$PVCT: The #Holy #Grail of #Cancer Treatment is...

It was interesting to read about Moffitt's work in the February edition of Cancer Watch.

Some believe Provectus has the most unusual opportunity in the history of drug development thus far, and that no one has ever seen a drug work like Rose Bengal in PV-10 and PH-10.

[Emphasis below all mine.]

The Cancer Watch article establishes context with historical PV-10 clinical trial success: Back in October, 2012, Phase 2 metastatic melanoma data on use of intralesional PV-10 presented at ESMO (European Society for Medical Oncol- ogy) 2012 Congress in Vienna, Austria, showed an objective response rate (ORR) of 51%, and a disease control rate of 69% in target melanoma lesions. The other finding, which lies behind some of the intensifying interest in PV-10, was a 61% ORR in bystander (uninjected) lesions among patients who had complete or partial responses in their target lesions. The bystander lesion ORR in patients with non responsive target lesions was 18%. Of deep interest, as well, were case studies showing potential stasis or regression of untreated visceral lesions in patients following PV-10 treatment of their cutaneous lesions.

The author further establishes governing thought: A bystander effect was clearly apparent in the first study in that PV-10-treated mice had 3 or fewer lung metastases as compared with more than 250 in each of the untreated mice.

In further elucidating the work at the cancer center, the author wrote: The focus at Moffitt, Dr. Sarnaik continued, is on discerning the presence of immune cell infiltrate in untreated tumors after PV-10 injections into other lesions. "We are really interested in harnessing immune cell infiltrate as a form of treatment," he said, noting also that while creating cancer vaccines has been thought of traditionally as one of the Holy Grails of cancer research, cancer vaccines have turned out to be not strong enough to generate an adequate immune response. Is Dr. Sarnaik implying PV-10 is the Holy Grail?

In response to the weakness of cancer vaccines: The strategy of adoptive cell transfer potentially overcomes the weak vaccine response...While adoptive cell transfer offers the advantage that enough T cells can be obtained for infusion in all patients, the T-cell receptors transfected into the T cells have a limited antigen specificity.

PV-10, however: ...Shari Pilon-Thomas, PhD, also a Moffitt researcher, demonstrated that T-lymphocytes recovered from mice treated with PV-10 do appear to be of a higher quality, as evidenced by stronger tumor reactivity...

Sarnaik's study will test Pilon-Thomas' conclusions in humans: "This is a straightforward study that will give a yes or no answer," Dr. Sarnaik said.

The Cancer Watch article about Moffitt may be the information/PR prelude to the cancer center's long-awaited high profile conference presentation and contemporaneous publication of its work on the immunological MOA characterization of PV-10 work.

When I think of appropriate "high profile" conferences, two come to mind: the annual meetings of the American Association for Cancer Research ("AACR") and the American Society of Clinical Oncology ("ASCO"). The former runs April 6-10, while the latter runs May 31-June 4. While research is presented at both conferences, ASCO is more focused on clinical trial results and updates. As such, and since Moffitt's work to date (excluding the recently initiated human trial) has been murine research, I'd guess the target conference for Moffitt is AACR. If AACR is indeed where Moffitt presents, then I'd also guess the target peer-reviewed publication is Cancer Research.

$PVCT Fundraising

From the company's 8-K filing today, management raised $2,550,000 of Series A 8% convertible preferred stock last week (February 22) at 75 cents per share. The closing price of the stock on February 21 and 22 was 65 and 67 cents, respectively. This equity security appears to be similar to the security issued to institutional investors in March 2010. Warrant coverage for the February raise was 1.25 ($1.00 strike). For the October 2012 raise in which Eric and Peter participated, the share price of the common stock issued was 75 cents, and warrant coverage was 1 ($1.00 strike).

I estimated management's cash balance as at the end of February to be $1.3-2.3MM ($300-500K burn rate per month). The February raise should boost cash near or above $4MM, an amount that satisfies the company's auditors. I think the specific threshold is at least 12 months operating runway, which I also think is a $4MM figure (~$333K per month).

Peter said the February raise was driven completely by external audit requirements, which plays to form like the October raise before it and like the March raise before that: $2MM+ slugs designed to meet the auditors' going concern threshold. The timing of the fund raising might suggest, however, that the probability of Peter bringing home a check is near or at zero.

Generally speaking, management has protected the overall economics of PV-10 and PH-10's respective market opportunities. This assumes of course the eventual exit meets or exceeds management's full monetization threshold (as well as mine).

How long this protection lasts and how effective it is clearly is a function of what, if anything, Peter brings back from China.

Rumor du jour: Peter met with executives from Indian pharmaceutical companies this week to discuss terms and conditions of a regional license deal for PV-10 in India.

$PVCT: Get Shorty (Update)

Short interest at 2/15/13 (~1.58 million) increased by ~11% over 1/31/13 (1.42 million). Since January 14, 2011:

Since January 14, 2012:

Volume since the last reporting period (through today's market session) has been 1.8 million shares (assuming this OTC reporting from Yahoo! Finance indeed is accurate; as a reminder, I obtain the short interest figure from the OTC website):

Did short interest drop significantly this week? To the extent it may matter, we'll find out the result of the period ending February 28 on March 11.

