Star Scientific Files Annual Financial Report for 2012; Reports on Results of
Operations and Continued Increase in Sales of its Dietary Supplement Products
GLEN ALLEN, Va., March 18, 2013
GLEN ALLEN, Va., March 18, 2013 /PRNewswire/ -- Star Scientific, Inc. (NASDAQ:
STSI) today filed its annual financial report on Form 10-K with the Securities
& Exchange Commission (SEC). The Company reported net sales for the year
ended December 31, 2012 of $6.2 million, a five-fold increase over 2011 net
sales of $1.2 million. Fourth-quarter 2012 net sales totaled $2.0 million,
compared with $0.8 million in fourth-quarter 2011. Net sales of the Company's
Anatabloc® dietary supplement constituted the vast majority of all sales for
2012. The Company's net sales have increased in each of the past five
quarters, with that trend continuing in the first quarter of 2013.
(Logo: http://photos.prnewswire.com/prnh/20120301/NE62741LOGO )
Total operating expenses for 2012 were approximately $27.2 million, a decrease
of approximately $7.9 million, or 22.3%, from approximately $35.1 million for
the same period in 2011. Research and Development costs increased in 2012 by
$1.3 million from the earlier period to $4.6 million, primarily in connection
with clinical (human) and pre-clinical (non-human) studies of the Company's
Anatabloc® dietary supplement and Anatabloc® Facial Creme. Anatabloc® Facial
Creme was introduced into the market in September 2012 as a cosmetic product,
and a related Anatabloc® cleanser and serum are both in development.
Marketing expenses also increased in 2012 by approximately $3.6 million from
the earlier period to $6.2 million. This increase was directly related to the
company's efforts to broaden consumer awareness for its Anatabloc® product.
General and administrative expenses decreased from approximately $29.3 million
in 2011 to approximately $16.5 million for 2012, a decrease of approximately
$12.8 million, or 43.7%. This decrease in G&A expenses for 2012 was due
primarily to lower non-cash charges for stock based compensation.
The Company reported a net loss of $(22.9) million for 2012, as compared with
a net loss of $(38.0) million for the same period in 2011. The net loss for
2012 includes other income of $6.6 million, primarily in connection with the
September 2012 settlement of the RJ Reynolds patent litigation matters.
As of December 31, 2012, the Company discontinued the sale of its low-TSNA
smokeless tobacco products and completed its transition from the tobacco
manufacturing business in order to focus exclusively on its dietary
supplements, related cosmetic products, and potential pharmaceutical
products. This decision was made, among other reasons, because manufacturing
dissolvable tobacco products negatively impacted the Company's ability to
interest leading research centers in undertaking clinical research related to
its dietary supplements and the principal compound in those products,
anatabine citrate. The Company's corporate intent is to embrace the biotech
landscape as it focuses on a range of wellness products, both in the
nutraceutical and pharmaceutical areas. At the same time, the Company will
continue to explore licensing opportunities for its patented StarCured®
tobacco curing process and for its related low-TSNA dissolvable tobacco
products and technology.
Certain statements contained in this release constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements include, but are not limited to statements identified
by words such as "believes," "expects," "anticipates," "estimates," "intends,"
"plans," "targets," "projects" and similar expressions. The statements in this
release are based upon the current beliefs and expectations of our company's
management and are subject to significant risks and uncertainties. Actual
results may differ from those set forth in the forward-looking statements.
Numerous factors could cause or contribute to such differences, including, but
not limited to, results of clinical trials and/or other studies, the
challenges inherent in new product development initiatives, including the
continued development and market acceptance of our nutraceutical dietary
supplements products, the effect of any competitive products, our ability to
license and protect our intellectual property, our ability to raise additional
capital in the future that is necessary to maintain our business, changes in
government policy and/or regulation, potential litigation by or against us and
any governmental review of our products or practices, as well as other risks
discussed from time to time in our filings with the Securities and Exchange
Commission, including, without limitation, our annual report on Form 10-K for
the fiscal year ended December 31, 2012. We undertake no duty to update any
forward-looking statement or any information contained in this press release
or in other public disclosures at any time.
About Star Scientific
Star Scientific, Inc. is a technology-oriented company with a mission to
promote maintenance of a healthy metabolism and lifestyle. Over the last
several years, through its wholly owned subsidiary, Rock Creek
Pharmaceuticals, Star Scientific has been engaged in the manufacturing, sale,
and marketing of two nutraceutical dietary supplements, and the development of
other nutraceuticals and pharmaceuticals. The company also continues to pursue
the licensing of the technology behind its proprietary StarCured® curing
process and its related products. Rock Creek Pharmaceuticals has scientific
and research offices in Gloucester, MA, and a regulatory office in Washington,
DC. Star Scientific has a Corporate and Sales Office in Glen Allen, VA, and an
Executive, Scientific & Regulatory Affairs office in Washington, DC.
Talhia T. Tuck
Vice President, Communications and Investor Relations
Star Scientific, Inc.
SOURCE Star Scientific, Inc.
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