2011 is coming to an end. As the clock winds down on the year, now is the perfect time to look back over what CytRx (NASDAQ:CYTR) has achieved. We think CytRx has achieved a lot in 2011. Below are the key achievements:
Positive Phase II Clinical Results with Bafetinib Presented at ASH Conference
CytRx presented positive results from the open-label, single-agent Phase II ENABLE proof-of-concept clinical trial, which demonstrates bafetinib's clinical activity and preliminary safety in patients with relapsed or refractory B-cell chronic lymphocytic leukemia (B-CLL), on December 12 at the 2011 ASH meeting.
The results were presented by Tapan Kadia, M.D., Department of Leukemia at the University of Texas, M.D. Anderson Cancer Center, in a poster session. CytRx also announced that the ENABLE abstract has been selected for inclusion in the Highlights of ASH® program for presentation in 2012 in ASH meetings in Austin, Orlando, Atlanta, Las Vegas, New York and San Francisco.
As a reminder, in May 2010, CytRx initiated a Phase II proof-of-concept clinical trial (ENABLE) with bafetinib as a second line treatment for B-CLL due to the potent and specific inhibitory properties of bafetinib against Lyn and Fyn kinases, which are overexpressed in B-CLL cancers.
In this clinical trial, high-risk B-CLL patients who have failed treatment with first-line agents will self-administer oral doses of bafetinib twice daily. The bafetinib dose used in this trial is based on the highest dose that was best tolerated in the Phase I study. Patients will be monitored for clinical response, time to disease progression and cancer progression-free survival. Total of 30 patients will be enrolled. The dose of bafetinib may be escalated to 360 mg twice daily if relatively few side effects are observed at the 240 mg twice daily dose. The endpoint of this Phase II trial is objective response rate (30% ORR is target). MD Anderson is the primary U.S. site.
Each of the 18 late-stage B-CLL patients enrolled in the ENABLE trial had been treated with and failed between one and six therapies, with a median of three, and 14 of the 18 patients (87%) having unfavorable cytogenetics(del 17p; 13) . Patients were treated with orally administered bafetinib twice daily. Six of 12 (50%) of the evaluable patients achieved 30% or greater shrinkage of the lymph node and spleen, and four of 12 (33%) patients had stable disease.
Lymph node softening also was noted in these patients. Only one grade 3 or 4 adverse events (grade 3 elevated liver enzymes) were noted, which resolved when bafetinib administration was ceased. Grade 1 and 2 adverse events included elevated liver enzymes with normal bilirubin, fatigue and gastrointestinal symptoms. No serious adverse events (SAEs) were observed at the dose of 240 mg twice daily, which is the dose that would likely be used in any future clinical trials in chronic lymphocytic leukemia. Two patients remain in the trial, which is being conducted at the M.D. Anderson Cancer Center and City of Hope Medical Center.
CytRx is currently in discussions with potential partners to further advance bafetinib's clinical development as the company focuses its clinical efforts on other two promising drug candidates, INNO-206 and tamibarotene.
The initial results are encouraging. The Phase II study demonstrated that bafetinib is clinically active in a group of patients with relapsed B-CLL who have failed several other treatments for their cancer. Based on this indication of clinical activity and the low incidence of adverse events, additional patients enrolled in the ENABLE Phase II clinical trial will receive bafetinib as a single agent at a higher dose. This increased dosage could increase the potential for greater efficacy.
B-CLL is the most common form of leukemia in adults in Western countries. More than 17,000 new cases of B-CLL are reported in the United States alone each year; however up to an estimated 40% of cases may not be reported due to under-diagnosis and lack of placement in cancer registries. Virtually all patients are older than 55 years at presentation, with an average age of 70 years. Patients in the high-risk B-CLL classification have a median overall survival period of one to five years.
CytRx Reports Third Quarter 2011 Financial Results
On Nov 08, 2011, CytRx Corporation reported financial results for the three months ended September 30, 2011.
There was no revenue for the third quarter of 2012.
Research and development (R&D) expenses were $3.2 million for the third quarter of 2011 and included development expenses for the company's programs of $2.1 million for INNO-206, $0.3 million for bafetinib and $0.2 million for tamibarotene. R&D expenses were $2.8 million for third quarter of 2010.
General and administrative (G&A) expenses remained relatively unchanged at $1.7 million and $1.8 million for the third quarters of 2011 and 2010, respectively. G&A expenses included $0.2 million of employee stock option expense in both quarters.
CytRx reported a GAAP net loss of $0.6 million, or $0 per share, for the third quarter of 2011, which included a $4.3 million gain on warrant derivative liability related to warrants associated with past equity financings. For the third quarter of 2010, the net loss was $4.4 million, or $0.04 per share.
Non-GAAP net loss was $4.9 million or $0.04 per share.
CytRx reported cash, cash equivalents and marketable securities of $41.4 million as of September 30, 2011.
We believe investors are not concerned about the earnings release for CytRx. Right now all eyes are on the company's balance sheet and pipeline development. In this regard, we think CytRx has made great progress so far.
