650 | ) | ||||||||
Purchases of investments
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- | - | (282,538 | ) | ||||||||
Maturities of investments
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- | - | 340,476 | |||||||||
Cash flows provided by investing activities
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- | - | 59,186 | |||||||||
FINANCING ACTIVITIES
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||||||||||||
Net proceeds from stock option exercises
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- | - | 4,612 | |||||||||
Net proceeds from sale of stock
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- | - | 3,376 | |||||||||
Common stock purchases
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- | - | (1,041 | ) | ||||||||
Cash flows provided by financing activities
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6,947 | |||||||||||
NET DECREASE IN CASH AND CASH EQUIVALENTS
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(661 | ) | (2,747 | ) | (42,290 | ) | ||||||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
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13,778 | 24,387 | 55,407 | |||||||||
CASH AND CASH EQUIVALENTS, END OF PERIOD
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$ | 13,117 | $ | 21,640 | $ | 13,117 | ||||||
Supplemental Disclosure of Non-Cash Investing Activities -
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AzERx and CBI
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|||||||||||
AzERx/CBI Acquisitions:
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||||||||||||
Current assets acquired
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$ | 29 | ||||||||||
Patents acquired
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2,142 | |||||||||||
Liabilities acquired, and accrued acquisition costs
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(457 | ) | ||||||||||
Original investment reversal
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(750 | ) | ||||||||||
In-process research and development acquired
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34,311 | |||||||||||
Common stock issued for acquisition
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(31,217 | ) | ||||||||||
Cash paid for acquisition
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$ | 4,058 |
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OVERVIEW OF BUSINESS
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Description of the Business
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·
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We ceased 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.
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·
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We ceased all activities related to the development of TP508, our other drug candidate, and returned the patent and other intellectual property we own related to TP508 to the original licensor, the University of Texas Medical Branch at Galveston, Texas. We no longer have any interest in or rights to TP508.
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·
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We ceased 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.
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·
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We ceased all activities related to the development of TP508, our other drug candidate, and returned the patent and other intellectual property we own related to TP508 to the original licensor, the University of Texas Medical Branch at Galveston, Texas. We no longer have any interest in or rights to TP508.
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CAPSTONE THERAPEUTICS CORP.
(Registrant)
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Signature
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Title | Date |
/s/ John M. Holliman, III
John M. Holliman, III
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Executive Chairman
(Principal Executive Officer)
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May 10, 2012
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/s/ Les M. Taeger
Les M. Taeger
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Senior Vice President and Chief
Financial Officer
(Principal Financial and Accounting Officer)
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May 10, 2012
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Exhibit No.
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Description
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Incorporated by Reference To:
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Filed Herewith
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31.1
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Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rule 13a-14(a), as amended
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X
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31.2
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Certification of Principal Financial and Accounting Officer Pursuant to Securities Exchange Act Rule 13a-14(a), as amended
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X
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32
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Certification of Principal Executive Officer and Principal Financial and Accounting Officer Pursuant to 18 U.S.C. Section 1350*
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1.
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I have reviewed this quarterly report on Form 10-Q of Capstone Therapeutics Corp.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: May 10, 2012
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1.
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I have reviewed this quarterly report on Form 10-Q of Capstone Therapeutics Corp.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: May 10, 2012
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CONTINGENCY - LEGAL PROCEEDINGS
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3 Months Ended | ||
---|---|---|---|
Mar. 31, 2012
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|||
Commitments and Contingencies Disclosure [Abstract] | |||
Commitments and Contingencies Disclosure [Text Block] |
In April 2009, we became aware of a qui tam complaint that was filed under seal by Jeffrey J. Bierman as Relator/Plaintiff on March 28, 2005 in the United States District Court for the District of Massachusetts against OrthoLogic and other companies that allegedly manufactured bone growth stimulation devices, including Orthofix International N.V., Orthofix, Inc., DJO Incorporated, Reable Therapeutics, Inc., the Blackstone Group, L.P., Biomet, Inc., EBI, L.P., EBI Holdings, Inc., EBI Medical Systems, Inc., Bioelectron, Inc., LBV Acquisition, Inc., and Smith & Nephew, Inc. By order entered on March 24, 2009, the court unsealed the amended complaint. The amended complaint alleges various causes of action under the federal False Claims Act and state and city false claims acts premised on the contention that the defendants improperly promoted the sale, as opposed to the rental, of bone growth stimulation devices. The amended complaint also includes claims against the defendants for, among other things, allegedly misleading physicians and purportedly causing them to file false claims and for allegedly violating the Anti-kickback Act by providing free products to physicians, waiving patients’ insurance co-payments, and providing inducements to independent sales agents to generate business. The Relator/Plaintiff is seeking civil penalties under various state and federal laws, as well as treble damages, which, in the aggregate could exceed the financial resources of the Company.
