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BioSyntech Reports Q3 Fiscal 2009 Results

BioSyntech, Inc. (Biosyntech) has reported revenues of CAD3,198 for the third quarter of fiscal 2009, compared with revenues of CAD21,193 in the year-ago quarter. It has reported a net loss of CAD4.5 million, or CAD0.05 loss per share, for the third quarter of fiscal 2009, compared with the net loss of CAD2.3 million, or CAD0.02 loss per share, in year-ago quarter.

“We achieved a major milestone subsequent to the end of the quarter, completing the enrolment of eighty patients into the pivotal trial for our lead product, BST-CarGel(R),” said Michel Lagueux, chairman of the board of directors. “We will continue to manage our resources conservatively as we prepare for the results from this pivotal trial, which could lead to marketing approval for BST-CarGel(R) in Canada and Europe. In parallel, we continue to advance our US strategy for BST-CarGel(R) and the pursuit of strategic options.”

Financial review

For the nine-month period ended December 31, 2008, the company had revenues of $17,065 against revenues of $125,357 for the nine-month period ended December 31, 2007. The company has had limited revenues to date generated almost entirely by sales of purified chitosan, called Ultrasan.

Research and development (“R&D”) expenses totalled $1,646,645 for the third quarter of fiscal 2009, against $1,568,786 for the comparable quarter a year ago. R&D expenses were $4,631,213 for the nine-month period ended December 31, 2008 against $4,404,126 for the same period a year ago. The increases were mainly due to higher research contracts only partly offset by lower compensation costs.

General and administrative expenses totalled $548,633 for the third quarter, against $917,521 for the comparable quarter a year ago. General and administrative expenses were $2,243,719 for the nine-month period ended December 31, 2008 against $2,766,658 for the same period a year ago. The decreases were mainly due to lower remuneration as a result of the restructuring, lower compensation expenses related to options granted, lower marketing and investor relations expenses, only partly offset by higher professional fees.

The accretion in the carrying value of the convertible debenture and interest was respectively of $1,029,436 and $1,819,255 for the quarter and nine-month periods ended December 31, 2008 against nil for the three-month and nine-month periods ended December 31, 2007.

The restructuring costs were $1,356,358 for the quarter and nine-month periods ended December 31, 2008 against nil for the three-month and nine-month periods ended December 31, 2007. The restructuring costs are mainly comprised of severances as dictated by contractual agreements and termination fees in accordance with Quebec common practice.

The loss for the nine-month period ended December 31, 2008 amounted to $9,868,299 or ($0.10) per share against $6,821,392 or ($0.07) per share for the nine-month period ended December 31, 2007.

As at December 31, 2008, the company had cash, cash equivalents and short-term investments of $6,293,849 against $2,835,806 as at March 31, 2008.