New CTIX writeup in Seeking Alpha by ChemistFrog:
Post# of 72440
Posted On: 01/17/2013 2:54:25 PM
New CTIX writeup in Seeking Alpha by ChemistFrog:
'Top Of The Class' Small Pharma Investments For 2013 Part II
seekingalpha.com/article/1118281
Small Pharma Leader in Small Molecule Approach to Fighting Cancer
Cellceutix Corporation (CTIX.OB) long time investors have enjoyed a solid stock run up in the last month, with shares reaching 52-week highs of $2.47 after the company traded below a dollar as recently as late November. The share price increase has come as a result of promising news on its lead drug candidate, Kevetrin™, a small molecule drug that reactivates tumor suppressor protein p53. Once reactivated (cancer cells have a way of inhibiting p53), p53 induces the expressions of p21 and PUMA (p53 up-regulated modulator of apoptosis). This reactivation inhibits cancer cell growth and causes tumor cell apoptosis (programmed cell death).
Volume and share price interest for the company's common shares started to pick up after the company's December 3rd announcement that the phase 1 Kevetrin™ dose escalation trial was progressing well with 84 blood samples from the patients being been sent to a laboratory for pharmacokinetics analysis (an evaluation of how the drug is absorbed, distributed, metabolized, and excreted from the body). A follow up December 14th announcement from the company confirmed that it was allowed to continue with the next higher dose of Kevetrin™, with dosing to begin on December 16th. Shares continued to climb to the $2.50 resistance mark on December 26-27th after a December 24th response by CEO, Leo Ehrlich, to a December 23rd story in the New York Times titled "Genetic Gamble; New Approaches to Fighting Cancer" and its focus on p53. The New York Times story went on to discuss p53 as the "Guardian Angel Gene" and mentioned work by Merck (MRK), Roche Holding Ltd. (RHHBY.PK) and Sanofi SA (SNY) in "racing to develop their own versions of a drug they hope will restore a mechanism that normally makes badly damaged cells self-destruct and could potentially be used against half of all cancers." Although obviously disappointed that Cellceutix was not mentioned in the piece, I'm certain Mr. Ehrlich appreciated the exposure for the novel approach to the publication's large readership. Important for interested shareholders going forward was a statement by Mr. Ehrlich in his response noting "I believe that a discerning examination of the article and publicly available information shows that we are not only ahead of these larger companies, but we have a better mechanism which is more likely to function against most cancers. Our research to date shows that Kevetrin™ affects both wild and mutant types of p53, a claim that to the best of our understanding, the other companies cannot make." If clinicals underway confirm this statement, the company's common shares as well as the targeted patient groups (not yet to be determined) could each benefit.
A December 31st company update gives much information that should be considered as the company heads into 2013 with a now $2.00 share price and $186 million market capitalization. With Kevetrin™ in multiple trials, Mr. Ehrlich gave indications of multiple catalysts ahead for the company in 2013 with trial updates and data presentations likely. Company-sponsored clinical trials at Harvard University's Dana-Farber Cancer Center and Beth Israel Deaconess Medical Center, which began in November, are evaluating the drug's safety with pharmacokinetics from the early cohort expected in the short-term. Trials evaluating Kevetrin™ for Acute Myelogenous Leukemia (AML) and sponsored by "a leading European university" are expected to being in 1H 2013. Data presentations by the company as well as its partners will be significant although these are early stage clinicals. With Merck, Roche, and Sanofi each developing drugs using similar technologies, positive and applicable news from any or each of these companies will also likely have impacts on the company's share price. Additionally, positive Kevetrin™ data could also begin turning large pharmaceutical companies' heads, with licensing or buyout potential also becoming evident for the early-stage company before its valuation starts ramping up under its own merit.
Although beyond the scope of this article, investors should also consider the company's lead product candidate, Plurisol™, with phase 2 trial preparations now underway evaluating the drug's safety/efficacy to treat psoriasis. If the FDA approves the company forgoing early-stage clinicals and allows it to instead start with a phase 2 trial, the company could save much time and money moving forward to its first likely marketable product. Cellceutix is also planning on starting a "proof of concept" trial for Plurisol™ in Q1 2013 in the European Union, which could also affect share price in the coming weeks.
A development-phase company, Cellceutix is still largely dependent on shareholder money to fund its operations with the ever-looming fear of dilution in the thoughts of its investors. However, a December 10th announcement by the company of a $10 million stock purchase agreement with Aspire Capital Fund, LLC gave terms of some of the best financing agreements I have personally ever seen with a small pharmaceutical company . Aspire would buy $10 million of the company's common shares over the next three years at market price with Cellceutix determining the timing and number of shares to purchase. Terms of the deal indicated no restrictions on the funds, financial covenants, restrictions on future financings, rights of first refusal, participation rights, penalties, or liquidated damages per the agreement. Cellceutix did issue 336,625 common shares to Aspire for consideration of the agreement; however, no warrants were part of the agreement. With cash and equivalents of only $125,000 on September 30th, the financing certainly helps to secure the company and its growing pipeline.
Cellceutix common shares are now trading at $2.00 at the time of this composition, above the simple moving average (SMA) with technical support seen at $1.75. Although a "watch and wait" approach may often serve investors better for solid entries, the pharmacokinetics results for Kevetrin™ are still pending and may send share prices upward once again. Alternately, poor or questionable results may also give interested investors a better entry soon thereafter as the data may or may not indicate efficacy or safety accurately. With the company's recent news serving as the major catalyst for recent price increases, interested investors should also consider the risk of downside if clinicals don't yield positive data. Many indications are potentially going to be evaluated, and failure in one indication does not necessarily failure for another. Also consider, the company's Kevetrin™ platform is in early clinicals with marketing potential still years away, but that is typically considered and expected in the small pharma sector and has likely been taken into consideration with the company's $186 million market capitalization.