The rumor mill has started churning. You would figure it was getting close enough to the likely event outcome that it had to start in ernest at some point. I heard several.

The first rumor purports Peter will return with an agreement (but no cash yet) with a Chinese pharmaceutical partner. The agreement -- call it what you wish (e.g., an MOU, an LOI, etc.) -- thus would allow Provectus to issue a PR (because the agreement would be a material event) revealing the name of the Chinese firm and key provisions of the anticipated license agreement that would form the basis for a definitive contract, which likely would be consummated and funded within 30 to 60 days.

The second, which I won't go into any detail, would lead one to think the Chinese partner is Hisun.

Maxim Group's Dr. Echo Yinghui He, MD PhD, a Senior Analyst who also covers Provectus, purportedly accompanied Peter on his China trip.

Finally, a large Hong Kong-based Provectus shareholder purportedly also joined Peter. From what I gathered, the shareholder's purpose was Reaganesque.

Peters returns Saturday. A PR next week? Maybe...

$PVCT: #Tumor Heterogeneity

I’ve tried to understand the issue, problem and challenge of tumor heterogeneity, and why and how PV-10 works so well. I’ve previously written that to understand PV-10 is to understand the relationship between chemoablation and immune-mediated signaling. It's what Craig means when he says the immune system responds in direct proportion to the degree of insult. Think of PV-10 chemoablation as the proxy for the degree of insult, which is rapid, complete and durable in the case of PV-10. But when Craig describes his approach in this way, what is he really getting at? How did he approach tackling or solving tumor heterogeneity?

(Source withheld, 2009) There have been well documented but exceedingly rare cases of spontaneous or post-infection remissions in melanoma that appear to be immunologically mediated. There is a correlation between treatment-associated autoimmune depigmentation, or vitiligo, and favorable melanoma outcomes. Regression of uninjected melanoma modules after intralesional BCG therapy had been demonstrated.

Results with conventional therapy for metastatic melanoma up to that point remained poor. Melanoma patients at high risk of recurrence are readily identifiable. Tumor-induced immunosuppression increases with tumor burden. Immunotherapy should be more effective the earlier it is applied. 

But there are major obstacles to overcome: patient heterogeneity (variable outcomes for patients within similar stages, HLA haplotype differences), tumor antigenic heterogeneity (not all tumors express the same antigens), antigen loss (most immunogenic proteins are not essential to survival), tumor-induced immunosuppression, and the length of time needed for an immune response.

A weak or partial immune response to the tumor selects for more virulent tumor cells to survive, akin to antibiotic resistance in microbial infections. Vaccines are inducing “tolerance” by repeated exposure to antigen, convincing the immune system not to react to tumor-associated antigens and/or stimulating the generation of “suppressor” cells.

Tumor heterogeneity is a critical problem. In any given cell there are, say, 15,000 unique mRNAs at any given second. A few seconds later, illustratively, 15,000 new ones. There are, for example, at least 15,000 to 20,000 unique proteins on a membrane surface at any one time. These change continuously. Does picking one of them to form the basis of a cancer vaccine make sense? Does targeting a specific antigen as a holistic solution make sense?

Heterogeneity is so wide, trying to target a specific antigen might be tough if not hopeless task. A needle in a haystack? Maybe a needle in an entire whole galaxy.

Treating as many tumors as you can with PV-10 intratumorally achieves two significant positive outcomes. First, you lower the patient's overall tumor burden so as to allow the immune system to work better. Second, you allow more of the heterogeneous antigens (from the injected heterogeneous tumor) to be seen by the immune system. The more tumors treated by PV-10 the better.

PV-10: 1. Lower tumor burden. 2. Cover the antigenic spectrum as broad as one can.

$PVCT: It's the #immune system, #stupid.

"It's the economy, stupid" is a slight variation of the phrase "The economy, stupid" which James Carville had coined as a campaign strategist of Bill Clinton's successful 1992 presidential campaign against sitting president George H. W. Bush. (Source: Wikipedia).

To understand PV-10 is to understand the relationship between chemoablation and immune-mediated signaling. It's what Craig means when he says the immune system responds in direct proportion to the degree of insult. Think of PV-10 chemoablation as the proxy for the degree of insult, which is rapid, complete and durable in the case of PV-10. Moffitt should say the same thing in its conference presentation(s) and contemporaneous peer-reviewed publication.

A good amount of work -- creative, innovative, pragmatic, historical, scientific, medical literature-based, etc. -- went and a continues to go into dosing, of historical and upcoming clinical trials, of certain indications, of pre-clinical work on newer indications.

Yes, management doesn't talk openly about dosing, nor do they talk openly about several other topics of import and value.

