BioRestorative (BRTX) Earnings Call Transcript

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Date

Wednesday, Nov. 12, 2025 at 4:30 p.m. ET

Call participants

• Chief Executive Officer — Lance Alstodt
• Chief Financial Officer — Robert Eugene Kristal
• Chief Scientific Officer — Francisco J. Silva

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Risks

• Revenue decline -- CFO Robert Eugene Kristal reported revenues of $11,800, down sharply from $233,600, due to the timing of biocosmeceutical sales orders, resulting in a substantial year-over-year decrease.
• Widened net loss -- Net loss increased to $3 million or $0.33 per share compared to $1 million or $0.13 per share, reflecting higher operational losses.
• Operational losses -- Loss from operations rose to $3.7 million from $2.3 million, demonstrating a marked increase in operating expenses.
• Resource constraints -- CEO Lance Alstodt said, "We have not dedicated resources to developing it. We have a protocol. We have an agreed-upon protocol with the FDA, but it is not as if we are starting to go out and recruit sites and recruit patients just given the financial constraints."

Takeaways

• Revenue -- $11,800 recognized, entirely from royalty income, with no material biocosmeceutical sales booked for the period.
• Cash position -- $4.5 million available at quarter end, excluding $1.1 million in gross financing proceeds completed after quarter close.
• Debt -- No outstanding debt reported by CFO Robert Eugene Kristal.
• Phase II BRTX-100 trial status -- Enrollment exceeded 75%, with over 10 patients in late-stage screening and trial anticipated to complete enrollment very near term.
• FDA Fast Track designation -- The BRTX-100 program was granted Fast Track status by the FDA for chronic lumbar disc disease and is positioned for a potential Type B meeting regarding accelerated BLA approval.
• Biocosmeceutical market shift -- CEO Lance Alstodt stated, "Over the last several months, we have rebuilt and strengthened our commercial infrastructure, including supply chain, sales coverage, distribution, and customer engagement. A major part of that strategy was bringing in the right commercial leader. As many of you saw in a recent press release, we welcomed Crystal Romano as our Global Head of Commercial Operations," and are now pursuing multi-channel distribution beyond the Cartessa agreement.
• ThermoStem licensing discussions -- Active negotiations continue with a commercial-stage regenerative medicine company concerning licensing rights to the ThermoStem metabolic disease platform.
• Intellectual property milestone -- In October, the Japanese Patent Office issued allowance for a broad patent covering ThermoStem’s allogeneic brown adipose-derived stem cell technology and encapsulation methods.
• Recent financing -- Post-quarter, a fully subscribed financing round priced above market closed with senior leadership participation, adding approximately $1.1 million (gross) to capital resources.
• Cervical spine program -- Protocol approval exists for a cervical trial, but no resources have been allocated to develop this indication due to stated financial priorities.

Summary

BioRestorative Therapies (NASDAQ:BRTX) reported a sharp year-over-year drop in revenue and increased operating losses stemming from delayed biocosmeceutical sales. The company has accelerated patient enrollment in its Phase II BRTX-100 clinical trial for lumbar disc disease and secured FDA Fast Track status, positioning for regulatory discussions that could directly impact time-to-market. Management highlighted expansion of its biocosmeceutical strategy, appointing Crystal Romano to lead commercial operations, and signaled a multi-pronged sales approach beyond existing partnerships. Post-quarter financing increased cash resources, and management reiterated ongoing, but uncertain, licensing negotiations for its ThermoStem obesity/metabolic program, supported by a new Japanese patent allowance for its core technology. Allocation of resources toward pipeline expansion outside the lead program remains hampered by financial constraints.

