8-K
PURE BIOSCIENCE, INC. (PURE)
UNITEDSTATES
SECURITIESAND EXCHANGE COMMISSION
WASHINGTON,D.C. 20549
FORM8-K
CURRENTREPORT
Pursuantto Section 13 or 15(d)
ofthe Securities Exchange Act of 1934
Dateof Report (Date of earliest event reported): December 15, 2021
PUREBIOSCIENCE, INC.
(Exactname of registrant as specified in its charter)
| Delaware | 001-14468 | 33-0530289 |
|---|---|---|
| (State or other jurisdiction<br><br> <br>of incorporation) | (Commission<br><br> <br>File Number) | (IRS Employer<br><br> <br>Identification No.) |
| 9669 Hermosa Avenue<br><br> <br>Rancho Cucamonga, California | 91730 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’stelephone number, including area code: (619) 596-8600
Notapplicable
(Formername or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written<br> communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting<br> material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement<br> communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement<br> communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On December 15, 2021, PURE Bioscience, Inc. (the “Company”) issued a press release announcing financial results for the fiscal quarter ended October 31, 2021 and related information. A copy of the press release is attached as Exhibit 99.1.
The information in this Item 2.02 is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section. The information in this Item 2.02 shall not be incorporated by reference into any registration statement or other document filed with the Securities and Exchange Commission.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| 99.1 | Press Release, dated December 15, 2021. |
|---|---|
| * | Exhibit<br> 99.1 is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act<br> of 1934 or otherwise subject to the liabilities of that Section, nor shall it be incorporated by reference into any registration<br> statement or other document filed with the Securities and Exchange Commission. |
| --- | --- |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| PURE BIOSCIENCE, INC. | ||
|---|---|---|
| Dated:<br> December 15, 2021 | By: | /s/ Tom Y. Lee |
| Tom<br> Y. Lee | ||
| Chief<br> Executive Officer |
EXHIBITINDEX
| Exhibit<br><br> <br>Number | Description |
|---|---|
| 99.1 | Press Release, dated December 15, 2021. |
Exhibit 99.1
PUREBioscience Reports Fiscal First Quarter 2022
FinancialResults
Updateon Business and PURE’s SDC-Based Antimicrobial Food Safety Solutions
RANCHO CUCAMONGA, CA (December 15, 2021) – PURE Bioscience, Inc. (OTCQB: PURE) (the “Company,” “PURE” or “we”), creator of the patented non-toxic silver dihydrogen citrate (SDC) antimicrobial, today reported financial results for the fiscal first quarter ended October 31, 2021.
Summaryof Results – Fiscal First Quarter Operations
| ● | Net<br> product sales were $497,000 and $1,417,000 for the fiscal first quarters ended October 31,<br> 2021 and 2020, respectively. The decrease of $920,000 was attributable to decreased sales<br> across our distribution and end-user network servicing the food processing, transportation<br> and janitorial industry. |
|---|---|
| ● | Net<br> loss for the fiscal first quarter ended October 31, 2021 was $796,000, compared to $180,000<br> for the fiscal first quarter ended October 31, 2020. |
| ● | Net<br> loss per share was ($0.01) for the fiscal first quarter ended October 31, 2021, compared<br> to a net loss of ($0.00) for the fiscal first quarter ended October 31, 2020. |
| ● | Gross<br> margin, as a percentage of net product sales, was 65% and 55% for the fiscal first quarters<br> ended October 31, 2021 and 2020, respectively. The increase in gross margin percentage was<br> due to the sale of higher-margin formulations and packaging configurations of our products<br> during the fiscal first quarter ended October 31, 2021, compared to the fiscal first quarter<br> ended October 31, 2020. |
BusinessUpdate
Marketingand Sales
The Company has hired an international marketing firm, based out of Seattle, Washington, to support the Company’s efforts to increase revenue growth and brand recognition in the coming year. The firm focuses on working with companies to develop comprehensive marketing strategies that identify competitive delineation, drive-focused campaigns, and develop sales leads designed to materialize revenue. We expect their work to incorporate a website redesign, brand refresh, new strategic messaging and content, as well as focused video and digital campaigns that target markets such as food processing, food distribution, education, healthcare and government. We believe that a natural result of a formal marketing program, with a regular cadence of activity, will translate into market recognition of PURE as a highly-competitive brand that stands apart from the competition. Board Member, Kristin Taylor, has been instrumental in helping the Company to build a marketing function that is focused on revenue and results.
