Competitor Pro-pell claims this photo illustrates risks associated with hormone therapy
Initiation: May 20, 2024
J Capital Research ("J Cap")  is a stock-research company. ​J Cap  has analyzed the U.S.- and Canadian-listed company biote Corp. (BTMD) and is hereby publishing the outcome and the conclusions of our analysis, based on publicly available information. We may benefit from a decline in the price of BTMD shares, and, for this reason, there might be a conflict of interest.
  • BTMD offers hormone and “nutraceuticals” products that purport to slow aging and increase sex drive. But many former patients say the treatments make people sick, sometimes fatally. 
  • Patients often get irritable, develop acne, experience voice changes, and grow facial hair. Dangerous side effects can include cancer and cardiac problems. One lawsuit says that the (male) patient “developed breast cancer specifically as a result of the “improper, inappropriate, unsafe, and unnecessary hormone therapy that he received . . .per BioTE’s hormone replacement Pellet Therapy program.”
  • BTMD does not test products coming out of the compounding facilities and sometimes ignores appropriate hormone release levels. A 2021 lawsuit alleges that BTMD instructed its “trusted providers” to “patently disregard the patient’s objective Testosterone lab values.
  • We learned from the FDA that BTMD does not check products coming out of the compounding facilities. A 2021 lawsuit alleges that BTMD instructed its “trusted providers” “to patently disregard the patient’s objective Testosterone lab values.
  • One of BTMD’s three suppliers5 has been accused of blinding patients due to negligence.
    • We believe BTMD’s business could be cut by over 70% if the FDA determines that the hormone treatments it pushes need to be regulated as drugs.
  • A key supplier has “received approximately 26 reports of adverse events related to your Testosterone and Estradiol implantable pellets, including reports of death, heart attack. stroke, When we asked clinicians, they were unaware of the adverse events.
  • To promote its products, BTMD reports “studies” that say “hormones are compounded in . . . licensed FDA outsourcing centers and are held to strict standards.” But BTMD’s suppliers have been told by the FDA that their facilities do not meet the standards for a licensed compounding facility.
  • ​BTMD’s CEO was head of the Amen Clinics, called a “scam” in Reddit posts, which describe founder Daniel Amen as a “snake oil salesman” and “scam artist.” Amen partners with BTMD. The Amen Clinics purport to diagnose ADHD, Alzheimers, and many other conditions via brain scans. They don’t.
  • The CEO has little experience in consumer healthcare - except for her recent stint at Amen. In 2017, she was formally accused of fraud via “unjust enrichment” through a related party.
  • A clinician told us that customer retention is tough for BTMD, because they often get doses wrong, and many clinics prefer to figure out dosing and delivery methods themselves. Another clinician told us BTMD has a problem with poorly formulated pellets popping out, especially from male patients. 
  • BTMD has changed CFOs twice since 2022. Those CFOs left under a cloud.
  • We are puzzled that BTMD can attract any investors with growth of 4% YoY in Q1 2024, barely keeping up with inflation, a 43% decline YoY in operating cash flow in the quarter, and a price of about 100x earnings.
  • A wall of shares is coming to the market, indicating massive dilution for shareholders.
  • BTMD had to agree to purchase from its own founder almost $77 mln in stock to settle a lawsuit in which the founder called BTMD’s SPAC merger a “get rich quick scheme.”
  • The company’s disclosure of legal proceedings fills two pages of the 10K. 
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** Please see full report for lots of footnotes.​
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