The thing that makes you go hmmmm... Rose Bengal has an established safety history, a short half-life in the bloodstream, and is excreted via the liver and kidneys. The half-life is measured in minutes, like 15-30 or thereabouts. The drug is gone from the body almost immediately, so there is never enough of it to kill remote (untreated) tumors like what injected (treated) tumors receive via intratumoral delivery. PV-10 is long gone before the immune system removes the untreated ones. Hmmmm...

Did An #Institutional #Investor in $PVCT Close Its Shop?

Funds blow up and/or close down all the time. Natural selection. Darwinian evolution. Call it what you want. The recent depression in certain commodity prices was attributed by some to the blow up of a couple of funds and the liquidation of their positions.

Many commodity markets are deep (i.e., very liquid), like certain U.S. large cap equity names for example, and closing of positions (more often long, thus liquidation means selling) don't usually move prices much unless those positions were large to very large. Market participants in the know about such closings/liquidations often step out of the way until the fund(s) is(are) done.

Sizable positions in less liquid or illiquid assets or stocks can move prices much more. And knowledgeable market participants do the same thing. They wait, and then they act (if they desire to act at all).

I have written about Revelation, a formerly large shareholder of Provectus stock, converting its preferred shares into common and selling them. The firm's latest Form 13G filing indicated a dramatic reduction in beneficial ownership. Sometimes investors decide they've had enough and throw in the towel. It happens to institutional and retail investors alike.

Rumors are circulating about Revelation sold its Provectus warrants too. Sometimes investors sell because their closing down, and their selling has nothing to do with their investment thesis related to a particular holding. A hedge fund doesn't sell its warrants, digging around for the very last scrap in its larder, if it's throwing in the towel on its thesis. The situation arises because the fund and perhaps the firm itself are closing down.

A graph of Revelation's quarter-end 13F SEC filings from 12/31/11 to 12/31/12 is below.

The number of holdings (13F entries) and amount of assets under management related to these holdings (cash is not reported) for the period or quarter ending 12/31/12 are down considerably from, say, the last quarter-end of 9/30/12, let alone year-over-year.

We obviously don't know Revelation's fund terms and conditions (e.g., redemption notices, gates, etc.), but it is very possible the fund and maybe the firm is closing.

Short interest for the period ending February 15 is reported tomorrow. The large spike in short interest, perhaps attributed to the "fake short" caused by converting preferred shares into common shares, might fall and confirm Revelation was responsible for it. Rear-view mirror stuff.

If the Big Seller has been Revelation liquidating its Provectus holding, the loss of this downward pressure on the stock may permit natural buying interest to push the share up dramatically more.

$PVCT: @MaverickNY: TLS, what is it and why is it important to cancer research

Around mid-February a reader of this blog asked about Tumor Lysis Syndrome ("TLS") in the context of PV-10. He forwarded me the link to Dr. Sally Church's blog's article about TLS. This topic was raised because AbbVie suspended 5 clinical studies for experimental leukemia and lymphoma medicine because patients died from tumor lysis syndrome ("TLS").

Pieter Droppert wrote:

Source

Dr. Church wrote:

I do not think this is an issue for PV-10, but I learned quite a lot by exploring the topic and delving further into what makes Provectus' drug unique. The generation of too much necrotic tissue at one time is not good. It is important to manage tumor burden with the ablation of PV-10. Thus far, debulking was taken care of before patients were treated with PV-10 through surgical excision. As PV-10 is used in different stages of disease, however, physicians should take a balanced approach, making sure the entire tumor burden of the patient is properly treated. For example, a patient may have some surgical excision depending on tumor size, and then be treated with PV-10 for the remainder of the disease. Or, his or her tumor burden could be treated over a period of time with PV-10.

One key to PV-10's unique ability to very effectively treat local and distant cancer lies in the intratumoral delivery of the drug. This intratumoral route helps generate the remote response or bystander effect.

Systemic delivery, according to Craig, is what's wrong with chemotherapy. This route creates bad side effects, generates poor efficacy, and kills anti-tumor immunity, induces tolerance or shuts it off entirely.

Provectus has been careful about the size of tumor that would or should addressed by PV-10 because of the very issue of overwhelming a patient with dead tissue, which is a topic well known in medical literature (including, for example, literature related to radiofrequency ablation). Dosing, for example, plays an important role. A successful approach requires understanding several factors, among them the amount of necrotic tissue generated by PV-10 in different situations and under different scenarios, toxicity, etc. How much tumor you kill immediately versus over time not only influences dosing, but it also influences treatment approach.

$PVCT: $PFE Seeks Alliances in #China

An article by The Wall Street Journal's Kathy Chu.

"Pfizer already has a joint venture in the world's second-largest economy with Zhejiang Hisun Pharmaceuticals to develop generic drugs, which dominate China's pharmaceutical sales. Pfizer also has a minority investment in Shanghai Pharmaceuticals Holding Co., one of China's largest drug distributors, and its animal health division has a JV with China'sJilin Guoyuan Animal Health Co. for animal vaccines."

"As local companies become fiercer competitors, partnering with them is also appealing because of their in-depth knowledge of the China market, according to Mr. Wu."