The United States Government declined to intervene or participate in the case. On September 4, 2009, the Relator/Plaintiff served the amended complaint on the Company. We sold our bone growth stimulation business in November 2003 and have had no further activity in the bone growth stimulation business since that date. We intend, in conjunction with the other defendants, to defend this matter vigorously and believe that at all times our billing practices in our bone growth stimulation business complied with applicable laws. On December 4, 2009, the Company, in conjunction with the other defendants, moved to dismiss the amended complaint with prejudice. In response to that motion, Relator/Plaintiff filed a second amended complaint. On August 17, 2010, the Company, in conjunction with the other defendants, moved to dismiss the second amended complaint with prejudice. That motion was denied by the court on December 8, 2010. On January 28, 2011, we, in conjunction with the other defendants, filed our answer to the second amended complaint. No trial date has been set. Discovery in the case is now open.
Based upon the currently available information, we believe that the ultimate resolution of this matter will not have a material effect on our financial position, liquidity or results of operations. However, because of many questions of law and facts that may arise, the outcome of this litigation is uncertain. If we are unable to successfully defer or otherwise dispose of this litigation, and the Relator/Plaintiff is awarded the damages sought, the litigation would have a material adverse effect on our financial position, liquidity and results of operations and we would not be able to continue our business as it is presently conducted. |
CASH AND CASH EQUIVALENTS
|
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2012
|
|||
Cash and Cash Equivalents [Abstract] | |||
Cash and Cash Equivalents Disclosure [Text Block] |
At March 31, 2012 and December 31, 2011, cash and cash equivalents included money market accounts and commercial paper with original maturities of less than 90 days. |
CONDENSED BALANCE SHEETS (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2012
|
Dec. 31, 2011
|
---|---|---|
ASSETS | ||
Cash and cash equivalents | $ 13,117 | $ 13,778 |
Other current assets | 532 | 758 |
Total current assets | 13,649 | 14,536 |
Furniture and equipment, net | 136 | 160 |
Total assets | 13,785 | 14,696 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Accounts payable | 144 | 77 |
Accrued compensation | 10 | 13 |
Other accrued liabilities | 2 | 29 |
Total current liabilities | 156 | 119 |
Stockholders' Equity | ||
Common Stock $.0005 par value; 100,000,000 shares authorized; 40,885,411 shares in 2012 and 40,775,411shares in 2011 issued and outstanding | 20 | 20 |
Additional paid-in capital | 189,102 | 189,074 |
Accumulated deficit ($147,731 at March 31, 2012 and $146,755 at December 31, 2011, accumulated during development stage period) | (175,493) | (174,517) |
Total stockholders' equity | 13,629 | 14,577 |
Total liabilities and stockholders' equity | $ 13,785 | $ 14,696 |
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OVERVIEW OF BUSINESS
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3 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2012
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||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | OVERVIEW OF BUSINESS
Capstone Therapeutics Corp. is a biotechnology company committed to developing a pipeline of novel peptides and other molecules aimed at helping patients with under-served conditions. We were focused on the development and commercialization of two product platforms: AZX100 and Chrysalin (TP508).
On October 13, 2011, our Board of Directors adopted a plan to preserve cash during our ongoing partnering efforts and effected a reduction from eighteen to four employees.
On January 20, 2012, we announced additional steps we have taken 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. Those steps included:
AZX100 is a novel synthetic 24-amino acid peptide and is believed to have smooth muscle relaxation and anti-fibrotic properties. AZX100 is currently being evaluated for medically and commercially significant applications, such as prevention of hypertrophic and keloid scarring and treatment of pulmonary and peridural fibrosis. We filed an IND for a dermal scarring indication in 2007 and completed Phase 1a and Phase 1b safety clinical trials in dermal scarring in 2008. We commenced Phase 2 clinical trials in dermal scarring following shoulder surgery and keloid scar revision in the first quarter of 2009. During 2010 we completed and reported results for our clinical trials in keloid scar revision and substantially completed our Phase 2 clinical trial in dermal scarring following shoulder surgery. We completed and reported our Phase 2 clinical trial in dermal scarring following shoulder surgery in 2011. We have an exclusive worldwide license to AZX100. In the first quarter of 2012 we ceased 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 are currently focused on development partnering or licensing opportunities for AZX100.
