Participants recently discussed Provectus' compassionate use program on InvestorVillage.
Search this blog for "compassionate use;" you'll find the search feature on the blog's right hand side, towards the bottom when you scroll down.
Several posts on this topic then will list.
The compassionate use program is very valuable (to both patients and the company) and, I think, under-appreciated. Its influence is clear, providing (among other things) insight into how the pivotal MM Phase 3 trial should be designed under the sought after SPA, more and different data to the FDA as Provectus seeks accelerated approval, and a depth and breadth of confirmation that PV-10 works really well.
75 patients have been enrolled thus far. Emerging stories regarding patient success are striking.
The key takeaways, for me, from the program are two-fold:
If you throw enough water on a fire, you put it out. Put differently, inject enough PV-10 (e.g., repeated treatments with the drug, more of the drug) and the cancer goes away; and,
"Did it seem as if the current Moffitt studies would be enough to generate real interest among the big pharma companies? That is, if Pfizer doesn't just snatch them up first."
The first round of Moffit's murine studies confirmed that PV-10 chemoablation of melanoma lesions leads to a systemic response and the induction of systemic anti-tumor immunity.
The second round of murine studies could expand this confirmation to several other cancers and further characterize PV-10's systemic benefit. Human trials, slated to begin this summer, would follow thereafter with additional characterization.
Big Pharma interest in PV-10 is of course very real: from the drug's potential role as a local treatment -- to fill the unmet need of and clear demand for effectively treating visible and accessible tumors -- to its systemic benefit -- again, to fill the unmet need where Yervoy and Zelboraf fall short.
The key to aiding Big Pharma's technical assessment of PV-10, aside from clearing up its regulatory path (i.e., SPA), is to elucidate its systemic characterization (i.e., MOA, MOIR). These technical assessment folks want to understand how and why PV-10 works, feeling uncomfortable with black boxes around that which they cannot wrap their heads, ultimately wanting to answer "is it real?"
We can only believe more Moffitt data will answer their questions and spectacularly rock their world in the process.
I recently had the opportunity to speak with an executive (formerly scientifically- and operationally-focused, now transaction-oriented in his current role and responsbilities) from Big Pharma (a top 5 company) who has been keeping tabs on Provectus. This first conversation was brief, as I spoke with him while he was in a taxi during several long days at a conference.
Recall my previous comments regarding's Craig Eagle and Pfizer's "pole position" in this blog post, and Dr. Eagle's keeping tabs on Provectus.
My thoughts from a short call follow. He (the above mentioned Big Pharma executive):
Was constructive on PV-10's local-regional and systemic benefits;
Highlighted the clear need and market opportunity for a loco-regional treatment option;
Thinks PV-10 and the trial data are real, and that what management has accomplished in bringing PV-10 along the drug development process thus far was/is an amazing testament to the team;
Complimented Provectus regarding its efforts to facilitate and maintain an efficient due diligence process for interested parties (I appreciated this particular perspective of his as a former corporate investor: "Process does not make a bad deal good, but it can make a good deal great.");
Spoke to the technical assessment process at Big Pharma, where folks are trying to ascertain if PV-10 indeed is real. A drug cannot be a black box, where technical assessors are unable to understand how it works. As a result, understanding PV-10's mechanisms of action and immune response are important. Of course, such information from Moffitt (particularly as it relates to the drug's immune or bystander effect), in addition to Provectus' historical work, already has contributed to Big Pharma current knowledge, and more Moffitt results are inbound;
Expanded his comments above to include final clinical data, and it's impact on the technical assessment process;
Added one could not diminish the "damn intellectually interesting" aspect of PV-10 -- a local agent that has material and meaningful systemic benefit -- in the thought process of Big Pharma technical assessors;
Commented on the importance of appropriate, careful media relations work to increase the interest level of Big Pharma commercial people as the technical assessment process reaches its conclusion. A greater profile in the news contributes to catching and increasing the attention of these commercial folks; and
Expanded his comments above to add that getting play in the media was a slippery slope. Biotechnology companies have to careful in what they say, when they say it and how they say it, so mistakes or misrepresentations, even if inadvertent, are not made.
