CTI BioPharma Corp.
Q1 2017 Earnings Call Transcript

Published: 3 Aug 2017

[Operator:]

Good day and welcome to the CTI Biopharma Second Quarter 2017 Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Ed Bell. Please go-ahead sir.

[Ed Bell:]

Thanks. And welcome everyone to our second quarter financial result conference call. The press releases we put in our financial results can be found on the home page and in the investor section of our corporate website at ctibiopharma.com. Following formal remarks by management, the conference call will be open for questions. Joining me today are Adam Craig, President and Chief Executive Officer; Matt Plunkett, Chief Business Officer; Bruce Seeley, Chief Commercial and Administrative Officer and Jack Singer our Chief Scientific Officer. Before we begin, please note that during the course of this call we will make forward looking statements based on current expectations. Such forward looking statements are not guarantees of future performance and are subject to risk and uncertainties that may cause actual results to differ materially from those anticipated by the forward-looking statements. Additional information concerning these risks and uncertainties is contained in the press release reporting our financial results for the second quarter, the risk factors section of the company's quarterly report on Form 10-Q for the quarter ended June 30, 2017, and in the company's other periodic reports and filings with the Securities and Exchange Commission. I will now turn the call over to Adam.

[Adam Craig:]

Thank you, Ed. And good afternoon everyone. From the start of 2017 we worked hard on making CTI a leaner, more focused and better financed company. To that end we have made significant progress on our financial, clinical and regulatory goal and then take an effort to strengthen the company operationally. Highlights of our achievement include, a marketing authorization application or MA Pacritinib which is now under review by the MA, the enrolments of the first patients and the PAC203 trial of the Pacritinibs, completed enrolments in the PIX306 trial PIXUVRI, a $45 million fund raising with the addition of new institutional investors, changes to the board with the addition of three new independent directors and the streamlining of the work force. I will now provide more detailed clinical, regulatory and corporate update and then Matt will follow on with the financials. Our recently submitted marketing authorization application for Pacritinib seeks approval to treat myelofibrosis patients with thrombocytopenia, that is patients with platelet counts less than 100,000 per microliter. The application is being validated and is now under review by the EMA. Myelofibrosis patients with thrombocytopenia either disease related or treatment related have a significant unmet medical need. Many of these patients do not have good disease control and their life expected to reduce. It is estimated that these patients currently represent a large proportion up to 50% of the overall myelofibrosis patient population. We believe that Pacritinib has a clinical profile that can provide benefit to these patients and look forward to working with EMA during the review of the application. In addition, other this week we announced that the first patient has been enrolled in the PAC203 trial, a Phase 2 trial of Pacritinib in patients with primary myelofibrosis and thrombocytopenia who have failed ruxolitinib therapy. PAC203 is design to evaluate the dose's functional relationship and the safety of c using three dose regiment. 100 milligrams once daily, 100 milligrams twice daily of BID, and 200 milligrams BID. The 200 milligram BID dose regiment was used in the Phase 3 PERSIST-2 trial of Pacritinib in patients with myelofibrosis. We expect to perform an interim utility analysis of the PAC203 data, when the first 15 available patients in each arm had 12-week spleen volume reduction data. Overall the trial is expected to enroll up to approximately 105 patients. This trial was requested by the FDA as a condition as a clinical holding removed. We plan to evaluate the interim data when available and then potentially have a discussion with the FDA and a possible regulatory pathway in the U.S. Moving onto PIXUVRI, last quarter we announced an expanded license and development collaboration agreement for PIXUVRI with Servier. We have made excellent progress this quarter in transitioning the activities related to the expansion that will leverage Servier's commercial resources in the EU and then allow us to focus our resources on the development of Pacritinib. Separately, this week we announced the completion of enrollments in the Phase 3 PIX306 trial. This trial is comparing PIXUVRI and rituximab with gemcitabine and rituximab in the setting of aggressive B-cell NHL and is being conducted as a post-authorization requirement of the European conditional marketing authorization. And if positive, the trial could potential support broader indications. Topline results are then driven and are expected in the first half of 2018. Since the beginning of the year we have worked hard to restructuring strength in the board by bringing on additional independent members that can provide the insight and experience in drug development, commercialization and corporate development. We've recently appointed David Parkinson and Laurent Fischer as Directors. David has significant experience in oncology drug development and is currently President and Chief Executive Officer of SI Pharmaceuticals. Laurent has more than 20 years of experience in developing and commercializing novel medicines in the biopharmaceutical industry and currently serves as Liver Therapeutic Area Head at Allergan following its acquisition of Supira Therapeutics in 2016. I will now turn the call over to Matt to review the financials for this quarter.

[Matt Plunkett:]

Thank you Adam. I will now briefly review your financials for the second quarter and the first six months of 2017. Please refer to our press release issued today for complete details. Total revenues for the second quarter and six months ended June 30, 2017 were $22.2 million and $23.0 million respectively compared to $7.4 million and $43.8 for the respective periods in 2016. The increase in total revenues for the second quarter compared to the same period in 2016 is primarily due to license and contract revenue that includes the recognition of payments received from the expansion of the license and collaboration agreements for PIXUVRI with Servier and the receipt of a payment from TEBA related to the achievement of sales milestones for TRISENOX. The decrease in total revenues for the six months of 2017 is primarily due to recognition of $32 million in milestone revenue related to Pacritinib in the first quarter of 2016 and that product sales of PIXUVRI for the second quarter in six months ended June 30th 2017 were $0.63 million and $1.0 million respectively compared to $1.1 and $2.3 million for the respective periods in 2016. Operating income for the second quarter was 5.3 million and operating loss for the first six months was $14 million for the period ended June 30th 2017 as compared to an operating loss of $19.1 million and $14.9 million for the respective periods in 2016. Operating income in the second quarter of 2017 is compared to an operating loss for the same period in 2016 resulted primarily from an increase in license and contract revenues as mentioned above and decrease in research and development and selling general and administrative expenses. Net income for the second quarter of 2017 was $1.0 million or $0.03 per share as compared to a net loss of $19.8 million or $0.71 per share for the same period in 2016. Net loss for the six months ended June 30, 2017 was $18.8 million or $0.63 per share compared to a net loss of $16.5 million or $0.59 per share for the same period in 2016. Turning to the balance sheet, as of June 30, 2017, cash and cash equivalence totaled $74.7 million, the cash position increased over the quarter both from payments received from our partners as well as the financing that included strong institutional investment. With that, I will now turn the call back to Adam.

[Adam Craig:]

Thanks, Matt. This concludes our formal remarks. Operator, please open the call for questions.

[Operator:]

And there are no questions at this time. [Operator Instructions].

[Adam Craig:]

Okay. Thank you, operator, there are no questions. In summary, during the first half of 2017, we have made substantial progress in making CTI leaner, more focused as well as operations stronger and as we move forward on executing our clinical and regulatory goals. Thank you for joining the call today.

[Operator:]

That conclude today’s conference. Thank you for your participation. You may now disconnect.