BRTX 10-K & 10-Q changes, risk factors and insider trading
BioRestorative Therapies, Inc. · Nasdaq · Services-Misc Health & Allied Services, Nec · CIK 1505497 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “In the event that we are unable to utilize our current premises and need to relocate, we will be required to comply with regulatory requirements as to the operation of our laboratory, which could have had a material adverse effect on the conduct of our clinical trials and on our business.”
New heading “Our common stock is classified as a “penny stock;” the restrictions of the penny stock regulations of the SEC may result in less liquidity for our common stock.”
New heading “Our failure to meet the continued listing standards of Nasdaq could result in a delisting of our common stock.”
Removed heading “Risks Relating to Late Filing of our Periodic Report”
Removed heading “Risks Relating to Late Filing of our Periodic Report”
Removed heading “Our failure to prepare and timely file our Quarterly Report on Form 10-Q for the period ended March 31, 2024 with the SEC limits our access to the public markets to raise debt or equity capital for a period of time.”
Largest changes
“Our common stock is classified as a “penny stock;” the restrictions of the penny stock regulations of the SEC may result in less liquidity for our common stock.”see in full comparison
“Our failure to meet the continued listing standards of Nasdaq could result in a delisting of our common stock.”see in full comparison
“The SEC has adopted regulations which define a “penny stock” to be any equity security that has a market price (as therein defined) of less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Unless exempt, the rules require the delivery, prior to any transaction involving a penny stock by a retail customer, of a disclosure schedule prepared by the SEC relating to the penny stock market. …”see in full comparison
“Delisting from the Nasdaq Capital Market may adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our securities and may negatively affect the value and liquidity of our common stock. Delisting also could have other negative results, including the potential loss of institutional investors or interest in business development opportunities.”see in full comparison
“In the event that we are unable to utilize our current premises and need to relocate, we will be required to comply with regulatory requirements as to the operation of our laboratory, which could have had a material adverse effect on the conduct of our clinical trials and on our business.”see in full comparison
“Our failure to prepare and timely file our Quarterly Report on Form 10-Q for the period ended March 31, 2024 with the SEC limits our access to the public markets to raise debt or equity capital for a period of time.”see in full comparison
Full comparison: every changed paragraph (37)
Risks
Relating to Late Filing of our Periodic Report
We
have a limited operating history. Since our inception, we have incurred net losses. As of December 31, 2024,2025, our accumulated deficit
was $155,678,715.$169,920,690. Our consolidated financial statements as of December 31, 20242025 and 20232024 and for the years then ended which are included
in this Annual Report following Item 16 (“Form 10-K Summary”) have been prepared on the basis that we will continue as a
going concern, which contemplates realization of assets and satisfying liabilities in the normal course of business. For the year ended
December 31, 2024,2025, we had a net loss of $9.0$14.2 million and a negative cash flows from operations of $8.2$10.8 million and as of December 31,
2024,2025, we had a working capital deficit of $7.4$0.6 million. We anticipate that we will continue to incur net losses and negative cash flows
from operations
as we execute our development plans for 20252026 and beyond, as well as other potential strategic and business development
initiatives. These
conditions raise substantial doubt about our ability to continue as a going concern for at least twelve months after
the issuance date
of the financial statements included herein. Our current funds will not be sufficient to fund our development efforts for the twelve months following the issuance
date of such financial statements or enable us to fully complete
our development
activities or attain profitable operations. If we are unable to obtain such needed additional financing on a timely basis,
we may have
to curtail our development, marketing and promotional activities, which would have a material adverse effect on our business,
financial financial
condition and results of operations, and ultimately we could be forced to discontinue our operations and liquidate. The report
of our
independent registered public accounting firm with respect to our financial statements as of December 31, 2024 and 20232025 and for
the years
year then ended indicates that our financial statements have been prepared assuming that we will continue as a going concern. The
report states
that, as of December 31, 20242025 there is substantial doubt about our ability to continue as a going concern within one year
after the issuance
date of such financial statements. Our plans in regard to these matters are described in footnote 1 to such financial
statements. Our
financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Except
for a certain license agreement with Regenerative Sciences, LLC, a product manufacturing agreement with Cartessa Aesthetics, LLC,LLC and agreements relating
to the conduct of our Phase 2 clinical trial,
we do not have any material agreements or understandings in place with respect to the implementation
of our business strategy. No assurances
can be given that we will be able to enter into any necessary agreements with respect to the
development of our business. Our inability
to enter into any such agreements would have a material adverse effect on our results of operations
and financial condition.
Our
performance is substantially dependent on the performance of Lance Alstodt, our Chief Executive Officer. We rely upon him for
strategic strategic
business decisions and guidance. We are also dependent on the performance of Francisco Silva, our Vice President of
Research and Development.
Each The employment agreement for each of Messrs. Alstodt and Silva isexpired subjectin toMarch an2026 employmentand agreementhas withnot us.yet been
extended. We do not have any key-man insurance policies on the
lives of either of our executive officers. We believe that our future
success in developing marketable products and services and achieving
a competitive position will depend in large part upon whether
we can attract and retain additional qualified management and scientific
personnel. Competition for such personnel is intense, and
there can be no assurance that we will be able to attract and retain such personnel.
The loss of the services of Mr. Alstodt and/or
Mr. Silva or the inability to attract and retain additional personnel and develop expertise
as needed would have a substantial
negative effect on our results of operations and financial condition.
In the event that we are unable to utilize our current premises and need to relocate, we will be required to comply with regulatory requirements as to the operation of our laboratory, which could have had a material adverse effect on the conduct of our clinical trials and on our business.
We are utilizing our laboratory, which includes a cGMP ISO-7 certified clean room, to provide the cell processing services necessary for the clinical production of BRTX-100 for our Phase 2 disc clinical trial and to manufacture our commercial product. In the event that we are required to relocate our premises, whether due to a casualty event or otherwise, we will be required to comply with regulatory requirements as to the operation of our laboratory which could have a material adverse effect on the conduct of our clinical trials and on our business.
Risks
Relating to Late Filing of our Periodic Report
Our
failure to prepare and timely file our Quarterly Report on Form 10-Q for the period ended March 31, 2024 with the SEC limits our access
to the public markets to raise debt or equity capital for a period of time.
We
filed our Quarterly Report on Form 10-Q for the period ended March 31, 2024 with the SEC late on June 11, 2024; therefore, at such time,
we were not current in our reporting requirements with the SEC. We are not currently eligible, without receiving a waiver from the SEC,
to register our securities pursuant to a short-form registration statement on Form S-3 or a “shelf” registration statement
until June 2025. After such date, we must maintain status as a current filer. If we wish to pursue an offering now, we would be required
to conduct the offering on an exempt basis or file a registration statement on Form S-1. Using a Form S-1 registration statement for
a public offering could take significantly longer than using a registration statement on Form S-3 and increase our transaction costs,
and could, to the extent we are not able to conduct offerings using alternative methods, adversely impact our ability to raise capital
or complete acquisitions of other companies in a timely manner.
We
are dependent upon the successful development, approval and commercialization of our product candidates. Before we are able to seek regulatory
approval of our product candidates, we must conduct and complete extensive clinical trials to demonstrate their safety and efficacy in
humans. OurWe leadare productcurrently candidate, BRTX-100, is in early stages of development and we have just recently commencedconducting a Phase 2
clinical trial using BRTX-100 to treat chronic lower back pain due to degenerative
disc disease related to protruding/bulging
discs.
