SEATTLE ( TheStreet) -- U.S. regulators rejected again Cell Therapeutics' ( CTIC) blood cancer drug pixantrone -- with a small (and cruel) asterisk.

Next up for the financially strapped biotech firm: A reverse stock split.

Cell Therapeutics has a habit of burying important (and negative) news developments, so it's helpful to read the company's press releases from the bottom to the top.

"OND denied the dispute appeal request to conclude that the efficacy of pixantrone has been demonstrated…," Cell Therapeutics said Tuesday, albeit deep in its publicly released statement.

OND is the Office of New Drugs, the division within the U.S. Food and Drug Administration to which Cell Therapeutics appealed the agency's decision last year to reject pixantrone as a new treatment for non-Hodgkin's lymphoma.

Translation: FDA rejects pixantrone again.

The asterisk I mention above: FDA's Office of New Drugs is apparently allowing Cell Therapeutics to resubmit pixantrone for another medical review, if certain matters can be resolved. The cruel part is that Cell Therapeutics must resubmit pixantrone to the FDA's Office of Oncology Drug Products, which is the same group of hard-nosed regulators that threw out pixantrone in the first place.

Translation: Ouch!

Naturally, Cell Therapeutics is claiming this new pixantrone development as a victory. I guess Cell Therapeutics might win, if winning is defined as spinning the bad news enough to convince some gullible retail investors that pixantrone still has a fighting chance left in its appeal process. The ultimate goal for Cell Therapeutics is to keep the company's foundering stock afloat, even if just barely.

No doubt this will be the case that Cell Therapeutics argues on its conference call later this morning, which comes, not so coincidentally, one day after the expiration of Nasdaq's delisting deadline. Cell Therapeutics has all but run of out time in an effort to get the stock price above a buck, which means the company will likely need to pull the trigger on its third reverse stock split in the last four years.

More on the Cell Therapeutics' lousy financial condition and the reverse stock split in a minute. First, it's important to put pixantrone in the proper clinical perspective. Cell Therapeutics may get a chance to resubmit pixantrone for another FDA review, but the drug's phase III clinical data remain the same, which is to say, not warranting approval.

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