• CEO Lance Alstodt said, "That green light from them would be tremendous. It would be a major value-enhancing inflection point and would be sort of an acknowledgment that we do not have to unblind the data; we are going to go forward in this pivotal study," referring to the possibility of a single pivotal Phase III trial versus the typical two, pending the FDA Type B meeting.
• Active cash management allows current staff to absorb both clinical and new biocosmeceutical commercialization demands, with possible near-term hiring in quality and manufacturing as volumes scale.
• Management indicated the revenue ramp in biocosmeceuticals is expected to be, "we will see some lumpiness in this business as we are starting out. There may be quarters where we have an outsized revenue number and some quarters in the very beginning where it looks like a miss, but it is really just about the developing business and reaching a broader group of customers," with significant variability possible in the near term until distribution matures.
• The ability to channel proprietary cell lines to cosmetic topicals, without detraction from core clinical research, represents a strategic use of lab capacity during clinical trial transitions.

Industry glossary

• BLA (Biologic License Application): FDA application required for the approval to market a biological product in the United States.
• Fast Track designation: FDA program to expedite the review of drugs that treat serious conditions and fill an unmet medical need.
• Type B meeting: A formal mid-development meeting with the FDA to review regulatory, trial, and approval strategies for drugs or biologics.
• Allogeneic: Derived from a donor rather than the recipient; in this context, refers to cell therapies using donor stem cells.
• Exosome-based secretome: Bioactive factors, including exosomes, secreted by cells and used in regenerative or aesthetic therapies.
• BAT (Brown Adipose Tissue): A type of fat tissue involved in energy expenditure and weight regulation, often targeted for metabolic and obesity therapies.

Full Conference Call Transcript

Lance Alstodt: Thanks, Stephen, and good afternoon, everyone. Welcome. On behalf of the management team and everyone at BioRestorative Therapies, I would like to thank you for your interest in our company. For those of you who are shareholders, we appreciate your continued support. As you can see from the press release we issued just a short time ago, we continue to execute well across all areas of our business in the third quarter. We have a lot of exciting things to look forward to as we move through the last couple of months of the year. With that said, I'd like to ask Robert Eugene Kristal, our CFO, to provide a brief overview of our third-quarter financial results.

Robert Eugene Kristal: Thanks, Lance. Good afternoon, everyone. To streamline the presentation of the financial results, all the numbers I will refer to have been rounded, so they are approximate. Third-quarter 2025 revenues were $11,800 and consisted entirely of royalty revenue. This compares to revenues of $233,600 in Q3 2024, the vast majority of which came from biocosmeceutical sales in connection with our exclusive supply agreement with Cartessa. The overall year-over-year decrease in Q3 2025 revenues was driven by the timing of orders for the developing biocosmeceutical revenue stream. The company's third-quarter 2025 loss from operations was $3.7 million compared to $2.3 million for the comparable period of 2024.

The company's third-quarter 2025 net loss was $3 million or $0.33 a share compared to a net loss of $1 million or $0.13 per share for 2024. The company ended the quarter with cash, cash equivalents, and marketable securities of $4.5 million with no outstanding debt. This did not include the gross proceeds of approximately $1.1 million from the company's recent financing, which we completed subsequent to the quarter end. With that, I'll now turn the call over to Francisco.

Francisco J. Silva: Thanks, Rob. For the benefit of those who are new to BioRestorative Therapies, I would like to take a moment to summarize our development programs. Our lead clinical-stage candidate, BRTX-100, is a novel cell-based therapeutic engineered to target areas of the body that have little blood flow. The product is formulated using autologous, or your own, cultured mesenchymal stem cells collected from a patient's bone marrow. The safety and efficacy of BRTX-100 in treating chronic lumbar disc disease is being evaluated in our ongoing Phase II prospective, randomized, double-blinded, and sham-controlled study. A total of up to 99 eligible subjects will be enrolled at up to 16 clinical sites across the United States.

Subjects included in the trial will be randomized two to one to receive either BRTX-100 or placebo. Enrollment in the Phase II study is starting to accelerate, and we expect to be able to share more data as appropriate. In February, we announced that the BRTX-100 program for chronic lumbar disc disease was granted Fast Track designation by the FDA. This was a major milestone achievement, which has enabled us to work more collaboratively with the FDA as we continue to advance our lead clinical program towards a Biologic License Application (BLA) approval.

