Cell Therapeutics Inc. (NASDAQ: CTIC)

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 Co. L.P. for various drug developments.

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

Source: Reuters.com, SEC Filings.

Financial Strength

Source: Reuters.com, SEC Filings.

Analyst Consensus

The mean of two analysts polled by Thomson Reuters rate shares of CTIC an “Outperform.”

Analyst Recommendations and Revisions

Source: Reuters.com, SEC Filings.

Investment Highlights

CTIC develops and commercializes 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 phase III drug candidate, Pixantrone, could reach more than $1 billion at market saturation. Data show that nine of 10 drugs completing phase III clinical trials eventually become commercial products.

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 $4.85 billion, and King Pharmaceuticals (Nasdaq: KG), which trades at a market capitalization of $2.81 billion. As of February 8, CTIC trades at a market capitalization of $367 million.

Recent Company News

The Company’s shares collapsed on February 8 following revelations of an increased possibility of a negative Food and Drug Administration (FDA) decision regarding the Company’s lead drug candidate Pixantrone. Investors fear that a negative FDA decision may threaten the Company’s ability to remain operational.

Pixantrone is presently under review by the Oncologic Drugs Advisory Committee (ODAC), a committee that advises the FDA. Documents released by the FDA indicate problems with Pixantrone, giving investors hints of the ODAC review results.

The issue concerning investors appears to involve the opinion of the ODAC relating to Pixantrone’s side effects, which include heart damage when used repeatedly.

Results of the ODAC review is expected to be released on February 10.

About Pixantrone

Pixantrone (BBR 2778) is a novel addition to the topoisomerase II inhibitor class of drugs for the treatment of lymphoma, leukemia and breast cancer. As an alternative to anthracyclines, Pixantrone does not raise the risk of congestive heart failure, a typical and common risk associated with anthracyclines. As a result of the cumulative risks of anthracyclines, the use of these drugs have a limited lifetime of doses. Pixantrone does not increase future risks of congestive heart failure.

Unlike anthracyclines, Pixantrone can be administered through a peripheral vein in lieu of a central-implanted catheter.

Technical Analysis

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

CTIC trades below its 13-day moving average. This bearish sign is significant because the 13-day moving average is downwardly sloped.

The MACD for CTIC currently indicates a bearish signal. The MACD is below the signal line, a 9-day moving average of the MACD. The MACD is below the critical level of 0, which implies the past price action had been negative. Overall, the chart is bearish.

Comparative Analysis

Source: Thomson Financial

Insider Trading Activity

Source: Yahoo Finance

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