Along with a new marketing campaign, the Company is actively interviewing candidates for the newly-formed position of Director of Sales. The Company expects the individual who assumes this role to leverage his or her background in executing and delivering meaningful annual revenue targets within the bioscience sector.
The Company is in negotiations on a contract with a distributor for wider and deeper penetration into the Canadian markets. These efforts have included notification and filings with Health Canada providing a new importer of record. This distributor has been working with Canadian and multi-national food processing customers to validate usage and efficacy in facilities with the intent to begin sales efforts immediately upon execution.
FoodSafety
Jason Kawata, Vice President, Food Division, continues to lead efforts to implement EPA PURE Hard Surface and FDA PURE Control in the fresh produce channels. Jason is joined in these efforts by distributors and consultants, including Factor IV Solutions and Dr. Martin Wiedmann, a member of PURE’s Scientific Advisory Board, to provide training and validation across the channel. The Company support and sales efforts continue as the produce industry ramps back up from the pandemic slow down. In-facility validation has begun with the second largest U.S. produce processor and is moving forward towards completion. We are currently in contract discussions with a multi-national chemical distributor to carry our products to their targeted customers in fruit and vegetable processing. Assuming this contract is executed, we believe this partnership will add another dimension to our efforts into the total produce industry.
The Company was featured in a weekly newsletter to the Produce Marketing Association and United Fresh, two industry-leading trade groups with a 375,000 combined monthly impressions. The Company provides targeted solutions to industry-specific issues with links to our website that include text and video explanations of our chemistry and application technologies along with validation data. We are seeing increased inquiry levels and new business opportunities from these efforts.
The addition of Tim Steffensmeier, Director of Technical Services, Food Division, also has helped our sales efforts. He has provided introductions to numerous multi-national food processors, including an evaluation installation in a facility that is one of 16 U.S. locations where we believe PURE Hard Surface is uniquely qualified to solve long-standing food safety issues. Following a successful evaluation, we expect a product adoption process to be implemented across all U.S. facilities. Mr. Steffensmeier’s efforts have also created new relationships and added customers across other food processing channels including produce, dairy, frozen food and protein.
Janitorialand Sanitation
Efforts continue in our janitorial and sanitation industries. This past fall, PURE Hard Surface was the cover article of School Bus Ride Magazine, an official publication of the National Association for Public Transportation. The article focuses on PURE Hard Surface as a product that combines the highest efficacy with the lowest EPA toxicity levels making it an ideal safety measure for student transportation and classroom disinfection efforts. PURE Hard Surface adoption continues and is now in over 20 school districts across the U.S. and growing.
Lighthouse for the Blind and Visually Impaired, our partner that blends and bottles PURE Hard Surface in its EPA-registered facility, was faced with pandemic and supply chain issues during the final phase of bringing its new facility on-line. While these issues have caused delays, production is now slated for this quarter. Lighthouse continues to sell PURE Hard Surface to their regular customers and have added 10 new Government Supply Administration (GSA) distributors as well as sales and business development staff to aid the National Industries for the Blind in their efforts to sell PURE Hard Surface - Ability One products.
Tom Y. Lee, Chief Executive Officer, said, “Our end-users continue to grow in all segments, however, the global pandemic continues to create labor and material shortages. These issues, along with the over-purchase of chemistry, continue to be hurdles in selling our products. PURE’s focus needs to be enhanced in 2022. This is why the Board of Directors has decided to invest in a formal marketing function that will be designed to help drive leads and a strong sales pipeline intended to increase revenue in all verticals. Marketing will also help to publicize our competitive delineation and compelling brand. We believe that refreshing the website, building new messaging and content, as well as tracking sales leads and revenue through our new CRM (customer relationship management) software, will help to drive growth. Additionally, we plan to add more sales headcount intended to propel the business forward in the coming year,” concluded Lee.
AboutPURE Bioscience, Inc.
PURE is focused on developing and commercializing our proprietary antimicrobial products primarily in the food safety arena. We provide solutions to combat the health and environmental challenges of pathogen and hygienic control. Our technology platform is based on patented, stabilized ionic silver, and our initial products contain silver dihydrogen citrate, better known as SDC. This is a broad-spectrum, non-toxic antimicrobial agent, and formulates well with other compounds. As a platform technology, SDC is distinguished from existing products in the marketplace because of its superior efficacy, reduced toxicity and mitigation of bacterial resistance. PURE is headquartered in Rancho Cucamonga, California (San Bernardino metropolitan area). Additional information on PURE is available at www.purebio.com.
