EnteroMedics Announces Third Quarter 2009 Financial Results.Company Receives Notice of NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on Listing Deficiency ST. PAUL, Minn. -- EnteroMedics Inc. (NASDAQ: ETRM ETRM Energy Trading and Risk Management ETRM Enterprise Technology Reference Model (Massachusetts) ), the developer of medical devices using neuroblocking technology to treat obesity and other gastrointestinal disorders, today reported financial results for the three and nine months ended September 30, 2009. For the three months ended September 30, 2009, the Company reported a net loss of $12.0 million, or $0.40 per share, including non-cash expense of $3.8 million related to the revaluation Revaluation A calculated adjustment to a country's official exchange rate relative to a chosen baseline. The baseline can be anything from wage rates to the price of gold to a foreign currency. In a fixed exchange rate regime, only a decision by a country's government (i.e. of warrant liability, research and development expenses of $4.6 million, and general and administrative expenses of $2.7 million. For the nine months ended September 30, 2009, the Company reported a net loss of $29.0 million, or $1.06 per share. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. were primarily associated with the cost of supporting the Company's clinical trials and the development of VBLOC[R] vagal vagal /va·gal/ (va´gal) pertaining to the vagus nerve. va·gal adj. Of or relating to the vagus nerve. vagal pertaining to the vagus nerve. blocking therapy delivered through the Company's Maestro[R] System. On September 30, 2009, the Company's cash, cash equivalents and short-term investments totaled $27.1 million, which does not reflect the proceeds of its October 2, 2009 agreement with an institutional investor Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. to raise $4.9 million in a registered direct offering of its common stock. "We expect to complete our evaluation of the one year data from the EMPOWER trial during the fourth quarter. This process will help us determine the Company's plans for VBLOC Therapy," said President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Mark B. Knudson, Ph.D. "We remain fully committed to the support of the patients and health care professionals involved in our ongoing clinical studies." "Our cash position gives us operating flexibility well into 2010," stated Gregory S. Lea, Senior Vice President and Chief Financial Officer of EnteroMedics. "We are focused on effectively managing our expenses while we finalize our next steps with the Maestro System." NASDAQ Notice of Deficiency EnteroMedics also announced today that on October 19, 2009 it received a Nasdaq Staff Deficiency Letter Deficiency letter Notification from the SEC to a prospective issuer of securities that revisions or additions need to be made to the preliminary prospectus. deficiency letter indicating that, for ten consecutive business days, the Company's common stock did not maintain the minimum Market Value of Listed Securities (MVLS MVLS Maryland Volunteer Lawyers Service MVLS Microsoft Volume Licensing Services ) of $50,000,000 as required by Listing Rule 5450(b)(2)(A). The Company has been provided 90 calendar days, or until January 19, 2010, to regain listing compliance, which can be achieved if the Company's MVLS closes at $50,000,000 or more for a minimum of ten consecutive business days during this time. The Company will continue to be listed on the NASDAQ Global Market during this period. In the event the Company does not regain compliance prior to expiration of the 90 days, it will receive written notification that its securities are subject to delisting. The Company may, at that time, appeal the Staff's determination to a Hearings Panel. Such an appeal, if granted, would stay delisting until a Panel ruling. Alternatively, the Company may choose to apply for transfer to the Nasdaq Capital Market Originally called the NASDAQ Small Cap Market, NASDAQ announced a name change to the NASDAQ Capital Market on September 27, 2005. [1] The NASDAQ Capital Market exists for securities of smaller, less-capitalized companies (small caps) that do not qualify for , provided it satisfies the requirements for continued listing on that market. There can be no assurance that the Company will be able to reestablish or maintain compliance with listing criteria on either Nasdaq market or that an appeal, if taken, would be successful. About EnteroMedics Inc. EnteroMedics is a development stage medical device company focused on the design and development of devices that use neuroblocking technology to treat obesity and other gastrointestinal disorders. EnteroMedics' proprietary neuroblocking technology, VBLOC[R] vagal blocking therapy, is designed to intermittently block the vagus nerves using high-frequency, low-energy, electrical impulses. EnteroMedics is currently recruiting patients outside of the United States for a feasibility study "A Feasibility Study" is an episode of the original The Outer Limits television show. It first aired on 13 April, 1964, during the first season. It was remade in 1997 as part of the revived The Outer Limits series with a minor title change. examining VBLOC Therapy's effects on blood glucose levels blood glucose level, n level of glu-cose in the bloodstream, normally about 70 to 115 mg/dL after fasting overnight. Higher levels may indicate diseases such as diabetes mellitus. in diabetic patients. For more information, visit www.enteromedics.com. Forward-Looking Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement: This press release contains forward-looking statements about EnteroMedics Inc. Our actual results could differ materially from those discussed due to known and unknown risks, uncertainties and other factors including our limited history of operations, our losses since inception and for the foreseeable future; our lack of regulatory approval for our Maestro[R] System for the treatment of obesity; our preliminary findings from our EMPOWER[TM] pivotal trial; our ability to commercialize our Maestro System; our dependence on third parties to initiate and perform our clinical trials; the need to obtain regulatory approval for any modifications to our Maestro System; physician adoption of our Maestro System and VBLOC[R] vagal blocking therapy; our ability to obtain third party coding, coverage or payment levels; ongoing regulatory compliance; our dependence on third party manufacturers and suppliers; the successful development of our sales and marketing capabilities; our ability to raise additional capital when needed; our ability to attract and retain management and other personnel and to manage our growth effectively; potential product liability claims; potential healthcare fraud and abuse claims; potential healthcare legislative reform and our ability to obtain and maintain intellectual property protection for our technology and products. These and additional risks and uncertainties are described more fully in the Company's filings with the Securities and Exchange Commission, particularly those factors identified as "risk factors" in the Company's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. dated March 12, 2009. We are providing this information as of the date of this press release and do not undertake any obligation to update any forward-looking statements contained in this document as a result of new information, future events or otherwise. Caution-Investigational device. Limited by U.S. Federal law to investigational use. The implantation procedure and usage of the Maestro[R] System carry some risks, such as the risk generally associated with laparoscopic Laparoscopic A minimally-invasive surgical or diagnostic procedure that uses a flexible endoscope (laparoscope) to view and operate on structures in the abdomen. Mentioned in: Obstetrical Emergencies procedures and those related to treatment as described in the EMPOWER clinical trial informed consent. [TABLE OMITTED] [TABLE OMITTED] |
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