As you know, Provectus is presenting PV-10 data at ESMO 2012 on October 1. ESMO is widely considered to be the most prestigious oncology association in Europe.
Why is participation at ESMO a poster presentation, rather than a speaking slot? Typically, Phase 2 and lesser trial data is communicated via poster, while Phase 3 and higher trial data is presented orally. Is it possible the gravity of the immunology-related work by Moffitt, had it been available at the time of submission, might have encouraged reviewers to push the Provectus PIs (and Eric) into the oral category.
What will be the nature of the statistical analysis and narrative of the poster presentation?
ESMO's prestigiousness and attendance (not disimilar to ASCO) [from the congress' press materials] draw more than 17,000 participants from over 120 different countries, including oncology professionals, healthcare policy makers, patient groups, pharmaceutical industry, cancer foundations and representatives of international media. What kind of event-related splash will Provectus make?
The WebMD video, Rose Bengal Dye for Melanoma Cancer, was added to WebMD's website in December 2011. The story originally was produced and aired in July 2011.
The mixed securities shelf registration Provectus filed earlier this month (July 2) was made effective on July 20. Prior to this, the shelf's securities were not available for sale nor could offers to buy securities be accepted until the registration became effective.
The quote below was contributed by a large shareholder. Thank you. I think, in regards to the company, that it is a thought provoking and substantively correct quote (where "unravel," in the context of Provectus, is "unfold").
“Well, it’s true: “inevitable” is not the same thing as “imminent.” When people see that something is inevitable — and I’m guilty of this mistake myself — they tend to believe those things are also imminent, even when that’s not so. But the inevitable is inevitable, and that means it must happen. We usually can’t predict exactly when — and such things often take far longer to arrive than we imagine they possibly can — but once things start to unravel, they tend to accelerate quickly.” — Doug Casey
None of us can predict or foresee who will acquire Provectus (or, for that matter, who will do a mini-oncology or dermatology deal with the company). Well, maybe Eddie Morra knows. We can try to predict or we can think we're making educated guesses, but it's mostly speculation for now. Management's thoughts on this topic are key.
Craig Eagle's presence on Provectus' corporate advisory board (CAB) is an important data point. Executives within Big Pharma have different degrees of flexibility in their respective business mission, role and responsibilities. How many oncology-focused biotechnology companies have executives from Pfizer's Oncology Business Unit (OBU) associated with them in a formal or informal fashion? How many executives within OBU are associated with oncology-focused companies? For that matter, how about other Big Pharma?
In a world where there are few drug in development that work and fewer still that work well, Big Pharma teams tasked with refilling drug pipelines (outside of internal R&D) keep their eyes on a short list of candidates. No one wants to be uninformed or late to the game when it comes to understanding who has a drug that works and works well. No one wants to be too far down in line when it comes times to act.
Craig Eagle's extensive and germane experience clearly is a very big plus for Provectus to access and from which to benefit. It does strike me, however, that he occupies the pole position on behalf of Pfizer for when it comes time to act.
I began blogging on Provectus in no small part due to the encouragement a Wharton classmate had given me to blog my real-time entrepreneurial experience of a previous start-up business venture.
This person always seems to be an early adopter of technology in a business or operations setting. In watching and learning from him, I realized his usage was quite thoughtful. How did the use of a technology (e.g., websites, blogs, social networks, Twitter, Pinterest, among other things) impact or provide useful feedback about his work or company or industry (as much as he questioned how a technology impacted his personal or family life)?
Since I believe my investment in Provectus, on a relative basis, ultimately will be the greatest trade ever (with sincere and repeated apologies to Gregory Zuckerman, from whose book this phrase was taken and whose book made for a great read, and John Paulson, who "pulled off the greatest trade in financial history."], I began to blog my thoughts about the company and its prospects.
Later, particularly as Moffitt murine study results began to surface, it became clear I was blogging and likely will continue to blog history.
Finally, I blog because readership statistics inform me of Provectus' prospects, too. Insight I have gained from such statistics has been almost as important as what I have learned from my diligence of management, other shareholders, principal investigators, pharma and biotech executives, the medical community, research analysts and investment bankers.
As at mid-July, blog readers come from 50 countries and 480 U.S. cities (650+ cities in the U.S. and around the world).