We
anticipate that we will not be able to commercialize our BRTX-100 product candidate for at least five years.years; however, due to the
unknowns relating to the FDA regulatory process, such time period may be longer or shorter.
We
have just recently commenced the clinical trials necessary to obtain FDA approval to market our product candidate, BRTX-100. Since
we lack significant experience in completing clinical trials and bringing a drug through commercialization, we have hired outside consultants
with such experience. Clinical trials for BRTX-100 and other product candidates in development may be delayed or terminated as
a result of many factors, including the following:
The recent extensive use of both FDA-approved and compounded version of glucagon-like peptide-1 (GLP-1) receptor agonist drug products, such as Wegovy and Ozempic (semaglutide), including the launch of FDA-approved oral Wegovy in January 2026, for the treatment of obesity has significantly increased the competition in the obesity market.
The
enactment of the Biologics Price Competition and Innovation Act of 2009, or BPCIA, created an abbreviated regulatory pathway for the
approval of products demonstrated to be biosimilar, or “highly similar,” to or “interchangeable” with an FDA-approved
innovator (original) biologic product. The abbreviated regulatory pathway establishes legal authority for the FDA to review and approve
biosimilar biologics, including the possible designation of a biosimilar as “interchangeable” based on its similarity to
an existing reference product. Under the BPCIA, an application for a biosimilar product cannot be approved by the FDA until 12 years
after the original branded product is approved under a biologics license application, or BLA. The FDA has developed considerable experience
with the biosimilar and interchangeable
biosimilar processes since the enactment of the BPCIA in 2009. Should any of our product candidates
be approved via the BLA pathway,
we expect that biosimilar applicants will seek approval of biosimilar, and/or interchangeable, versions
of our product that could result
in lower prices for our products.
We
may also face increased competition from unapproved stem cell therapies performed by treatment centers that do not requirecomply with FDA premarketrequirements.
Despite approval.
InFDA’s Augustsuccessful 2022,enforcement aagainst federalunapproved Districtstem Courtcell treatments in the casefederal ofcourts (United States v. Regenerative
Sciences, LLC (2014 D.C. Cir.), United States v. U.S. Stem Cell Clinic LLC (2021 11th Cir.) and United States
v. California Stem Cell Treatment Center, Inc. held(2024 that9th Cir. cert. denied) thousands of clinics continue to offer
certain autologous adiposeunapproved stem cell treatmentstherapies weredue notto “biologicalhigh products”demand, FDA enforcement limitations, and thereforetactical didrebranding notto requireavoid FDA approval.enforcement action.
TheFDA decision was reversed bylacks the U.S.resources Courtto bring enforcement actions against thousands of Appealsindividual forsmall-office theclinics Ninthsimultaneously. Circuit, but may be appealed to the U.S. Supreme Court. Should itTherefore,
be reversed by the Supreme Court, we could face competition from stem cell clinics that would not be required to undergo the costly and
time-consuming FDA approval and
compliance process.
We
rely on information technology systems to keep financial records, maintain laboratory and corporate records, communicate with staff and
external parties and operate other critical functions. Any significant degradation or failure of these computer systems could cause us
to inaccurately calculate or lose data. Despite the implementation of security measures, these internal computer systems and those used
by our clinical investigators, clinical research organizations, and other contractors and consultants are vulnerable to damage from computer
viruses, unauthorized access, natural disasters, terrorism, war, and telecommunication and electrical failures. The techniques that could
be used by criminal elements or foreign governments to attack these computer systems are sophisticated, change frequently and may originate
from less regulated and remote areas of the world. While we have not experienced any such system failure, theft of information, accident
or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption
of our clinical development activities. For example, the loss of clinical trial data from historical or future clinical trials could
result in delays in regulatory approval efforts and significantly increase costs to recover or reproduce the data. To the extent that
any disruption, theft of information, or security breach were to result in a loss of or damage to data or applications, or inappropriate
disclosure of confidential or proprietary information, we could incur liability and the clinical development and the future development of
of our product candidates could be delayed.
We
manufacturemanufactured a commercial product as a contract manufacturer for a third-party company, Cartessa.company. While we believe the product we manufacturemanufactured
for Cartessathe isthird party was intended for cosmetic uses, we (as the contract manufacturer) dodid not ultimately have control over how the product
was is
marketed. It is possible that the FDA could determine, based on how the product iswas marketed (among other considerations), that it
was is
intended for unapproved therapeutic use(s), which could result in the temporary or permanent suspension of manufacturing and/or commercialization
of the product and/or a wide range of enforcement actions, such as warning letters, recall, ‘dear doctor’ letters, and others.
If the FDA takes enforcement action against Cartessathe third party or us in connection with this product, or against others for whom we may
serve in the future as a contract manufacturer, it could have an adverse impact on our operations
and/or harm our reputation as a biologics
company.
Our common stock is listed on Nasdaq. However, no assurance can be given that an active market for our common stock will be sustained. In addition, although there have been market makers in our common stock, we cannot assure that these market makers will continue to make a market in our securities or that other factors outside of our control will not cause them to stop market making in our securities. Making a market in securities involves maintaining bid and ask quotations and being able to effect transactions in reasonable quantities at those quoted prices, subject to various securities laws and other regulatory requirements. Furthermore, the development and maintenance of a public trading market depends upon the existence of willing buyers and sellers, the presence of which is not within our control or that of any market maker. Market makers are not required to maintain a continuous two-sided market, are required to honor firm quotations for only a limited number of securities, and are free to withdraw firm quotations at any time. Even with a market maker, factors such as our past losses from operations and the small size of our company mean that there can be no assurance of an active and liquid market for our securities developing in the foreseeable future. Even if there is a market for our securities, we cannot assure that securityholders will be able to resell their securities at any price. See “Risks Associated with Our Nasdaq Listing.”
We
currently have authorization to issue up to 75,000,000 shares of common stock of which, as of March 26,23, 2025,2026, 7,504,78025,478,170 shares were
issued issued
and outstanding. InUntil addition,May as2026, discussed in Item 1 (“Business – Business Development – Material Events During 2024”),
we arewill obligated to issue an additional 1,138,055 shares of common stock. We are notbe restricted from issuing additional shares of our
common stock in the future,
including securities convertible into, or exchangeable or exercisable for, shares of our common stock.stock, In
addition,subject there are 1,398,158 shares of Series B preferred stock issued and outstanding. Such shares are convertible underto certain
exceptions. circumstances
intoBeginning anin equalMay number2026, ofwe shareswill ofno commonlonger stock.be so restricted.
Pursuant
to our November 2021 public offering of securities, we issued warrants for the purchase of an aggregate of 2,645,000 shares of
common common
stock (of which warrants for the purchase of an aggregate of 1,675,000 shares of common stock have been exercised and warrants for the purchase of 970,000 shares of common stock remain outstanding) as well
as underwriter
warrants for the purchase of 235,970 shares of common stock. We have an effective registration statement on Form S-3
under the Securities
Act registering the issuance of such shares. The shares issuable pursuant to the registration statement on Form
S-3 will be freely tradable
in the public market, except for shares held by affiliates. In addition, in connection with the public
offering and pursuant to exchange
agreements entered into with holders of convertible notes and warrants, we issued an aggregate of
313,789 shares of common stock and
warrants for the purchase of an aggregate of 1,856,938 shares of common stock (of which warrants
for the purchase of an aggregate of
1,676,580 shares of common stock have been exercised). The shares of common stock issued to such
holders are eligible for resale in the
open market (subject to Rule 144 volume limitations applicable to affiliates), potentially
causing sales in the market to increase and
our stock price to decline. We have registered the resale of the shares of common stock
issuable upon exercise of such warrants. The
issuance of shares of common stock upon exercise of the above warrants would dilute the ownership of our stockholders.