Chrysalin (TP508), a novel synthetic 23-amino acid peptide, is believed to produce angiogenic and other tissue repair effects in part by 1) activating or upregulating endothelial nitric oxide synthase (eNOS); 2) cytokine modulation resulting in an anti-inflammatory effect; 3) inhibiting apoptosis (programmed cell death); and 4) promoting angiogenesis and revascularization. It may have therapeutic value in diseases associated with endothelial dysfunction. We primarily investigated Chrysalin in two indications, fracture repair and diabetic foot ulcer healing. Effective January 17, 2012, we ceased all activities related to the development of Chrysalin. We returned the intellectual property related to TP508 to the University of Texas Medical Branch in March 2012 and we no longer have any interest in or rights to TP508.
We remain a publicly-traded company, subject to the reporting requirements and other regulations of the Securities and Exchange Commission.
Company History
Prior to November 26, 2003, we developed, manufactured and marketed proprietary, technologically advanced orthopedic products designed to promote the healing of musculoskeletal bone and tissue, with particular emphasis on fracture healing and spine repair. Our product lines included bone growth stimulation and fracture fixation devices are referred to as our “Bone Device Business.” On November 26, 2003, we sold our Bone Device Business. Our principal business remains focused on tissue repair, although through biopharmaceutical approaches rather than through the use of medical devices.
On August 5, 2004, we purchased substantially all of the assets and intellectual property of Chrysalis Biotechnology, Inc. (“CBI”), including its exclusive worldwide license for Chrysalin for all medical indications. We became a development stage entity commensurate with the acquisition. Subsequently, our efforts were focused on research and development of Chrysalin with the goal of commercializing our product candidates.
On February 27, 2006, we purchased certain assets and assumed certain liabilities of AzERx, Inc. Under the terms of the transaction, we acquired an exclusive license for the core intellectual property relating to AZX100.
Our development activities for AZX100 and Chrysalin represented a single operating segment as they shared the same product development path and utilized the same Company resources. As a result, we determined that it is appropriate to reflect our operations as one reportable segment. Through March 31, 2012, we have incurred $147 million in net losses as a development stage company.
OrthoLogic Corp. commenced doing business under the trade name of Capstone Therapeutics on October 1, 2008, and we formally changed our name from OrthoLogic Corp. to Capstone Therapeutics Corp. on May 21, 2010.
In these notes, references to “we”, “our”, the “Company”, “Capstone Therapeutics”, “Capstone”, and “OrthoLogic” refer to Capstone Therapeutics Corp. References to our Bone Device Business refer to our former business line of bone growth stimulation and fracture fixation devices, including the OL1000 product line, SpinaLogic®, OrthoFrame® and OrthoFrame/Mayo.
Financial Statement Presentation
In the opinion of management, the unaudited condensed interim financial statements include all adjustments necessary for the fair presentation of our financial position, results of operations, and cash flows, and all adjustments were of a normal recurring nature. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the complete fiscal year.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to Securities and Exchange Commission rules and regulations, although we believe that the disclosures herein are adequate to make the information presented not misleading. These unaudited condensed financial statements should be read in conjunction with the financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011. Information presented as of December 31, 2011 is derived from audited financial statements.
As discussed above, the Company has significantly curtailed its research and development operating activities. The Company has announced that it is in “wind down” mode, meaning that it is not currently planning to initiate any additional human clinical trials in dermal scar reduction with AZX100. Accordingly, the Company reduced its employee count from 18 in October 2011 to four as of December 31, 2011. The remaining employees are focused on completing necessary regulatory and statutory requirements related to prior human clinical studies, as well as maintaining compliance with all applicable public company reporting requirements. The board of directors (also reduced from six to three members) effected this reduction in force to preserve the Company’s cash asset for the benefit of its shareholders. Relating to future corporate strategy, the duration and timing of resolution of the qui tam lawsuit could affect our interest in or ability to: (a) engage in a strategic/merger transaction; (b) restart clinical operations based on a corporate partnering event or other shareholder support for renewing clinical studies; and (c) a liquidating distribution to the shareholders. This uncertainty relating to corporate strategy results in substantial doubt about the Company’s ability to continue as a going concern. These financial statements do not include any adjustments that might result from the outcome of this uncertainty. The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.