"The heightened competition can benefit consumers by improving the overall quality and safety of the drugs offered in China, Ms. Wang says. More than 260 million of the country's citizens suffer from a chronic disease, according to data from China's Ministry of Health."

"The Chinese government has made affordable healthcare a priority, spending $125 billion over the past three years to extend insurance coverage to 95% of the population while also improving access to hospitals and clinics."

Will $PVCT Peter Procure Provectus Peking Pork?

$PVCT: SPA Insights

A friend of the blog provided these links about SPAs. I found them informative. Thank you.

A. "One measure which has been designed to mitigate some of this regulatory risk is the Special Protocol Assessment (SPA) agreement between a sponsor (often drug companies) and the Food & Drug Administration (FDA), which first issued guidance on the process in 2002."

B. SPA Takeaways.

Takeaway #1. Sponsors who have successfully conducted studies that have met the predefined outcomes in a SPA agreement are highly unlikely to be rejected on the grounds that more clinical data/studies are required. I think I now have a much better perspective on the time Eric took to hone the agreement with the FDA on the SPA. The SPA of course has not yet arrived, so nothing is final until it is final.

If you're going to design a process where fish in a barrel are to be shot, and you're not doing the shooting, you want to make perfectly sure or as close to perfect as you can that the fish are indeed efficiently, effectively, successfully and statistically (with significance) shot by whomever is shooting the fish and measuring the shot fish. To that end, you would pick, among other things:

• The right barrel, for size, diameter, leakproof-ness, ability to withstand buckshot or bullets from the gun, etc.,
• The right gun, for accuracy, effectiveness, magazine size, power, etc.,
• The right liquid for the barrel, for clearness, low viscosity, etc.,
• The right fish for slowness, docility, easy identification, size, etc., 
• And so on until you had reduced possible degrees of freedom to a de minimis number.

The goal would be to leave nothing to chance. In doing so, I think Eric spent copious amounts of time and significant effort to ensure the eventual trial design would generate both a statistically significant and clinically meaningful outcome, even if it meant more time than initially expected to do so. 

#2. PV-10 is safe.

Takeaway #3. Even the safest and most efficacious drugs can be held up if there are issues with the CMC component of the NDA. I have not discussed much of this aspect of the PV-10, but my diligence thus far suggests there are no significant CMC (Chemistry, Manufacturing and Control) hurdles.

Takeaway #4. The path from SPA to approval can typically take upwards of 5 years. A interesting point, particularly in light of the time it took Provectus to enroll, treat, analyze, and release interim, preliminary and final clinical data of patients in the company's MM Phase 2 trial. Contrast this with management's belief the control arm of the MM Phase 3 trial data should fail in 1-2 months, interim analysis may be available as early as late-Q3 or Q4 2013, and PV-10 could be approved as early as 2014.

#PVCT's #China #Arbitrage Opportunity

I have queried Peter extensively about China on a broad array of topics. One item of particular interest to me was the notion of an "arbitrage opportunity" potentially arising from geographic-based interest in PV-10: China vs. the West.

On the one hand: While many Western Big Pharma companies are very interested in the drug, they still desire to understand the story of how and why a very effective local agent can have as comparable systemic and immunologic benefit. Thus, we wait for Moffitt.

On the other hand: The Chinese are much more interested in understanding whether PV-10 works and works cost-effectively.

Both hemispheres agree the drug is safe, and both acknowledge PV-10 is effective. It is possible, however, that cultural differences might contribute to each party's thinking and decision-making processes. One wants to know why and how, while the other wants to know how much.

The arbitrage opportunity thus would be (A) an early monetization of Provectus through a regional license deal with a China pharmaceutical company that is prepared to act now {monetization through sizable upfront, milestone and royalty payments that increase share price to where some shareholders exit out of some of their positions} -- versus (B) a later, more fuller monetization of the company through its acquisition by Western Big Pharma because for the time being these pharmaceutical companies will not act {monetization through end-game share price}.

$PVCT #Horse #Race (updated)

Last updated here.

A $PVCT #China #Travel Vignette

Peter is traveling to China with a small team of people, the composition/functional role/number of whom in situations with him would depend on place/venue/nature of an in-country meeting.

$PVCT Who? Rose Bengal What?

I found what I believe are circa 2008 figures of the number of public companies on major and minor U.S. stock exchanges. Thousands and thousands... Of those, there are 400 to 450 public biotechnology companies.

It's easy to rail against the universe and management in the echo chamber of blogs like mine and online stock boards about lack of awareness of the company. Some of it is warranted. Most of it is not. We certainly can argue all day about this. I find myself on each side of the argument, depending on the day or month. The hard truth, and really what it comes down to, is most folks, investors-at-large at a minimum, do not know about the company.

Management has routinely said the company's primary customers are the FDA and Big Pharma; the former as it relates to the regulatory path, and the latter as it relates to the eventual buyer of the company. When it comes to creating an actual product and traveling the path to bring it to market (or seeking the right pharma partner to do so), management's approach is smart, particularly given the novelty and innovation of PV-10, its new pathway, a long-desired approach to treat cancer in a different, more effective manner, etc.