In
addition, in February 2024, in connection with thecertain warrant exercises discussed in Item 1 (“Business – Business Development
– Material Events During 2024”),exercises, we issued warrants for the purchase of an aggregate of 2,513,686
shares of common stock.
We have registered the resale of the shares of common stock underlying such warrants. The issuance of shares of common stock upon exercise
of the above warrants would dilute the ownership of our stockholders.
We
also have effective registration statements on Form S-8 under the Securities Act registering an aggregate of 6,850,0009,850,000 shares of our
common stock issuable under our 2021 Stock Incentive Plan, or the 2021 Plan (of which 319,797349,046 shares have been issued). As of March
23, 27,
2025,2026, options to purchase 5,237,9735,229,325 shares of our common stock were outstanding under the 2021 Plan and 4,271,629 shares of our common stock were available for grant under the 2021 Plan. The shares issued and
issuable pursuant
to the registration statements on Form S-8 will be freely tradable in the public market, except for shares held by
affiliates. We may
include a resale prospectus in a registration statement on Form S-8 with regard to the 2021 Plan covering the
resale of the shares issuable
to Messrs. Alstodt and Silva (and other affiliates) upon their exercise of options held by them and
shares issued to them upon the vesting
of restricted stock units, or RSUs, issued to them. The resale of such shares will be
currently subject to the volume limitations imposed
by Rule 144.
We also have an effective registration statement on Form S-1 with regard to the resale of up to 508,592 shares of our common stock issuable upon the exercise of warrants.
Pursuant to our February 2026 public offering of securities, we issued warrants for the purchase of an aggregate of 14,285,715 shares of common stock, pre-funded warrants for the purchase of an aggregate of 1,725,000 shares of common stock (all of which have been exercised) and placement agent warrants for the purchase of 1,000,000 shares of common stock. We have an effective registration statement on Form S-1 under the Securities Act registering the issuance of such shares. The shares issuable pursuant to the registration statement on Form S-1 will be freely tradable in the public market, except for shares held by affiliates.
As of March 23, 2026, there were outstanding in the aggregate (i) warrants to purchase up to 19,780,753 shares of our common stock at a weighted average exercise price of $1.39 per share; and (ii) options to purchase up to 5,229,325 shares of our common stock at a weighted average exercise price of $2.58 per share. The issuance of shares of common stock upon the exercise of the above warrants and options would dilute the ownership of our stockholders.
Further,
we have an effective shelf registration statement on Form S-3 under the Securities Act registering $75,000,000 of our equity and debt
securities. Pursuant to the requirements of Form S-3, we currently may sell pursuant to such Form S-3, during any 12 month period, securities
having an aggregate market value of no more than one-third of the aggregate market value of the shares of our common stock held by non-affiliates.
The
sale of a substantial number of shares of our common stock or securities convertible into, or exchangeable or exercisable for,
shares shares
of our common stock, whether directly by us in future offerings or by our existing stockholderssecurityholders in the secondary market,
the perception
that such issuances or resales could occur or the availability for future issuances or resale of shares of our common
stock or securities
convertible into, or exchangeable or exercisable for, shares of our common stock could materially and adversely
affect the market price
of our securities and our ability to raise capital through future offerings of equity or equity-related
securities on attractive terms
or at all.
Our common stock is classified as a “penny stock;” the restrictions of the penny stock regulations of the SEC may result in less liquidity for our common stock.
The SEC has adopted regulations which define a “penny stock” to be any equity security that has a market price (as therein defined) of less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Unless exempt, the rules require the delivery, prior to any transaction involving a penny stock by a retail customer, of a disclosure schedule prepared by the SEC relating to the penny stock market. Disclosure is also required to be made about commissions payable to both the broker/dealer and the registered representative and current quotations for the securities. Finally, monthly statements are required to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. The market price for shares of our common stock is currently below $5.00 and we do not satisfy any of the exceptions to the SEC’s definition of penny stock. Accordingly, our common stock is currently classified as a penny stock. As a result of the penny stock restrictions, brokers or potential investors may be reluctant to trade in our securities, which may result in less liquidity for our shares.
We
are incorporated in Nevada. Anti-takeover provisions in Nevada law and our articles of incorporation and bylaws could make it more
difficult difficult
for a third party to acquire control of us and may prevent stockholders from receiving a premium for their securities. Our
certificate certificate
of incorporation provides that our Board of Directors may issue up to 20,000,000 shares of preferred stock,stock (less the
1,398,158 shares of preferred stock previously issued), in one or more series, without
stockholder approval and with such terms,
preferences, rights and privileges as the Board of Directors may deem appropriate. Of such
20,000,000 authorized shares, 1,398,158No shares of Series B preferred stock are currently issued
and outstanding. These provisions and other factors
may hinder or prevent a change in control, even if the change in control would
be perceived as beneficial to, or sought by, our other
stockholders.
We
cannot assure you that we will be able to continue to comply with the minimum bid price requirement of Nasdaq.
Although
the market price of our common stock satisfied the initial listing minimum bid price requirement for Nasdaq, there can be no assurance
that the market price of our common stock will increase to, or remain atat, the $1.00 per share level required for continuing compliance
with that requirement.
There are many factors, such as negative financial or operational results, that could adversely affect the market
price of our common
stock and jeopardize our ability to maintain Nasdaq’s minimum bid price requirement. On March 23, 2026, the
last reported sale price of our common stock was $0.33 per share.
Our failure to meet the continued listing standards of Nasdaq could result in a delisting of our common stock.
On March 26, 2026, we received a notice from Nasdaq notifying us that, because the closing bid price for our shares of common stock was less than $1.00 per share for 30 consecutive business days, we were no longer in compliance with the minimum bid price requirement for continued listing on Nasdaq. Rule 5550(a)(2) of Nasdaq’s Marketplace Rules, or the Nasdaq Rules, requires listed securities to maintain a minimum bid price of $1.00 per share, and Rule 5810(c)(3)(A) of the Nasdaq Rules provides that a failure to meet the minimum bid price requirement exists if the deficiency continues for a period of 30 consecutive business days.
Pursuant to Rule 5810(c)(3)(A) of the Nasdaq Rules, we have been provided an initial compliance period of 180 calendar days, or until September 22, 2026, to regain compliance with the minimum bid price requirement. If we do not regain compliance with the minimum bid price requirement by September 22, 2026, we may be afforded a second 180 calendar day grace period. To qualify, we would be required to meet the continued listing requirements for market value of publicly held shares and all other standards for initial listing on the Nasdaq Capital Market, with the exception of the minimum bid price requirement. In addition, we would be required to provide written notice of our intention to cure the minimum bid price deficiency during this second 180-day compliance period by effecting a reverse stock split, if necessary.
If it appears to the staff of Nasdaq that we will not be able to cure the deficiency in connection with the minimum bid price requirement, or if we are otherwise not eligible for the additional compliance period, and we do not regain compliance by September 22, 2026 for the minimum bid price requirement, Nasdaq will provide written notification to us that our shares of common stock are subject to delisting. At that time, we may appeal the delisting determination to a hearings panel pursuant to the procedures set forth in the applicable Nasdaq Rules.
