) --Dear Jim:
You want to sue me? Really?
During Friday afternoon's conference call, you said
was considering a lawsuit against my employer,
, and me because, "It is time we take action to stand up for retail shareholders across all such fronts, especially when misstatements are made with malicious intent or a reckless disregard for the truth."
Cell Therapeutics CEO Jim Bianco
Jim Bianco, if you really want to protect the interests of your shareholders, retail or otherwise, you should resign from your post as CEO of Cell Therapeutics immediately.
Seriously, Jim. Resign now. Leave and take your entire management team with you. Instruct your board of directors to appoint a caretaker executive as interim CEO whose primary task will be to sell off whatever assets the company has left. Use the proceeds to pay off the debt on
. If there's any money remaining, return it to shareholders as a small token compensation for the years of losses they've endured under your incompetent and wasteful reign as
Listening to you suggest that you're safeguarding the financial interests of shareholders would be laughable if it weren't such a pathetic misrepresentation of the facts.
Since 2005, Cell Therapeutics' shares have lost 99.9% of their value.
I ran a screen for the worst performing biotech stocks over the past five years. Congratulations Jim, Cell Therapeutics is ranked No. 1. The only biotech firms that lost more value since 2005 than Cell Therapeutics are those that went belly up.
While shareholders have been wiped out, you've become a very wealthy man. You could say Cell Therapeutics is your personal ATM. It's a great system (for you), shareholders make the deposits and you make the withdrawals.
Since 2005, you've collected well more than $20 million in total compensation, which includes salary, bonuses, stock awards and perks like
, "personal protective services" for you and your family and health club membership dues. (You can't pay for your own gym membership?)
In 2009, you earned $12 million in total compensation. The top five executives of your management team earned $32 million in total compensation. Cell Therapeutics reported an operating loss of more than $81 million. Meantime, under your direction, Cell Therapeutics' total share count has now ballooned to almost 700 million, if it's not past that already.
Even in an era of skyrocketing CEO compensation, your take-home pay is particularly galling because Cell Therapeutics' drug-development track record -- of which you're responsible -- is short on accomplishments but long on failures, setbacks and screw-ups.
Jim, if the fight against cancer is a war, you've been on the losing side of the battlefield your entire career.
. This should have been a layup. Pixantrone belongs to a common and well-understood class of chemotherapy drugs. It's a me-too drug, for heck's sake! All Cell Therapeutics probably had to do to get pixantrone approved by the Food and Drug Administration was conduct a single, successful pivotal trial in a population of advanced lymphoma patients who were essentially out of treatment options. I'm hard pressed to think of a lower regulatory hurdle for a cancer drug.
But still, Cell Therapeutics, under your management,
Yet in typical Bianco fashion, you grabbed the microphone Friday afternoon and acted as if nothing bad had happened. You didn't apologize for your colossal blunder. You took no responsibility for pixantrone's rejection. You simply moved on to the next fantastical story -- making yet more promises and proclamations about a new pixantrone pivotal trial that will be completed in a ridiculously short time period and with widespread support and participation from leading U.S. lymphoma specialists.
Jim, who are these U.S. doctors supporting pixantrone today? Please, don't tell us they're the same doctors who cared so little about pixantrone the first time around that they chose to enroll just eight patients across the entire country in the previous phase III study, according to the FDA.
And do you honestly expect us to believe that you're going to reach an agreement with FDA on a new pixantrone trial
line up research centers to run the trial
find the money to pay for the trial
enroll your first patient by September?
You called that timeline a "target" on Friday's conference call. I call it just another serving of Bianco B.S.
More malarkey from Friday's call, when you said, "We've been pleased with the expressed interest amongst large pharma companies, and the potential to co-develop and co-promote pixantrone with us in the U.S. and to take the lead on the product outside the U.S."
Jim, I can't imagine that anyone is going to partner pixantrone.
is probably not interested in licensing a tragically unimpressive chemotherapy drug that was just summarily rejected by FDA. Likewise with Opaxio -- what company in its right mind is going to find value in a drug that has failed every phase III trial it's been tested in and was just rejected by European regulators?
That's nonsense and you know it.
Jim, your track record on
, but your record for delivering on promises of
is even worse. The most recent crop of retail investors you've somehow managed to bring into the Cell Therapeutics' fold probably doesn't know your
. I, on the other hand, have been writing about you and Cell Therapeutics for almost a decade. I've heard you set a lot of goals over the last nine to 10 years, yet I've rarely seen you actually deliver on any of them.
Don't forget Jim, I was writing about you and the company in 2003 when you were promising a partnership for
. That deal never happened. Instead you zipped over to Milan and bought
, an obscure Italian drug firm that had been looking for a buyer, unsuccessfully, for almost two years before you came calling. Novuspharma was the original developer of pixantrone. Almost seven years later, incredibly, you still haven't managed to bring pixantrone to market.
Hey Jim, remember Trisenox? Cell Therapeutics had to settle a federal lawsuit accusing the company of illegal marketing practices. What about Zevalin? You bought that foundering cancer drug but didn't manage to boost sales before selling it off again. Xyotax? Fail. Pixantrone? Fail.
Reality looks far different and darker than the rosy fantasy world you continue to project. The only thing you've managed to do well -- exceedingly well -- is collect large paychecks and burden shareholders with one dilutive financing after another.
Jim, your time is almost over.
. I can't imagine that you have enough money to keep the business running through the end of the year, never mind repaying the millions in debt due this summer or funding new clinical trials.
On Friday, Cell Therapeutics was forced to postpone its annual shareholder meeting. You conveniently neglected to explain the reason during Friday's conference call but I'm assuming you failed, once again, to gain a quorum for the meeting. Let's hope that if shareholders do bother to participate, that they vote against the company's proposal to increase shares in the corporate treasury to 1.2 billion shares from its current ceiling of 800 million shares.
Without the extra shares, you won't be able to raise any more money. And without new cash, you won't be able to waste any more money on worthless drugs. Your days of living lavishly off the backs of shareholders will be over.
Jim, you have no credibility left. The bag of tricks is empty. I suspect that I'm not the only one who sees you as a pariah in the biotech business community. I doubt anyone respects you. I don't hear anyone rushing to your defense. Do the honorable thing for once in your career and resign as CEO of Cell Therapeutics.
Do it now, please. If you do, cancer patients and investors will finally have reason to thank you.
-- Reported by Adam Feuerstein in Boston.
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Adam Feuerstein writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback;
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