Tuesday, May 15, 2012

"The message today is momentum" — Michael Tardugno, Q1 2012 Conference Call

I highly recommend everyone to listen to today's Q1 conference call, it was particularly detailed and the company sounded rather upbeat (link can be found here). Highlights from today's 2012 Q1 conference call (generally only highlighting what is unique and new):

  • Moving forward with branding and payer research, conducting market research with key stakeholders
  • NDA submission process--Engaged KOLs and moving forward with selection of a CRO with FDA portal access and using a common technical document approach as a basis for NDA and MAA filings.
  • Multimodality approach is the future for a number of cancers, hyperthermia being a key component.
  • On track for 700 patients by the end of Q2
  • Approximately $2M to be paid to Hisun only after technical success (3 registration batches) and after unblinding of data. Registration batches expected to be completed "next year"
  • Yakult remains enthusiastic and that initiation of bridging study will commence after successful HEAT data
  • Ended first quarter with $24.6M dollars, sufficient to fund through Q3 of 2013. 
  • Phase 2 RCW will recruit 40 patients
  • CRLM, RCW, bone mets, and pancreatic cancer trials will "give the oncology a community a snapshot of the broad potential of ThermoDox while it's approval is being considered"
  • Securing multiple manufacturers important for supply continuity. Hisun has recently invested significantly in expanding capacity in China.
  • Next DMC meeting likely in September (DMC meetings are every 3-4 months roughly every 100 patients)
  • Progression and event rates are "substantially following what they consider consistent with a successful trial"
  • Approval for ThermoDox in HCC as early as end of 2013
  • sFDA China regulatory review period could be "cut by half" from 12-15 months, due primarily to the severity and umnet need in HCC. Hisun will support the regulatory process in China. 
  • Target number of patients for HIFU bone mets trial is "in the 20's"
  • No presentations at ASCO or WCIO, first data to be presented will likely be data from RCW Phase 1 trial (my question was in regards to WCIO)
  • Company cannot disclose the average lesion size in the trial (my question)
  • The company would like a business card for "Odaat enterprises" (sorry, had to...that was quite funny...for those who don't know, Odaat is the individual from this blog post)
  • As an FYI, this was the second time I noted both Cowen (Edward Nash) and Cantor Fitzgerald (Mara Goldstein) analysts on the call. 
Let me know if you have any questions or if I missed something. 


Monday, May 7, 2012

Celsion Secures Strategic China Manufacturing Agreement, CEO presents at Deutsche Bank Conference

Today, investors saw a new press release from Celsion, specifically announcing that the company has entered into a long-term supply agreement with Hisun Pharmaceuticals for the manufacturing of ThermoDox in the China market. The market did not seem to pay much attention to this announcement, but I would argue this represents a key milestone along the commercialization path for ThermoDox, particularly since China represents the largest market for the company in HCC. The agreement includes the following:
  1. Tech transfer for proprietary manufacturing process, and non-dilutive funds to support that endeavor (I imagine there is a lot of legal work there, IP in emerging markets is a scary topic, read about Bayer's experiences with Nexavar in India)
  2. Production of China registration batches
  3. Option for Hisun to globally manufacture ThermoDox following SFDA approval
  4. Support for regulatory approval activities in China
  5. An undisclosed manufacturing price that "will support high gross margins across global territories"
My own personal thought is that this agreement with Hisun gets the company one step closer to global licensing agreement with a big pharma partner. I found it quite interesting that the press release made a reference to Pfizer's JV with Hisun, a greater than half billion dollar agreement signed in February. According to that agreement, both companies will contribute assets to the JV. I could see how a Pfizer-Celsion deal fits very nicely into this arrangement. As I have tweeted and reiterated many times before, ThermoDox presents big pharma with a very attractive product to penetrate emerging markets, particularly China, especially given the initial indication focus on HCC. My own thoughts are that a deal will not be announced until manufacturing is completely squared away, and this point has been reiterated by the company before (see below).

In other news, Michael Tardugno also presented at the 37th Annual Deutsche Bank Health Care Conference. There was nothing particularly new or exciting presented:
  • Reconfirmed final data from the HEAT study would be available at the end of 2012
  • Final confirmatory OS data due 18-24 months after top-line PFS results
  • Reiterated enough cash on hand to last until Q3 of 2013, burn rate of $1.7M for next 18 months (company likely has just over $20M as of right now)
  • Revenue potential of $500M by 2017 in HCC using 10% global share capture rate
  • Phase II RCW trial to commence patient enrollment in the second half of 2012
  • Company working to establish "redundant manufacturing capability" from high quality sites, "which we believe would be very important to a successful high quality license with a multinational company"
  • In response to the sole Q&A question regarding business development, Mr. Tardugno said the "enthusiasm coming from our investigators [HCC] is nothing short of remarkable". He added, "We would be looking forward to firm license discussions with what we think would be a multinational partner post data for markets outside the US"
The last point was probably the most interesting one, as it tells me the company is really playing hard ball with potential partners. Post data, assuming success, the terms of such a licensing deal exponentially change in the company's favor. That said, if the company is truly not seeking a deal until end of the year, I see a cash raise likely in Q3, as I have mentioned before, hopefully in the 3-5 range. Absent a cash raise, the company will have $10M in cash by the end of 2012, and I sense they are no longer looking to "scrape the barrel" as they have done in the past. 

It's hard to believe that we are already nearing mid-2012, and rapidly approaching final data from the HEAT study. Feel free to leave questions or comments.