Is It Time To Ride The Momentum Of BioRestorative Therapies (BRTX) Stock?

BioRestorative Therapies, Inc. (OTXMKTS: BRTX), a thinly traded over the counter stock is gaining investor attention, bolstered by a rising share price that has added roughly 10% in value since Thursday of last week. The gains came after BRTX announced that the Australian Patent Office had issued a Notice Of Acceptance for BRTX’s patent application covering methods related to its proprietary metabolic program, TheroStem™. Following payment of required fee’s, the patent is expected to be issued within ninety days.

BRTX Building It’s IP

The metabolic patent fortifies a prior issued patent to BRTX and compliments its original “brown fat” technology patent published in the United States in November of 2015. Once final, the Australian allowance will provide for the protection of methods generating stem cells and stem cell lines from brown adipose tissue (brown fat) under animal-free conditions. BRTX intends to advance the technology to determine the efficacy and therapeutic value for treating a broad range of degenerative and metabolic disorders, including but not limited to diabetes, hypertension, cardiac deficiency, and obesity.

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Introducing BioRestorative Therapies

BioResortative Therapies, Inc. is in the business of developing therapeutic products and medical treatments utilizing cell and tissue protocols, primarily with the use of adult stem cells. BRTX has two primary programs in the clinic, one that is targeting disc and spine disease and the other to treat metabolic disorders.

BRTX is led by a strong management team and is complimented with an equally impressive scientific advisory board, bringing extensive experience in stem cell science, medical-related services, life science services, and acquisition and strategic partnering.

The stock trades on the OTC market, thinly traded with approximately 1700 shares traded each day and has a 52-week price range of between $2.71 – $5.01 a share. Shares closed on Friday at $4.50 a share, up 11% for the week. Since March 1, 2017, the stock is higher by 7%, with anemic volume reaching only as high as 5400 shares traded on March 20th. The volume may be indicative of the under-the-radar nature of BRTX as well as being attributable to the small number of shares outstanding. As of the latest quarterly filing, BRTX has only 5.27 million shares outstanding, with 3.56 million of those shares being available in the public float.

Low volume stocks are not necessarily a bad thing for either momentum or short-term investors. When small share floats combine with positive and material news, the result can often lead to significant moves in the company stock. In the case of BRTX, investors appear to be gaining interest in the company’s clinical programs, confident that either the “brtxDISC™” or “TheroStem Program™” can deliver the news to drive the share price higher.

brtxDISC Program™

The brtxDISC program is the company’s lead therapeutic study intended to treat Chronic Lumbar Disc Disease (cLDD). BRTX is utilizing a minimally invasive, non-surgical autologous stem cell treatment to provide a potential long-term therapeutic effect for patients with bulging and protruding discs.

The BRTX method represents a significant shift from traditional treatment options and offers an alternative approach to treating damaged discs by exploiting the treatment gap between non-invasive and invasive procedures. The BRTX solution is minimally invasive and designed to specifically target cLDD, which may offer significant pain relief in the lower back, buttock, legs, and pain-related symptoms in the legs, toes or feet.

The market is significant, with more than 65 million patients suffering from chronic back pain per year. In a population group apprised of patients more than 50 years old, estimates indicate that roughly 85% of the group will begin to show signs of degenerative disk disease, with the vast majority of these cases being asymptomatic in nature.

The BRTX alternative is looking to provide an effective alternative to open surgery which requires general anesthesia as well as a prolonged recovery regimen. Procedures currently used to treat these conditions include laminectomies and discectomies, both which are physically disruptive to the patient. These intrusive surgical methods often require bone and ligaments to be removed so that the treating surgeon can gain access to the herniated or ruptured disc, which leads to extended recovery times and sometimes severe and long-lasting postoperative pain.

BRTX is studying a new approach. Their procedure is intended to offer a much-needed shift to the way back surgery is being addressed in the United States and abroad. With treatment inconsistencies, comprised of either being surgically treated or heavily medicated with opioid relief, BRTX believes that they can fill the gap in-between those parameters and provide an alternative and therapeutic option for patients, one which may also prove to be curative in nature.

In February of this year, BRTX received FDA clearance to initiate its Phase II clinical trial for the treatment of patients with degenerative disc disease. The phase II trial is a 72 patient, randomized, double-blinded and controlled study. The multi-center study is designed to evaluate both safety and efficacy of a single dose of BRTX-100 in treating chronic lower lumbar disc disease. The primary endpoint of the study is to reduce pain and to increase function in study patients.

