EXHIBIT 99.2
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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
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000-21214
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86-0585310
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(I.R.S. Employer
Identification No.)
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| 1275 West Washington Street, Suite 101, Tempe, Arizona | 85281 | |
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 2.02
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Results of Operations and Financial Condition.
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Item 7.01.
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Regulation FD Disclosure.
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Item 9.01
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Financial Statements and Exhibits.
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(d)
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Exhibits
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Exhibit No.
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Description
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99.1
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Press Release dated March 14, 2013
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99.2
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Capstone Therapeutics Operating Update, March 14, 2013
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| Dated: March 14, 2013 | CAPSTONE THERAPEUTICS CORP. |
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/s/ John M. Holliman, III
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John M. Holliman, III
Executive Chairman
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EXHIBIT 99.1
TEMPE, Ariz., March 13, 2013 (GLOBE NEWSWIRE) -- Capstone Therapeutics (OTCQB:CAPS); (the "Company"), today will hold a conference call and webcast to provide an operating update and 2012 financial results.
Operating Results
We incurred a net loss attributable to Capstone Therapeutics stockholders in 2012 of $3.6 million compared to a net loss of $9.7 million in 2011. The decrease in the net loss for the year ended December 31, 2012 compared to 2011 resulted primarily from the reduction in staff in the fourth quarter of 2011 and other actions taken by the Company to wind down internal operations and move to a virtual operating model. This decrease was partially offset by costs of approximately $139,000 related to the LipimetiX Development, LLC joint venture transaction we entered into on August 3, 2012, and the research and development expenses of LipimetiX Development, LLC, of $1,133,000 (net of intercompany transactions of $50,000) net of the net loss of $473,000 allocated to noncontrolling interest for 2012.
On August 3, 2012, we contributed $6.0 million to the LipimetiX Development, LLC joint venture. For 2012, we used $3.6 million of cash, of which $1.5 million was used by LipimetiX Development, LLC. At December 31, 2012, we had cash and cash equivalents of $10.2 million, of which $4.5 million is held in, and reserved for use by, LipimetiX Development, LLC and unavailable for general use by the Company.
Conference Call Information
Management will hold a conference call and webcast on Thursday, March 14, 2013 at 4:30 pm EDT. The call may be accessed at 877-303-2908 (U.S.), 408-427-3860 (outside U.S.); accompanying slides may be viewed by logging onto the Investors section of the Company's website, www.capstonethx.com. A replay will be available beginning March 14, 2013 at 7:30 pm EDT until midnight March 17, 2013 and may be accessed at 855-859-2056 (U.S.) or 404-537-3406 (outside U.S.) with conference ID 19854610.
About Capstone Therapeutics
Capstone Therapeutics is a biotechnology company committed to developing a pipeline of novel therapeutic peptides aimed at helping patients with under-served medical conditions. The Company is focused on development and commercialization of two product platforms: AZX100 and ApoE Mimetic Peptide Molecule AEM-28 and its analogs (through the LipimetiX Development, LLC joint venture).
AZX100 is a novel synthetic 24-amino acid peptide, one of a new class of compounds in the field of smooth muscle relaxation and fibrosis. AZX100 has been evaluated for commercially significant medical applications such as the prevention or reduction of hypertrophic and keloid scarring and treatment of pulmonary and peridural fibrosis. In the first quarter of 2012 we ceased clinical development of AZX100 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 in dermal scarring, pulmonary fibrosis and peridural fibrosis.
Apolipoprotein E (Apo E) is a 299 amino acid protein that plays an important role in lipoprotein metabolism. AEM-28 is a 28 amino acid mimetic of Apo E that contains a domain that anchors into a lipoprotein surface while also providing the Apo E binding domain that is removed by heparin sulfate receptors in the liver. AEM-28 as an Apo E mimetic has the potential to restore the ability of atherogenic lipoproteins to be cleared from the plasma, completing the reverse cholesterol transport pathway, and thereby reducing cardiovascular risk. This is an important mechanism of action for AEM-28. For patients that lack LDL receptors (Homozygous Familial Hypercholesterolemia, HoFH), have Severe Refractory Hypercholesterolemia, or have acute coronary syndrome, AEM-28 may provide a therapeutic solution.
AEM-28 and its analogs are being developed by our joint venture, LipimetiX Development, LLC. The joint venture's initial development plan is to file an IND and pursue FDA approval of AEM-28 as treatment for Severe Refractory Hypercholesterolemia and Homozygous Familial Hypercholesterolemia (as an Orphan Drug). The initial funded development plan will extend through Phase 1a and 1b/2a clinical trials over an expected twenty-seven month period with a biomarker endpoint test targeting reduction of LDL cholesterol. The joint venture may also fund research or studies to investigate Apo E mimetic molecules, including AEM-28 and analogs, for treatment of acute coronary syndrome.
