Cytori Therapeutics Inc (NASDAQ:CYTX) announced that the Company and Biomedical Advanced Research and Development Authority (BARDA), a division of the U.S. Department of Health and Human Services, increased the contract option originally signed in August 2014 to fund continued investigation and development of Cytori Cell Therapy™ for use in thermal burn injuries.
The amended option is valued at $16.6 million, an increase of approximately $2.5 million from its previous value of $14.1 million. Upon Investigational Device Exemption (IDE) approval by the FDA, if received, Cytori will request that BARDA provide additional funding to cover costs associated with the completion of a pilot clinical trial. This trial will employ IV administration of Cytori Cell Therapy.
The supplemental funds from this amended contract will be used to support the remaining activities necessary to seek approval of the IDE and support clinical readiness. The original contract includes additional options, exercisable at BARDA’s discretion, valued at up to $68 million to fund both pilot and pivotal clinical trials and additional work in thermal burn complicated by radiation exposure.
“BARDA and Cytori continue to work closely to develop this technology in the interests of the nation,” said Dr. Marc Hedrick, President and Chief Executive Officer of Cytori. “Additional funding allows Cytori to complete activities necessary for conduct of a pilot trial with the objective of getting Cytori Cell Therapy into the clinic for thermal burn in 2017.”
The current healthcare system is ill-prepared for large numbers of patients requiring simultaneous treatment for thermal burns associated with radiation exposure. Current standard of care consists of dressings, skin grafts and skin substitutes. Despite these treatments, patients with severe burns commonly suffer from prolonged pain, aggressive scarring, skin contracture and reduced range of motion. Cellular therapeutics such as those offered by Cytori may have the potential to improve the quality and rate of wound healing and reduce scarring and also can be deployed in a cost effective manner, even in mass casualty situations.
According to the American Burn Association, there were approximately 450,000 burn injuries in 2013 that required medical treatment in the United States, with approximately 40,000 requiring hospitalization. In a mass casualty event, the Government Accountability Office estimates that as many as 10,000 patients could require thermal burn care. The limited number of specialist surgeons and burn centers in the U.S. creates a public health need for a burn wound therapy that can be quickly and broadly applied by non-specialist medical personnel following such an event.(Original Source)
Shares of Cytori closed last Friday at $2.01, down $0.03 or -1.23%. CYTX has a 1-year high of $6.45 and a 1-year low of $1.81. The stock’s 50-day moving average is $2.10 and its 200-day moving average is $2.70.
On the ratings front, Cytori has been the subject of a number of recent research reports. In a report issued on September 12, Maxim analyst Jason Kolbert reiterated a Buy rating on CYTX, with a price target of $5.00, which implies an upside of 149% from current levels. Separately, on June 27, Roth Capital’s Joseph Pantginis maintained a Buy rating on the stock and has a price target of $11.00.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Jason Kolbert and Joseph Pantginis have a total average return of -16.1% and 6.9% respectively. Kolbert has a success rate of 29% and is ranked #4049 out of 4163 analysts, while Pantginis has a success rate of 37% and is ranked #359.
Cytori Therapeutics, Inc. is a late stage cell therapy company. Its develops autologous cell therapies from adipose tissue, using its proprietary technology, to treat a variety of medical conditions. Data from preclinical studies and clinical trials suggest that Cytori Cell Therapyâ¢ acts principally by improving blood flow, modulating the immune system, and facilitating wound repair.