Forward-lookingStatements: Any statements contained in this press release that do not describe historical facts may constitute forward-lookingstatements as that term is defined in the Private Securities Litigation Reform Act of 1995. Statements in this press release concerningthe Company’s expectations, plans, business outlook, future performance, future potential revenues, expected resultsof the Company’s marketing efforts, the execution of contracts under negotiation, and any other statements concerning assumptionsmade or expectations as to any future events, conditions, performance or other matters, are “forward-looking statements.”Forward-looking statements inherently involve risks and uncertainties that could cause our actual results to differ materially from anyforward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the Company’sfailure to implement or otherwise achieve the benefits of its proposed business initiatives and plans; economic and other disruptionsresulting from COVID-19; acceptance of the Company’s current and future products and services in the marketplace, including theCompany’s ability to convert successful evaluations and tests for PURE Control and PURE Hard Surface into customer orders and customerscontinuing to place product orders as expected and to expand their use of the Company’s products; the Company’s ability tomaintain relationships with its partners and other counterparties; the Company’s ability to generate sufficient revenues and reduceits operating expenses in order to reach profitability; the Company’s ability to raise the funding required to support its continuedoperations and the implementation of its business plan; the ability of the Company to develop effective new products and receive requiredregulatory approvals for such products, including the required data and regulatory approvals required to use its SDC-based technologyas a direct food contact processing aid in raw meat processing and to expand its use in OLR poultry processing; competitive factors,including customer acceptance of the Company’s SDC-based products that are typically more expensive than existing treatment chemicals;dependence upon third-party vendors, including to manufacture its products; and other risks detailed in the Company’s periodicreport filings with the Securities and Exchange Commission (the SEC), including its Form 10-K for the fiscal year ended July 31, 2021and Form 10-Q for the first fiscal quarter ended October 31, 2021. You should not place undue reliance on these forward-looking statements,which speak only as of the date of this press release. By making these forward-looking statements, the Company undertakes no obligationto update these statements for revisions or changes after the date of this release.
Contact:
Mark Elliott, VP Finance
PURE Bioscience, Inc.
Ph: 619-596-8600 ext: 116
PUREBioscience, Inc.
CondensedConsolidated Balance Sheets
| July 31, 2021 | |||||
|---|---|---|---|---|---|
| Assets | |||||
| Current assets | |||||
| Cash and cash equivalents | 1,760,000 | $ | 2,390,000 | ||
| Accounts receivable | 238,000 | 368,000 | |||
| Inventories, net | 312,000 | 332,000 | |||
| Restricted cash | 75,000 | 75,000 | |||
| Prepaid expenses | 68,000 | 32,000 | |||
| Total current assets | 2,453,000 | 3,197,000 | |||
| Property, plant and equipment, net | 769,000 | 740,000 | |||
| Patents, net | 333,000 | 366,000 | |||
| Total assets | 3,555,000 | $ | 4,303,000 | ||
| Liabilities and stockholders’ equity | |||||
| Current liabilities | |||||
| Accounts payable | 465,000 | $ | 593,000 | ||
| Accrued liabilities | 124,000 | 138,000 | |||
| Loan payable | 239,000 | 239,000 | |||
| Total current liabilities | 828,000 | 970,000 | |||
| Commitments and contingencies | |||||
| Stockholders’ equity | |||||
| Preferred stock, 0.01 par value: 5,000,000 shares authorized, no shares issued and outstanding | — | — | |||
| Common stock, 0.01 par value: 150,000,000 shares authorized, 87,873,141 shares issued and outstanding at October 31, 2021, and 87,223,141shares issued and outstanding at July 31, 2021 | 879,000 | 873,000 | |||
| Additional paid-in capital | 128,437,000 | 128,253,000 | |||
| Accumulated deficit | (126,589,000 | ) | (125,793,000 | ) | |
| Total stockholders’ equity | 2,727,000 | 3,333,000 | |||
| Total liabilities and stockholders’ equity | 3,555,000 | $ | 4,303,000 |
All values are in US Dollars.
PUREBioscience, Inc.