Capstone's corporate headquarters are in Tempe, Arizona. For more information, please visit the Company's website: www.capstonethx.com.
The Capstone Therapeutics logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5429
Statements in this press release or otherwise attributable to Capstone regarding our business that are not historical facts are forward looking statements 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, 2012, and other documents we file with the U.S. Securities and Exchange Commission
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. | ||
| (A Development Stage Company) | ||
| CONSOLIDATED BALANCE SHEETS | ||
| (in thousands, except share data) | ||
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December 31, 2012 |
December 31, 2011 |
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| ASSETS | ||
| Current assets | ||
| Cash and cash equivalents, $4,499 reserved at December 31, 2012 | $ 10,205 | $ 13,778 |
| Other current assets | 383 | 758 |
| Total current assets | 10,588 | 14,536 |
| Patent license rights, net | 980 | -- |
| Furniture and equipment, net | 23 | 160 |
| Total assets | $ 11,591 | $ 14,696 |
| LIABILITIES AND EQUITY | ||
| Current liabilities | ||
| Accounts payable | $ 233 | $ 77 |
| Accrued compensation | 6 | 13 |
| Other accrued liabilities | 55 | 29 |
| Total current liabilities | 294 | 119 |
| Equity | ||
| Capstone Therapeutics Corp. Stockholders' Equity | ||
| Common Stock $.0005 par value; 100,000,000 shares authorized; 40,885,411 shares in 2012 and 40,775,411 shares in 2011 issued and outstanding | 20 | 20 |
| Additional paid-in capital | 189,181 | 189,074 |
| Accumulated deficit ($150,335 at December 31, 2012 and $146,755 at December 31, 2011, accumulated during development stage period) | (178,097) | (174,517) |
| Total Capstone Therapeutics Corp. stockholders' equity | 11,104 | 14,577 |
| Noncontrolling interest | 193 | -- |
| Total equity | 11,297 | 14,577 |
| Total liabilities and equity | $ 11,591 | $ 14,696 |
| CAPSTONE THERAPEUTICS CORP. | |||
| (A Development Stage Company) | |||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||
| (in thousands, except per share data) | |||
| As a Development | |||
| Years ended December 31, | Stage Company | ||
| August 5, 2004 - | |||
| 2012 | 2011 | December 31, 2012 | |
| OPERATING EXPENSES | |||
| General and administrative | $ 1,764 | $ 3,506 | $ 31,486 |
| Research and development | 2,385 | 6,394 | 102,434 |
| Purchased in-process research and development | -- | -- | 34,311 |
| Other | -- | -- | (375) |
| Total operating expenses | 4,149 | 9,900 | 167,856 |
| Interest and other income, net | (96) | (31) | (13,854) |
| Loss from continuing operations before taxes | 4,053 | 9,869 | 154,002 |
| Income tax benefit | -- | (158) | (1,355) |
| Loss from continuing operations | 4,053 | 9,711 | 152,647 |
| Discontinued operations - net gain on sale of the bone device business, net of taxes of $267 | -- | -- | (2,202) |
| Net Loss | 4,053 | 9,711 | 150,445 |
| Less: Net Loss attributable to the noncontrolling interest | (473) | -- | (473) |
| Net Loss attributable to Capstone Therapeutics Corp. stockholders | $ 3,580 | $ 9,711 | $ 149,972 |
| Per Share Information: | |||
| Net loss, basic and diluted, attributable to Capstone Therapeutics Corp. stockholders | $ 0.09 | $ 0.24 | |
| Basic and diluted shares outstanding | 40,879 | 40,775 | |
| CAPSTONE THERAPEUTICS CORP. | |||||||
| (A Development Stage Company) | |||||||
| CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | |||||||
| (in thousands) | |||||||
| Capstone Therapeutics Corp. Stockholders' Equity | |||||||
| Potentially | Non | ||||||
| Redeemable | Common Stock | Additional | Accumulated | controlling | |||
| Equity | Shares | Amount | Paid in Capital | Deficit | Interest | Total | |
| Balance August 5, 2004 (prior to the acquisition of CBI) | $ -- | 34,550 | $ 17 | $ 146,125 | $ (27,762) | $ -- | $ 118,380 |
| Acquisition of CBI, August 5, 2004 | -- | 3,248 | 2 | 23,451 | -- | -- | 23,453 |
| Acquisition of AzERx, February 27, 2006 | -- | 1,355 | 1 | 7,763 | -- | -- | 7,764 |