Delisting from the Nasdaq Capital Market may adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our securities and may negatively affect the value and liquidity of our common stock. Delisting also could have other negative results, including the potential loss of institutional investors or interest in business development opportunities.
Management's Discussion & Analysis (MD&A)
New heading “Public Offerings”
Removed heading ““At-the-Market” Offering”
Removed heading “Warrant Exercises”
Largest changes
We are currently pursuing our Disc/Spine Program with our initial investigational therapeutic product being called BRTX-100. In March 2022, a United States patent issued in our Disc/Spine Program. Wesee in full comparisonhavearereceivedconductingauthorization from the FDA to commencea Phase 2 clinical trial investigating the use of BRTX-100 in the treatment of chronic lower back pain arising from degenerative disc disease.We have commenced such clinical trial through the execution of a CRO agreement with PRC Clinical, the execution of clinical trial site agreements, patient enrollment, the commencement of patient procedures, the purchase of manufacturing equipment and the expansion of our laboratory to include capabilities for clinical production.We have obtained an exclusive license to use technology for investigational adult stem cell treatment of disc and spine conditions, including protruding and bulging lumbar discs. The technology is an advanced stem cell injection procedure that may offer relief from lower back pain, buttock and leg pain, and numbness and tingling in the leg and foot.
“In April 2023, we entered into a Capital on Demand Sales Agreement with JonesTrading Institutional Services LLC, or JonesTrading, under which we had the ability to issue and sell shares of our common stock, from time to time, through JonesTrading, up to an aggregate offering price of approximately $6,109,000 in what is commonly referred to as an “at-the-market”, or ATM, program. …”see in full comparison
“In November 2024, we entered into an At The Market Offering Agreement with Rodman, under which we currently have the ability to issue and sell shares of our common stock, from time to time, through Rodman, up to an aggregate offering price of approximately $3,614,000 in an ATM, program. Subsequent to the year ended December 31, 2024, we sold 492,000 shares of our common stock under the ATM program with Rodman at a weighted-average gross price of approximately $2.20 per share and raised approximately $1,084,000 of gross proceeds. …”see in full comparison
Full comparison: every changed paragraph (41)
We
are currently pursuing our Disc/Spine Program with our initial investigational therapeutic product being called BRTX-100.
In March 2022, a United States patent issued in our Disc/Spine Program. We haveare receivedconducting authorization from the FDA to commence
a Phase 2 clinical trial investigating
the use of BRTX-100 in the treatment of chronic lower back pain arising from degenerative
disc disease. We have commenced such clinical trial through the execution of a CRO agreement with PRC Clinical, the execution of clinical
trial site agreements, patient enrollment, the commencement of patient procedures, the purchase of manufacturing equipment and the expansion
of our laboratory to include capabilities for clinical production. We have obtained an exclusive
license to use technology for investigational
adult stem cell treatment of disc and spine conditions, including protruding and bulging
lumbar discs. The technology is an advanced
stem cell injection procedure that may offer relief from lower back pain, buttock and leg
pain, and numbness and tingling in the leg
and foot.
We
are also developing our ThermoStem Program. This pre-clinical program involves the use of brown adipose (fat) in connection with
the cell-based treatment of type 2 diabetes and obesity as well as hypertension, other metabolic disorders and cardiac deficiencies.
United States patents related to the ThermoStem Program were issued in September 2015, January 2019, March 2020, March 2021, July
2021, June 2023 and December 2023; Australian patents related to the ThermoStem Program were issued in April 2017, October 2019
and August 2021; Japanese patents related to the ThermoStem Program were issued in December 2017, June 2021, February 2022 June
2023, and July 2024 and September 2025; Israeli patents related to our ThermoStem Program were issued in October 2019, May 2020, March
2022 and March 2025; and
European patents related to the ThermoStem Program were issued in April 2020, January 2021, July 2023
and FebruaryMarch 2025.
We
operate a commercial biocosmeceutical platform. Our current commercial product, formulated and manufactured as a third party contract manufacturer using our cGMP ISO-7 certified
clean room, is a cell-based secretome containing exosomes, proteins and growth factors.
This proprietary biologic serum has been specifically
engineered by us to reduce the appearance of fine lines and wrinkles and bring
forth other areas of cosmetic effectiveness. Moving forward,
we also intend to explore the potential of expanding our commercial
offering to include a broader family of cell-based biologic aesthetic
products and therapeutics via IND-enabling studies, with the
aim of pioneering FDA approvals in the emerging biocosmeceuticals space.
In
April 2023, we entered into a Capital on Demand Sales Agreement with JonesTrading Institutional Services LLC, or JonesTrading, under
which we had the ability to issue and sell shares of our common stock, from time to time, through JonesTrading, up to an aggregate offering
price of approximately $6,109,000 in what is commonly referred to as an “at-the-market”, or ATM, program. During the year
ended December 31, 2023, we sold 132,827 shares of our common stock under the ATM program with JonesTrading at a weighted-average gross
price of approximately $4.68 per share and raised approximately $622,000 of gross proceeds. The total commissions and related legal fees
were approximately $127,000, and we received net proceeds of approximately $495,000. No shares were sold during the year ended December
31, 2024 pursuant to the ATM program with JonesTrading. In connection with the ATM program with Rodman & Renshaw, LLC, or Rodman,
discussed below, in November 2024, we terminated the Capital on Demand Sales Agreement with JonesTrading.
In
July 2023, we sold an aggregate of 685,033 shares of our common stock in a registered direct public offering. We received net proceeds
of approximately $1,854,000 from the offering.
In
November 2024, we entered into an At The Market Offering Agreement with
Rodman & Renshaw, LLC, or Rodman, under which we currently havehad the ability to issue and
sell shares of our common stock, from time to time,
through Rodman, up to an aggregate offering price of approximately $3,614,000 in
an ATM program. Subsequent toDuring the year ended December 31, 2024, 2025,
we sold 492,000965,424 shares of our common stock under the ATM program with
Rodman at a weighted-average gross price of approximately $2.20 $2.08
per share and raised approximately $1,084,000$2.0 million of gross proceeds. The
total commissions and related legal fees were approximately $178,000, and weWe received net proceeds of approximately $906,000.$1.8 Asmillion. ofWe March
24,currently 2025,may we had remaining capacity tonot sell upany to an additional $2,530,000shares of common stock under the ATM program
with Rodman.
In October 2025, we sold 678,125 shares of our common stock in a registered direct offering. We received net proceeds of approximately $0.9 million from the offering.
In February 2026, we sold 12,560,715 shares of our common stock, pre-funded warrants to purchase 1,725,000 shares of our common stock (which have been exercised in full) and warrants for the purchase of 14,285,715 shares of our common stock in a public offering. We received net proceeds of approximately $4.5 million from the offering.
For
the year ended December 31, 2024,2025, we had a net loss of $9.0$14.2 million and negative cash flows from operations of $8.2$10.8 million andand, as
of of
December 31, 2024,2025, we had a working capital deficit of $7.4$0.6 million. We anticipate that we will continue to incur net losses and negative
cash cash
flows from operations as we execute our development plans for 20252026 and beyond, as well as other potential strategic and business
development development
initiatives. These conditions raise substantial doubt about our ability to continue as a going concern for at least twelve
months after
the issuance date of the financial statements included in this Annual Report. We will require significant additional funding
to complete
our clinical trials using BRTX-100. We will require a substantial amount of additional funding to implement our other
programs programs
as discussed in this Annual Report under the caption Item 1 (“Business”), including our metabolic ThermoStem
Program, Program,
and fund general operations. No assurance can be given that the amount of funding that we anticipate may be required for
such purposes
is correct or that we will be able to accomplish our goals within the timeframes projected. In addition, no assurance can
be given that
we will be able to obtain any required financing on commercially reasonable terms or otherwise.