In that regard, through the Fast Track designation, we are anticipating that the FDA will grant us a Type B meeting to discuss a potential accelerated BLA approval pathway for the BRTX-100 program for the treatment of chronic lumbar disc disease. Moving to our core preclinical metabolic program, ThermoStem, we are developing a cell-based therapy candidate to target obesity and related metabolic disorders using brown adipose tissue-derived stem cells, which are then used to generate brown adipose tissue (BAT) as well as exosomes secreted by the brown adipose stem cells. BAT is intended to mimic naturally occurring brown adipose depots that have been found to regulate metabolic homeostasis in humans and is involved in weight loss.

The global obesity market is projected to exceed $100 billion annually by the end of the decade, driven by unprecedented demand for GLP-1 therapies. BioRestorative Therapies' ThermoStem program is uniquely designed to address this demand by, one, providing an alternative to chronic GLP-1 injections through a regenerative cell-based solution; two, mitigating tolerability issues such as muscle mass loss or potential cardiovascular risk, some of the most pressing concerns associated with GLP-1 therapies; and three, creating licensing and partnership opportunities. With respect to the last point, we are pleased that our previously reported substantial discussions with an undisclosed commercial-stage regenerative medicine company regarding a potential license agreement for our ThermoStem metabolic disease program are continuing.

While we cannot provide interim progress updates nor provide any assurances that this will come to a mutually acceptable agreement, we are committed to closing the loop as soon as practical. As awareness of the promise that our ThermoStem-derived brown adipose-derived stem cells hold for the treatment of obesity-related metabolic disorders continues to grow, it is important that this potentially game-changing opportunity is well protected, both for us and any current or future potential licensing partners. Accordingly, we have been methodically building a comprehensive patent portfolio with issued patents that cover both U.S. and international markets. The most recent example of that came this past October when we announced a major intellectual property milestone.

The Japanese Patent Office issued a notice of allowance for our ThermoStem platform. The newly allowed patent provides broad protection terms for allogeneic, off-the-shelf brown adipose-derived stem cell technology. These claims are materially stronger than previously granted patents, covering not only the therapeutic cells themselves but also multiple methods of encapsulation and delivery, including alginate microcapsules, cellulose hydrogels, polymer membranes, and advanced scaffolding systems. With that, I will turn the call back over to Lance.

Lance Alstodt: Thanks, Francisco. As you can see from what Francisco and Rob just reviewed, we had an exciting and productive third quarter. While the progress continues, we are carefully managing our resources as we advance our two core development programs. Before I close, I want to highlight two transformative developments that we believe reshape BioRestorative Therapies' commercial and clinical trajectory. First, our biocosmeceuticals business continues to gain a lot of momentum. Over the last several months, we have rebuilt and strengthened our commercial infrastructure, including supply chain, sales coverage, distribution, and customer engagement. A major part of that strategy was bringing in the right commercial leader.

As many of you saw in a recent press release, we welcomed Crystal Romano as our Global Head of Commercial Operations. Crystal is a known commodity to us and to the aesthetics community. She helped lead commercial execution efforts as President of Cartessa, and she understands the physician office and medical spa channels exceptionally well. Having someone with her product experience, account relationships, and hands-on operating background gives us tremendous confidence in her ability to execute and drive scalable revenue growth. The enthusiasm that we are seeing and that from what I am seeing in the field, combined with Crystal's leadership, positions this business for meaningful revenue contribution as we scale.

For a company in our position, having a commercial business capable of generating revenue alongside our clinical programs is strategically important, and we believe it can become a very material contributor in 2026 and beyond. Second, and equally as exciting, we believe that enrollment in our Phase II BRTX-100 clinical trial is approaching completion. Each month, we move closer to a fully enrolled study and a more statistically powerful data set. While the data remain blinded, the initial trends continue to mirror our earlier clinical signals, including significant improvement in pain and function for patients suffering from chronic lumbar disc disease.

