Cell Therapeutics Inc. (CTIC) is a biopharmaceutical company engaged in the development and commercialization of oncology drug therapies for the treatment of cancer. Its portfolio of trial therapies include phase III candidate drug therapy Pixantrone, for the treatment of non-Hodgkin’s lymphoma; phase II drug Brostallicin, for the treatment of sarcoma; and OPAXIO for the treatment of non-small cell lung, ovarian, and other forms of cancer. The Company partnered with Novartis International Pharmaceuticals Ltd. and PG-TXL Company L.P. for various drug developments.

Founded in 1991, the Company is headquartered in Seattle, Washington.

Source: Reuters.com, SEC Filings.

Financial Summary

For the first quarter ended March 31, 2009, CTIC posted a loss of $13.1 million, or a loss of 5 cents per share, compared with a loss of $54.6 million, or a loss of $7.68 per share, for the first quarter of fiscal 2008. The Company cites an increase in the total number of shares outstanding as the reason for the drop in per share loss. Outstanding shares increased from 7.1 million last year to 285 million in 2009.

HISTORICAL SURPRISES

Source: Reuters.com

Analyst Recommendations and Revisions

Source: Reuters.com

CTIC is a biopharmaceutical company developing and commercializing oncology drug therapies products for the treatment of cancer. Its portfolio of trial therapies includes a phase III candidate drug therapy Pixantrone, for the treatment of non-Hodgkin’s lymphoma, which, if approved, will compete in a multi-billion-dollar market.

According to the Cancer Market Outlook report published by Business Insights, the market for cancer therapeutic drugs is expected to reach $40.9 billion by 2012. The Company’s partner, Norvartis, is a leading maker of drug therapies for the treatment of cancer.

If approved by the U.S. Food and Drug Administration (FDA), the market for CTIC’s drug candidate Pixantrone, could reach more than $1 billion at its market saturation. Brostallicin is the Company’s phase II drug candidate for the treatment of sarcoma, with prospects of reaching commercialization at approximately 50% following successful completion of phase II.

Pharmaceutical companies with revenue of more than $1 billion include Cephalon Inc. (Nasdaq: CEPH), which trades at a market capitalization of $3.73 billion, and King Pharmaceuticals (Nasdaq: KG), which trades at a market capitalization of $2.25 billion. As of August 17, CTIC trades at a market capitalization of $849 million.

Most Recent 10-Q Highlights

On August 6, the Company reported in its 10-Q that it submitted peer-reviewed phase III data regarding Pixantrone to the Food and Drug Administration (FDA), completing the submission of a New Drug Application (NDA).

Total net operating expenses dropped 24% to $21.7 million, compared with $28.7 million for the second quarter of fiscal 2008. The Company cited in a press release that the decline in operating expenses was due to a 54%-decline in research and development expenses for the quarter ended June 30, 2009. The Company’s per share net loss decreased to 6 cents per share, compared with $5.18 per share. Net loss from operations decreased 54% to $27.4 million from $59.3 million. The decline in the Company’s net loss was due to a large increase in outstanding shares outstanding.

The Company reported a 44.5% reduction of outstanding debt, or a reduction of $52.9 million, resulting in a savings of approximately $3.3 million in interest expense.

At the close of the second quarter ended June 30, the Company had $12.0 million in cash and cash equivalents. Recently following the close of the second quarter, the Company reported it will receive approximately $41 million from the sale of additional common stock.

On June 30, the Company announced it was included in the Russell 3000, Russell 2000, and Russell Global Indexes.

On June 24, the Company submitted necessary paperwork for its non-Hodgkin’s lymphoma drug candidate Pixantrone.

Source: http://stockcharts.com/h-sc/ui?s=ctic

CTIC trades above its 13-day moving average. The stock trades in a range of $1.25 and $2.00, with support at the $1.25 price level.

The MACD for CTIC currently indicates a neutral signal. The stock has traded in a range since June, while traders await further news.

The Company is traded with premium to peer group P/S multiples, mainly due to its leading candidate drug therapy Pixantrone for the treatment of non-Hodgkin’s lymphoma. The Company’s earnings, debt load and other important metrics are not relevant to investors and trades of this stock at this point in the Company’s history. Investors look forward to Pixantrone clearing phase III trials, instead. At this stage, the drug has approximately 90% chance of reaching commercialization in more than a billion dollar market.

Source: Thomson Financial

Data provided by Thomson Financial

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