Financing and Funding - The company received aggregate equity and debt financing of $1,658,500 and $10,888,339 respectively during the year ended December 31, 2019[21]. - The company anticipates requiring approximately $12,000,000 in financing to commence and complete a Phase 2 clinical trial for BRTX-100 and approximately $45,000,000 in further funding for additional clinical trials[43]. - The company received debtor-in-possession financing of $1,189,413 during its Chapter 11 reorganization[26]. - The company is currently seeking various financing alternatives to support future operations, including a potential loan from Auctus Fund, LLC[209]. Clinical Trials and Product Development - The company plans to commence a Phase 2 clinical trial for BRTX-100 in the third quarter of 2021, pending necessary funding[33]. - The FDA authorized a Phase 2 clinical trial for BRTX-100 in February 2017, with plans to commence the trial in Q3 2021, pending necessary funding[49][64]. - The Phase 2 clinical trial will involve 99 patients randomized 2:1 for BRTX-100 to control, with a primary efficacy endpoint at 12 months focusing on function improvement and pain reduction[65]. - The company anticipates beginning preclinical animal studies for its treatment protocol by Q3 2021, pending necessary financing[95]. - The company is pursuing its Disc/Spine Program with its lead cell therapy candidate BRTX-100, having received FDA authorization to commence a Phase 2 clinical trial[201]. Research and Development - The company has established a laboratory facility to further develop cellular-based treatments and stem cell-related intellectual property[42]. - The company has entered into multiple research agreements, including a $250,000 initial payment and up to $525,000 from Pfizer for a joint study on human brown adipose cell models[85]. - The company has established a laboratory in Melville, New York, for research and potential production of cell-based product candidates[98]. - The company has entered into a Research and Development Agreement with Rohto Pharmaceutical Co., Ltd. and a Research Agreement with Pfizer, focusing on stem cell technologies[108]. Market Potential and Competition - The company has identified that nearly 25 million American adults suffer from chronic lower back pain, with approximately 12 million diagnosed with disc degeneration[46]. - The total annual healthcare and lost productivity costs in the U.S. related to pain are estimated to be $600 billion, highlighting the potential market for BRTX-100[74]. - The company faces competition from larger pharmaceutical and biotechnology firms, which have significantly greater resources, making it challenging to predict market entry timelines for competing products[117]. Financial Performance - For the year ended December 31, 2019, the company generated revenues of $130,000, an increase from $111,000 in 2018, representing a growth of approximately 17.1%[212]. - Total operating expenses for 2019 were $8,562,005, compared to $7,758,652 in 2018, indicating an increase of about 10.4%[211]. - The net loss for 2019 was $14,647,890, compared to a net loss of $12,517,803 in 2018, reflecting an increase in losses of approximately 17.0%[211]. - The accumulated deficit as of December 31, 2019, was $78,570,146, with a stockholders' deficit of $12,776,146 and a working capital deficiency of $13,651,716[204]. Regulatory Environment - The company is subject to stringent FDA regulations regarding the development and marketing of its stem cell products, which may require significant resources to comply with if not classified under HCT/P regulations[126][129]. - The FDA requires two adequate and well-controlled Phase 3 clinical trials to demonstrate the efficacy of an investigational drug or biologic[142]. - The FDA may require additional Phase 4 clinical trials after a product is approved to confirm effectiveness and provide safety information[144]. - The approval process for a PMA could take one to four years, with no guarantee of ultimate clearance or approval[163]. Intellectual Property - The company has obtained four United States patents and seven foreign patents related to its ThermoStem Program[41]. - The company has multiple patents related to its ThermoStem Program, including issued patents in the US, Australia, Japan, and Europe[93][94]. - The company has secured registrations for multiple trademarks, including a published application for the trademark BRTX, which is crucial for protecting its proprietary technology[108][109]. Employee and Operational Information - The company currently has six full-time employees and believes employee relations are good[182]. - The principal executive offices and laboratory occupy 6,800 square feet of space under a lease expiring in December 2024, with annual base rental ranging from $153,748 to $173,060[185].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 30, 2019 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 000-54402 BIORESTORATIVE THERAPIES, INC. (Exact name of registrant as specified in its charter) Delaware 91-1835664 (State or ...

