Reported Company:

biote Corp

Researcher Company:

J Capital Research

Price at Report Date:

Close Price Day after report date:

6.72

% Decline Day after Report Date:

% Decline vs Yesterdays Date:

-2.2321

Summary

J Capital Research recently published a damning report on Biote Corp. (NASDAQ:BTMD), a company known for selling hormone replacement therapy (HRT) “pellets” and nutraceutical products. The report raises significant concerns about the safety, regulatory compliance, and business practices of Biote Corp., which could lead to severe repercussions for the company and its investors.

Who is biote Corp?

Biote Corp. is a health and wellness company that specializes in hormone replacement therapy (HRT) using bio-identical hormone pellets. These pellets are implanted into patients and purportedly offer a steady release of hormones to address conditions like menopause and low testosterone. The company also offers nutraceutical products and services to clinics that administer these treatments. biote Corp. has faced growing scrutiny over its product safety, business practices, and financial stability since it went public through a SPAC merger in 2022.

Key Points from Report

Dangerous Side Effects and Regulatory Issues

• Safety Concerns: The report highlights that biote’s hormone treatments have been linked to severe side effects, including cancer, cardiac problems, and other dangerous conditions. Notably, the FDA inspection found 4,202 adverse events related to biote products that were not reported.
• Lawsuits: There are ongoing lawsuits where patients allege that biote’s treatments caused them to develop life-threatening conditions, such as breast cancer and heart attacks, due to improper dosing and unsafe practices.

Shady Business Practices and Misleading Marketing

• Regulatory Non-Compliance: biote’s manufacturing partners, responsible for producing the hormone pellets, have been cited by the FDA for unsanitary conditions, poor sterilization practices, and the production of unapproved and misbranded products.
• Misleading Claims: biote has been accused of promoting their products as safe and effective without proper scientific backing. The FDA has repeatedly warned the company for mislabeling and inappropriate marketing practices.

Financial Instability and Management Issues

• Weak Financial Performance: The company has shown minimal growth, with Q1 2024 revenue only increasing by 4.4% year-over-year, barely keeping pace with inflation. Meanwhile, operating cash flow fell by 43%.
• Executive Turnover: biote has seen significant turnover in its financial leadership, with three CFOs resigning under questionable circumstances since 2021. This instability raises concerns about the company’s financial management and future prospects.
• Share Dilution: The company faces massive potential dilution, with the possibility of its Class A share count increasing from 34.2 million to nearly 74.7 million, which would heavily impact existing shareholders.

Activ8 Finance Analysis

biote Corp. appears to be a highly risky investment based on the findings of J Capital Research. The combination of severe safety concerns, ongoing legal challenges, regulatory scrutiny, and financial instability poses significant risks. The company’s questionable business practices and executive turnover further compound the uncertainty.