CTI BioPharma Corp (NASDAQ:CTIC) reported financial results for the second quarter ended June 30, 2015.
“The significant interest from the oncology community generated by the Phase 3 PERSIST-1 clinical data, presented at the ASCO and EHA conferences, supports our belief that there remains a significant unmet medical need for patients with myelofibrosis and that pacritinib may play an important role in addressing the current treatment gaps for this disease,” said James A. Bianco, M.D., CTI BioPharma’s President and CEO. “Armed with these positive data from the PERSIST-1 trial, our efforts are now directed toward exploring potential regulatory pathways in the U.S., while our partner Baxalta expects to submit a marketing application in Europe before the end of the year. Concurrently, we remain committed to completing the second pacritinib Phase 3 trial, PERSIST-2, and to continuing investigation into the potential for pacritinib in other blood-related cancers outside of myelofibrosis.”
Second Quarter 2015 and Recent Highlights
- In May, data from the PERSIST-1 Phase 3 clinical trial of pacritinib for the treatment of patients with myelofibrosis showed that, compared to best available therapy (exclusive of a JAK inhibitor), or BAT, pacritinib therapy resulted in a significantly higher proportion of patients with spleen volume reduction and control of disease-related symptoms. Treatment with pacritinib resulted in improvements in severe thrombocytopenia and severe anemia, eliminating the need for blood transfusions in a quarter of patients who were transfusion dependent at the time of enrollment. Gastrointestinal symptoms were the most common adverse events and typically lasted for approximately one week. A limited number of patients discontinued treatment due to side effects. There were no Grade 4 gastrointestinal events reported. These results were presented in a late-breaking oral session at the 51st Annual Meeting of the American Society of Clinical Oncology.
- In June, results from PERSIST-1 patient-reported outcome (PRO) and other quality of life measures presented at a late-breaking oral session at the 20th Congress of the European Hematology Association (EHA) showed significant improvements in symptom score with pacritinib therapy compared to BAT across the symptoms reported in the presentation.
- In June, data from an investigator-sponsored Phase 2 trial of tosedostat in elderly patients with either primary acute myeloid leukemia (AML), or AML that has evolved from myelodysplastic syndrome (MDS) showed that the combination of tosedostat with low-dose cytarabine/Ara-C (LDAC) resulted in an overall response rate of 54 percent in elderly patients with AML, with 45 percent of patients achieving durable complete responses. These findings were also presented at the EHA congress.
- In June, the following two potential milestone payments from Baxalta Incorporated, orBaxalta, to CTI BioPharma were accelerated in the amount of $32 million: a $12 milliondevelopment milestone advance payable in connection with the potential regulatory submission to the European Medicines Agency with respect to pacritinib, which Baxaltaanticipates submitting as early as late in 2015, and a $20 million development milestone advance payable for the first treatment dosing of the last patient enrolled in PERSIST-2 (the ongoing randomized Phase 3 trial evaluating pacritinib for patients with myelofibrosis whose platelet counts are less than or equal to 100,000 per microliter).
- In June, entered into an amendment to the loan agreement with Hercules Technology Growth Capital, Inc. under which we received $6.2 million in additional funding with the potential to borrow an additional $5 million subject to certain conditions.
- In July, Bruce J. Seeley was appointed as Executive Vice President and Chief Commercial Officer to lead all aspects of commercial operations.
Second Quarter 2015 Financial Results
Total revenues for the second quarter and the six months ended June 30, 2015 were $1.1 million and $3.8 million, respectively, compared to $1.3 million and $2.8 million for the same periods in 2014. Net product revenues of PIXUVRI for the second quarter 2015 were $0.8 million and $1.7 million, respectively, compared to $1.1 million and $2.4 million for the same periods in 2014.
The non-GAAP operating loss, which excludes non-cash share-based compensation expense, for the second quarter ended June 30, 2015 was $28.3 million, compared to non-GAAP operating loss of $21.3 million for the same period in 2014. The GAAP operating loss for the second quarter ended June 30, 2015 was $31.0 million, compared to a GAAP operating loss of$26.7 million for the same period in 2014. The increase in operating loss is predominantly associated with the Phase 3 development program for pacritinib and the PIX306 post-authorization Phase 3 trial for PIXUVRI. For the six months ended June 30, 2015, the non-GAAP operating loss was $51.4 million, compared to $41.1 million for the same period in 2014. For the six months ended June 30, 2015, the GAAP operating loss was $58.5 million, compared to$54.3 million for the same period in 2014. Non-cash share-based compensation expense for the second quarter and six months ended June 30, 2015 was $2.8 million and $7.1 million, respectively, compared to $5.4 million and $13.2 million for the same periods in 2014. For information on CTI BioPharma’s use of the aforementioned non-GAAP measure and a reconciliation of such measure to GAAP operating loss, see the section below entitled “Non-GAAP Financial Measures.”
Net loss for the second quarter ended June 30, 2015 was $32.6 million, or $0.19 per share, compared to a net loss of $27.4 million, or $0.19 per share, for the same period in 2014. Net loss for the six months ended June 30, 2015 was $61.2 million, or $0.35 per share, compared to$56.4 million, or $0.39 per share, for the same period in 2014.
As of June 30, 2015, cash and cash equivalents totaled $54.9 million, compared to $70.9 millionas of December 31, 2014.
2015 Financial Outlook
CTI BioPharma reaffirms prior financial guidance that it expects total revenues for 2015 will be approximately $50 million to $55 million, and it expects that non-GAAP operating loss for 2015 will be approximately $75 million to $85 million, which excludes non-cash share-based compensation expense. These financial projections are primarily based on factors previously outlined in the Company’s fourth quarter and full year 2014 financial results press release. (Original Source)
Following the 2Q results, shares of CTI BioPharma are trading at $1.89, up $0.10 or 5.59%. CTIC has a 1-year high of $2.94 and a 1-year low of $1.65. The stock’s 50-day moving average is $1.97 and its 200-day moving average is $2.03.
On the ratings front, Roth Capital analyst Debjit Chattopadhyay reiterated a Buy rating on CTIC, with a price target of $4.50, in a report issued on June 16. The current price target implies an upside of 150.0% from current levels. According to TipRanks.com, Chattopadhyay has a total average return of 31.4%, a 64.9% success rate, and is ranked #17 out of 3727 analysts.