Readership (unique blog visits comprised of new and returning visitors), one proxy for awareness of and interest in the company, has grown steadily over time, too. The July figure below is a projected full-month number.
Provectus and PV-10's (and PH-10's) awareness has been growing and continues to grow in the U.S. and around the world, as much as there has been substantial growth of awareness and acceptance within the medical community and Big Pharma.
Today's share price drop spooked some shareholders, while continuing to frustrate others.
An intraday low of $0.67 on much heavier than [recent] normal volume (337K v. 70K) suggests either indiscriminate (i.e., a shareholder raising cash for whatever reason) or determined (i.e., one's thesis or reason for buying no longer is there, therefore one sells) selling.
Management thinks Provectus is at an inflection point. It thinks the company has been at this inflection point for some time (i.e., refer to Provectus' corporate
presentations since last year). The data and value support "external validation" and, therefore, a meaningful event. The tipping
point, then, is when such value actually is recognized, and should occur after the receipt of the SPA, which paves a clear path towards the approval of PV-10 for local (loco-regional) use, and the release of more Moffitt work, which clearly substantiates PV-10's systemic use. PV-10's multi-indication viability goes without saying
Provectus is a broken stock, saddled by having to trade over-the-counter and legacy decisions regarding cash bonuses. An independent board now oversees compensation decision-making.
A familiar mantra remains: The value proposition of the business has never been stronger. The value proposition of the stock in the near-term remains dangerously weak.
With no strong buying interest (thus, a weak bid), indiscriminate or determined selling can easily push the share price lower. With no new news as yet, the fear of a cascade affect on selling remains: Some shareholders sell. The price drops. More shareholders sell. The price drops even further. And so on.
Has anything changed in one day? Five days? One month? Three months? Six months? Year-to-date? Click on this Google Finance chart of PVCT. The share price's period loss ranges from -8% to -13%. Ironically, for the share price, nothing really has changed, save more of the same: stagnation, or more accurately, a painfully slow drift downwards.
For the business, the value proposition has increased dramatically. The SPA is in the bag; however, I cannot foresee when it is received, and can only rely on management's Q3 guidance. More Moffitt data should be very highly anticipated, and put a final nail into the coffin of criticism of or skepticism about PV-10 not being a systemic agent.
So how does the stock become unbroken? A move to the Nasdaq reforms and refreshes the stock, but certain events must be triggered.
Some kind of transaction or related event is in the offing. I cannot divine the timing. What kind of transaction?
A mini-oncology deal (a geography-specific, indication-specific license transaction). Perhaps two such deals.
An equity transaction by Big Pharma.
A dermatology deal will occur when prospective partners get full comfortable with the data. There, PH-10 data will drive the time frame and the value (as PV-10 data has for oncology).
My investment thesis remains sound. My analysis, which is constant and continuous, remains positive. The stock price performance, while dismal, remains a non-factor for now.
Well I've been waiting for this moment for all my life, oh Lord
I can feel it in the air tonight, oh Lord, oh lord
Well I've been waiting for this moment for all my life, oh Lord
I can feel it coming in the air tonight, oh Lord
And I've been waiting for this moment for all my life, oh Lord
I can feel it in the air tonight, oh lord, oh lord, oh lord
Well I've been waiting for this moment for all my life, oh lord, oh lord
I'm ona cross-country road trip with the family. We've turned the bend toward home. A few more days remain before we're sleeping comfortably in our own beds. Recently, we stopped over in Jasper, Indiana visiting close friends and their children.
There was a moment, one afternoon, when: Cows and other animals we encountered looked or appeared to look nervous. Lightning bugs, apparently so prevalent in the evening over your lawn and around your property that the night sky teeming with stars seemed to surround you, were scarce. Thunder in a clear but otherwise noticeably different sky rumbled across the horizon. Intermittent flashes of lightning were visible out of the corner of your eye.
There was a distinct, at times almost unreal (surreal?), quiet over the countryside. Storm clouds gathered. Something was coming. You knew it. You sensed it. You felt it.
It got darker. "I can feel it coming in the air tonight, oh Lord."
