UPDATED April 2, 2009

Cell Therapeutics has been quiet for a few days with no word on Pixantrone since last week’s crazy stock roller coaster (the stock almost hit $1). Review time: what do we know so far:

• Novartis has an option to buy Pixantrone, but there’s no timeline commitment. Its best bet would be to take it now before the drug is approved (most likely will be) and the stock is in the $2-3 range. NVS’ only concern is the high royalties it has to pay CTIC. The cash is peanuts.

• CTIC is getting $10M from Spectrum soon (Zevalin divestment). We could see this any day.

• CTIC is lean, streamlined and recently filed a $150M shelf which sank the stock.

• Pixantrone is efficacious and a potential blockbuster.

• Filing in June on track.

• Finally, we have the rumor floating around that a deal could come before April 6th.

Stay tuned…

March 24, 2009

The markets were abuzz today on the Allergan buyout speculation, but there was another company making some noise too: Cell Therapeutics (CTIC).

The company saw its stock more than double today from $0.13 to $0.28, only to come back down and close at $0.20. The company held a special meeting in lieu of its annual shareholders meeting which was webcast at 10AM PST. Prior to the webcast, the stock was taking off on extraordinary volume (44,291,284, avg vol 6,103,500).

Reason? There was speculation of a reverse-split or perhaps the announcement of a partnership for Pixantrone. After the meeting/webcast, the stock came back down and had some modest after-hour activity. So what exactly happened? Here’s the highlights:

• Pixantrone on target for a June 2009 filing

• Possible approval by year’s end

• Sales could top $600M in the U.S. alone

• Additional $10M Zevalin payment coming in April

CTIC is a company we’ve repeatedly wrote about in the past, including all of its restructurings, divestments and leaked info/rumor that Novartis was in fact going to act on its Pixantrone option by early April.

The company was trading at around a nickel just two weeks ago and has now more than quadrupled! It looks like everyone is optimistic about Pixantrone as the drug has demonstrated it was better than standard chemo in inducing remission in third-line non-Hodgkin’s lymphoma, a disease and stage for which patients have only palliative options.

Conculsion: The drug works.

Cell Therapeutics: You are hereby released from our Graveyard. Take that, Allergan!

Image from celltherapeutics

Public disclosure: No holdings in NVS, CTIC or competitors

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