Punk Ziegel biotech analyst Matt Kaplan believes that the Stellar 3 delay does suggest that positive data are coming. He combed medical journals and found 10 studies involving similar lung cancer patients with performance status 2 who were treated with various combinations of chemotherapy drugs. In these studies, median survival fell typically into the four-to-five month range.
The last patient enrolled in the Stellar 3 trial in November 2003, so given an anticipated early 2005 data release, Kaplan believes this suggests that Xyotax is having a positive impact on survival. Kaplan rates Cell Therapeutics a buy with an $18 price target. His firm has a banking relationship with the company.
But yet, investors haven't responded at all. The stock is actually down from when Cell Therapeutics first started dropping bullish hints about Stellar 3 in May.
"My guess from an investor standpoint is that in the absence of any near-term data, investors are not willing to give Cell Therapeutics the benefit of the doubt, especially when management has a history of disappointing," said Lehman Brothers analyst Jim Birchenough.The biggest disappointment so far, he says, is the company's failure to follow through on a much-hyped promise to ink a Big Pharma marketing partnership for Xyotax. Birchenough downgraded Cell Therapeutics to equal weight from overweight in June 2003, when instead of announcing an expected Xyotax deal, the company