And then, after a some time elapsed, without warning, other than what had been building above and around us, rain ferociously hammered the ground. Petrichor, that familiar scent of rain on dry earth, filled our nostrils.
We felt the wind gush over us and heard its howl as it blistered the area, buffeting the house and threatening to displace anything not nailed down.
Really?
The consensus view, based on discussions with certain Big Pharma executives, biotechnology-focused investment bankers and experienced life sciences investors (who, it seems, all think very similarly), is once Provectus "arrives" (i.e., the tipping point) everyone will want them, and will want them at the same time. The crux of the matter is the need for drugs like PV-10 and PH-10 is very intense for Big Pharma.
When the tipping point occurs, it will appear to have happened very swiftly and ferociously. But, for now, we wait. Something wicked[ly profitable] this way comes?
I can feel it coming in the air tonight, oh Lord
Well I've been waiting for this moment for all my life, oh Lord
I've enjoyed immensely interacting and sharing information with other large shareholders over the course of my share ownership of Provectus. The blurb below, from the Medical Technology Stock Letter, was e-mailed to me by one of these folks (underlined emphasis below is this person's):
Amylin is being bought for $31 per share by Bristol-Myers who upped their bid from $22 last weekend to close the deal. And then in a stunning and unusually creative move for Big Pharma, Bristol went out and teamed up with Astra-Zeneca who bought half of AMLN for $3.4 billion. The fact that another biotech has been bought for a substantial premium by Big Pharma is positive as it signals that M&A in biotech remains hot. Bristol is really stepping up their M&A pace as this is the second big deal for them in 2012, they paid $2.5 billion to acquire the hepatitis C company, Inhibix. The company is trying to replace their top selling drug Plavix which went generic last year and represented $7.1 billion in sales. Big Pharma is in big trouble as last year they lost patent protection on drugs valued at $34 billion in annual sales, an amount that is estimated to grow to $147 billion by 2015 according to data compiled by Bloomberg. The Bristol deal is the fifth sealed in 2012 for more than $1 billion, almost doubling the rate of the previous two years. We are clearly on the cusp of a long-term trend as there are not enough new drugs in Big Pharma’s pipelines to drive top-line growth.
Another important positive from the deal is Big Pharma’s willingness (at least Bristol-Myers & Astra-Zeneca) to work together and be creative as they slice and dice up the best of biotech’s developed drugs. Bristol and Astra also helped themselves by avoiding a bidding war as they could have easily driven the price for AMLN higher if either party had been too stubborn to ink a 50/50 partnership.
In my view, the essence of the blurb rather aptly summarizes the company's current situation.
To answer a blog reader question: I do not know when Provectus will announce receipt of the SPA. I still speculate mid-July [for an official announcement] (recall I previously speculated as early as late-June), but management's guidance was base case Q3. Q3, rather obviously, comprises the months of July, August and September. If no more details are to be hammered out, what only should remain is official notification. There is, however, a difference between agreeing with the FDA on the SPA, and announcing its official receipt.
I close with another much appreciated blurb from the same shareholder [who provided me the one above]. It's from a SeekingAlpha article on Gleevac in which the author's comments crystalize the opportunity with Provectus (in the view of the shareholder):
Author:Steven B. Koevary, Department of Biomedical Sciences and Disease, New England College of Optometry & Department of Cell Biology, University of Massachusetts Medical School
Abstract: Rose bengal (RB) has been utilized as a photodynamic agent for the targeted killing of cancer cells. Recent data suggest that intralesional RB alone may be effective in chemoablating locoregional and metastatic melanomas. The ability of RB to induce direct and bystander melanoma cell death led to the speculation that it may be similarly effective in the treatment of other neoplasms. The objective of this study was to determine whether RB can limit the growth, or kill, ovarian cancer cells in vitro. Ovarian carcinoma cells with or without a germline BRCA1 mutation were cultured with up to 800 µM RB for one hour or four days, after which their ability to proliferate was assessed using the MTT assay. Control cells included an embryonic kidney cell line transformed with adenovirus, and normal human fibroblasts. Ovarian cancer cells exhibited significant dose-dependent suppression of growth in response to RB; this suppression was similar to that seen with carboplatin. RB treated ovarian cancer cells appeared rounded, shrunken, and damaged. RB also inhibited the growth of kidney tumor cells but was much less effective in slowing the growth of normal human fibroblasts suggesting that RB-mediated growth suppression might be tumor cell specific. Ovarian cancer cells treated with RB displayed a significant increase in apoptosis that peaked at approximately four times the levels seen in untreated control cells. Furthermore, RB exposure resulted in the intracellular generation of reactive oxygen species (ROS) at levels that were significantly greater than in untreated cells and similar to levels seen in cells treated short term with H2O2. These data suggest that RB may not only suppress ovarian cancer cell growth but also induce their apoptotic cell death, justifying the further investigation of the effects of RB in an animal model of ovarian cancer.
