Cell Therapeutics Dilutes Shareholder Value (CTIC)
Cell Therapeutics, Inc. (NASDAQ: CTIC) recently decided to exchange up to 60 million shares of its common stock for $30 million of notes. Liquidity crisis at the company continues to remain a major concern for us. Earlier, in April 2010, the company raised $18.5 million through preferred stock and warrants.
Although Cell Therapeutics has taken several steps to reduce the burn rate, its cash crunch will continue for the time being. During 2009, Cell Therapeutics reduced its debt burden considerably. However, the company’s policy to reduce debt level by converting into common stock dilutes shareholder value.
The liquidity crisis at Cell Therapeutics has become more prominent since its New Drug Application for lead candidate, Pixuvri was denied. The company has been seeking approval for the drug to treat relapsed or refractory aggressive non-Hodgkin’s lymphoma (NHL) in patients who have not responded to other treatment options.
In April 2010, the company received a complete response letter for Pixuvri from the US Food and Drug Administration. The company will be required to conduct additional trials, the roadmap for which will be decided in consultation with the FDA.
Following the setback for Pixuvri, Cell Therapeutics reduced its workforce by 36 employees. The reduction in staff strength along with the elimination of other planned expenses is likely to result in savings of about $16 million in 2010. The company expects operating expenses for 2010 to be approximately $60 million, a 21% reduction from its earlier projection.
Apart from Pixuvri, the company has other pipeline candidates as well. With the advancement of the pipeline, additional funds are required to support the various programs.
Current investor focus is primarily on the future course of action that Cell Therapeutics takes for Pixuvri. We are Neutral on the stock.
Close: CTIC closed up 0.5% at $0.4625 today, but shares were up over $0.50 early this morning.
Cell Therapeutics… The Pixantrone Fight Continues (CTIC)
Cell Therapeutics, Inc. (NASDAQ: CTIC) is in the news again, and not just over its special meeting of shareholders. In the middle of the night, Cell Therapeutics announced that the company has received a Complete Response Letter from the FDA over its new drug application for Pixuvri (pixantrone dimaleate) for relapsed or refractory aggressive non-Hodgkin’s lymphoma. This is a battle in a war that looks far from being over.
The FDA cited as its primary reason for the action its concerns previously raised at the Oncologic Drugs Advisory Committee meeting on March 22, 2010 and recommended the company conduct an additional trial to demonstrate the safety and effectiveness of its product.
The company said further that, based on the FDA’s ODAC presentation, it has decided to pursue expanded access program for pixantrone while it conducts an additional study in aggressive non-Hodgkin’s lymphoma.
It now expects enrollment in a follow-up combination therapy study in a similar population could be rapid and occur predominantly within the U.S. and it has had preliminary discussions on the subsequent trial design with a leading statistician, and potential lead investigators who believe the study will be positively received by the lymphoma treatment community. That was noted as being “on the basis of the PIX 301 clinical trial results and the lack of satisfactory alternative therapies for their patients with multiple relapsed aggressive non-Hodgkin’s lymphoma.”
The company further noted that this is a sad outcome for its patients with relapsed/refractory aggressive NHL and it noted disappointment that the FDA “would ignore clinically meaningful improvements in overall response rate and progression-free survival, let alone complete responses….”
Cell Therapeutics plans to request a meeting with the FDA on both the design of the follow-on study as well as expanded access program for patients who are not participating in the company’s clinical trial. Later this month, it plans to meet with its clinical expert and the co-rapporteurs as it prepares to submit its Marketing Authorization Application to the European Medicines Agency for review. Based on their feedback and guidance, the Company expects to submit the application in the third quarter of 2010.
What is interesting here is that this is another true fight. The company’s version of statistically significant is different than the FDA’s version. This is also for relapsed or refractory aggressive non-Hodgkin’s lymphoma, which is far from the company trying to get a “first line of defense” or primary treatment status.
This stock battle of bulls and bears appears to be far from over. The company recently raised capital and is set for its special meeting of shareholders. The market is far from open, but the initial indications show the stock trading up at $0.66 versus a $0.637 close on Thursday.
Stay tuned.
JON C. OGG
Cell Therapeutics Bracing For Shareholder Event (CTIC)
Cell Therapeutics Inc. (NASDAQ: CTIC) is still in trouble after its recent implosion. But traders have still been swinging this stock around each day on one report or another, and we are finally starting to see a break or compression in the intra-day volatility in this biotech stock.
Last week the company agreed to sell $20 million in preferred stock and warrants to several institutional investors, and it noted that it could raise up to $32 million in total if those investors exercise their warrants. The company has also been hit by lawsuits of the class action nature and has a key upcoming meeting that will be a make or break decision time for shareholders.
