Cell Therapeutics Inc. has raised $18.5 million and entered a partnership with a strategic investment group for $30 million in cash and services.
The Seattle-based biopharmaceutical company agreed to sell nearly 2.6 million shares of its common stock to several institutional investors in a direct offering at a reduced rate of $7.10 per share.
Following Monday afternoon's announcement, shares for CTI (NASDAQ:CTIC) began selling for $8.18 Tuesday morning and ended at $8.30, down 16 cents.
CTI's quarterly report ending Sept. 30 showed the company had $103 million in cash, cash equivalents, securities available for sale and interest receivable. It posted a net loss of $34.9 million, or 62 cents per share, for the quarter.
Raising funds is crucial for CTI as it moves forward on several oncology products, said CTI's director of investor relations, Leah Grant.
"We have a large number of Phase III clinical trials just initiating," Grant said.
CTI's marketed product is Trisenox, which was approved by the FDA in 2000 to treat patients with relapsed or refractory acute promyelocytic leukemia, a blood cancer. The drug was authorized by the European Commission in March 2002.
To date, sales of Trisenox have brought the company $28 million in net revenues, Grant said, adding that estimates for next year's sales are expected to be provided in a year-end report.
Looking ahead for Trisenox, CTI has signed a six-year financing and services agreement with Research Triangle Park, N.C.-based Quintiles Transnational Corp.'s strategic partnering group, PharmaBio Development. Under the agreement, CTI will receive $25 million in cash and $5 million in clinical services from PharmaBio, Grant said.
In return, CTI will make royalty payments to PharmaBio based on a percentage of net sales of Trisenox in the U.S. and certain European markets, with a minimum royalty payment of $53 million over the course of the six-year agreement, "based on our current forecast," Grant said.
With the commitment from Quintiles' investment group, CTI will be able "to continue the chemical development of Pixantrone," Grant said, adding the drug started its Phase III trial this year.
Pixantrone is an investigational agent designed to treat non-Hodgkin's lymphoma and aimed at improving the activity and safety of the anthracycline family of cancer agents. Enrollment of 320 patients for the trial should complete by mid-2005, and the product has received fast-track designation.
In July, CTI raised $42.8 million by selling 9 million shares after mid-study data from its STELLAR 3 trial of Xyotax, a therapy treatment for non-small-cell lung cancer, indicated the trial would not be completed until the end of 2004 at the earliest. (See BioWorld Today, July 29, 2004.)
"We're gearing up for completion of our trials for Xyotax, our lung cancer drug, and, hopefully, we'll be launching that in early 2006," Grant said. "So clearly we're very focused on that right now."
Results initially were expected in August or September, but the trial, which enrolled 400 patients, needed to reach 311 death events before data could be analyzed. The trial compares Xyotax, a polyglutamate polymer linked to paclitaxel, in combination with carboplatin, to paclitaxel combined with carboplatin to determine whether there is a 30 percent improvement in average survival rates among patients with high-risk non-small-cell lung cancer.
Another Xyotax study involves 840 lung cancer patients and looks at the drug as a second-line treatment option. Data are expected sometime in 2005. Grant said the company also will begin a Phase III study of Xyotax in the treatment of ovarian cancer early next year.