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In 2012, I correctly represented three "reasoned" cases for the positive outcome of Acadia's (ACAD) Pimavanserin (A Reasoned Case For Pimavanserin's Success) and Vivus' (VVUS) Qnexa (A Reasoned Case For Qnexa Approval) and Avanafil (A Reasoned Case For Avanafil Approval). This article presents a reasoned case for Celsion's (CLSN) ThermoDox.

On Friday, Celsion's share price closed at $7.36 after rising from below $4.50 in late October. Anticipation of its phase III clinical trial results are expected in January 2013. Investors are duly warned that successful results are not guaranteed and since so much of Celsion's work is strategically positioned around its ThermoDox technology, upon failed results the blow to the company's share price could be astronomical. However, should the clinical trial meet its tumor progression-free primary endpoint in intermediate stage liver cancer, there's every reason to think that with 750,000 new cases per year Celsion will rocket into double-digit share price territory.

My past and present approach has been to apply a tri-fold analysis that has served well in evaluating the odds of other clinical trials and/or FDA approval. In the case of ThermoDox, I conclude the following:

  • Efficacy = better than probable
  • Safety = highly probable
  • Trial design = excellent

I. Efficacy

The only way to anticipate clinical trial efficacy with any sense of confidence or lack thereof, I discover it useful to trace the history. I find it particularly telling, in a good way, that over time Celsion has forged ahead with its liver, breast, and overall cancer studies. So often you see a company abandon an area of study to move on to another, but I would described Celsion's ThermoDox program as robust and growing. While investors are focused upon the liver study outcome, Celsion has a number of ThermoDox projects in motion.

(To cut down on quotation space, I will limit quotes to essential information. Readers are welcome to follow the links.)

Early on, Celsion learned that ThermoDox could deliver a concentrated level of Doxorubicin to a defined tumor site using its nanoparticle technology in combination with radiofrequency ablation. From 2004, with reference to pre-clinical animal studies in liver cancer, we read:

...preclinical results of the work conducted in large animals by the FDA in conjunction with NIH... These results demonstrated that ThermoDox, used in this manner, deposited fifteen times more drug at the tumor site than conventional, intravenous delivery of doxorubicin.

Soon after in a 2005 report, Celsion advanced its ThermoDox into a study of advanced breast cancer:

Celsion is currently sponsoring a phase I dose escalation study using ThermoDox in combination with RFA to treat liver cancer. ...it is funding a phase I dose escalation study at Duke University for the treatment of local-regionally advanced breast cancer. Patient enrollment in this study is expected to start early in 2006.

During 2005 press release, two animals studies supported the ThermoDox theory:

In the first study ...ThermoDox (heat sensitive liposomal doxorubicin) administered in combination with pulsed High Intensity Focused Ultrasound (HIFU), as an activating heat source, significantly increased doxorubicin concentrations in tumors grown in mice by comparison to the combination of HIFU with Doxil, a non-heat sensitive liposomal formulation of doxorubicin.

In the second animal study... given to dogs increased the size and fibrin deposition in the target thermal lesions created by RFA compared to the application of RFA alone. No other important liver or systemic toxicity was observed in the animals tested with RFA and ThermoDox.

In a 2006 press release, ThermoDox advancements continued:

Queen Mary Hospital, an affiliate of the University of Hong Kong, in Hong Kong, has begun to participate as an additional site in Celsion's ongoing Phase I dose escalation study ...at the National Cancer Institute in Bethesda, Maryland, 14 patients have now been treated in the study at single doses as high as 50mg/m². ...the first patient in a Phase I, dose-escalation, multi-dose study of the safety and pharmacokinetics of ThermoDox in combination with microwave heat to treat patients with local-regionally advanced recurrent breast cancer.

Later in 2006, Celsion offered another report on its ThermoDox animal studies while phase I work continued.

By 2007, the ThermoDox story was gaining significant traction. In early January the company reported:

...Duke University scientists reported results of a recent study using Celsion's temperature sensitive liposomes in combination with heat at various times during the drug infusion.

Previous preclinical studies using heat activated liposomes in combination with local hyperthermia had demonstrated increased tumor effect compared to non-temperature sensitive liposomes or free drug.

In that same month, the company reported:

ThermoDox... in conjunction with Radiofrequency Ablation (RFA) was used with limited and manageable toxicity to treat 22 patients, 8 with primary hepatocellular carcinoma and 14 with metastatic liver cancer, at doses of up to 60 mg/m².