For
the years ended December 31, 20242025 and 2023,2024, we generated $401,000$59,700 and $145,800,$101,000, respectively, of royalty revenue in connection with our
sublicense agreement andwith salesthe revenuestem cell treatment company. The decrease was primarily due to a decrease in connectiondisc with our cosmeceuticals business.procedures.
For each of the years ended December 31, 2025 and 2024, we generated $300,000 of cosmetic product sales revenue in connection with our supply agreement with Cartessa Aesthetics, LLC.
Research
and development expenses include cash and non-cash compensation of (a) our Vice President of Research and Development; (b) our Scientific
Advisory Board members; and (c) laboratory staff and costs related to our brown fat and disc/spine initiatives. Research and development
expenses are expensed as they are incurred. For the year ended December 31, 2024,2025, research and development expenses increased by $1,314,118,$3,387,758,
or 33%,51%, to $5,348,709$10,094,671 compared to $4,034,591$6,706,913 for the year ended December 31, 2023.2024. The increase was primarily driventhe byresult headcountof an increase
in recruitment and other costs
for our Phase 2 clinical trial of $323,025$2,682,474, andan increase of general lab supplies expense of $1,041,952,$485,166,
and an increase in stock-based compensation expense of $165,849, partially offset by thea reversaldecrease in bonus expense of $33,996 and a 2023decrease
in bonusheadcount accrualcosts of $257,873.$9,851.
General
and administrative expenses consist primarily of salaries, bonuses, payroll taxes and stock-based compensation to employees (excluding
any cash or non-cash compensation of our Vice President of Research and Development and our laboratory staff), as well as corporate expenses
such as legal and professional fees, investor relations and occupancy related expenses. For the year ended December 31, 2024,2025, general
and administrative expenses decreasedincreased by $4,752,570,$667,108, or 42%13%, to $6,579,413$5,888,317 from $11,331,983$5,221,209 for the year ended December 31, 2023.2024. The increase
decrease was primarily driven by aan decreaseincrease in stock-based compensation expense of $4,970,401$347,212, andan a decreaseincrease in headcount costs of $111,363,$212,274, an increase
offsetin byconsulting expense of $130,453, and an increase in professional fees of $229,273.$31,241.
We
expect that our general and administrative expenses related to operations will continue to increase as we expand our staff, develop our
infrastructure infrastructure
and incur additional costs to support the growth of our business.
Interest
incomeincome, net
For the year ended December 31, 2025, interest income, net of interest expense decreased $349,870, or 57%, to $266,207 from $616,077 for the year ended December 31, 2024. The change was primarily due to a decrease in interest income from the investments held in marketable securities due to a lower average balance of the marketable securities during 2025 as compared to 2024.
For
the year ended December 31, 2024, interest income increased $63,784, or 12%, to $616,077 from $552,293 for the year ended December 31,
2023. The increase was due to the interest and dividend income of the investments held in marketable securities.
Grant
income
There
was no grant income for the year ended December 31, 2024. Grant income of $83,333 during the year ended December 31, 2023 consisted of
funding received under a National Institutes of Health Small Business Technology Transfer (STTR) Phase 1 grant, offset by related expenses.
For the year ended December 31, 2025, other income decreased $133,402, or 88%, to $17,448 from $150,850 for the year ended December 31, 2024. The change was primarily due to a one-time payment received in the 2024 period in connection with the development of our biocosmeceuticals product line.
For
the year ended December 31, 2024, other income of $150,850 primarily related to investment dividend income and other miscellaneous income.
For the year ended December 31, 2023, other income of $169,664 primarily related to an Employee Retention Tax Credit, gains from settlements
of certain accrued expenses and realized and unrealized gain on investments.
For the year ended December 31, 2024, we recognized a gain on exchange of warrants of $1,711,698 related to the issuance of warrants and common stock in exchange for the cancellation of existing warrants. There was no gain on exchange of warrants for the year ended December 31, 2025.
Change
in fair value of derivativewarrant liabilities
For the year ended December 31, 2025, we recognized a gain on the change in fair value of warrant liabilities of $1,121,502 related to the reduction in the fair value of the warrants that are accounted for as warrant liabilities. For the year ended December 31, 2024, we recognized a gain on the change in fair value of warrant liabilities of $97,188 related to the reduction in the fair value of the warrants that are accounted for as warrant liabilities.
For
the year ended December 31, 2024, we recognized a gain on the change in fair value of warrant liabilities of $97,188 related to the reduction
in the fair value of the warrants that are accounted for as warrant liabilities. For the year ended December 31, 2023, we recognized
a gain on the change in fair value of warrant liabilities of $3,997,780 related to the reduction in the fair value of the warrants that
are accounted for as warrant liabilities.
Working capital decreased by $7,981,844 primarily due to $10,788,963 of cash used to fund our operations and a $8,742,967 decrease in marketable securities, offset by $8,897,470 of cash provided by investing activities and $2,854,791 of cash provided by financing activities.
For
the year ended December 31, 2024,2025, we had a net loss of $9.0$14.2 million and negative cash flows from operations of $8.2$10.8 million andand, as
of of
December 31, 2024,2025, we had a working capital deficit of $7.4$0.6 million. We anticipate that we will continue to incur net losses and negative
cash cash
flows from operations as we execute our development plans for 20252026 and beyond, as well as other potential strategic and business
development development
initiatives. Based on these conditions, we believe we maydo not have sufficient cash for at least twelve months after
the issuance
date of the financial statements included in this Annual Report which raises substantial doubt about our ability to continue as a going
concern.
Public Offerings
In October 2025, we sold 678,125 shares of our common stock in a registered direct offering. We received net proceeds of approximately $0.9 million from the offering.
In February 2026, we sold 12,560,715 shares of our common stock, pre-funded warrants to purchase 1,725,000 shares of our common stock (all of which have been exercised) and warrants for the purchase of 14,285,715 shares of our common stock in a public offering. We received net proceeds of approximately $4.5 million from the offering.
“At-the-Market”
Offering
In
November 2024, we entered into an At The Market Offering Agreement with Rodman, under which we currently have the ability to issue and
sell shares of our common stock, from time to time, through Rodman, up to an aggregate offering price of approximately $3,614,000 in
an ATM, program. Subsequent to the year ended December 31, 2024, we sold 492,000 shares of our common stock under the ATM program with
Rodman at a weighted-average gross price of approximately $2.20 per share and raised approximately $1,084,000 of gross proceeds. The
total commissions and related legal and accounting fees were approximately $178,000 and we received net proceeds of approximately $906,000.
As of March 26, 2025, we had remaining capacity to sell up to an additional $2,530,000 of common stock under the ATM program with Rodman.
Warrant
Exercises
In
February 2024, we received gross proceeds of approximately $8,100,000 pursuant to the exercise of outstanding warrants. See Item 1 (“Business
– Business Development – Material Events During 2024”) for additional information.
Net cash used in operating activities was $10,788,963 for the year ended December 31, 2025, primarily due to cash used to fund the net loss of $14,241,975, partially offset by net non-cash expenses of $2,143,536 and $1,309,476 of cash provided by changes in our operating assets and liabilities. Net cash used in operating activities was $8,230,346 for the year ended December 31, 2024, primarily due to cash used to fund the net loss of $8,979,381 partially offset by net non-cash expenses of $720,382 and $28,653 of cash provided by changes in operating assets and liabilities.