| Exercise of common stock options | -- | 997 | -- | 4,579 | -- | -- | 4,579 |
| Stock-based compensation cost | -- | -- | -- | 3,346 | -- | -- | 3,346 |
| Compensation earned on stock awards | -- | 494 | -- | 1,200 | -- | -- | 1,200 |
| Sale of common stock | -- | 1,263 | 1 | 3,375 | -- | -- | 3,376 |
| Common stock purchased and retired | -- | (1,132) | (1) | (1,040) | -- | -- | (1,041) |
| Recognized uncertain tax position | -- | -- | -- | -- | (363) | -- | (363) |
| Reclassification of share-based awards liability | -- | -- | -- | (541) | -- | -- | (541) |
| Recognition of potentially redeemable equity, net of amortization | 15,556 | -- | -- | -- | (15,556) | -- | (15,556) |
| Net loss August 5, 2004 through December 31, 2010 | -- | -- | -- | -- | (136,681) | -- | (136,681) |
| Balance December 31, 2010 | 15,556 | 40,775 | 20 | 188,258 | (180,362) | -- | 7,916 |
| -- | |||||||
| De-recognition of potentially redeemable equity, net of amortization | (15,556) | -- | -- | -- | 15,556 | -- | 15,556 |
| Stock-based compensation cost | -- | -- | -- | 159 | -- | -- | 159 |
| Reclassification of share-based awards liability | -- | -- | -- | 657 | -- | -- | 657 |
| Net loss | -- | -- | -- | -- | (9,711) | -- | (9,711) |
| Balance December 31, 2011 | -- | 40,775 | 20 | 189,074 | (174,517) | -- | 14,577 |
| Formation of Joint Venture | -- | -- | -- | -- | -- | 666 | 666 |
| Stock-based compensation cost | -- | 110 | -- | 107 | -- | -- | 107 |
| Net loss | -- | -- | -- | -- | (3,580) | (473) | (4,053) |
| Balance December 31, 2012 | $ -- | 40,885 | $ 20 | $ 189,181 | $ (178,097) | $ 193 | $ 11,297 |
| CAPSTONE THERAPEUTICS CORP. | |||
| (A Development Stage Company) | |||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
| (in thousands) | |||
| As a | |||
| Development | |||
| Stage Company | |||
| Years Ended December 31, | August 5, 2004 - | ||
| 2012 | 2011 | December 31, 2012 | |
| OPERATING ACTIVITIES | |||
| Net loss | $ (4,053) | $ (9,711) | $ (150,445) |
| Non cash items: | |||
| Deferred tax expense | -- | -- | 770 |
| Depreciation and amortization | 29 | 117 | 3,971 |
| Non-cash stock-based compensation | 107 | 159 | 4,931 |
| Gain on sale of bone device business | -- | -- | (2,298) |
| In-process research and development | -- | -- | 34,311 |
| Change in other operating items: | |||
| Interest, income taxes and other current assets | 375 | (115) | 1,325 |
| Accounts payable | 156 | (169) | (738) |
| Accrued liabilities | 19 | (871) | (2,956) |
| Cash flows used in operating activities | (3,367) | (10,590) | (111,129) |
| INVESTING ACTIVITIES | |||
| Expenditures for furniture and equipment, net | -- | (19) | (1,044) |
| Proceeds from sale of assets | 172 | -- | 7,172 |
| Cash paid for assets of AzERx/CBI | -- | -- | (4,058) |
| Cash paid for patent rights | (378) | -- | (1,028) |
| Purchases of investments | -- | -- | (282,538) |
| Maturities of investments | -- | -- | 340,476 |
| Cash flows provided by (used in) investing activities | (206) | (19) | 58,980 |
| FINANCING ACTIVITIES | |||
| Net proceeds from stock option exercises | -- | -- | 4,612 |
| Net proceeds from sale of stock | -- | -- | 3,376 |
| Common stock purchases | -- | -- | (1,041) |
| Cash flows provided by financing activities | -- | -- | 6,947 |
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (3,573) | (10,609) | (45,202) |
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 13,778 | 24,387 | 55,407 |
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ 10,205 | $ 13,778 | $ 10,205 |
| Supplemental Disclosure of Non-Cash Investing Activities - | LipimetiX | LipimetiX/AzERx/CBI | |
| LipimetiX/AzERx/CBI Acquisitions: | |||
| Current assets acquired | $ -- | $ 29 | |
| Patent rights acquired | 1,045 | 3,187 | |
| Liabilities acquired, and accrued acquisition costs | -- | (457) | |
| Original investment reversal | -- | (750) | |
| In-process research and development acquired | -- | 34,311 | |
| Noncontrolling interest | (667) | (667) | |
| Common stock issued for acquisition | -- | (31,217) | |
| Cash paid | $ 378 | $ 4,436 | |
CONTACT: FOR FURTHER INFORMATION:
Investor Relations
(602) 286-5250
investorinquiries@capstonethx.com