In the study, patients with up to 4 lesions ranging from 3 to 7 centimeters are eligible to receive ThermoDox at doses ranging from 20 to 70 mg/m². The effect of the treatment on the diameter of the lesions is followed using MRI, PET and contrast enhanced CT scans taken pre-treatment and at one and three months post-treatment. Lesion diameters will be compared to those of other patients treated with RFA alone. This study, being carried out by Celsion and the NCI continues to enroll patients into the 60 mg/m² treatment cohort.

Celsion has licensed the global rights to the temperature-sensitive liposome technology from Duke University where ThermoDox is also being used in this Phase I clinical study of patients with recurrent chest wall breast cancer...

...dose in this study continues to escalate safely as clinical evidence suggests that a higher dose should result in increased efficacy. We are continuing to work with the FDA to finalize endpoints for a Phase III study in primary liver cancer, to be conducted by Celsion, in which we expect to initiate enrollment in 2007. This work will be used to refine tumor targeting and ultimately to improve the efficacy of drugs using our heat activated delivery system."

By March 2007, Celsion reported a landmark initiative:

...it has filed for a Special Protocol Assessment (SPA) with the U.S. Food and Drug Administration (FDA) for the design of its phase III trial of ThermoDox™ (Thermally Sensitive Liposomal Doxorubicin) in combination with radiofrequency ablation to treat patients with non-resectable Hepatocellular Carcinoma (HCC). The Phase III trial, a randomized, double-blinded study, will examine the efficacy and safety of ThermoDox plus RFA versus RFA-alone. As proposed, the global trial is expected to enroll and randomize approximately 600 patients.

Here's a quick link to some other key events in 2007:

2008 was a year of achievement. The company announced: CELSION Secures Special Protocol Assessment of its Pivotal Phase III Liver Cancer Trial from FDA, New Data Continues To Support The Safety And Clinical Activity For Celsion's Thermodox® In Recurrent Breast Cancer, including Celsion Provides Update on Its Global Pivotal Phase III Primary Liver Cancer Trial in which the company reported:

In addition to the receipt of FDA agreement in January of 2008 for our pivotal Phase III Primary Liver Cancer trial in the United States, the Company reports that it has obtained regulatory approval to conduct its study titled "A Phase III, Randomized, Double-Blinded, Dummy-Controlled Study of the Efficacy and Safety of ThermoDox (Thermally Sensitive Liposomal Doxorubicin) in Combination with Radiofrequency Ablation Compared to RFA Alone in the Treatment of Non-Resectable Hepatocellular Carcinoma " in Hong Kong, Taiwan, Korea, Canada, and Italy, and anticipates that a Clinical Trial Agreement will be obtained in China before the end of 2008. In addition, Celsion reports that site initiation and patient enrollment are tracking well against its most recent projections.

By 2009, in addition to starting its phase I/II clinical study of ThermoDox in wall chest breast cancer, the company received orphan drug status for ThermoDox in its liver cancer phase III study: Celsion Receives Orphan Drug Designation for ThermoDox® to Treat Primary Liver Cancer. During this year, the phase III study expanded into Japan, Malaysia, Philippines, and China.

Perhaps one of the most significant milestones for ThermoDox in 2010 was: Celsion's Phase III ThermoDox(R) HEAT Study Recommended as Priority Clinical Trial for HCC. In that report investors learned that:

National Cancer Institute (NCI) Clinical Trials Planning Meeting (CTPM) for Hepatocellular Carcinoma have been released and published in the August 2010 issue of Journal of Clinical Oncology, the official publication of American Society of Clinical Oncology (OTC:ASCO). In addition to evaluating the current standard of care, the NCI panel also recommended Celsion's Phase III ThermoDox HEAT Study as a Priority Clinical Trial for HCC.

By 24 August 2010, the company announced:

the U.S. Food and Drug Administration (FDA) has designated the HEAT Study of its investigational drug, ThermoDox, in combination with radiofrequency ablation as a Fast Track Development Program.

Plus, the company achieved two other important milestones: Celsion Receives Positive FDA Guidance for its New Drug Application for ThermoDox to Treat Primary Liver Cancer and Celsion Receives COMP Recommendation for Orphan Drug Designation in Europe for ThermoDox® to Treat Primary Liver Cancer. As the company has pointed out, ThermoDox is poised to enter the Americas, European, and Asian markets upon phase III success.

In 2011, having sifted through the articles, I note a number of key highlights that add color to the ThermoDox story:

it has received written, scientific advice from the European Medicines Agency (EMA) confirming that the Company's Phase III HEAT Study, a multinational, double-blind, placebo controlled pivotal study of ThermoDox in combination with radio frequency ablation for the treatment of hepatocellular carcinoma , or primary liver cancer, is acceptable as a basis for submission of a marketing authorization application (MAA).

