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Cell Therapeutics(CTIC) CEO Jim Bianco has done very well for himself by opening his big mouth. But his shareholders? Well ... not so much.
The biotech company surprised investors this Monday when it withdrew its U.S. approval application for the experimental lymphoma pixantrone because of unresolved and undisclosed "communications" with the
Food and Drug Administration.
Shares of Cell Therapeutics fell 17% to $1.09 per share on the news that the FDA will now be unable to make a decision on the approvability of pixantrone on April 24. Cell Therapeutics says it plans to resubmit the drug application to the FDA later this year after it has time to prepare new information.
Of course, the news was less shocking to those that have long followed the company and its overly chatty CEO. For them it was business -- and dumbness -- as usual.
Back in March 2010, an FDA advisory panel voted 12-0 to recommend pixantrone's rejection, which the FDA later did. Cell Therapeutics appealed that rejection and resubmitted the drug last year, setting up what was supposed to be a second shot at approval this spring.
Meanwhile, Bianco spent the interim reassuring Wall Street analysts that the vote from the pixantrone advisory committee meeting scheduled for Feb. 9 would be in his favor.
Why was Bianco so confident that the FDA would greenlight pixantrone after failing it the first time?
claimed that the FDA's cancer-drug review chief Dr. Richard Pazdur was dressed down by his agency superiors for an unfairly negative review of pixantrone which led to the drug's rejection in 2010.
And if Pazdur was muzzled -- as Bianco boasted he would be -- then the FDA's second clinical review of pixantrone could be more lenient and the panel of outside experts more likely to recommend the drug's approval.
Now it may be us talking out of turn this time, but the hasty pixantrone withdrawal clearly doesn't sound like FDA's top cancer drug reviewer was backing down anytime soon from his previous criticisms of the drug.
In fact, it just sounds like more of the same from Bianco, who acquired pixantrone eight years ago and has not stopped promising a speedy approval since.
Not that all his hot air has stopped him from cashing in of course. Since late November, Bianco has been awarded nearly $800,000 in cash bonuses by Cell Therapeutics' board, including a $150,000 bonus for 20 years of service to the company.
Then again, maybe Bianco deserves the extra pay.
If there is one thing Wall Street hates, it is uncertainty. And if there is one thing we can count on, it's Jim Bianco overpromising and under-delivering.