Cell Therapeutics, Inc. (CTIC)
Q1 2010 Earnings Call
April 28, 2010 8:30 am ET
James Bianco - Chief Executive Officer
Jack Singer - EVP and Chief Medical Officer
Louis Bianco - Chief Financial Officer
Ren Benjamin - Rodman & Renshaw
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Ladies and gentlemen, welcome to the Cell Therapeutics Q1 2010 conference call on the 28
of April 2010. Throughout today's recorded presentation, all parties will be in a listen only mode. After the presentation, there will be an opportunity to ask questions. (Operator Instructions) I will now hand the conference over to James Bianco. Please go ahead, sir.
Good morning and thank you for joining us today.
Before we get started I’d like to remind you as is common with presentations of this type that we will be making forward-looking statements and as such we recommend that you refer to our SEC filings for more information on the risks and uncertainties facing our company and our securities.
Let me also remind you that this call will be recorded and will be available for playback on our website. Any unauthorized recording of this call or use of this recording is prohibited without written consent from the company.
On today, we will review our financials and the progress we have made reducing our expenses going forward, talk a little bit about the proposed timelines for filing our marketing approval application in Europe and the initiations of our follow-on pivotal trial in the U.S., our strategy for achieving our nine-month enrollment target in the PIX306 study and the utility of expanded access program for pixantrone in assisting in that goal, briefly discuss the importance of today's announcement on the NCCTG breast cancer initiative with brostallicin and then review the NASDAQ minimum bid requirement.
Lastly, we will discuss Q2 upcoming events of interest.
So let me start with the financial results. Overall net loss in Q1 2010 was approximately 37% lower than in Q1 2009. When excludes the exception of one-time items such as the $10.2 million gain associated with the balance of sale of Zevalin to Spectrum and the gain on the derivative liabilities who preferred stock restructuring of $7.7 million.
In Q1 of this year, we had two exceptional non-cash expenses, which included equity based compensation and deemed dividends related to preferred stock offering which totaled $25 million.
So after adjusting for these differences, the net loss is approximately $19 million for Q1 compared to $30 million for the same period in 2009 and we have implemented a number of steps that will significantly lower our net operating burn rate going forward to a target burn rate of $4.4 million per month.
These steps are critical in allowing us to focus our resources on moving pixantrone through the European Marketing Authorization review process and on initiating the follow-on pivotal study and seeking approval of an expanded access program for pixantrone in the U.S.
We ended the quarter with approximately $41.5 million in cash, which does not include the $18.5 million in net proceeds we received in April 2010. If we are successful in exchanging the $40.4 million of convertible notes for equity, we believe this cash balance would provide more than 12 months of operating capital going forward.
Let's move on to pixantrone. As we noted in our press release, the meeting we had with the European Regulatory Authorities and their clinical experts assigned to review the application for Pixantrone was very supportive of using PIX301 data for submission of an MAA in Europe.
This was notable in light of their awareness of ODAC and the FDA comments on the trial. They specifically noted their review, which considers the totality of the evidence across all the end points of this trial including their interest in the soon to be updated end-of-study survival results.
In addition to meeting the co-rapporteurs, we also met with the EMEA's pediatric committee who expressed interest in having pixantrone study for as potential to treat hematologic cancers in children, given the lower propensity for cardiac toxicity and standard anthracycline like agents.
The pediatric investigation plan updated for the recommendations made by the PDCO would be submitted this quarter along with a 60-day review request, which allow us to meet an MAA submission target in late September or early October.
We are also working steadily towards submission of a post NDA meeting with the FDA, during which we will discuss the initial trial design for the follow-on clinical study of pixantrone that was recommended by the FDA to supplement requirements for approval in the U.S.
In parallel, we will begin submitting an application for the expanded access program as well.
Let me touch briefly on our plans to capitalize on the intense interest amongst leading lymphoma community practices for participating in a follow-on pixantrone trial. We are working on integrating a social media based campaign linking participating sites with advocacy groups and patients across 75 of the largest integrated largest integrated lymphoma treatment practices, practices like UPMC, Georgia Cancer Specialists, etc.
And based on electronic medical record review, the treatment practices amongst 50 of these centers, we have identified as source of several thousand patients who visit this centers each year, who would be potentially eligible to participate in the pixantrone follow-on trial.
In addition to knowing where these patients are being treated and having their centers participating in the trial, it's also important to know how these centers treat these patients and the outcome of those current practices, allowing us to design the study, which is current with their management for these patients and one in which pixantrone can prove superior in the outcome for the treatment of these patients with relapsed refractory NHL.