This brings us to 2012, when 30 May the company announced: Celsion Announces Completion of Enrollment in Its Pivotal Phase III HEAT Study of ThermoDox in Primary Liver Cancer and later this year on 9 November: Celsion Announces Phase III HEAT Study of ThermoDox in Primary Liver Cancer Reaches Target Number of Events for Unblinding. My personal conclusion is that the clinical trial has been executed like clock-work and the global buy-in, participation, and the establishment of a future market footprint is impressive.

Now the question of whether the actual mechanism (i.e. heat releasing the high doses of Doxorubicin) of ThermoDox effectively targets the tumor and tumor area appears to be strongly supported in preclinical and phase I studies. However, whether it increases progression free recurrence is the point of the current phase III clinical study. That 380 events out of 701 total patients has triggered the unveiling of the data, you can't help but think that 321 patients -- for some reason (ThermoDox?) - have yet to trigger a primary progression free end-point event. That strongly favors a positive outcome especially knowing that in about a year's time, patients historically treated with radiofrequency ablation alone have a high percentage of tumor recurrence. I therefore conclude that ThermoDox's primary efficacy is better than probable.

II. Safety

Periodic safety reports were released by the company:

Doxorubicin is already FDA approved and radiofrequency ablation is a practiced technology, so the ThermoDox invention has a wealth and history of data supporting a good safety profile. Something Celsion has done a good research job at is defining the near-maximum dosage profile (cf. 50 mg/m2 in the ABLATE colorectal liver phase III metastase study) and while there are known associated side effects with Doxorubicin, none of these are show-stoppers. I think investors can have a very high level of confidence around ThermoDox's safety profile.

III. Trial Design

The global phase III NCT00617981 HEAT study was "first received" on 6 February 2008 and was fully enrolled by 30 May 2012. 701 total patients, 101 more than the original 600 planned. A double-blinded two arm study (ThermoDox versus 5% Dextrose solution). Primary end-point: progression free survival until a local recurrence and/or any new distant intrahepatic hepatocellular carcinoma tumor and/or any new extrahepatic hepatocellular carcinoma tumor and/or death from any cause. Secondary end-point: overall survival, definite worsening, local recurrence, and safety.

Going head-to-head against placebo, either placebo or ThermoDox® is administered by intravenous infusion over 30 minutes before radiofrequency ablation begins.

Hepateocellular carcinoma liver cancer is a deadly disease, so it seems logical that progression free survival was chosen as the primary end-point versus over all survival as the secondary end-point. If ThermoDox successfully promotes progression free survival, the FDA looks poised to move this Special Protocul/Fast Track drug technology forward as quickly as possible. I see nothing in the trial design that might potentially derail the results other than the major variabilities of the patients themselves, ThermoDox®administration, and the administrators of medical the technique.

In the process of evaluation, I consulted a number of journal articles:

Celsion estimated the primary completion date for December 2012, but reported a month early, November 2012, a total of 380 events. It's remarkable that Celsion targeted the completion of the primary end-point that precisely, but that only speaks well of the trial design.

Conclusion

The greatest risk I see with ThermoDox is whether it achieves the primary progression free event end-point. But I still ponder: What about the 321 patients who have not triggered a primary event? Doesn't it seem likely that a majority of these 321 patients were treated with ThermoDox®?

Furthermore, the expansion of ThermoDox into other areas of cancer research (colorectal, prostate, breast) favors the value and effectiveness of the technology. Celsion has been very methodical in its approach and its historical record is very strong.

I think it's common knowledge that any therapy that promotes progression free recurrence is a global billion dollar plus market opportunity. As others have pointed out, with ThermoDox targeting multiple medical indications, the long-term market opportunity is a billion dollar multiple. Seeing how Celsion has already extended the ThermoDox footprint into the European and Asia markets along with the rest of the world including the United States, I hesitate to imagine how high on phase III success the company's share price could rise as events unfold. Therefore, priced in the $7's/share and taking every risk into account, I conclude based on my three-prong study that Celsion is a VERY STRONG BUY.

Source: A Reasoned Case For Celsion's ThermoDox

Additional disclosure: Investors buy and/or sell at their own risk. This article is for entertainment purpose only and offers zero individual advice. You are duly warned and obligated to seek the advice of a licensed market professional. 'Long' for me is until I sell and I do not 'short' stocks.