Net
cash used in operating activities was $8,230,346 for the year ended December 31, 2024, primarily due to cash used to fund the net loss
of $8,979,381 which gives effect to net non-cash expenses of $720,382, partially offset by $28,653 of cash provided by changes in operating
assets and liabilities. Net cash used in operating activities was $6,430,211 for the year ended December 31, 2023, primarily due to cash
used to fund the net loss of $10,417,704 which gives effect to net non-cash expenses of $3,472,167, partially offset by $515,326 of cash
provided by changes in our operating assets and liabilities.
Net cash provided by investing activities was $8,897,470 for the year ended December 31, 2025 primarily due to the sale of marketable securities which provided $11,692,686 of cash, offset by the purchase of marketable securities which used $2,679,147 of cash and purchases of equipment which used $116,069 of cash. Net cash provided by investing activities was $514,529 for the year ended December 31, 2024 primarily due to the sale of marketable securities which provided $21,508,641 of cash, offset by the purchase of marketable securities which used $20,887,923 of cash and purchases of equipment which used $106,189 of cash.
Net
cash provided by investing activities decreased by $2,737,514 for the year ended December 31, 2024 compared to the year ended December
31, 2023, primarily due to the purchase of marketable securities.
Net cash provided by financing activities was $2,854,791 for the year ended December 31, 2025 due to net proceeds of $2,918,297 received in connection with the issuance of common stock pursuant to the 2024 ATM offering and an October 2025 registered direct offering and $41,165 due to the exercise of stock options, partially offset by the payment of deferred offering costs of $99,973 and repayment of financed insurance premiums of $4,698, compared to $7,379,330 net cash provided by financing activities for the year ended December 31, 2024 due to net proceeds of $7,528,027 received in connection with the exercise and issuance of warrants, partially offset by the payment of deferred offering costs of $148,697.
Net
cash provided by financing activities increased by $5,030,557 for the year ended December 31, 2024 compared to the year ended December
31, 2023 due to the gross proceeds from the exchange and issuance of warrants of $8,123,391, less issuance costs of $595,364, all partially
offset by $2,348,773 of gross proceeds from the sale of common stock pursuant to an ATM and direct offering undertaken
during the year ended December 31, 2023.
For
a detailed discussion of our significant accounting policies and related judgments, see Note 2 of the Notes to Consolidated Financial
Statements in “Item 8. Financial Statements and Supplementary Data” of this Annual Report.
What changed in the latest 10-Q
Risk Factors
An investment in our Common Stock involves a number of very significant risks. You should carefully consider the risk factors included in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on March 26, 2026, and the other information contained in that report and in this quarterly report in evaluating the Company and its business before purchasing shares of our Common Stock. Our business, operating results and financial condition could be adversely affected due to any of those risks.
No wording changes found in this section (only numbers or dates changed in 1 paragraph).
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
New heading “Nasdaq Listing Compliance”
Removed heading “Common Stock Repurchase Program”
Removed heading “Comparison of the Nine Months Ended September 30, 2025 to the Nine Months Ended September 30, 2024”
Largest changes
“Comparison of the Nine Months Ended September 30, 2025 to the Nine Months Ended September 30, 2024”see in full comparison
“Research and development expenses include cash and non-cash compensation of (a) our Vice President of Research and Development; (b) our Scientific Advisory Board members; and (c) laboratory staff and costs related to our brown fat and disc/spine initiatives and biocosmeceuticals program. Research and development expenses are expensed as they are incurred. For the nine months ended September 30, 2025, research and development expenses increased by $2,462,738, or 49.2%, as compared to the nine months ended September 30, 2024. …”see in full comparison
We are currently pursuing our Disc/Spine Program with our initial investigational therapeutic product being called BRTX-100. In March 2022, a United States patent issued in our Disc/Spine Program.see in full comparisonWePursuanthaveto authorization receivedauthorizationfrom theFDAFDA,towecommenceare conducting a Phase 2 clinical trial investigating the use of BRTX-100 in the treatment of chronic lower back pain arising from degenerativedegenerativedisc disease. We havecommencedreceivedsuch clinical trial through the execution of a CRO agreement with Professional Research Consulting, Inc., d/b/a PRC Clinical, the execution of clinical trial site agreements, patient enrollment, the commencement of patient procedures, the purchase of manufacturing equipment and the expansion of our laboratory to include capabilities for clinical production. We have receiveda license from the New York State Department of Health to act as a tissue bank for mesenchymal stem cell processing. In June 2023, we received a unanimous recommendation from the Data Safety Monitoring Board to continue our Phase 2 clinical trial without any changes. We have obtained a worldwide (excluding Asia and Argentina) exclusive license to use technology for investigational adult stem cell treatment of disc and spine conditions, including protruding and bulging lumbar discs. The technology is an advanced stem cell injection procedure that may offer relief from lower back pain, buttock and leg pain, and numbness and tingling in the leg and foot. We are investigating the expansion of the clinic application of BRTX-100 to other indications within the body.
Comparison of the Three Months Endedsee in full comparisonSeptemberMarch30,31,20252026 to the Three Months EndedSeptemberMarch30,31,20242025
Full comparison: every changed paragraph (47)
As
of SeptemberMarch 30,31, 2025,2026, our accumulated deficit was $166,713,054.$172,075,095 We have historically only generated a modest amount of revenue, and our
our losses have principally been operating expenses incurred in research and development, marketing and promotional activities in order to
to commercialize our products and services, plus costs associated with meeting the requirements of being a public company. We expect to
to continue to incur substantial costs for these activities over at least the next year.
We
are currently pursuing our Disc/Spine Program with our initial investigational therapeutic product being called BRTX-100.
In March 2022, a United States patent issued in our Disc/Spine Program. WePursuant haveto authorization received authorization from the FDAFDA, towe commenceare
conducting a Phase 2 clinical trial investigating the use of BRTX-100 in the treatment of chronic lower back pain arising from
degenerative degenerative
disc disease. We have commencedreceived such clinical trial through the execution of a CRO agreement with Professional Research Consulting, Inc.,
d/b/a PRC Clinical, the execution of clinical trial site agreements, patient enrollment, the commencement of patient procedures, the
purchase of manufacturing equipment and the expansion of our laboratory to include capabilities for clinical production. We have received
a license from the New York State Department of Health to act as a tissue bank for mesenchymal
stem cell processing. In June 2023, we
received a unanimous recommendation from the Data Safety Monitoring Board to continue our Phase
2 clinical trial without any changes.
We have obtained a worldwide (excluding Asia and Argentina) exclusive license to use technology
for investigational adult stem cell treatment
of disc and spine conditions, including protruding and bulging lumbar discs. The technology
is an advanced stem cell injection procedure
that may offer relief from lower back pain, buttock and leg pain, and numbness and tingling
in the leg and foot. We are investigating
the expansion of the clinic application of BRTX-100 to other indications within the
body.
In
addition, in continuation of our mission of developing and commercializing cell-based biologics, we arehave seeking to developdeveloped a biologics-based
cosmetic products business.business Pursuantthrough to such business,which we would formulate, manufacture and sell products designed for cosmetic and aesthetic
uses. InOur Aprilbiocosmeceutical
product 2024,offerings weconsist announcedof thattwo weproduct enteredlines: intoExoCR, which is sold pursuant to a five-year exclusive supply agreement with Cartessa Aesthetics, LLC (“Cartessa”),
a leading North American based aesthetic company, toand supplyBioX, which we commenced selling commercially during the three months ended March 31, 2026 to
multiple Cartessacustomers ourin firstthe commercialordinary product.course of business.