'Top Of The Class' Small Pharma Investments For 2013 Part II
seekingalpha.com/article/1118281
Small Pharma Leader in Small Molecule Approach to Fighting Cancer
Cellceutix Corporation (CTIX.OB) long time investors have enjoyed a solid stock run up in the last month, with shares reaching 52-week highs of $2.47 after the company traded below a dollar as recently as late November. The share price increase has come as a result of promising news on its lead drug candidate, Kevetrin™, a small molecule drug that reactivates tumor suppressor protein p53. Once reactivated (cancer cells have a way of inhibiting p53), p53 induces the expressions of p21 and PUMA (p53 up-regulated modulator of apoptosis). This reactivation inhibits cancer cell growth and causes tumor cell apoptosis (programmed cell death).
Volume and share price interest for the company's common shares started to pick up after the company's December 3rd announcement that the phase 1 Kevetrin™ dose escalation trial was progressing well with 84 blood samples from the patients being been sent to a laboratory for pharmacokinetics analysis (an evaluation of how the drug is absorbed, distributed, metabolized, and excreted from the body). A follow up December 14th announcement from the company confirmed that it was allowed to continue with the next higher dose of Kevetrin™, with dosing to begin on December 16th. Shares continued to climb to the $2.50 resistance mark on December 26-27th after a December 24th response by CEO, Leo Ehrlich, to a December 23rd story in the New York Times titled "Genetic Gamble; New Approaches to Fighting Cancer" and its focus on p53. The New York Times story went on to discuss p53 as the "Guardian Angel Gene" and mentioned work by Merck (MRK), Roche Holding Ltd. (RHHBY.PK) and Sanofi SA (SNY) in "racing to develop their own versions of a drug they hope will restore a mechanism that normally makes badly damaged cells self-destruct and could potentially be used against half of all cancers." Although obviously disappointed that Cellceutix was not mentioned in the piece, I'm certain Mr. Ehrlich appreciated the exposure for the novel approach to the publication's large readership. Important for interested shareholders going forward was a statement by Mr. Ehrlich in his response noting "I believe that a discerning examination of the article and publicly available information shows that we are not only ahead of these larger companies, but we have a better mechanism which is more likely to function against most cancers. Our research to date shows that Kevetrin™ affects both wild and mutant types of p53, a claim that to the best of our understanding, the other companies cannot make." If clinicals underway confirm this statement, the company's common shares as well as the targeted patient groups (not yet to be determined) could each benefit.
A December 31st company update gives much information that should be considered as the company heads into 2013 with a now $2.00 share price and $186 million market capitalization. With Kevetrin™ in multiple trials, Mr. Ehrlich gave indications of multiple catalysts ahead for the company in 2013 with trial updates and data presentations likely. Company-sponsored clinical trials at Harvard University's Dana-Farber Cancer Center and Beth Israel Deaconess Medical Center, which began in November, are evaluating the drug's safety with pharmacokinetics from the early cohort expected in the short-term. Trials evaluating Kevetrin™ for Acute Myelogenous Leukemia (AML) and sponsored by "a leading European university" are expected to being in 1H 2013. Data presentations by the company as well as its partners will be significant although these are early stage clinicals. With Merck, Roche, and Sanofi each developing drugs using similar technologies, positive and applicable news from any or each of these companies will also likely have impacts on the company's share price. Additionally, positive Kevetrin™ data could also begin turning large pharmaceutical companies' heads, with licensing or buyout potential also becoming evident for the early-stage company before its valuation starts ramping up under its own merit.
Although beyond the scope of this article, investors should also consider the company's lead product candidate, Plurisol™, with phase 2 trial preparations now underway evaluating the drug's safety/efficacy to treat psoriasis. If the FDA approves the company forgoing early-stage clinicals and allows it to instead start with a phase 2 trial, the company could save much time and money moving forward to its first likely marketable product. Cellceutix is also planning on starting a "proof of concept" trial for Plurisol™ in Q1 2013 in the European Union, which could also affect share price in the coming weeks.
A development-phase company, Cellceutix is still largely dependent on shareholder money to fund its operations with the ever-looming fear of dilution in the thoughts of its investors. However, a December 10th announcement by the company of a $10 million stock purchase agreement with Aspire Capital Fund, LLC gave terms of some of the best financing agreements I have personally ever seen with a small pharmaceutical company . Aspire would buy $10 million of the company's common shares over the next three years at market price with Cellceutix determining the timing and number of shares to purchase. Terms of the deal indicated no restrictions on the funds, financial covenants, restrictions on future financings, rights of first refusal, participation rights, penalties, or liquidated damages per the agreement. Cellceutix did issue 336,625 common shares to Aspire for consideration of the agreement; however, no warrants were part of the agreement. With cash and equivalents of only $125,000 on September 30th, the financing certainly helps to secure the company and its growing pipeline.
Cellceutix common shares are now trading at $2.00 at the time of this composition, above the simple moving average (SMA) with technical support seen at $1.75. Although a "watch and wait" approach may often serve investors better for solid entries, the pharmacokinetics results for Kevetrin™ are still pending and may send share prices upward once again. Alternately, poor or questionable results may also give interested investors a better entry soon thereafter as the data may or may not indicate efficacy or safety accurately. With the company's recent news serving as the major catalyst for recent price increases, interested investors should also consider the risk of downside if clinicals don't yield positive data. Many indications are potentially going to be evaluated, and failure in one indication does not necessarily failure for another. Also consider, the company's Kevetrin™ platform is in early clinicals with marketing potential still years away, but that is typically considered and expected in the small pharma sector and has likely been taken into consideration with the company's $186 million market capitalization.
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