Completing enrollment would be a major milestone for the company, and it positions us exceptionally well heading into a potential Type B FDA meeting in December. As enrollment completes, we intend to present additional data from a larger patient population, and we are optimistic that the results will be consistent with the encouraging trends observed so far. Simply put, the pathway to a potential Phase III and ultimately a BLA has never been more visible. In addition, I want to highlight the strength of our recent financing. Following the end of the quarter, we closed a fully subscribed financing that was priced above market. Senior leadership, including myself and several of our existing investors, participated in the round.

We believe that level of participation reflects continued confidence in the direction of the company, belief in the value of our clinical and commercial strategy, and alignment with long-term shareholder interests. Importantly, the financing strengthened our balance sheet and ensures we have the resources needed to advance our short-term clinical and commercial milestones while continuing to manage our cash efficiently. We also remain, as Francisco said, in subsequent discussions with a commercial-stage regenerative medicine company regarding a potential license of our ThermoStem metabolic program. As you mentioned, we are not providing interim updates on that. We remain committed to closing the loop on that process as soon as practical.

We believe that the strength of our expanding intellectual property portfolio further enhances the value of that platform. We have also been able to access that cell line and that platform for use in our biocosmeceuticals, so we are starting to cross-fertilize our cell-based therapy technology into commercially developed products as well. Taken together, accelerating our clinical progress, a growing commercial engine, ongoing licensing discussions, and a strengthened balance sheet, we believe BioRestorative Therapies is well-positioned to deliver meaningful value creation in the quarters ahead. I thank you for your time. With that, concluding our introductory remarks, we are happy to take any questions you may have.

Holly, if you wanted to open it up for some questions, I would be happy to do that.

Operator: Certainly. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again, that is star one to ask a question. One moment, please, while we poll for questions. Your first question for today is from Michael Okunewitch with Maxim Group.

Michael Okunewitch: Hey, guys. Thank you for taking my questions today. Congrats on all the great progress.

Lance Alstodt: Thanks, Michael.

Michael Okunewitch: I guess just with the changes to your leadership and seeming increased focus on this biocosmeceuticals business, just talk a little bit about how significant that overall cosmeceuticals opportunity is? And then is this something that you would be able to tap on your own, or would you need more Cartessa-like deals to penetrate this market? I would just like to get a better understanding of how you view the market dynamics here.

Lance Alstodt: Sure. No, I appreciate the question. It is going to be a substantial focus for us going forward. We are really positioning the company as a hybrid where we are taking opportunity and advantage of near-term revenue opportunities along with the longer-term clinical outcomes. I think there is no one like us in the MicroCap biotech space, which I think provides for a very differentiated profile and one that is extremely interesting for both investors as well as success to shareholders. In terms of the opportunity, this is a $63 billion market opportunity. This is a huge and growing market, the biocosmeceutical space.

We are a biotech company, and there are not many biotech companies that are fully focused on developing this market. Many companies are marketing companies that are sourcing material that I would describe as low dilution, low quality. We are able to manufacture, formulate, test, quality test, and release products coming directly from our lab using different cell lines and different variabilities. We are approaching this market originally with an exclusive distribution agreement with Cartessa. We have been working with Cartessa to broaden that scope outside of Cartessa's distribution capabilities. That is part of the reason for having Crystal in place. We have more of a three-pronged approach.

We are going to add additional distributors on board, so not just Cartessa, but many others. Those distributors we have relationships with through Crystal's large rolodex of account relationships. We will also be selling directly into the med spas and aestheticians, that professional channel, where we will be able to capture that margin that we would have otherwise not been able to capture by selling directly into Cartessa. So that is an exciting accretive opportunity for us. Crystal has a tremendous amount of relationships within that professional channel as that was her calling effort as part of Cartessa. So we are excited to really get that underway.