In January, BRTX submitted an IND application to the FDA to obtain clearance to commence the BRTX-100 trial. Additionally, BRTX has recently completed its pre-IND meeting with the FDA and is preparing to file an additional IND submission for a clinical trial to advance other therapies in the brtxDISC program

By using a non-surgical approach, trained medical professionals will perform a re-transplantation of a patient’s stem cells, an out-patient procedure that can take place in a physician’s office. The method involves facilitating the delivery of a patients own cells to the damaged part of the injured disc, which theoretically allows the stem cells to repair the damaged region. The training required to perform the procedure is not extensive, and BRTX expects that there will be hundreds of doctors able to treat patients with these intradiscal injections. Once approved, the method is anticipated to have a global impact and a substantially larger patient market to serve.

In pre-clinical studies, BRTX has published data which demonstrates the effectiveness of the stem cell treatment, showing that after just three months post-injection, the trial patient’s had been relieved of most of their discomforting symptoms and an associated MRI image showed a significant reduction in size and shape of the disc bulge. The treating cells are delivered through a proprietary medical device that allows for precise delivery of the cells used in the therapy. The device may further prove to have additional clinical indications that may be of future benefit to the company, resulting in an increase of potential clinical applications as well as the possibility to secure licensing agreements.

Trial data is expected to be released throughout 2017, and the company is hoping to further substantiate and duplicate the encouraging results already shown in patient treatments. MRI’s are showing the clear benefit to the BRTX alternative treatment option, and the company is sitting well positioned to gain both scientific and share price traction if the results remain consistent with prior data and study publications.

TheroStem Program™

BRTX’s TheroStem Program is designed around the use of brown fat stem cells to treat metabolic disorders and obesity with a focus on the potential to prevent the onset of Type 2 Diabetes. BRTX has been successful in identifying the first stem cell population isolated from a particular brown fat depot in the human body. Studies have shown that brown fat is present in the human body and can maintain and regulate metabolic systems in the body. Use of this isolated brown fat cell may include the ability to induce weight loss, and to reduce glucose and lipid levels in the body, with the potential to delay or prevent the onset of Type 2 Diabetes.

BRTX is studying the potential for brown fat cells to have multiple indications for use, and as the program advances, the company will seek an opportunity to develop and collect data that may lead to the creation of a small molecule drug therapy, targeted to treat Type 2 Diabetes.

The study by BRTX, recognizing the value of brown stem cell’s, has offered encouraging possibilities, and the TheroStem Program plans to leverage the data of its groundbreaking research to study different cellular therapies and to advance and broaden the company pipeline.

BRTX And The Future

Obviously, no one can predict the outcome of any trial. However, the BRTX platform has published encouraging data that supports the potential for an approved treatment. BRTX received peer recognition when its data was released in the Journal of Traditional Medicine, which highlighted the success of the companies long-term safety and feasibility study of the injection of autologous, MSC’s into patients with cLDD. The study produced no adverse or unexpected responses, another indication of the potential success of the proposed therapies.

The company has strong management that has demonstrated the skill set necessary to advance the clinical stages successfully through the regulatory hurdles. Keep in mind that clinical trials are not cheap, and the company expects that it will need approximately $8 million to complete its pending phase II trial and an additional $30 million in additional funding to supplement the trial to its conclusion. The company is producing revenue based on a royalty agreement; however, it is not substantial and helps only minimally to offset the net loss of the company.

BRTX has demonstrated the ability to raise cash, and with the studies about to commence, investors may once again find management up to the task to raising the funds needed to advance the trials. BRTX is a good stock to have on the radar, and with its small share float, the stock can catch a bid on any hint of positive news. Be prudent with your BRTX investment decisions, but at the same time, don’t ignore the opportunity altogether. When facing adversity, strong leaders emerge, and with BRTX staring at potentially revolutionary treatment options, the likelihood of the team to raise the money necessary to advance the trials appears to be quite achievable. At current levels, the dilution may appear significant as a percentage of existing shares issued, however, the company should be able to keep total o/s well under 8 million shares post financing.

With the stock trading higher by 11% last week, it serves as an indicator that positive news can generate quick returns. For BRTX stock, the price trend is gaining positive momentum. But, until the financial considerations associated with trial cost are addressed, be sure to stay focused toward any and all material developments. In the near term, though, the trend may be a trader’s friend, providing an opportunity for quick, momentum based gains from a stock that may hold long-term promise.

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Disclosure: This article was written by Kenny Soulstring, and it reflects my own opinions and unique articulation. This article is not intended to offer investing advice, guarantee 100% accurate predictions or to be interpreted as providing a personal recommendation. What I can guarantee, though, is accurate research, thoughtful analysis and an enthusiasm about any stock that I cover.

While I seek to uncover emerging companies that I feel have true value and potential, it’s important that investors assign an appropriate time horizon to each of their investments, understanding that emerging companies need time to mature.

I wrote this article myself and it includes my own research and expresses my own opinions. I am not receiving compensation for it (other than from CNA Finance). I have no business relationship with any company whose stock is mentioned in this article.

Additional Disclosure: I have no position in any stock mentioned, but may initiate a long position in BRTX within the next 72 hours.

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