CondensedConsolidated Statements of Operations
(Unaudited)
| Three months ended | ||||||
|---|---|---|---|---|---|---|
| October 31, | ||||||
| 2021 | 2020 | |||||
| Net product sales | $ | 497,000 | $ | 1,417,000 | ||
| Royalty revenue | 4,000 | 174,000 | ||||
| Total revenue | 501,000 | 1,591,000 | ||||
| Cost of goods sold | 172,000 | 641,000 | ||||
| Gross Profit | 329,000 | 950,000 | ||||
| Operating costs and expenses | ||||||
| Selling, general and administrative | 1,057,000 | 1,046,000 | ||||
| Research and development | 67,000 | 83,000 | ||||
| Total operating costs and expenses | 1,124,000 | 1,129,000 | ||||
| Loss from operations | (795,000 | ) | (179,000 | ) | ||
| Other income (expense) | ||||||
| Interest expense, net | (1,000 | ) | (1,000 | ) | ||
| Total other income (expense) | (1,000 | ) | (1,000 | ) | ||
| Net loss | $ | (796,000 | ) | $ | (180,000 | ) |
| Basic and diluted net loss per share | $ | (0.01 | ) | $ | (0.00 | ) |
| Shares used in computing basic and diluted net loss per share | 87,432,380 | 87,072,951 |
PUREBioscience, Inc.
CondensedConsolidated Statement of Stockholders’ Equity
(Unaudited)
| Common Stock | Additional<br> Paid-In | Accumulated | Total<br> Stockholders’ | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Shares | Amount | Capital | Deficit | Equity | |||||||||
| Balance July 31, 2021 | 87,223,141 | $ | 873,000 | $ | 128,253,000 | $ | (125,793,000 | ) | $ | 3,333,000 | |||
| Share-based compensation expense - stock options | — | — | 169,000 | — | 169,000 | ||||||||
| Share-based compensation expense - restricted stock units | — | — | 21,000 | — | 21,000 | ||||||||
| Issuance of common stock upon the vesting of restricted stock units | 650,000 | 6,000 | (6,000 | ) | — | — | |||||||
| Net loss | — | — | — | (796,000 | ) | (796,000 | ) | ||||||
| Balance October 31, 2021 (Unaudited) | 87,873,141 | $ | 879,000 | $ | 128,437,000 | $ | (126,589,000 | ) | $ | 2,727,000 | |||
| Common Stock | Additional<br> Paid-In | Accumulated | Total<br> Stockholders’ | ||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |
| Shares | Amount | Capital | Deficit | Equity | |||||||||
| Balance July 31, 2020 | 87,072,951 | $ | 871,000 | $ | 127,414,000 | $ | (123,474,000 | ) | $ | 4,811,000 | |||
| Share-based compensation expense - stock options | — | — | 208,000 | — | 208,000 | ||||||||
| Share-based compensation expense - restricted stock units | — | — | 21,000 | — | 21,000 | ||||||||
| Net loss | — | — | — | (180,000 | ) | (180,000 | ) | ||||||
| Balance October 31, 2020 (Unaudited) | 87,072,951 | $ | 871,000 | $ | 127,643,000 | $ | (123,654,000 | ) | $ | 4,860,000 |
PUREBioscience, Inc.
CondensedConsolidated Statements of Cash Flows
(Unaudited)
| Three Months Ended | ||||||
|---|---|---|---|---|---|---|
| October 31, | ||||||
| 2021 | 2020 | |||||
| Operating activities | ||||||
| Net loss | $ | (796,000 | ) | $ | (180,000 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
| Share-based compensation | 190,000 | 229,000 | ||||
| Depreciation and amortization | 58,000 | 45,000 | ||||
| Changes in operating assets and liabilities: | ||||||
| Accounts receivable | 130,000 | 529,000 | ||||
| Inventories | 20,000 | (186,000 | ) | |||
| Prepaid expenses | (36,000 | ) | (30,000 | ) | ||
| Accounts payable and accrued liabilities | (142,000 | ) | (606,000 | ) | ||
| Net cash used in operating activities | (576,000 | ) | (199,000 | ) | ||
| Investing activities | ||||||
| Purchases of property, plant and equipment | (54,000 | ) | (174,000 | ) | ||
| Net cash used in investing activities | (54,000 | ) | (174,000 | ) | ||
| Net decrease in cash and cash equivalents, and restricted cash | (630,000 | ) | (373,000 | ) | ||
| Cash and cash equivalents, and restricted cash at beginning of period | 2,465,000 | 3,914,000 | ||||
| Cash and cash equivalents, and restricted cash at end of period | $ | 1,835,000 | $ | 3,541,000 | ||
| Reconciliation of cash and cash equivalents, and restricted cash to the condensed consolidated balance sheets | ||||||
| Cash and cash equivalents | $ | 1,760,000 | $ | 3,466,000 | ||
| Restricted cash | $ | 75,000 | $ | 75,000 | ||
| Total cash and cash equivalents and restricted cash | $ | 1,835,000 | $ | 3,541,000 |