I will tell you, based on some of the calls that I have had with her, I am very confident and optimistic that this is a business that we are going to put the wheels on track very soon and be able to demonstrate some meaningful wins within the first couple of quarters of her being here. I would also like to discuss potentially the idea of going direct to consumer with a branded product that we have been discussing and talking about from a business plan perspective, understanding the logistics and the resources that are required in order to do that.

I think this three-pronged approach gives us a really broad approach to this large and growing market with probably one of the best, if not the best, most potent exosome-based secretomes that are out there. The beauty about our business and our manufacturing capabilities is the ability to work with the customer to customize, whether it is a branded product or a white label product, to their specifications and to their customer networks. Dialing up and dialing down the potency, adding different types of peptides, adding different types of growth factors, etcetera. This is going to be something that we should all keep our eyes on.

Obviously, it is a little bit too early to give specific guidance in terms of the revenue ramp. I still maintain the idea that we will see some lumpiness in this business as we are starting out. There may be quarters where we have an outsized revenue number and some quarters in the very beginning where it looks like a miss, but it is really just about the developing business and reaching a broader group of customers. We are excited about this, and we will talk more about this going forward.

Michael Okunewitch: And then I would like to follow up on that, just talking a little bit about how this impacts the overall business strategy, how you are balancing these now two sides of the business, and also some potential synergy there. So is your focus on biocosmeceuticals shifting any resources away from clinical development, or is this truly additive? And then are there any potential synergies in biocosmeceuticals from having the credibility of a legitimate biotechnology company?

Lance Alstodt: Yes. So the cross synergies, I would describe, have to do with the cell lines that we are using for clinical purposes. As you know, we are not commercializing our cell lines domestically as they are governed under the FDA from a BLA license perspective. But we are able to use aspects of those cell lines to develop products for topical use only, for cosmetic use only. I expect that the end users will use these products for topical use only. I do not know whether or not they will use it off-label for regenerative purposes. We do not condone that, but I believe that will be also an aspect of the end user's application.

In terms of resources, we can manage the resources within this space entirely with the people that we have today. We may add some additional folks on the quality side and on the manufacturing side. We are going to see a lull in the utilization of our lab as we fulfill our enrollment obligation under our Phase II protocol. Then there will be some time of delay between a Phase II and a Phase III. Our expectation is that during that time frame, we can really capitalize on full utilization and focus within the biocosmeceutical program.

Michael Okunewitch: Alright. Thank you for the additional color, Lance. I really appreciate the update.

Lance Alstodt: Thanks, Michael.

Operator: Your next question for today is from Jonathan Matthew Aschoff with ROTH Capital.

Jonathan Matthew Aschoff: Hi. How are you doing? I was wondering on BRTX-100, can you help us understand when we may see the subsequent data release? Will it still be blinded, or will it be the final data since it sounds like you are almost enrolled? Also, can you help us out with any maybe numerical enrollment update?

Lance Alstodt: On the numerical side, I will say we are more than three-quarters enrolled. We have more than 10 patients in late-stage screening, which could come in for harvest within the next couple of weeks. If you do the math, we are getting really close. I do not know if we are going to get it just under the wire in terms of the year-end, but to the extent that it is built into January, I think that is a very realistic and pragmatic target for us to hit from an enrollment perspective.

As far as data, we are going to keep the data blinded because we have a strategy as it relates to communication with the FDA under our Fast Track designation, looking to accelerate the BLA process. Our hope would be to get directly into a Phase III study from a pivotal perspective as opposed to doing two Phase III studies, as most companies do two Phase III studies. We have such a large and robust data set in connection with our Phase II with 99 patients.