"Thus, even when optimally debulked, many patients still exhibit tumor nodules too small to have been resected by even the most skilled surgeon that likely seed future growths. In light of the above data, it is theorized that injection of these nodules with RB at the time of surgery may prove to be an effective strategy for not only their elimination, but for vaccinating patients against the future regrowth of gross tumors. This notion is supported by data that showed that PV-10 treatment increased the levels of tumor infiltrating lymphocytes and that the overall survival of ovarian cancer patients was greater in patients whose tumors contained T cells."
This ad was first shown during the televised 2012 Superbowl. I'm going to borrow from it gratuitously for this post.
It's halftime at Provectus. The company's second half is about to begin. All that matters now is looking ahead and finding a way forward. Management is in their locker room discussing what they can do to win this game in the second half. Shareholders are hurting. And they're all wondering what management is going to do to make a comeback. They're all scared, because this isn't a game.
Monthly volume grinds lower and lower.
Quarterly volume paints an even more pathetic picture.
To add insult to injury, short interest, a mostly useless statistic at this point, creeps higher.
And the stock price has been cut in half over five years.
Despite a bleak stock picture, there became something very real, very palpable, about Rose Bengal, PV-10 and Provectus in 2012's first half:
On January 18, the FDA indicated an additional end-of-Phase 2 meeting with Provectus was not required, allowing the company to submit a design for a Special Protocol Assessment.
On March 19, Provectus released top line Phase 2 data for PH-10's first randomized controlled psoriasis study, corroborating the drug's effectiveness in mild-to-moderate plaque psoriasis.
On March 26, H. Lee Moffitt Cancer Center & Research Institute confirmed PV-10 chemoablation of melanoma lesions leads to a systemic response and the induction of systemic anti-tumor immunity, finding higher levels of interferon-γ, which is thought to be the quintessential cytokine mediating an immune response to melanoma.
On April 13, MD Anderson Cancer Center's Dr. Merrick Ross updates HemOnc Today Conference attendees about intralesional ablative therapies and PV-10. What has been said in private for months and months now is said more and more in public: PV-10 should be approved as a first-line therapy now.
On May 14, Provectus forms an independent board of directors with the addition of Jan Koe and the stepping down of the company's Dr. Eric Wachter. Earlier, in April, the NASDAQ formally lowers the requirements for stocks like PVCT to list on its exchange. In Provectus' case, a greater-than-$2-bid for 5 consecutive days only is needed.
On May 30, the company adds Doug Ulman, national cancer survivorship advocate and president and CEO of LIVESTRONG, to its corporate advisory board.
On June 22, Provectus releases top-line final data from its phase 2 clinical trial of PV-10 for metastatic melanoma. Dr. Agarwala's presentation also reveals overall disease burden is reduced, PV-10's response is durable, and the FDA is helping to get the drug approved with an easily beatable hurdle for PV-10 in the Phase 3 trial.
On June 26, an article in Cancer Watch highlighted Moffitt Cancer Center's studies confirming the direct effects of PV-10 chemoablation as well as its systemic response, and including powerful statements from key opinion leaders: PV-10 generates the quintessential immune response for melanoma, PV-10's induced antigen response is a surgical strike, there is no question there is a clinical need for PV-10, and the father of intralesional therapy acknowledging PV-10's promise.
On June 29, Provectus files a mixed securities shelf of both common and preferred stock, potentially setting the stage for a strategic minority investment by a bug pharmaceutical company.
All that matters now is what's ahead. How does management come from behind? How do shareholders win?