It is hyperbole for anyone outside of the medical community to even think about calling PV-10 a cure for cancer or the closest thing to it.

The rule for treating cancer is to treat it as early as one can. PV-10 is positioned very well in the treatment ladder (we await Moffitt to explain the drug's clinical relevance), from a diagnostic to pre-surgery application to post-surgery application -- collectively the vast portion of the cancer market -- to application in combination with radiotherapy and systemic chemotherapies and immunotherapies for very late stage disease-afflicted patients -- a very important but small portion of the market.

As I wrote previously, Provectus is approaching catalytic milestone events that should move the share price substantially (that is what management believes); as a result, it is now or in short order fair to management and shareholders to measure the resulting movement or lack of movement in share price after these events (the SPA's receipt, Moffitt's explanations, a China deal).

I did a quick thought experiment:

• Came up with 15 so-called cancer immunotherapy companies. 
• Went to SeekingAlpha and typed in their ticker symbols in order to find out how many SA members had subscribed to alerts about each company.
• Graphed the results, and they are telling (see below).

After one or more of the SPA, Moffitt and China, what happens when more people become aware of the drug, company and stock?

What's the outcome of a 10x increase in PVCT SeekingAlpha subscribers, for example and as a proxy for greater awareness by investors-at-large?

$PVCT: It doesn't get more definitive.

It doesn't get more simple than this. I think management's position on two key value drivers clearly is definitive.

#1. The SPA is key to life sciences investors getting into the stock because of the very specific regulatory path clarity and the management of such it provides. Get the SPA, and these investors will buy Provectus shares.

#2. Life sciences investors need to understand PV-10's clinical relevance. Substantive data explaining the "bystander effect" and PV-10's immune mediated signaling, a new pathway, among other things, will be presented at a major conference and contemporaneously published in a peer-reviewed publication for the first time (I am confident I figured out the names of the conference and journal). Moffitt explains the systemic and immune-mediated benefit of local agent PV-10, and these investors will buy stock.

#3. China needs no comment from management. Close at least a good regional license deal with good upfront, milestone and royalty payments, and investors of all stripes will buy Provectus shares.

I looked at these three near-term value drivers -- the SPA, Moffitt's work and a China deal -- and their respective importance to key Provectus constituents: the FDA, Big Pharma, life sciences investors, and investors at large (of which I of course am one). This assessment is illustrated in the table below.

The FDA is the constiuent most relevant to PV-10's regulatory path for (a) the SPA so Provectus ultimately may achieve approval for the focused label of local treatment of Stage III MM cancer patients, (b) accelerated approval for MM, which could have a one-in-two chance of being achieved after Moffitt's conference presentation and journal publication, and (c) to a lesser extent only because management is mum on the topic, breakthrough therapy designation for liver cancer.

Big Pharma cares about the SPA, but it seems they care much more about Moffitt's story and explanation of PV-10's clinical relevance. Randomized data, interim or otherwise, is very meaningful to Big Pharma. Should the pivotal MM trial start at the end of March or in April, it is conceivable an interim dataset could be made available to Pfizer and others to peruse in late-Q3 or Q4 2013. Nevertheless, the new pathway discovered explains how PV-10 facilitates the death of cancer, and it could be novel and important enough to spur Big Pharma to act. Only time and the degree of Moffitt's reception by the global oncology community will tell.

Life Sciences Investors care about the SPA and Moffitt. Management comes across as definitive on these items: Get it and explain it, respectively, and these investors will buy Provectus stock.

Investors at large care about the SPA, Moffitt and China. Portions of this constituency get in early -- before the SPA, Moffitt and China fully unfold -- because they like the story and think they understand the opportunity. Other portions jump in after one or more of these events occur. Still others enter the fray as the share price moves higher.

It is fair, now, to both management and shareholders, to measure the resulting movement or lack of movement in share price after the SPA's receipt and Moffitt's explanations, whether you're an investor in Denmark, Germany, Switzerland, Saudi Arabia, Singapore, Hong Kong, New York, Illinois, Texas, Tennessee, California, or in one of many other places in North America, Europe and Asia.

In truth, no one really knows what the company's share price will do until it does it. After the SPA and Moffitt, let's take stock (pardon the pun) of Provectus, management and the share price.

$PVCT's #China #Pharma Process In More Detail

Peter should be off to China in a week. What may or could happen?

A. He secures a deal.
If Peter gets a deal done, he:

1. Returns with the upfront payment,
2. Signs an memorandum of understanding ("MOU") that at least identifies the Chinese strategic partner by name, or
3. Signs a letter of intent ("LOI") with the partner where key provisions (i.e., terms) would have been agreed to by the partner and Provectus to provide the basis for definitive agreements.

Along branches (2) and (3), definitive agreements could be completed, signed and then enable the company to receive the upfront payment within 30 to 60 days.