```markdown Part I - Financial Information [Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements.) Financial statements for June 30, 2019, show significant deficiencies, increased net losses, and going concern uncertainty [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2019, the company reported a stockholders' deficiency of **$8.94 million**, driven by net loss, partially offset by capital raised Condensed Consolidated Balance Sheet Data (Unaudited) | Balance Sheet Items | June 30, 2019 ($) | December 31, 2018 ($) | | :--- | :--- | :--- | | **Assets** | | | | Cash | 1,283,666 | 117,523 | | Total Current Assets | 1,357,058 | 180,987 | | Total Assets | 2,432,079 | 1,192,381 | | **Liabilities & Stockholders' Deficiency** | | | | Total Current Liabilities | 11,143,202 | 9,254,888 | | Total Liabilities | 11,374,550 | 9,833,419 | | Total Stockholders' Deficiency | (8,942,471) | (8,641,038) | | Total Liabilities and Stockholders' Deficiency | 2,432,079 | 1,192,381 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net loss increased to **$8.04 million** for the six months ended June 30, 2019, driven by higher operating expenses, interest, and debt extinguishment losses Condensed Consolidated Statements of Operations (Unaudited) | Metric | Three Months Ended June 30, 2019 ($) | Three Months Ended June 30, 2018 ($) | Six Months Ended June 30, 2019 ($) | Six Months Ended June 30, 2018 ($) | | :--- | :--- | :--- | :--- | :--- | | Revenues | 31,000 | 37,000 | 60,000 | 56,000 | | Total Operating Expenses | 2,159,804 | 2,087,335 | 4,517,140 | 4,337,073 | | Loss From Operations | (2,128,804) | (2,050,335) | (4,457,140) | (4,281,073) | | Net Loss | (4,157,190) | (3,514,423) | (8,040,362) | (6,022,083) | | Net Loss Per Share | (0.24) | (0.53) | (0.52) | (0.93) | [Condensed Consolidated Statements of Changes in Stockholders' Deficiency](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Deficiency) Stockholders' deficiency increased to **$8.94 million** by June 30, 2019, due to the **$8.04 million** net loss, partially offset by capital raising - For the six months ended June 30, 2019, the company issued **8,065,083 shares** of common stock through various transactions, including for cash, services, and debt exchanges, contributing to an increase in additional paid-in capital[14](index=14&type=chunk) - The net loss of **$8,040,362** for the six months ended June 30, 2019, was the primary driver for the increase in the accumulated deficit and overall stockholders' deficiency[12](index=12&type=chunk)[14](index=14&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operations was **$3.40 million** for the six months ended June 30, 2019, offset by **$4.59 million** from financing, increasing cash by **$1.17 million** Cash Flow Summary for Six Months Ended June 30 (Unaudited) | Cash Flow Activity | 2019 ($) | 2018 ($) | | :--- | :--- | :--- | | Net Cash Used In Operating Activities | (3,397,117) | (2,198,577) | | Net Cash Used In Investing Activities | (29,371) | (12,869) | | Net Cash Provided By Financing Activities | 4,592,631 | 1,763,295 | | **Net Increase (Decrease) In Cash** | **1,166,143** | **(448,151)** | - Non-cash financing activities were significant, including the issuance of **$3.57 million** in shares to exchange for notes payable and accrued interest, and recording **$3.17 million** in derivative liabilities related to convertible notes[20](index=20&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail going concern doubt, extensive notes payable, and crucial subsequent financing events contingent on shareholder approval and Nasdaq listing - The company develops therapeutic products using adult stem cells, with a lead program, brtxDISC (BRTX-100), for treating disc/spine disorders, and a pre-clinical ThermoStem Program for metabolic disorders[21](index=21&type=chunk) - There is substantial doubt about the Company's ability to continue as a going concern due to a working capital deficiency of **$9.8 million**, a stockholders' deficiency of **$8.9 million**, and a net loss of **$8.0 million** for the six months ended June 30, 2019[23](index=23&type=chunk) - Subsequent to June 30, 2019, the company entered into a securities purchase agreement with Arena Investors LP for up to **$5.4 million** in financing through preferred stock, a warrant, and a convertible note. The closing is contingent on a concurrent public offering of at least **$7.5 million** and a Nasdaq listing[112](index=112&type=chunk) - During the first six months of 2019, the company issued **$6.48 million** in new notes payable and exchanged **$1.20 million** of debt for equity, highlighting its