22nd Century Group Files Annual Report and Provides Business Update
CLARENCE, N.Y.--(BUSINESS WIRE)-- 22nd Century Group, Inc. (OTCBB: XXII), a company that has developed groundbreaking technology for tobacco harm reduction and smoking cessation products, filed its 2011 report on Form 10-K with the Securities and Exchange Commission (SEC) and provided a business update.
For year ended December 31, 2011, 22nd Century Group reported revenue of $1.01 million, compared with de minimis revenue for the year ended December 31, 2010. The company reported a net loss for 2011 of $1.35 million or $0.05 per diluted share, compared to a net loss for 2010 of $1.42 million or $0.11 per diluted share. The decrease in the net loss was a result of increased revenue combined with an unrealized gain related to warrants and reduced interest and debt expense totaling $2.73 million, offset by increases in operating expenses totaling $3.62 million, including clinical trial expenses, sales and marketing costs, and increased administrative expenses in year ended December 31, 2011, as compared to year ended December 31, 2010.
22nd Century Business Update
Potential out-licensing and partnership opportunities
The company is in advanced discussions with potential licensing partners for international markets. Transnational companies have expressed interest in 22nd Century’s proprietary technology and products. To most effectively commercialize its products, 22nd Century is exploring exclusive licensing arrangements on a country-by-country basis in Asia and Europe in addition to strategic partnerships in the United States. 22nd Century owns or exclusively controls 101 issued patents in 78 countries plus an additional 38 pending patent applications.
Results from three independent smoking cessation clinical trials with very low nicotine (“VLN”) cigarettes are expected to be available this year. These trials will be instrumental for the further development of X-22, 22nd Century’s prescription-based smoking cessation aid in development consisting of a kit of VLN cigarettes.
Queen Mary University of London, in collaboration with Pfizer Inc., is conducting a smoking cessation clinical trial with approximately 200 subjects to evaluate whether the use of 22nd Century’s VLN cigarettes in combination with medication (Chantix® or NRT) increases quitting rates over the use of Chantix® or NRT alone (ClinicalTrials.gov Identifier NCT01250301). This trial will be completed in June 2012.
The Clinical Trials Research Unit, University of Auckland completed a Phase III/IV smoking cessation trial with 1,410 subjects; half received VLN cigarettes plus NRT (nicotine patch, gum and/or lozenge) and half received only NRT. Results were presented at the Society for Research on Nicotine and Tobacco (SRNT) European meeting in 2011. The subjects treated with VLN cigarettes plus NRT had significantly higher quitting rates at all measured time points (3 weeks, 6 weeks, 3 months and 6 months) than subjects treated with NRT only. A report of this study has been accepted for publication in Addiction.
The University of Minnesota Masonic Cancer Center recently completed a Phase II trial, Innovative Interventions for Smoking Cessation (ClinicalTrials.gov Identifier NCT01050569). A total of approximately 219 subjects received one of three treatments: exclusive use of 22nd Century’s VLN cigarette, exclusive use of a 21-mg nicotine patch, and use of the nicotine patch and VLN cigarette concurrently. This is a follow-up to a previously reported study comparing VLN cigarettes, reduced nicotine cigarettes, and nicotine lozenges (Hatsukami et al. 2010).
22nd Century will compare results from these independent clinical trials to the company’s Phase II-B clinical trial to determine which variables optimize quitting for the design of future company-sponsored X-22 clinical trials. 22nd Century may proceed with a Phase III clinical trial as early as the fourth quarter 2012. The company’s Investigational New Drug Application for X-22 was cleared by the U.S. Food and Drug Administration (FDA) in July 2011.
Modified Risk Tobacco Products
22nd Century announced on April 10, 2012 that applications will be filed in the second half of 2012 with the FDA for two types of its proprietary modified risk cigarette candidates in accordance with the FDA’s March 30, 2012 Modified Risk Tobacco Product Applications Draft Guidance. The first cigarette, referred to as BRAND A, is a VLN cigarette that is patented in dozens of countries and contains the world’s lowest nicotine tobacco. The second cigarette, referred to as BRAND B, is a low-tar cigarette with a relatively high nicotine tobacco blend, effectively the world’s lowest tar-to-nicotine ratio cigarette.
For additional information on 22nd Century Group, please visit: www.xxiicentury.com
Cautionary Note Regarding Forward-Looking Statements: This press release contains forward-looking information, including all statements that are not statements of historical fact regarding the intent, belief or current expectations of the company, its directors or its officers with respect to the contents of this press release. The words “may,” “would,” “will,” “expect,” “estimate,” “anticipate,” “believe,” “intend” and similar expressions and variations thereof are intended to identify forward-looking statements. We cannot guarantee future results, levels of activity or performance. You should not place undue reliance on these forward-looking statements, which speak only as of the date that they were made. These cautionary statements should be considered with any written or oral forward-looking statements that we may issue in the future. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to reflect actual results, later events or circumstances or to reflect the occurrence of unanticipated events. You should carefully review and consider the various disclosures made by us in our annual financial report on Form 10-K dated April 16, 2012, including the section entitled “Risk Factors,” and our other reports filed with the U.S. Securities and Exchange Commission which attempt to advise interested parties of the risks and factors that may affect our business, financial condition, results of operation and cash flows. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected.
Tom Redington, 203-222-7399
Source: 22nd Century Group, Inc.
Released April 17, 2012