B. Peter does not secure the deal because the intermediary Provectus used for China is unable to get the strategic partners to do the contemplated deal.
It appears the process of bringing partners to the table, after blessings have been provided by and an agreement has been reached with the Chinese central government, is not dissimilar to an arranged marriage. Potential brides with dowries of different amounts, composition and strategic value in hand assemble in a "room" -- depending on whether the current agent is able to get them into the room (i.e., get them to agree to the general terms and conditions previously approved by the government) -- for Peter and the team that will travel with him to China, to pick. If no bride has a sufficient dowry, he returns to China with a new agent or intermediary, say in another month or more, to renew his attempt to secure a deal. Management believes China will not turn the company down because of strong interest there to do a deal with Provectus.

C. The Board and management elect to turn down a China deal because of Big Pharma interest to do a much larger global license for PV-10.
Enough said.

What are the probabilities of A, B and C? I do not know, although I do have my opinion. Like you, I will wait to see what PR and SEC filing, if any, are issued and made the week of March 4th, and then ask for explanations if necessary.

I have high expectations for management to get a very good deal done if China, if and should they close such a deal. The market and most observers of Provectus have little to no expectations. Expectations may rise closer to the week of March 4th, but more likely only after a deal has been struck and its details made known. To life sciences investors and investors at large, China and Provectus is the ultimate "Show-Me," as they say in Missouri.

My own expectations are in the table below.

A $PVCT Volcano

Generally speaking, volcanoes are not good things. Just ask the citizens of Pompeii.

Aside from you (the reader of this blog) and I, no one in the capital markets really cares about Provectus. Yes, that statement was a bit of hyperbole, but it's reasonably accurate. To be specific, no institutional investor cares about the company's stock. Yahoo Finance! lists near zero institutional or mutual fund ownership.

MSN Money confirms the lack of interest.

Literally no one in the markets, except for you and I, cares about the stock, the drug, the data,... Adam Feuerstein's Biotech Stock Mailbag of last week had the very descriptive statement below about Celsion: "Wall Street largely shunned Celsion until the very end because no one believed its data..."

What did CLSN do in 2012? More than a 4x increase in share price. 2013 of course was another matter...

We're getting closer to a very significant test of the share price. Either there is a volcanic eruption or two in it, or there merely are puffs of smoke. Life sciences and other investors are supposed to buy after the SPA (around March 18th) and again after Moffitt (early-April). That's only 4 to 7 weeks off.

Wendy Selig attended $PVCT's Pete's #BIOCEO13 presentation

Wendy Selig, President and CEO of the Melanoma Research Alliance attended Peter's presentation at BIOCEO13 last week.

@ldtimmerman: "immunotherapy could someday become a standard approach"

Third Rock’s Latest, Jounce, Grabs $47M For Cancer Immunotherapy by Xconomy's Luke Timmerman.

I found the following two quotes interesting.

The key to PV-10 is to properly understand the relationship between chemoablation and immune-mediated signaling. It is what Craig means when he says the immune system responds in direct proportion to the degree of insult. PV-10 chemoablation is the proxy for the degree of insult, which is rapid, complete and durable in the case of PV-10.

$PVCT: "The irony of the situation was apparent to everyone."

Click to enlarge figure

If what I think will come to pass does, the irony of the sequence of events will not be lost on long-time Provectus shareholders. Could the 6-year chart to the right go vertical (on a relative basis to the y-axis describing a share price in the 60-cent range) as a result, finally? After years of patience and impatience, it is hard not to chuckle about the potential for an inexplicable congruence of events.

The SPA: A PR around the week of March 18th?

A China deal: Peter leaves the week of February 25th. A PR during the week of March 4th (with an 8-K filing of an MOU identifying the Chinese strategic partner or an LOI detailing key terms and provisions of a deal with said partner), followed by a closing and funding as early as the week of April 1st (i.e., 30 days later)?

Moffitt: Moffitt's first snippets emerge, followed by the full presentation and contemporaneous peer-reviewed publication. Snippets start sometime in March (a PR or two by Provectus or Moffitt, or both), followed by the full monty in early-April (multiple PRs by either or both parties)?

@MoffittNews' Dr. Jeffrey S. Weber, MD, PhD -- $PVCT KOL

Moffitt's Dr. Amod Sarnaik, MD said, in Provectus' January 8, 2013 PR, "We look forward to verifying the promising pre-clinical data from our ongoing work in this translational study. These results should help elucidate the immunologic basis of the 'bystander effect' noted in previous clinical studies of PV-10 and help optimize PV-10 treatment, particularly in combination with other therapies."

On the bio page of Dr. Jeffrey Weber, MD, PhD, the director of the Donald A. Adam Comprehensive Melanoma Research Center at Moffitt Cancer Center, you will read "As a tumor immunologist & immunotherapist, I focus on translational clinical trials including development of novel trials in melanoma based on my lab work."

What does a translational study in cancer research mean? A translational study turns knowledge from the laboratory into a treatment for patients.

Such is the gravity of what Moffitt should say.

According to the October 2002 paper from the immediately prior link, "[T]he concept of translational research addresses what would be an efficient and orderly way of applying the advanced understanding and technology of the field of biology to cancer treatment. The essence of translational research lies in coming to understand the biological features of a cancer so as to translate molecular biological evidence into clinical anticancer strategies. In other words, "translational research" can simply be defined as the process of determining a treatment solely on the basis of molecular biological characteristics."

