(Source: PRNewswire)
PETERSBURG, Va., Aug. 10 /PRNewswire-FirstCall/ -- Star Scientific, Inc. (Nasdaq: STSI) filed its second-quarter report on Form 10-Q today with the Securities and Exchange Commission. The company reported net sales of $.2 million for the second quarter, significantly higher when compared with net sales of $.05 million for the same quarter in 2008. Net sales for the first six months of 2009 totaled $.38 million compared with $.2 million for the same period in 2008. Sales volumes rebounded strongly compared with lower volumes for first-quarter 2009, which the company believes was due to the passage of amendments to the Children's Health Insurance Program bill that are financed by increases in the federal excise tax on tobacco products. The company reported a second-quarter net loss of $7.0 million compared with a $6.4 million loss for the same period in 2008. This increase was due primarily to additional costs associated with the May, 2009 jury trial of the company's patent infringement lawsuit against RJ Reynolds Tobacco Company. Total operating costs for second quarter 2009 of $6.4 million increased from $5.8 million for the same period in 2008.
(Logo: http://www.newscom.com/cgi-bin/prnh/20090317/ STARSCIENTIFICLOGO )
The research and development portion of those expenses included $.1 million in product development work to enhance the company's dissolvable smokeless tobacco products, Ariva(R) and Stonewall(R). As part of that effort, the company recently completed successful focus group testing for several new versions of Ariva(R), including additional blends. The company also is in active discussions with another tobacco company regarding an agreement aimed at expanding distribution and marketing of Ariva(R) and Stonewall(R). If an agreement is achieved, Star anticipates it will be able to achieve both cost reductions and broadened product distribution for its dissolvable tobacco products.
Second quarter R&D expenses also included expenditures of $.4 million by the company's Rock Creek Pharmaceuticals subsidiary. These expenditures related to assessing the applicability of low- TSNA tobacco and certain MAO agents for several applications, including in a non-nicotine nutraceutical product designed to minimize nicotine cravings.
Rock Creek now has completed two preliminary studies to assess the viability and safety of the active components for a non- nicotine nutraceutical (a dietary supplement product). Curtis Wright, MD, MPH, Chief Medical Officer of Rock Creek, stated he is pleased with the preliminary results of the safety studies now being conducted at two independent research institutions.