reliance on debt financing and restructuring to sustain operations[60](index=60&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Management highlights severe liquidity challenges, going concern doubt, widening net losses, and critical dependence on new capital [Overview and Financial Condition](index=27&type=section&id=Overview%20and%20Financial%20Condition) The cell therapy company faces critical financial conditions with a **$72.0 million** accumulated deficit and **$9.8 million** working capital deficiency, raising going concern doubts - The company's lead cell therapy candidate, BRTX-100, has received FDA authorization to commence a Phase 2 clinical trial for treating chronic lower back pain, with plans to start in Q4 2019, assuming necessary funding is secured[127](index=127&type=chunk) - The company anticipates needing approximately **$20 million** to commence and complete the Phase 2 trial for its Disc/Spine Program and an additional **$45 million** to complete all clinical trials for BRTX-100[131](index=131&type=chunk) - A securities purchase agreement was signed with Arena Investors LP for **$5.4 million**, but the deal is contingent on a successful public offering of at least **$7.5 million** and a Nasdaq listing[133](index=133&type=chunk) [Consolidated Results of Operations](index=29&type=section&id=Consolidated%20Results%20of%20Operations) Net losses increased to **$8.0 million** for the six months ended June 30, 2019, driven by higher operating expenses, interest, and substantial debt extinguishment loss Comparison of Results for the Six Months Ended June 30 | Expense Category | 2019 ($) | 2018 ($) | Change (%) | | :--- | :--- | :--- | :--- | | Marketing and promotion | 124,686 | 58,554 | +113% | | Consulting | 1,133,607 | 850,884 | +33% | | Research and development | 896,729 | 779,945 | +15% | | General and administrative | 2,362,118 | 2,647,690 | -11% | | Interest expense | 644,911 | 391,642 | +65% | | Loss on extinguishment of notes | 1,000,595 | 63,788 | +1468% | [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) The company faces severe liquidity constraints with a **$9.8 million** working capital deficiency, requiring significant additional capital beyond September 2019 - The company has a working capital deficiency of **$9,786,144** and stockholders' deficiency of **$8,942,471** as of June 30, 2019, raising substantial doubt about its ability to continue as a going concern[167](index=167&type=chunk) - Management expects current cash to fund operations only through September 2019, after which it will need to raise further capital to support operations and repay debt[171](index=171&type=chunk) Debt Maturity Schedule (as of filing date) | Maturity Date | Principal Amount ($) | | :--- | :--- | | Past Due | 144,000 | | QE 9/30/2019 | 1,060,000 | | QE 12/31/2019 | 3,732,226 | | QE 3/31/2020 | 1,685,250 | | QE 6/30/2020 | 862,138 | | QE 9/30/2020 | 167,688 | | **Total** | **7,651,302** | [Quantitative and Qualitative Disclosures About Market Risk](index=35&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) This section indicates that the item is not applicable to the company's operations - Not applicable[182](index=182&type=chunk) [Controls and Procedures](index=35&type=section&id=ITEM%204.%20Controls%20and%20Procedures.) Management concluded disclosure controls were effective as of June 30, 2019, with no material changes to internal controls - Based on an evaluation, the Principal Executive and Financial Officer concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[184](index=184&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2019, that have materially affected, or are reasonably likely to materially affect, internal controls[185](index=185&type=chunk) Part II - Other Information [Legal Proceedings](index=36&type=section&id=ITEM%201.%20Legal%20Proceedings.) This section indicates that the item is not applicable to the company's operations - Not applicable[189](index=189&type=chunk) [Risk Factors](index=36&type=section&id=ITEM%201A.