The paper goes on to say: "There has been much debate over many years as to the best approach to stimulate immunity against tumors. Previously, researchers involved in immunotherapy ground up tumors and simply gave them back to the patients they were removed from or to other patients. This is not really translational research. At present, there is an understanding that the tumor antigens can be isolated and grouped as to which are more or less likely to provoke an immune response by collaborating with HLA antigens. Knowledgeof this resulted from an understanding of the biology of how antigens are processed. We can now define which peptides in which the antigens have a likelihood of inducing a response when they are presented either as cells or with dendritic cells or in other ways. It can be said that to merely give tumor vaccines without consideration of immune response is not translational. But it is translational to have a selection of antigens based on our understanding of how the immune system operates and which antigens are likely to be or actually are expressed in a tumor, because we are incorporating the biology into the clinical trial design."

Dr. Weber was instrumental in the approval of Vemurafenib (now Zelboraf), saying in April 2012 the success of Vemurafenib represented "the single most dramatic improvement in the treatment of melanoma in 20 years."

According to more of his Moffitt biographic information, Dr. Weber is charged with "...bringing together basic scientists, clinical and translational investigators and prevention/epidemiology scientists in an integrated overall melanoma research effort that rapidly brings new drugs and ideas to the clinic."

"He works extensively with [Dr.] Vernon Sondak...[and] has an extensive history of conducting translational and investigator-initiated clinical trials."

"Dr. Weber’s research interests lie in the monitoring and characterization of T cell responses to vaccination in cancer patients, and in the establishment of in vitro models to facilitate the understanding of how immune modulating antibodies amplify T cell responses in patients. He is also interested in the mechanisms by which achieving autoimmunity induces regression of cancer."

Such is the gravitas of Moffitt's Dr. Weber.

$PVCT: Rose Bengal Partitions into Diseased Cells Preferentially

The prototypical halogenated xanthene, Rose Bengal, as well as other halogenated xanthenes partition preferentially into diseased cells. The intellectual property underlying this aspect of Rose Bengal (and its brothers and sisters) have features that either are patented or better served held by the Provectus as a trade secret.

Jounce to focus on #cancer #immunotherapy

Third Rock Ventures Launches Jounce Therapeutics with $47 Million Series A to Transform Cancer Treatment

Cancer start-up will get $47m

Third Rock bankrolls cancer immunotherapy upstart with $47M A round

Having lived the early-2000s as an information technology (mostly, but with some life sciences investments because of our relationship with the National Cancer Institute) corporate VC, did I learn anything?

Yes, among them, watch for signs.

#FDA Breakthrough Therapy Designation

A Bloomberg article earlier in the week discussed "breakthrough status" for drugs to "...have closer communication with top FDA staff to move drugs for serious diseases to market more quickly, potentially with data from an expanded Phase 1 trial." Breakthrough status would be more applicable to Provectus' liver work than the company's melanoma work.

I asked management if Provectus submitted a request for Breakthrough Therapy designation for PV-10. As with the SPA process, it is unlikely the company will publicly discuss submissions for this process. Rather, should management secure this designation for PV-10, the market will read about it via a company PR.

$PVCT: HemOnc Today #Melanoma and Cutaneous Malignancies Conference

Several PIs are participating, but it is unclear to me at the current time if the company will participate in some way. I imagine Dr. Andtbacka's Current Status of Injectable Therapy presentation may mention or reference PV-10.

The agenda is here.

$PVCT's #China #Pharma Two-Step

In researching Provectus' China go-to-market strategy, I investigated Celsion's approach, among others. Other folks weighed in on their experiences and with their thoughts.

Celsion first partnered with local pharmaceutical manufacturer Zhejiang Hisun Pharmaceutical ("Hisun") in May 2012 on a commercial supply agreement. According to Celsion, Hisun would "...collaborate with Celsion around the regulatory approval activities for ThermoDox® with the China state Food and Drug Administration (SFDA). A local China partner affords Celsion access to accelerated SFDA review and potential regulatory exclusivity for the approved indication." An equity analyst covering the company noted "...partnering with a local company should foster
good relations with the government for Celsion." In January 2013 Celsion announced reaching terms with Hisum on a commercial license agreement. Step 1, commercial. Step 2, government.

Provectus did the China two-step in a more recognized fashion: Step 1, government. Step 2, commercial. It appears the company first established a strong, formal relationship with the government (e.g.,  Premier of the People's Republic of China, Ministry of National Defense, Ministry of Health, SFDA) directly and indirectly through Provectus' regional agent, culminating in Peter's November 2012 trip.

Peter's February 2013 trip should result in establishing a license relationship and agreement with a Chinese commercial partner and marketer, whether it is one of the companies in the table below or Hisun.

$PVCT's prospective #China #Pharma partner is...

