On November 8, 2016 CTI BioPharma Corp. (NASDAQ and MTA:CTIC) reported financial results for the third quarter ended September 30, 2016 (Press release, CTI BioPharma, NOV 8, 2016, View Source [SID1234516415]). Schedule your 30 min Free 1stOncology Demo! "We recently reported top-line data from our second Phase 3 trial of pacritinib and are encouraged by its clinical profile, particularly in patients with severe thrombocytopenia, and look forward to the presentation of the full results at an upcoming scientific meeting," said Richard Love, Interim President and CEO of CTI BioPharma. "With this data in hand, our top priority is to work with the FDA in short order to seek to address their recommendations for getting pacritinib off clinical hold and back on a development track. This has been a challenging year for us; however, we are committed to bringing novel therapies to patients with a critical unmet medical need."
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Recent Events
In August 2016, the Company announced top-line results from the PERSIST-2 randomized, controlled Phase 3 clinical trial comparing pacritinib, an investigational oral multikinase inhibitor, with physician-specified best available therapy (BAT) for the treatment of patients with myelofibrosis whose platelet counts are less than or equal to 100,000 per microliter. Preliminary results demonstrated that the PERSIST-2 trial met one of the co-primary endpoints showing a statistically significant response rate in spleen volume reduction in patients with myelofibrosis treated with pacritinib compared to BAT, including the approved JAK2 inhibitor ruxolitinib (p<0.01). Although the PERSIST-2 trial did not meet the other co-primary endpoint of greater than 50 percent reduction in Total Symptom Score (TSS), the preliminary analysis approached marginal significance compared to BAT (p=0.0791).
In October 2016, the Company regained worldwide rights for the development and commercialization of pacritinib following termination of the Pacritinib License Agreement with Baxalta, which is now part of Shire plc. Under the terms of the Asset Return and Termination Agreement with Baxalta, the Company has received $10.3 million from Shire as reimbursement for certain expenses incurred or to be incurred. The Company in exchange has agreed to provide a one-time payment to Baxalta, upon the first regulatory approval or any pricing and reimbursement approvals of a product containing pacritinib, in the amount of approximately $10.3 million which represents certain amounts paid by Baxalta for the benefit of the pacritinib program manufacturing efforts.
In October 2016, the Company announced that James A. Bianco, M.D. retired from his position as President and Chief Executive Officer. At the request of the Board of Directors, Richard Love, a director of the Company since 2007, was appointed to serve as Interim President and Chief Executive Officer. Mr. Love started two biotechnology companies, Triton Biosciences Inc. and ILEX Oncology Inc., and he served as Chief Executive Officer for Triton Biosciences Inc. from 1983 to 1991 and as Chief Executive Officer for ILEX Oncology from 1994 to 2001. Mr. Love also served in executive positions at not-for-profit organizations including the Cancer Therapy and Research Center (CTRC) and the Translational Genomics Research Institute (TGen).
Third Quarter Financial Results
Total revenues for the third quarter and nine months ended September 30, 2016, were $4.4 million and $48.3 million, respectively, compared to $1.0 million and $4.8 million for the respective periods in 2015. The increase in total revenue for the nine month period in 2016 is primarily due to recognition of $32 million in milestone payments and reimbursement of development costs from Shire plc related to pacritinib. CTI BioPharma had previously received a cash advance for these milestone payments from Baxalta in the second quarter of 2015 that was accounted for as long-term debt until the achievement of the associated milestones in the first quarter of 2016. Net product sales of PIXUVRI for the third quarter and the nine months ended September 30, 2016, were $1.0 million and $3.3 million, respectively, compared to $0.7 million and $2.4 million for the respective periods in 2015.
GAAP operating loss for the third quarter and nine months ended September 30, 2016, was $28.7 million and $43.6 million, respectively, compared to GAAP operating loss of $32.0 million and $90.5 million for the respective periods in 2015. Non-GAAP operating loss, which excludes non-cash share-based compensation expense, for the third quarter and nine months ended September 30, 2016, was $23.6 million and $32.4 million, respectively, compared to the non-GAAP operating loss of $26.1 million and $77.5 million for the respective periods in 2015. Non-cash share-based compensation expense for the third quarter and nine months ended September 30, 2016, was $5.1 million and $11.2 million, respectively, compared to $5.9 million and $13.0 million for the respective periods in 2015. For information on CTI BioPharma’s use of non-GAAP operating loss and a reconciliation of such measure to GAAP operating loss, see the section below entitled "Non-GAAP Financial Measures."
Net loss for the third quarter of 2016 was $29.2 million, or ($0.10) per share, compared to a net loss of $32.6 million, or ($0.19) per share, for the same period in 2015. Net loss for the nine months ended September 30, 2016, was $45.6 million, or ($0.16) per share, compared to a net loss of $93.8 million, or ($0.54) per share, for the same period in 2015. The decrease in net loss for the third quarter and the nine months ended September 30, 2016, compared to the respective periods in 2015 is primarily due to increased net product sales and license and contract revenue.
As of September 30, 2016, cash and cash equivalents totaled $61.6 million, compared to $128.2 million at December 31, 2015.