The idea would be to keep that data blinded and report on higher numbers with more data on a blinded perspective as we continue to attend and ask to present our material at certain conferences, certain industry-related conferences. In terms of the FDA and regulatory strategy, I think it is important that people understand that getting a Phase III pivotal while we are still completing the Phase II, which is kind of part of the ask in this upcoming Type B meeting, is game-changing for us. It would basically shave off about three years of time on the calendar and significant costs related to doing another Phase III.

If that were the case, then we would want to keep our data related to our Phase II blinded and do the appropriate follow-up in our protocol to a 24-month follow-up. That being said, it is really important to note that if the FDA does give us that green light, what they are doing is they are saying our safety profile is pristine. They are not going to allow us to move forward with a bad safety profile. Today, we have no material adverse events, no dose-limiting toxicities. Everything is really clean. It is an autologous product. We are very comfortable with that. They will be looking at a subset of data with respect to efficacy.

That green light from them would be tremendous. It would be a major value-enhancing inflection point and would be sort of an acknowledgment that we do not have to unblind the data; we are going to go forward in this pivotal study. If for some reason they decide, like many other biotech companies, we have to do two Phase III studies, that would put us in a position where we would consider unblinding the data after a 12-month follow-up and then report on that data effectively 12 months from the last patient that was enrolled. Like I said, we are expecting enrollment to be complete in the very near term.

Jonathan Matthew Aschoff: Alright. So it is enrollment completion, then a Type B meeting where you will figure out if it is one or two Phase III studies. That Type B looks like...

Lance Alstodt: I think we are going to continue to enroll patients. In December, we hope and expect, you know, the FDA has been a little bit slow to react just given the shutdown. We expect that we will get on the calendar sometime before the end of the year and have that Type B meeting. It is unclear whether we are going to have a definitive response from the FDA. We will be able to learn a lot. We will be able to review what a Phase III protocol looks like and get some buy-in. Part of the Fast Track designation process is to really sit down with the FDA and explore ways in which we can accelerate that BLA.

Jonathan Matthew Aschoff: Okay. And what is going on with the cervical trial?

Lance Alstodt: Getting that clearance is important. I think that is very meaningful in terms of keeping our pipeline robust. We have not dedicated resources to developing it. We have a protocol. We have an agreed-upon protocol with the FDA, but it is not as if we are starting to go out and recruit sites and recruit patients just given the financial constraints. I think this is something that we want to mark, that we have experience getting multiple INDs approved. It is my belief that our focus should really be around the lumbar spine.

If we can get the BLA approved, then it is our expectation that people will be really taking advantage of the broad application of that product in a variety of different avascular zones. But I think we tie that more to a company that has more robust capital resources down the road. I think it shows and demonstrates our strong regulatory capabilities and clinical capabilities by getting approved INDs in a variety of different applications.

Jonathan Matthew Aschoff: Okay. You know, lastly, do you think you are done booking biocosmeceutical revenues this year, or do you think we might have a recurrence of something in April that might look a little like the second quarter was?

Lance Alstodt: I do not know about the second quarter because it could be. I mean, now, I do not have the visibility. I know that some products have been sold since Crystal has been on board, but it is probably nascent relative to what I think the opportunity looks like as we begin to scale and she gets her feet under her.

Jonathan Matthew Aschoff: Okay. Thank you very much, guys.

Lance Alstodt: Thank you.

Operator: Once again, if you would like to ask a question, please press 1 on your keypad. We have reached the end of the question and answer session. I will now turn the call over to Lance for closing remarks.

Lance Alstodt: Thank you, Holly. I appreciate everyone's time. I think this is a really positive quarter for the company in terms of our clinical progress. Again, I am really excited about the development and some of the very meaningful changes that we have made in terms of bolstering our commercial program. I think there is more to talk about next quarter in that regard. Obviously, this upcoming discussion that we hope to have with the FDA should provide us with additional clarity on the regulatory pathway. Thanks again for your participation. We look forward to talking to you soon.

Operator: This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

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