Star Scientific, Inc. Reports NASDAQ Notification Regarding Minimum Bid Price, Files Third Quarter Report with SEC
PETERSBURG, Va., Nov. 9 /PRNewswire-FirstCall/ -- Star Scientific, Inc. (Nasdaq: STSI) reported today that on November 5, 2009 it received a deficiency letter from NASDAQ staff indicating that the company is not in compliance with the NASDAQ minimum bid rule. The letter noted that for the previous thirty consecutive trading days the company's minimum closing bid price per share had been below the $1.00 minimum bid price requirement set forth in NASDAQ Rule 5450(a)(1). In accordance with Marketplace Rule 5810(c)(3)(A), Star has 180 days, or until May 4, 2010, to regain compliance. In its notice NASDAQ indicated that if at any time during this period the minimum closing bid price is $1.00 or more per share for at least ten consecutive trading days, NASDAQ will provide confirmation that the company has regained compliance and the matter will be closed. The deficiency letter has no effect on the current listing or trading of Star Scientific shares.
The company also reported that today it has filed its quarterly financial report on Form 10-Q with the Securities & Exchange Commission. The company reported net sales of $231,942 for the third quarter compared with $136,725 for the same quarter in 2008. The gross loss for the third quarter decreased from $435,514 in 2008 to $400,238 for the quarter ended September 30, 2009. The net loss for the third quarter totaled $4.9 million compared with a net loss of $4.4 million for the same quarter in 2008. The $.5 million increase during third quarter 2009 was primarily linked with increased research and development (R&D) expense during this period.
Net loss for the nine months ended September 30, 2009 totaled $17.2 million, a $0.9 million increase from the same period on 2008. This increase related both to the increased R&D expense and to increased legal costs for the jury trial portion of the company's patent infringement lawsuit against RJ Reynolds.
As Star reported last week, the company and inVentiv Health LLC have agreed to partner in the marketing and sales of CigRx(TM), the nutraceutical product developed under the aegis of the company's subsidiary, Rock Creek Pharmaceuticals. Discussions on an agreement are continuing.
At the same time Star is preparing a "modified risk product" application and related materials, and believes it is on track to submit to the FDA in first quarter 2010. The application, which the company hopes will be the first of its kind to be submitted to the FDA, will seek approval to market Ariva® BDL and Stonewall® BDL as modified risk tobacco products under the provisions of the Family Smoking Prevention and Tobacco Control Act enacted in June, 2009. The Ariva® and Stonewall® brand extension "BDL" signifies that the tobacco in the product has TSNA levels that are substantially below the levels found in other tobacco products. FDA approval of Ariva ® and Stonewall® BDL as designated modified risk products would permit the company to share accurate and balanced information with adult smokers and tobacco users about the reduction in exposure to toxins that results from using these products instead of inhaling cigarette smoke or choosing traditional smokeless tobacco products that contain significantly higher TSNA levels.
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Star Scientific, Inc. and its consolidated subsidiaries ( collectively, the "Company") has tried, whenever possible, to identify these forward-looking statements using words such as "anticipates", "believes", "estimates", "expects", "plans", "intends" and similar expressions. These statements reflect the Company's current beliefs and are based upon information currently available to it. Accordingly, such forward-looking statements involve known and unknown risks, uncertainties and other factors which could cause the Company's actual results, performance or achievements to differ materially from those expressed in, or implied by, such statements. These risks, uncertainties and contingencies include, without limitation, the challenges inherent in new product development initiatives, the uncertainties inherent in the progress of scientific research, the Company's ability to raise additional capital in the future necessary to maintain its business, potential disputes concerning the Company's intellectual property, risks associated with litigation regarding such intellectual property, potential delays in obtaining any necessary government approvals of the Company's low-TSNA tobacco products, market acceptance of the Company's new smokeless tobacco products, competition from companies with greater resources than the Company, the Company's decision not to join the Master Settlement Agreement ("MSA"), the effect of state statutes adopted under the MSA, and the Company's dependence on key employees and on its strategic relationships with Brown & Williamson Tobacco Corporation in light of its combination with RJ Reynolds Tobacco Company, Inc. The impact of potential litigation, if initiated against or by individual states that have adopted the MSA, could be materially adverse to the Company.
Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. See additional discussion under "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2008, as filed with the SEC on March 16, 2009, and other factors detailed from time to time in the Company's other filings with the SEC, available at www.sec.gov. All information in this release is current as of this date and the Company undertakes no obligation to update or advise upon any such forward-looking statements to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.
About Star Scientific
Star Scientific is a technology-oriented tobacco company with a toxin reduction mission. It is engaged in the development of dissolvable smokeless tobacco products that deliver fewer carcinogenic toxins (principally tobacco specific nitrosamines, or TSNAs), through the utilization of the innovative StarCured® tobacco curing technology, and in sublicensing that technology to others. Star Scientific has a Corporate and Sales Office in Petersburg, VA, an Executive, Scientific & Regulatory Affairs office in Bethesda, MD, and manufacturing facilities in Chase City, VA.
About Rock Creek Pharmaceuticals
Rock Creek Pharmaceuticals develops pharmaceutical products for treatment of addiction and other neurological disorders. The company supports third-party academic, educational and therapeutic advances in both these areas of research. Rock Creek has scientific and research offices in Gloucester, MA. and a regulatory office in Washington, DC. See Star's website at: http://www.starscientific.com
Contact: Sara Troy Machir Vice President, Communications & Investor Relations firstname.lastname@example.org (301) 654-8300
SOURCE Star Scientific, Inc.