%20Risk%20Factors.) This section indicates that the item is not applicable, referring to the Annual Report on Form 10-K for a discussion of risk factors - Not applicable. The report refers to the risk factors discussed in the Annual Report on Form 10-K for the year ended December 31, 2018[190](index=190&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) During Q2 2019, the company issued significant unregistered equity securities for cash, debt exchange, and services, relying on Securities Act exemptions - During Q2 2019, the company issued common stock and warrants in multiple private transactions for cash, exchange of convertible notes, and consulting services, relying on exemptions from registration under the Securities Act[191](index=191&type=chunk) Selected Unregistered Sales in Q2 2019 | Date | Security Type | Consideration | Purpose | | :--- | :--- | :--- | :--- | | 5/7/19 | **1,111,111 Common Shares** & **1,111,111 Warrants** | **$500,000** | Cash | | 6/4/19 | **75,000 Common Shares** | **$30,000** | Consulting Services | | Various | Common Shares | Varies | Exchange of convertible notes | [Defaults Upon Senior Securities](index=37&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities.) This section refers to the MD&A, noting a **$144,000** note payable is past due - The report refers to the MD&A section, which discloses that a note payable for **$144,000** is past due[194](index=194&type=chunk)[168](index=168&type=chunk) [Mine Safety Disclosures](index=37&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures.) This section indicates that the item is not applicable to the company's operations - Not applicable[195](index=195&type=chunk) [Other Information](index=37&type=section&id=ITEM%205.%20Other%20Information.) This section indicates no other information to report for this item - None[197](index=197&type=chunk) [Exhibits](index=37&type=section&id=ITEM%206.%20Exhibits.) This section lists concurrently filed exhibits, including officer certifications and XBRL interactive data files - Exhibits filed include officer certifications and XBRL data files[199](index=199&type=chunk) ```

Revenue and Growth - For the three months ended March 31, 2019, the company generated revenues of $29,000, an increase from $19,000 in the same period of 2018, representing a 53% increase[123]. Operating Expenses - Total operating expenses for the three months ended March 31, 2019, were $2,357,336, compared to $2,249,738 for the same period in 2018, reflecting an increase of 5%[122]. - Consulting expenses increased by $166,804, or 39%, from $432,930 in Q1 2018 to $599,734 in Q1 2019, primarily due to increased cash consulting fees[126]. - Research and development expenses rose by $47,876, or 12%, from $407,130 in Q1 2018 to $455,006 in Q1 2019, driven by stock-based compensation expenses[128]. - Interest expense increased by $155,685, or 97%, in Q1 2019 compared to Q1 2018, due to higher interest-bearing short-term borrowings[132]. - The company recorded a loss on extinguishment of notes payable of $448,486 in Q1 2019, up from $18,837 in Q1 2018, reflecting increased debt repayments[134]. Net Loss and Deficit - The net loss for the three months ended March 31, 2019, was $3,883,172, compared to a net loss of $2,507,660 for the same period in 2018, indicating a 55% increase in losses[122]. - As of March 31, 2019, the company's accumulated deficit was $67,805,428, with a stockholders' deficiency of $7,652,744 and a working capital deficiency of $8,081,062[118]. Cash Flow and Liquidity - The company had cash of $496,279 as of March 31, 2019, compared to $117,523 as of December 31, 2018, indicating improved liquidity[137]. - The company experienced negative cash flows from operating activities of $1,980,162 for the three months ended March 31, 2019, compared to $1,158,201 for the same period in 2018[143]. - The net cash used to fund a net loss of $3,883,172 for the three months ended March 31, 2019, was adjusted for non-cash expenses totaling $1,990,036[143]. - Net cash provided by financing activities was $2,358,918 for the three months ended March 31, 2019, compared to $715,085 for the same period in 2018[144]. Debt and Financing - As of March 31, 2019, the company's outstanding debt was $6,458,280, with interest rates ranging from 6% to 15% per annum[139]. - The company raised $1,758,918 from debt financings and $600,000 from equity financings during the three months ended March 31, 2019[144]. - The company expects to require approximately $20,000,000 in financing to commence and complete a Phase 2 clinical trial for its Disc/Spine Program[119]. - The company has $190,028 in past due notes payable as of the date of filing[139]. - The company expects that available cash will fund operations through June 2019, after which additional capital will be needed[139]. Future Outlook - Future capital requirements will depend on the ability to successfully commercialize products and services, as well as potential collaborations or acquisitions[139]. - The company adopted ASC 606 for revenue recognition effective January 1, 2019, requiring significant judgments and estimates[145]. - There are no off-balance sheet arrangements that materially affect the company's financial condition[147].