Class action suits have come from The Law Firm of Barroway Topaz Kessler Meltzer & Check, LLP… A separate announcement by Brower Piven also asked those with losses of $50,000 or more contact to contact it regarding a lead plaintiff status. Hagens Berman Sobol Shapiro also has a class action against Cell Therapeutics.
Cell Therapeutics is hosting its Special Meeting of Shareholders in Seattle at 10:00 AM Pacific Time on April 9, 2010. The company has two key issues for vote listed from the February proxy:
- (1) to approve an amendment to the Company’s amended and restated articles of incorporation to increase the total number of authorized shares from 810,000,000 to 1,210,000,000 and to increase the total number of authorized shares of common stock from 800,000,000 to 1,200,000,000; and
- (2) to approve an amendment to the Company’s 2007 Equity Incentive Plan, as amended (the “2007 Equity Plan”), to increase the number of shares available for issuance under the 2007 Equity Plan by40,000,000 shares.
The other notion to consider is that this Special Meeting is only for holders of record at the close of business on February 19, 2010 as far as those who are entitled to vote.
We have seen a volatility compression take hold, so it will be interesting to see what (if anything) comes from the meet8ing this Friday. Either way, it may have some heated words thrown in that meeting.
At 10:38 AM EST Cell Therapeutics is up almost 1% at $0.536 on 2.65 million shares.
JON C. OGG
Major Short Selling Changes in Biotech (AMGN, BIIB, GILD, CELG, GENZ, GERN, DNDN, HGSI, AMLN, CTIC)
We have now seen the changes in short selling in biotech stocks via the Mid-March short interest report from NASDAQ. This marks the changes seen at the March 15, 2010 settlement date versus a prior February 26 settlement date. We took a look at Amgen Inc. (NASDAQ: AMGN), Biogen Idec Inc. (NASDAQ: BIIB), Gilead Sciences Inc. (NASDAQ: GILD), Celgene Corporation (NASDAQ: CELG), Genzyme Corp. (NASDAQ: GENZ), Geron Corporation (NASDAQ: GERN), Dendreon Corp. (NASDAQ: DNDN), Human Genome Sciences Inc. (NASDAQ: HGSI), and Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN). We even included the wild Cell Therapeutics, Inc. (NASDAQ: CTIC) to see what the shorts were betting on there.
There were some rather large changes both up and down. Again, the change reflects the March 15 settlement date versus a prior date of February 26:
Cell Therapeutics Looking More Like Sell Therapeutics (CTIC)
Cell Therapeutics, Inc. (NASDAQ: CTIC) is about to get to show traders and speculative investors the pleasure and pain in the world of chasing ten-baggers in speculative biotech stocks. The stock has developed a cult following, as you would expect in a company with a share price under $1.00 and a market cap of $560 million. Shares were halted at 7:00 AM EST this morning and it seems that we are finding out why the sudden drop came late Friday afternoon.
We noted last month how the company was facing a much tougher FDA and that appears to have been the case. The FDA has just rejected its NDA…. saying there was not enough clinical evidence to show whether the drug worked. There has yet to be an official press release from the company at noon, although it is spreading around the web. The vote was 9 to 0 against the drug.
It is developing pixantrone, its Phase III single-agent clinical trial product as a treatment for non-Hodgkins lymphoma and various other hematologic malignancies, solid tumors, and immunological disorders. It was just on March 8 when the company announced that the FDA approved NerPharMa to manufacture Cell Therapeutics’ drug Pixantrone.
Cell Therapeutics Facing Tougher FDA (CTIC)
Cell Therapeutics, Inc. (NASDAQ: CTIC) is getting clipped on Pixantrone this morning. The company was told by the FDA that there is limited clinical data on its proposed cancer drug, and that there were higher side effects and higher death incidents. Unfortunately, this comes ahead of a panel review date that is set for Wednesday, February 10, 2010. We have late April, on or about April 23, 2010, as the final decision date from the FDA for Pixantrone.
Pixantrone is the company’s pending treatment of relapsed and refractory non-Hodgkin’s lymphoma, although this is indicated for those who have seen their disease progress after having received treatment with at least two other therapies.
Cell Therapeutics had raised about $30 million in January via securities sales. Pixantrone was under FDA Fast Track and it has an Orphan Drug designation under EMEA in Europe.
The FDA noted that the main trial arm ended early due to a smaller number of enrollment, which is always a concern. This may not be a dead outcome yet, but this sets a bias of extreme caution going into Wednesday’s event.