Regular readers of this blog know of my belief that Pfizer ultimately will be the end-game acquirer of Provectus. I have long held, even before I began writing this blog in November 2012, that Pfizer is the most natural and logical of the Big Pharma to acquire the company. It's not a given by any stretch, but I think Pfizer is the leading candidate and then some at this point in time.

Thus far, the two public Pfizer data points are a joint patent application filed by Provectus and Pfizer in March 2012, and the addition of Pfizer's Dr. Eagle added to Provectus' corporate advisory board in August 2011. There are several other data points one can learn about while doing due diligence on the company.

It appears, the latest datapoint has been staring me in the face for a little while.

We know Provectus is currently interacting with potential partners for regional licensure in China, India and Japan, according to recent Craig's Noble presentation. I have written about a China deal somewhat ad nauseam.

Moffitt has to educate the global oncology community about PV-10's clinical relevance. Provectus has to obtain the SPA. And, the company has to get valuation way up through, for example, a sizable regional license deal like in China. From there, and with interim MM Phase 3 trial data, enough boxes may be checked for Pfizer (or another Big Pharma company) to take Provectus out.

If I am Pfizer (Dr. Eagle) and want to keep a close tab on the company, or just keep the company close, I steer them to a friendly in China rather than let Provectus partner up with a Chinese pharma company with whom I have no relationship or that has a relationship with one of my Western competitor. Just saying...

Who are Pfizer's partners in China? Which one of them is the potential or a more likely prospective Chinese strategic partner?

A. Sinopharm Group? Pfizer and Sinopharm appear to have begun collaborating in 2012.

B. Shanghai Pharmaceutical Co.? Pfizer and Shanghai Pharma, in whom Pfizer also invested, begun working together in 2011.

C. Zhejiang Hisun Pharmaceutical? The Pfizer-Hisun relationship may have begun as early as 2010. In early 2012, Pfizer and Hisun announced progress on a potential joint venture ("JV") between the two companies. In late 2012, Pfizer and Hisun announced the launch of the JV. Pfizer indicated the JV also would include "medicines to China to address the country's unmet healthcare needs."

D. Someone else?

Follow the money; that is, the relationship into which Pfizer put more money. Shanghai or Hisun? Investment or working relationship or both? The most invested and substantive relationship Pfizer has in China appears to be with Hisun. If I think Pfizer ultimately will acquire the company, it seems to me consistent to then think Hisun could (will?) be a (the?) potential pharma partner for Provectus in China.

Now, if the partner is Hisun-Pfizer Pharmaceuticals Co., the JV...well, that's a more interesting data point.

$PVCT: Source of the Short and the Selling?

From a Form 13-G filing today by Revelation Special Situations Fund, the fund's position dropped from 5.21% reported in February 2012:

To 2.22% reported in February 2013:

This activity may be the source of the short reported 1/31/13 and what seems as relentless selling of the stock.

$PVCT Poll Results!

Many thanks to those of you who participated in the blog's first poll. We will do more of them. The results of the one-week reader poll are:

More than 4-out-of-10 chose a China deal as the company achievement that would have the greatest impact on share price in Q1.

Provectus is pursuing a $30B market opportunity in China for melanoma and liver, bladder and lung cancer. The deal, if struck, could be worth about $1 billion or more.

The sketch below outlines a very basic outcome tree.

Peter travels to China in late-February (the week of February 25th):

• He returns with no deal after however long the duration of his trip is, which would suck!
• Peter returns with a consummated license transaction reasonably or objectively valued at more than $1B (and potentially much higher). It is possible the deal and its component parts (i.e., upfront, milestone and royalty payments) are much lower than expected, but probably unlikely. A $1B+ deal would, of course, rock!
• Alternatively, he enters into, on behalf of Provectus, an exclusive letter of intent with the Chinese strategic pharmaceutical company partner for a regional PV-10 license.

The signed letter of intent should be a material event that is important to shareholders, and thus the company would file a Form 8-K.

When Celsion entered into a technology development agreement for ThermoDox for China with Hisun and anticipated the eventual completion of a commercial license, the company filed a Form 8-K and issued a PR that detailed the key provisions of the anticipated license agreement negotiated and agreed to by Celsion and Hisun. Those provisions would provide the basis for a definitive contract between the two parties. As I wrote before, the Celsion deal essentially was a license transaction call option owned by Hisun. Positive ThermoDox results were necessary for Hisun to exercise its option to further negotiate an eventual license transaction for China, Hong Kong and Macau. The two companies never finalized, completed and funded the license deal because Celsion's Phase 3 trial failed and Hisun thus neglected to exercise its option.

For Provectus, should the company announce entry into an exclusive letter of intent to complete a commercial license with a Chinese partner, some 60 days or perhaps less could elapse before the deal is finalized, funded and completed. By or before late-April?

I cannot imagine management would do anything other than a traditional license transaction with the Chinese strategic pharma partner (that is, no Celsion/Hisun or Opexa/Merck Serono call option licensing deal). We'll know soon enough after Peter returns to Knoxville from China. I'll keep an eye out for Provectus 8-K filings on the SEC website starting the week of March 4th.