Cell Therapeutics' Drug Accepted

We are pleased to hear that the US Food and Drug Administration (FDA) accepted and filed for review Cell Therapeutics’ (CTIC - Analyst Report) New Drug Application (NDA). The company is seeking FDA approval (NDA filed in June 2009) for pixantrone for the treatment of relapsed and refractory non-Hodgkin’s lymphoma (NHL). Though an action date is yet to be published, the company expects the FDA to take a final decision regarding the review status by Sept 4.

Earlier in June, Cell Therapeutics presented encouraging results from a phase III trial of pixantrone. Although the efficacy data for pixantrone were encouraging, we are concerned about its side effects. While, neutropenia was 41.2% for pixantrone versus 19.4% for comparator, leukopenia was 23.5% for pixantrone versus 4.5% for comparator.

Although the grade 3, 4 cardiac disorder was similar among the two treatment groups (1.5% vs. 1.5%), there was a higher incidence of serious cardiac disorders in patients treated with pixantrone than among patients who received comparator agents (8.8% vs. 4.5%). The higher than expected side effects may limit the utility of pixantrone in NHL patients.
 
Pixantrone belongs to a class of cancer medicines known as anthracylines. Although, dosing of anthracyclines is limited due to severe cardiac toxicity, pixantrone scores here compared to the rest of the group as it has been designed to be less toxic to the heart. The drug is available in Europe on a named patient basis.
 
In the best case scenario, pixantrone could be approved in early 2010. Even if pixantrone is approved, the company will have to invest significantly in the commercialization and marketing of the product. Meanwhile, Cell Therapeutics is yet to submit an NDA for another late-stage candidate, Xyotax for the treatment of women with lung cancer.
 
Although the picture is not so gloomy on the product development front, we remain concerned about the company’s liquidity position. The company is under great pressure to raise additional cash to fund its operations. Though the situation recovered a bit with the sale of Zevalin, it cannot continue for long without a proper revenue stream. With a positive outlook for pixantrone, any successful partnership with a cash rich entity will solve the liquidity issue.