At 9:45 AM EST we have shares down 29.4% at $0.743 on 23 million shares. Average volume is 12 million shares and the 52-week trading range is $0.05 to $2.23.
JON C. OGG
Quest For 10-Baggers in BioHealth in 2010 (JAZZ, TRGT, VNDA, DNDN, HGSI, CGEN, BNVI, QCOR, ACHN, PSDV, ATHX, SNSS, AVNR, BIOD, ALXA, CTIC)
If one thing was noticed in biotech stocks, or BioHealth stocks as we often say, it was that investors, traders, and speculators all piled into the chase for the next ten-bagger late in the year. When you have as many biotech and BioHealth stocks that ran over 1,000% in 2009 that is only to be expected…. hence the 10-bagger comments. We had many biotech and biohealth shares rally from their lows significantly this year, with companies such as Jazz Pharmaceuticals, Inc. (NASDAQ: JAZZ), Targacept, Inc. (NASDAQ: TRGT), Vanda Pharmaceuticals, Inc. (NASDAQ: VNDA), Dendreon Corp. (NASDAQ: DNDN), and Human Genome Sciences, Inc. (NASDAQ: HGSI) all being in or having been in the 10-bagger club this year.
But late in 2009 we started seeing an onslaught of low-priced stocks with small cap or micro-cap values running rapidly higher on news. In some cases these faded, and in some not. We saw the traders run up shares of Compugen Ltd. (NASDAQ: CGEN), Bionovo, Inc. (NASDAQ: BNVI), Questcor Pharmaceuticals, Inc. (NASDAQ: QCOR), Achillion Pharmaceuticals, Inc. (NASDAQ: ACHN), pSivida Corp. (NASDAQ: PSDV), Athersys, Inc. (NASDAQ: ATHX), Sunesis Pharmaceuticals, Inc. (NASDAQ: SNSS), and AVANIR Pharmaceuticals, Inc. (NASDAQ: AVNR) on news late in 2009. Also covered as potentials for this are Biodel Inc. (NASDAQ: BIOD), Alexza Pharmaceuticals, Inc. (NASDAQ: ALXA), and Cell Therapeutics, Inc. (NASDAQ: CTIC).
We have reviewed each of these and given a synopsis for each to see if these could be the 10-baggers for 2010.
Read more
Cell Therapeutics Advances non-Hodgkin”s Lymphoma in E.U. (CTIC)
Cell Therapeutics, Inc. (NASDAQ: CTIC) is running higher on the report that it has advanced its Pixantrone filing process in Europe. It has submitted a Pediatric Investigation Plan to the European Medicines Agency as part of the required filing process.
This is required to seek approval of pixantrone as a treatment for relapsed or refractory aggressive non-Hodgkin”s Lymphoma in Europe.
The PIP outlines how the company proposes to study the drug in children in order to benefit child health. The company noted that anthracyclines are a mainstay in the treatment of childhood leukemias, lymphomas and solid tumors but long-term cardiotoxicity represents a significant issue. Cell Therapeutics plans to evaluate safety and efficacy of pixantrone in pediatric cancer patients.
CTI recently received a prescription drug user fee act action date of April 23, 2010 in the U.S. regarding CTI’s New Drug Application for pixantrone as potential treatment for relapsed or refractory, aggressive non-Hodgkin’s lymphoma.
Right before the open we have seen over 1 million shares and shares are up close to 6% at $1.45. The 52-week high is $2.23
JON C. OGG
September 15, 2009
Cell Therapeutics (CITC), Novarax (NVAZ), Human Genome (HGSI) Move
Several biotechs are trading on huge volume early in the session:
Cell Therapeutics (CTIC) has traded almost four million shares, and is up 2% to $1.69. The Food and Drug Administration accepted its application for review of pixantrone for refractory aggressive non-Hodgkin’s lymphoma, a form of cancer, yesterday. Read more
Cell Therapeutics (CTIC) Jumps On News
Cell Therapeutics, Inc. (CTIC) announced today that the U.S. Food and Drug Administration (FDA) has accepted and has filed for review the Company’s New Drug Application (NDA) for pixantrone as treatment for relapsed or refractory aggressive non-Hodgkin’s lymphoma (NHL).
Pixantrone (BBR 2778), is a novel topoisomerase II inhibitor with an aza-anthracenedione molecular structure that differentiates it from currently marketed anthracyclines and other related chemotherapy agents.
The market is still skeptical about the company’s actions. Shares are up only 4% to $1.77, but volume is large at almost 10 million shares
Douglas A. McIntyre
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