Financing and Revenue - The company has not generated significant revenues and anticipates requiring approximately $20 million in financing to commence a Phase 2 clinical trial for BRTX-100, with an additional $45 million needed for further clinical trials and general operations [35]. - The company has outstanding debt of approximately $5,161,916 as of December 31, 2018, which needs to be addressed alongside funding for clinical trials [35]. - The company has incurred $1,513,150 and $2,152,433 in research and development expenses for the years ended December 31, 2018 and 2017, respectively [95]. - The company has entered into multiple research agreements, including a $250,000 initial payment from Pfizer and up to an additional $525,000 during a two-year term [73]. - The company has not generated significant revenues yet, making it difficult to predict the regulatory status of its products [110]. Clinical Trials and Product Development - BRTX-100 is an autologous mesenchymal stem cell product derived from the patient's own bone marrow, designed to alleviate chronic lower back pain caused by degenerative disc disease [40]. - The Phase 2 clinical trial for BRTX-100 is planned to involve 72 patients, randomized 2:1, with a primary efficacy endpoint at 12 months and safety follow-up at 24 months [58]. - The company has received FDA authorization to commence the Phase 2 clinical trial for BRTX-100, expected to start in Q3 2019, contingent on funding [41]. - The animal study for BRTX-100 showed a statistically significant increase in disc height and improvement in disc histology compared to the control group at day 120 [56]. - The company is exploring potential licensing agreements for BRTX-100 to reduce the need for substantial capital to complete clinical trials and commercialization [59]. - The company is also pursuing a pre-clinical research initiative, the ThermoStem Program, utilizing brown adipose-derived stem cells for metabolic diseases [64]. - The company is developing a bioengineered implantable brown adipose tissue construct to target obesity and metabolic disorders using BADSCs [68]. - Pre-clinical animal models showed significant reductions in weight and blood glucose levels, with differentiated BADSCs supported by a biological scaffold [69]. - The next generation BAT is expected to have a higher purity of BADSC and a greater percentage of functional brown adipocytes, enhancing therapeutic effects [69]. - The company is focusing on the development of treatment protocols utilizing allogeneic cells from genetically similar donors [68]. - The company anticipates beginning preclinical animal studies for its generation 2 encapsulated brown adipose tissue construct by the second quarter of 2019 [79]. - The company anticipates that its cell product candidates will be marketed to healthcare professionals, hospitals, and research institutions upon regulatory approval [104]. Regulatory Compliance and Challenges - The FDA requires a series of clinical trials (Phase 1, 2, and 3) to establish the safety and efficacy of drugs and biologics before they can be marketed [117][121][123]. - If the FDA does not regulate the company's product candidates solely under HCT/P regulations, they may be classified as drugs or biological products, requiring significant resources for compliance [129]. - The company must comply with extensive FDA regulations regarding the manufacturing, testing, and marketing of its products, which can impose costly procedures [125]. - The regulatory process for obtaining FDA approval can take many years and is unpredictable, depending on the product and FDA requirements [129]. - The FDA has broad regulatory authority over drugs and biologics marketed in the U.S., including oversight of clinical trials and manufacturing practices [116]. - The company may face enforcement actions from the FDA if it fails to comply with regulatory requirements, which could adversely affect its operations [114]. - The FDA can impose various enforcement actions for non-compliance, including fines, product seizures, and potential criminal prosecutions, which could materially adversely affect the company [132]. - The FDA's Fast Track program allows expedited review for products intended to treat serious conditions, potentially improving the development timeline [133]. - Products may qualify for Breakthrough Therapy designation if they show substantial improvement over existing therapies, leading to intensive guidance from the FDA [134]. - Priority review can reduce the FDA's review time to six months for products that significantly improve treatment safety or effectiveness [136]. - Accelerated approval may be granted based on surrogate endpoints, requiring post-marketing studies to confirm clinical benefits [137]. - The FDA's premarket clearance process can take three to twelve months for 510(k) submissions and one to four years for PMA approvals, with no guarantee of approval [144]. - Compliance with Current Good Manufacturing Practices (cGMP) is essential for products regulated as drugs, biological products, or devices [146]. - The company must comply with the Health Insurance Portability and Accountability Act (HIPAA) and other data privacy regulations, with potential penalties for non-compliance [154]. - Violations of healthcare laws may result in civil and criminal penalties, operational restructuring, and exclusion from federal healthcare programs [159]. Company Operations and Structure - The company has established a laboratory with a clean room facility for the production of cell products, including BRTX-100, for clinical trials and research purposes [43]. - The company has established a laboratory in Melville, New York, for research and potential production of cell-based product candidates [83]. - The company currently has nine employees, with eight being full-time, indicating a small workforce [164]. - There are no definitive plans for establishing stem cell therapy clinics in any country, but the company intends to explore opportunities as they arise [162]. - The company faces uncertainty regarding compliance with foreign government regulations, which may be more stringent than FDA regulations in the U.S. [160]. - The complexity of new and emerging cell therapy regulations in various countries creates greater uncertainty for the international regulatory process [160]. - The company has not thoroughly explored applicable laws and regulations for potential expansion into foreign jurisdictions [160]. - The principal executive offices are located at 40 Marcus Drive, Melville, New York [163]. - The company is classified as a smaller reporting company and is not required to provide supplementary financial information [407].