Use of Estimates
The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires that management make a number of assumptions and estimates that affect the reported amounts of assets, liabilities, and expenses in our financial statements and accompanying notes. Management bases its estimates on historical experience and various other assumptions believed to be reasonable. Although these estimates are based on management’s assumptions regarding current events and actions that may impact us in the future, actual results may differ from these estimates and assumptions.
Legal and Other Contingencies
As discussed in Part II, Item 1 of this Form 10-Q under the heading “Legal Proceedings” and in Note B, “Contingency – Legal Proceedings” in Notes to Financial Statements, the Company is subject to legal proceedings and claims that arise in the course of business. The Company records a liability when it is probable that a loss has been incurred and the amount is reasonably estimable. There is significant judgment required in both the probability determination and as to whether an exposure can be reasonably estimated. In the opinion of management, there was not at least a reasonable possibility the Company may have incurred a material loss with respect to loss contingencies. However, the outcome of legal proceedings and claims brought against the Company are subject to significant uncertainty. Therefore, if the qui tam legal matter is resolved against the Company in excess of management’s expectations, the Company’s financial statements could be materially adversely affected.
Loss per Common Share
In determining loss per common share for a period, we use weighted average shares outstanding during the period for primary shares and we utilize the treasury stock method to calculate the weighted average shares outstanding during the period for diluted shares. Utilizing the treasury stock method for the three month period ended March 31, 2012, no shares of common stock were determined to be outstanding during the period and excluded from the calculations of diluted loss per share because they would be anti-dilutive. At March 31, 2012, options and warrants to purchase 3,473,352 shares of our common stock, at exercise prices ranging from $0.26 to $7.83 per share, were outstanding. |
CONDENSED BALANCE SHEETS [Parenthetical] (USD $)
In Thousands, except Share data, unless otherwise specified |
Mar. 31, 2012
|
Dec. 31, 2011
|
---|---|---|
Common stock, par value (in dollars per share) | $ 0.0005 | $ 0.0005 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 40,885,411 | 40,775,411 |
Common stock, shares outstanding | 40,885,411 | 40,775,411 |
Accumulated deficit during development stage (in dollars) | $ 147,731 | $ 146,755 |
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DOCUMENT AND ENTITY INFORMATION
|
3 Months Ended |
---|---|
Mar. 31, 2012
|
|
Entity Registrant Name | Capstone Therapeutics Corp. |
Entity Central Index Key | 0000887151 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Smaller Reporting Company |
Trading Symbol | caps |
Entity Common Stock, Shares Outstanding | 40,885,411 |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Mar. 31, 2012 |
Document Fiscal Period Focus | Q1 |
Document Fiscal Year Focus | 2012 |
CONDENSED STATEMENTS OF OPERATIONS (USD $)
In Thousands, except Per Share data, unless otherwise specified |
3 Months Ended | 92 Months Ended | |
---|---|---|---|
Mar. 31, 2012
|
Mar. 31, 2011
|
Mar. 31, 2012
|
|
OPERATING EXPENSES | |||
General and administrative | $ 424 | $ 1,165 | $ 30,146 |
Research and development | 556 | 2,082 | 100,605 |
Purchased in-process research and development | 0 | 0 | 34,311 |
Other | 0 | 0 | (375) |
Total operating expenses | 980 | 3,247 | 164,687 |
Interest and other income, net | (4) | (10) | (13,762) |
Loss from continuing operations before taxes | 976 | 3,237 | 150,925 |
Income tax benefit | 0 | 0 | (1,355) |
Loss from continuing operations | 976 | 3,237 | 149,570 |
Discontinued operations - net gain on sale of the bone device business, net of taxes of $267 | 0 | 0 | (2,202) |
NET LOSS | $ 976 | $ 3,237 | $ 147,368 |
Per Share Information: | |||
Net loss, basic and diluted (in dollars per share) | $ 0.02 | $ 0.08 | |
Basic and diluted shares outstanding (in shares) | 40,865 | 40,775 |
CONDENSED STATEMENTS OF OPERATIONS [Parenthetical] (USD $)
In Thousands, unless otherwise specified |
92 Months Ended |
---|---|
Mar. 31, 2012
|
|
Net gain on sale of the bone device business, net of taxes | $ 267 |