We
derive royalty revenue pursuant to a license agreement with a stem cell treatment company (the “SCTC”) entered into in January
2012, 2012,
as amended in November 2015 and November 2022. Pursuant to the license agreement, the SCTC has granted to us an exclusive license to
use certain intellectual property related to, among other things, stem cell disc procedures and we have granted to the SCTC a sublicense
to use, and the right to sublicense to third parties the right to use, in certain locations in the United States and the Cayman Islands,
certain of the licensed intellectual property. In consideration of the sublicense,sublicenses, the SCTC has agreed to pay us royalties on a per
disc disc
procedure basis.
We also derive product revenue from sales of our biocosmeceutical product offerings. During the three months ended March 31, 2026, we derived $11,870 of product revenue, all of which was generated from sales of our BioX product line. We did not derive any revenue from our supply agreement with Cartessa during the three months ended March 31, 2026. We did not generate any product revenue during the three months ended March 31, 2025.
We
have also derived product revenue from our five-year exclusive supply agreement with Cartessa entered into in April 2024.
Common
Stock Repurchase Program
On
June 16, 2025, our Board of Directors authorized a common stock repurchase program under which we may repurchase up to $2,000,000 of
our outstanding common stock through June 16, 2026. No repurchases have been made as of September 30, 2025.
Comparison
of the Three Months Ended SeptemberMarch 30,31, 20252026 to the Three Months Ended SeptemberMarch 30,31, 20242025
Our
financial results for the three months ended SeptemberMarch 30,31, 20252026 are summarized as follows in comparison to the three months ended SeptemberMarch 31,
30, 20242025:
For the three months ended March 31, 2026, we generated total revenues of $23,170, comprised of $11,870 of product revenue and $11,300 of royalty revenue, as compared to total revenues of $25,000, comprised entirely of royalty revenue, for the three months ended March 31, 2025. Royalty revenue, which is derived from our sublicense agreement with the SCTC, decreased by $13,700, or 54.8%, to $11,300 from $25,000, primarily due to a decrease in disc procedures performed by the SCTC. Product revenue, which is derived from sales of our biocosmeceutical product offerings, increased by $11,870 to $11,870 from $0, due to the commencement of commercial sales of our BioX product line during the three months ended March 31, 2026.
For
the three months ended September 30, 2025 and 2024, we generated $11,800 and $2,900, respectively, of royalty revenue in connection with
our sublicense agreement with the SCTC. The increase was primarily due to an increase in disc procedures.
For
the three months ended September 30, 2025 and 2024, we generated $0 and $230,700, respectively, of cosmetic product sales revenue in
connection with our exclusive supply agreement with Cartessa. The decrease is primarily related to the timing of orders for this new
developing revenue stream.
Research
and development expenses include cash and non-cash compensation of (a) our Vice President of Research and Development; (b) our Scientific Advisory
Advisory Board members; and (c) laboratory staff and costs related to our brown fat and disc/spine initiatives and biocosmeceuticals
program.initiatives. Research and development expenses
are expensed as they are incurred. For the three months ended SeptemberMarch 30,31, 2025,2026, research
and development expenses increaseddecreased by $1,141,387 $720,589
or 78.5%,27.2%, as compared to the three months ended SeptemberMarch 30,31, 2024.2025. The increasedecrease was
is primarily theattributed resultto a decrease in stock-based compensation
expense of $799,983, a decrease in general lab supplies expense of $83,447, and a decrease in bonus expense of $61,625, partially offset
by an increase in recruitment and other costs for our Phase 2 clinical trial of $850,037, an increase in lab supply
expense of $247,664 and an increase in stock-based compensation expense of $42,065 partially offset by a decrease in headcount costs
of $26,025 and a decrease in bonus expense of $17,625. We expect that our research and development expenses will continue to increase
in subsequent fiscal periods.$230,824.
General
and administrative expenses consist primarily of salaries, bonuses, payroll taxes and stock-based compensation to employees, as well
as corporate expenses such as legal and professional fees, investor relations and occupancy-related expenses. For the three months ended
SeptemberMarch 30,31, 2025,2026, general and administrative expenses increaseddecreased by $66,504,$707,518, or 6.3%,32.4%, as compared to the three months ended SeptemberMarch 31,
30,2025. 2024,The decrease is primarily drivenattributed byto ana increasedecrease in stock-based compensation expense of $73,623,$918,928, partially offset by an increase
in professional fees of $141,428, an increase in payrollheadcount costs of $58,546,$64,583 and an increase
in consulting expense of $16,655, partially offset by a decrease in professional fees of $79,744.$17,019.
Dividend
and Interest
Income Income, net
For
the three months ended SeptemberMarch 30,31, 2025,2026, dividend and interest incomeincome, wasnet $57,740of interest expense decreased by $95,129, or 95%, to $5,479
as compared to interest income of $158,547$100,608 for the three months
ended SeptemberMarch 30,31, 2024.2025. The change was primarily due to a decrease in interest
income from the investments held in marketable securities
due to a lower average balance of the marketable securities during the 2025 period2026 as
compared to the 2024 period.2025.
For
the three months ended SeptemberMarch 30,31, 2025,2026, other income was $930,$5,728, as compared to other income of $566$1,246 for the three months ended SeptemberMarch
30,31, 2024. The change was primarily due to an increase in dividend income from investments held in marketable securities.2025.
For
the three months ended September 30, 2025, we recognized a gain on the change in fair value of warrant liabilities of $612,064, related
to the decrease in fair value of warrants that are accounted for as warrant liabilities. For the three months ended September 30, 2024,
we recognized a gain on the change in fair value of warrant liabilities of $1,036,464, related to the decrease in fair value of warrants
that are accounted for as warrant liabilities.
Comparison
of the Nine Months Ended September 30, 2025 to the Nine Months Ended September 30, 2024
Our
financial results for the nine months ended September 30, 2025 are summarized as follows in comparison to the nine months ended September
30, 2024:
Revenues
For
the nine months ended September 30, 2025 and 2024, we generated $40,100 and $57,700, respectively, of royalty revenue in connection with
our sublicense agreement with the SCTC. The decrease was primarily due to a decrease in disc procedures.
For
the nine months ended September 30, 2025 and 2024, we generated $300,000 in each period of cosmetic product sales revenue in connection
with our exclusive supply agreement with Cartessa.
Research
and Development
Research
and development expenses include cash and non-cash compensation of (a) our Vice President of Research and Development; (b) our Scientific
Advisory Board members; and (c) laboratory staff and costs related to our brown fat and disc/spine initiatives and biocosmeceuticals
program. Research and development expenses are expensed as they are incurred. For the nine months ended September 30, 2025, research
and development expenses increased by $2,462,738, or 49.2%, as compared to the nine months ended September 30, 2024. The increase was
primarily the result of an increase in recruitment and other costs for our Phase 2 clinical trial of $2,010,122, an increase in lab supply
expense of $438,183, and an increase in headcount costs of $19,290, partially offset by a decrease in bonus expense of $86,372 and a
decrease in stock-based compensation expense of $5,976. We expect that our research and development expenses will continue to increase
in subsequent fiscal periods.