The SPA
A geographic-specific, indication-specific deal (or two)
A strategic minority investment, or perhaps a larger deal of some sort including the sale of Provectus shares to a corporate
A dermatology deal
More Moffitt murine study results
Moffitt human study results
Commencement of the MM Phase 3 trial
Progress towards accelerated approval
More intellectual property
A NASDAQ listing
Yeah, it's halftime shareholders. And, Provectus' second half is about to begin.
This morning's $100MM common and preferred stock filing.
A practicality: Given today's filing, it's possible management may cancel the other two shelfs. The goal of the today's shelf was to have a preferred security [easily] available for sale; however, the structure, easily replaces common stock features of the prior shelfs.
One fact:3.4MM preferred shares are outstanding out of an authorized amount of 25MM; thus, some 21.6MM remain available for issuance.
A reminder: Issuing a dollar-based shelf, rather than a number of securities-based one, means eventual dilution is market capitalization-based and, thus, calculated.
In the company's March 2010 private placement, Provectus issued 8% convertible preferred stock to a number of institutional investors. At the time, aside from raising money to fund operations, it appeared management's strategy was to bring institutional names into the stock and provide these investors with a security (preferred stock) that would have and hopefully further induce a longer-term holding period than issuing common stock.
The mixed-security shelf, by virtue of the preferred stock component, provides a mechanism for a strategic minority investment by Big Pharma. Although it is possible such stock could be issued to institutional investors, a strategic investment is more likely given where Provectus and PV-10's clinical, business and regulatory value propositions currently and future propositions are.
With the involvement of a strategic (e.g., a corporate investor like PFE or JNJ or "insert name") in a shelf issuance, the mechanism and features of preferred stock can facilitate a transaction in ways common stock cannot to the benefit of both buyer and issuer; such as, to provide the necessary structure and rationale [for the buyer] to support a premium to [the seller's] share price.
For example, PFE, a possible strategic given, among other things, Dr. Eagle's presence on Provectus' corporate advisory board), or another big pharmaceutical company could buy 4 to 5 million shares (maybe a lower amount) at $5 per share (maybe at lower price, too).
I'll address (speculate) what a strategic investment does to the perception, options and outcomes for the company in a subsequent post.
Are there going to be no more Moffitt results released until later in this year? Isn't it impossible for an end game to commence until something moves the stock?
Q1: I think the potential exists for the release of Moffitt's subsequent work possibly later this year.
Q2: I completely agree. An M&A transaction marking the end-game likely could not and would not occur until much more intrinsic value is reflected in Provectus' market capitalization. It appears to be a dynamic time at the company, and I'm sure the situation is fluid.
MM Phase 2 results bested Phase 1 results. Phase 3 will best Phase 2.
Combination therapy underway.
I want to thank a friend of the blog for his illustration that Provectus shares are a very, very tightly wound garage door coil (torsion spring). That's a great image. Loosen a bolt here and there incorrectly, and if your new nick name isn't Lefty, you might well find yourself pushing up the daisies. In financial speak: when the triggers/catalysts begin to happen, you might find yourself without enough or any shares of Provectus stock at current prices.
We could be surprised by the progress of the derm discussions.
The FDA wanted a bold hazard ratio to clearly (and likely unequivocally) demonstrate PV-10's superiority over the MM Phase 3 comparator, principally because PV-10 is an intralesional agent. The point of Tuesday's PR: PV-10's MM Phase 2 PFS of >9.6 months for Stage 3 disease versus comparators' PFS that range from 1.9 to 2.6 months means the hazard ratio should (will) be achieved. By the way, 9.6+ months will only get better in Phase 3 because principal investigators will have have much more flexibility in the amount of PV-10 they can deliver to patients during the treatment period.
One of the seminal rules (approaches) to come out of the Harvard Negotiation Project: Don't bargain over positions. Positional bargaining can limit your ability to arrive at a "wise agreement," an agreement that benefits both parties; the proverbial middle ground and the whole purpose of negotiation. Instead of thinking of a position, identify the goal. A specific position is binary: you either get it or you don’t. A goal can be attained in many ways, giving you many more options for arriving at a solution. (I sourced the substance of this paragraph from here.)
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