Balance Sheet Has Been Boosted
CytRx reported cash, cash equivalents and marketable securities of $41.4 million as of September 30, 2011.
In July 2011, the company raised net proceeds of approximately $19.1 million by issuing 39.2 million shares of common stocks and warrants to purchase up to 39,200,000 shares of common stock at a combined public offering price of $0.52 per share. The warrants are exercisable immediately upon issuance at an exercise price of $0.64 per share and, unless exercised, will expire on the fifth anniversary of the date of issuance.
We noticed that following the share offering, the company's share price declined dramatically at about 38%. We think investors are over reacted to the event. We admit that equity offering always dilute existing shareholder base, but for a small cap biotech company like CytRx, it's necessary to raise money for its operations, especially for advancing its clinical programs.
On the other hand, the funds raised from the common stock offering have greatly boosted the company's balance sheet. Although share price suffered in the short run, we think this offering is positive for the company in the long-term.
Favorable Initial Phase Ib/II Results Of INNO-206 Has Been Reported
On October 31, 2011, CytRx Corporation announced favorable initial response and safety indications from a group of patients with advanced solid tumors (principally soft tissue sarcomas) in the company's ongoing Phase Ib/II clinical trial with INNO-206, its tumor-targeting conjugate of the commonly used chemotherapeutic agent doxorubicin. Patients in this portion of the Phase Ib/II clinical trial received three different dose levels of INNO-206 to determine its maximum tolerated dose.
Patients in the Phase Ib/II trial are receiving INNO-206 at 350 mg/m2 every three weeks in six cycles. In the initial Phase Ib portion of the clinical trial, 12 patients, primarily with advanced soft tissue sarcomas, have received one or more administrations of treatment with INNO-206 in three-week cycles. The company determined a maximum tolerated dose of INNO-206 (350 mg/m2) that delivers a doxorubicin equivalent of 3½ times the standard doxorubicin dose administered to sarcoma patients.
The patients from the early portion of the trial were evaluated for tumor response after four cycles of INNO-206. The company also announced plans to add 12 patients to the Phase Ib/II trial to receive INNO-206 at the maximum tolerated dose, and six of those additional patients have already been enrolled. Total of 24 patients will be enrolled in the Phase Ib/II trial.
Of five patients who have completed four cycles with INNO-206 at the maximum tolerated dose, one patient has exhibited a partial tumor response (greater than 30% tumor shrinkage) and four patients have stable disease. A large, painful oral sarcoma that caused difficulty eating in one patient was greatly reduced following a single INNO-206 treatment. Common side effects reported to date from the Phase Ib/II trial include low neutrophil and platelet counts, minor mouth ulcers and mild nausea, which are expected side effects of doxorubicin.
CytRx is currently enrolling additional patients who will be treated at that dose to gather further response data in parallel with the planned international Phase IIb clinical trial scheduled to start in December 2011.
We think the initial data for INNO-206 are impressive. Although these initial results are from a limited number of patients, the individuals treated were very advanced in their disease and had previously received multiple different chemotherapy agents, including doxorubicin. These early indications may bode well for the potential success of the international Phase IIb clinical trial in patients who have advanced disease but were not previously administered chemotherapy.
As a reminder, doxorubicin is currently the only FDA-approved drug on the market as a treatment for soft tissue sarcoma and is a standard chemotherapy for a variety of other cancers. It is used either alone or in combination with other chemotherapy agents. Dose levels of doxorubicin are limited due to its toxicity. INNO-206 is a novel conjugate of doxorubicin that binds covalently to albumin, and is circulated throughout the body. INNO-206 is designed with a linker that releases doxorubicin in the low pH environment of tumors, concentrating the chemotherapeutic agent where it preferentially damages the tumor while minimizing the effect on healthy tissues.
CytRx plans to rapidly enter a Phase IIb clinical trial with INNO-206 in patients with soft tissue sarcomas in December 2011.
On July 05, 2011, INNO-206 has been granted an orphan drug designation for the treatment of patients with soft tissue sarcomas.
What Are The Implications For CytRx?
CytRx is a biopharmaceutical company focused on the development and commercialization of human therapeutics for the treatment of cancers. CytRx is focused on advancing its oncology portfolio and currently has seven clinical trials underway and one additional clinical trial planned with its oncology drug candidates, bafetinib, tamibarotene and INNO-206.
We think the company is moving in the right direction. With positive data for its lead candidates Bafetinib and INNO-206, the company plans to expedite the development of these therapeutic programs.
We believe CytRx is well capitalized with a strong balance sheet which sets it apart from most small cap biotech companies in the industry. As of September 30, 2011, CytRx held cash, cash equivalents and marketable securities of $41.4 million. There was no debt on the balance sheet. Current liquidity source will be sufficient to fund operations for the foreseeable future, probably to the end of 2012 according to our financial model.
We think CytRx is heading in the right direction in terms of clinical advancement and business development. The company is ready to do deliver more data in 2012 from its clinical programs.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.