General
and Administrative
General
and administrative expenses consist primarily of salaries, bonuses, payroll taxes and stock-based compensation to employees, as well
as corporate expenses such as legal and professional fees, investor relations and occupancy-related expenses. For the nine months ended
September 30, 2025, general and administrative expenses increased by $478,967, or 11.4%, as compared to the nine months ended September
30, 2024, primarily driven by an increase in stock-based compensation expense of $246,803 related to the vesting of awards, an increase
in consulting expense of $127,621, and an increase in payroll of $91,274, partially offset by a decrease in professional fees of $20,748.
Interest
Income
For
the nine months ended September 30, 2025, interest income was $231,621, as compared to interest income of $497,089 for the nine months
ended September 30, 2024. The change was primarily due to a decrease in interest income from the investments held in marketable securities
due to a lower average balance of the marketable securities during the 2025 period as compared to the 2024 period.
Other
Income
For
the nine months ended September 30, 2025, other income was $3,336, as compared to other income of $150,498 for the nine months ended
September 30, 2024. The change was primarily due to a one-time payment received in the 2024 period in connection with the development
of our biocosmeceuticals product line.
Gain
on Exchange of Warrants
For
the nine months ended September 30, 2024, we recognized a gain on exchange of $1,711,698 related to the issuance of warrants and common
stock in exchange for the cancellation of existing warrants. There was no gain on exchange of warrants for the nine months ended September
30, 2025.
Change
in Fair Value of Warrant Liabilities
For
the ninethree months ended SeptemberMarch 30,31, 2025,2026, we recognized a gain on the change in fair value of warrant liabilities of $552,536$1,220,121, relatedprimarily
toreflecting the decrease in fairour valuestock ofprice between January 1, 2026 and February 24, 2026, the date on which the warrants thatpreviously are accounted for classified
as warrantderivative liabilities.liabilities were reclassified to equity. For the ninethree months ended SeptemberMarch 30,31, 2024,
2025, we recognized a loss on the change
in fair value of warrant liabilities of $837,466$634,119 related to the increase in fairour valuestock ofprice warrants
during that are accounted for as warrant liabilities.period.
Working capital increased by $2,771,100, from a working capital deficiency of $586,029 at December 31, 2025 to working capital of $2,185,071 at March 31, 2026. The increase in working capital was driven primarily by a $1,399,349 reduction in current liabilities resulting from the reclassification of warrant liabilities to equity in connection with the conversion of the Series B Convertible Preferred Stock, a $674,597 decrease in accounts payable, and a net increase in current assets, of which cash and cash equivalents increased by $1,601,491 (partially offset by a $962,383 decrease in investments held in marketable securities). The net increase in cash and cash equivalents reflected $4,440,836 of cash provided by financing activities and $968,447 of cash provided by investing activities, partially offset by $3,807,792 of cash used in operating activities.
Working
capital decreased by $6,124,034 primarily due to $8,373,790 of cash used to fund our operations and the $6,297,318 decrease in marketable
securities, offset by $6,496,796 of cash provided by investing activities and the $1,931,548 of cash provided by financing activities.
For
the ninethree months ended SeptemberMarch 30,31, 2025,2026, we had a net loss of $11,034,339$2.2 million and negative cash flows from operations of $8,373,790,$3.8 million, and
as of SeptemberMarch 30,31, 2025,2026, we had working capital of $1,271,781.$2.2 million. We anticipate that we will continue to incur net losses and negative cash
cash flows from operations as we execute our development plans during 20252026 and beyond, as well as other potential strategic and business development
development initiatives. Based on these conditions, we believe we maydo not have sufficient cash for at least twelve months after the issuance date
date of the financial statements included in this Quarterly Report which raises substantial doubt about our ability to continue as a going
going concern.
Nasdaq Listing Compliance
On March 26, 2026, we received a notification letter from The Nasdaq Stock Market LLC (“Nasdaq”) indicating that we are not in compliance with the minimum bid price requirement of Nasdaq Listing Rule 5550(a)(2), which requires listed securities to maintain a minimum closing bid price of $1.00 per share. Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), we have an initial compliance period of 180 calendar days, or until September 22, 2026, to regain compliance. We intend to monitor the closing bid price of our Common Stock and consider available options to resolve the noncompliance, including effecting a reverse stock split of our Common Stock. There can be no assurance that we will regain compliance with the minimum bid price requirement or otherwise be in compliance with the Nasdaq listing criteria. See Note 1 to the unaudited condensed consolidated financial statements for additional information.
During
the ninethree months ended SeptemberMarch 30,31, 20252026 and 2024,2025, our sources and uses of cash were as follows:
Net
cash used in operating activities was $8,373,790$3,807,792 for the ninethree months ended SeptemberMarch 30,31, 2025,2026, primarily due to cash used to fund the net
net loss of $11,034,339,$2,154,405, adjustedadjustments forto net non-cash expenses of $2,246,501,$883,576, and $414,048$769,811 of cash providedused byin changes in operating assets
and liabilities.
Net cash used in operating activities was $5,882,501$2,778,786 for the nine
three months ended
September 30,March 2024,31, 2025, primarily due to cash used to fund the net loss of $7,343,233, adjusted$5,339,799
for net non-cash expenses of $1,520,670, and $59,938$31,214 of cash used in changes in operating assets and liabilities.liabilities, partially offset for adjustments to net non-cash expenses of
$2,592,227.
Net cash provided by investing activities was $968,447 for the three months ended March 31, 2026 primarily due to sales of marketable securities which provided $1,043,367 of cash, partially offset by purchases of marketable securities which used $74,920 of cash. Net cash provided by investing activities was $2,366,967 for the three months ended March 31, 2025 primarily due to sales of marketable securities which provided $3,456,535 of cash, partially offset by purchases of marketable securities which used $1,053,168 of cash and a purchase of equipment which used $36,400 of cash.
Net
cash provided by investing activities was $6,496,796 for the nine months ended September 30, 2025 primarily due to a sale of marketable
securities which provided $9,212,343 of cash, offset by a purchase of marketable securities which used $2,679,147 of cash and a purchase
of equipment which used $36,400 of cash. Net cash used in investing activities was $1,018,078 for the nine months ended September 30,
2024 primarily due to a purchase of marketable securities which used $18,294,566 of cash and a purchase of equipment which used $93,755
of cash, offset by a sale of marketable securities which provided $17,370,243 of cash.
Net cash provided by financing activities was $4,440,836 for the three months ended March 31, 2026 due to the issuance of Common Stock and pre-funded warrants in the Rodman public offering which provided gross proceeds of $5,000,000 of cash, partially offset by the payment of issuance costs which used $559,164 of cash. Net cash provided by financing activities was $1,092,718 for the three months ended March 31, 2025 due to the issuance of Common Stock in an at-the-market offering which provided $1,083,915 of cash and the exercise of stock options which provided $42,411 of cash, partially offset by the payment of issuance costs which used $33,608 of cash.
Net
cash provided by financing activities was $1,931,548 for the nine months ended September 30, 2025 due to net proceeds of $1,938,445 received
in connection with the issuance of common stock for the 2024 ATM offering and $42,411 due to the exercise of stock options, partially
offset by deferred offering costs of $49,308, compared to $7,505,646 net cash provided by financing activities for the nine months ended
September 30, 2024 due to net proceeds of $7,528,027 received in connection with the exercise and issuance of warrants, partially offset
by deferred offering costs of $22,381.
BRTX insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 0 filings. Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
No Form 4 stock transactions in this period.
Well-known investors holding BRTX (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 273,304 | $102.8K | 0.0% | Added 15% |