West Coast Editor
Chemokine Therapeutics Corp.'s withdrawal of a public offering, a 65-percent reduction in work force and loss of CEO Richard Piazza leaves the strapped firm with yearly savings of about $1.5 million, as remaining officials - who took a 10 percent pay cut - cast for financing alternatives.
Shares of Vancouver, British Columbia-based Chemokine (OTC BB:CHKT) closed Tuesday at 20 cents, down 8 cents. The stock has not traded over $1 for a year.
Piazza, who has served as CEO for the eight months, has taken a job with another company but is staying on board as chairman at Chemokine, where CFO Bashir Jaffer has been appointed interim CEO. Another board member, Mohammad Azab, has resigned for personal reasons. Company officials could not be reached.
Chemokine went public about three years ago, raising C$16 million (then US$13.3 million) through the sale of 16 million shares at C$1 each. According to its report for the third quarter of this year, the firm had cash and cash equivalents of $75,392, with short-term investments of $81,584, and assets totaled about $1.7 million. Market conditions were blamed for the withdrawal of the latest proposed offering. (See BioWorld Today, Jan. 4, 2004.)
The lead candidate, which has reached the Phase II stage, is CTCE-9908, is an antagonist of chemokine stromal cell derived factor-1 called SDF-1, which binds to the CXCR4 receptor on cancer cells and apparently causes them to metastasize. SDF-1 technology is licensed from the University of British Columbia.
In late October, Chemokine reported preliminary results from its Phase I/II trial with CTCE-9908, showing the drug was well tolerated with no dose-limiting toxicity observed up to the maximum dose of 5 mg/kg/day. The main side effect at the top dose was moderate phlebitis. Results also showed that seven out of 20 cancer patients had stable disease after one month, and one patient with small-bowel carcinoma showed stable disease after six months of therapy.
Behind that compound is CTCE-0214, which has undergone Phase I testing. The drug is an agonist of the chemokine receptor to SDF-1, present on blood stem cells, which could boost white blood cells in patients with chemotherapy-induced neutropenia. Early tests have yielded a 300 percent increase in white blood cell counts.
SDF-1 has proven a worthy target for Cambridge, Mass.-based Genzyme Corp., whose Mozobil (plerixafor), an antagonist of the SDF-1/CXCR4 complex, has yielded strong results in Phase III trials with multiple myeloma and non-Hodgkin's lymphoma, and the company plans to file for approval in both indications, here and overseas, during the first half of next year. (See BioWorld Today, July 20, 2007, and Aug. 3, 2007.)
Also working with SDF-1 is Atlanta-based Metastatix Inc., which in October raised $35 million in a Series B financing to move its lead CXCR4 antagonist, MSX-122, into the clinic for cancer. (See BioWorld Today, Oct. 10, 2007.)
Chemokine, in its third-quarter filing, reported that research and development expenses totaled $778,296 during the three months ended Sept. 30, compared to about $1.4 million during the previous year's period - a drop of $686,295, partly because of reduced spending for CTCE-0214 of $355,394 (related to the deferral of dose-escalation studies), as well as $50,565 for CTCE-9908.
Since its inception in the summer of 1998, the firm has raised money mainly through private and public offerings, garnering $28.6 million through the private sale of equity securities. In March 2006, Chemokine issued about 6.4 million shares of common stock in a private placement transaction for gross proceeds of about $5.9 million, netting about $5.4 million.