Moffitt Cancer Center

How does a paradigm shift in a highly regulated industry like pharmaceuticals? Change happens through acceptance and adoption. How does a disruptive technology disrupt in a highly regulated industry like pharmaceuticals? Acceptance and adoption by the governing regulatory body, the FDA, needs to occur, and it facilitates (invites) the disruption. Ultimate validation for Provectus only comes with an Agency stamp, which should begin with attaining a breakthrough therapy designation for PV-10 Provectus says it would request in 1Q14 and for which it would expect a response within 60 days of FDA receipt.

There is no doubt of Big Pharma's challenge: "More innovation. Better innovation. Affordable innovation." "Breakthrough must be seen through the eye of the patient (user), not the scientist. Gleevec is a breakthrough… so is Augmentin, Zocor, Aranesp, Humulin. Lipitor is not a breakthrough" (Source: The State of Pharmaceutical Innovation, Bernard Munos, InnoThink Center For Research in Biomedical Innovation, July 2012). Entrenched incumbents in a highly regulated environment with substantial balance sheets facing their so-called Kodak moment can draw out the inevitable. It takes is time..."This thing all things devours; Birds, beasts, trees, flowers; Gnaws iron, bites steel; Grinds hard stones to meal; Slays king, ruins town, And beats mountain down."

Until we learn more about the regulatory path to approval, what more has Moffitt Cancer Center to say about PV-10?

When I wrote in my September 2013 investment letter PV-10 exemplifies innovation over incrementalism, meaningful over marginal, productized technology over hypothetical, and changing the world over accepting the status quo, with not an insignificant amount of serendipity over contrivance...[i]n sum...the quintessential essence of a paradigm shift in the treatment of cancer, I refer to the disruptive nature of this life sciences technology from a user (patient) perspective: very safe, very effective, very inexpensive. The speed of adoption and acceptance (assuming first and foremost a regulatory embrace) relies on the breadth and depth of the customer (user (patient)) value proposition, and the convergence of the swirling winds of change impacting the industry's operating environment. As a giant pharmaceutical company, you no longer can sustain a business that charges tens and tens and tens and...of thousands of dollars for oncology drugs that fail to offer more than nominal tumor destruction, fail to meaningfully prevent recurrence, and fail to meaningfully overcome drug resistance.

While Provectus' stated path to initial approval in the U.S. for PV-10 would be locally advanced cutaneous melanoma, Moffitt's translational research work on the drug has been "...to find out more about how PV-10 works in melanoma tumors...[and] changes in the body's immune cells (cells that fight infection and illnesses) after PV-10 is given, both inside the melanoma tumors and circulating in the blood." As a patient, enrolling in Moffitt's Phase 1 feasibility study is not about seeking a clinical trial to successfully treat your affliction (NCCN guidelines suggest seeking a clinical trial as a treatment option for certain stages of melanoma). Rather, this pilot study is about agreeing to be experimented on by Moffitt researchers, presumably for the betterment of others (what Moffitt learns about PV-10 could help many more patients). One would hope the enrolled patients beneficially exit the trial having received sufficient successful PV-10 treatment (after researchers have literally extracted the information they desire and require).

Moffitt's August 2013 press release revealed their preliminary understanding of PV-10's "one shot one kill ability:" Single Injection May Revolutionize Melanoma Treatment, Moffitt Study Shows. If enough PV-10 is injected into a melanoma tumor -- the volume of PV-10 for injection (the amount in milliliters) should be proportional to the volume of the tumor -- the tumor is destroyed. For other indications, like liver or breast cancer, I imagine the surrounding organ or body tissue would influence the required drug volume. For example, PV-10 per unit volume of melanoma tumor should be different than PV-10 per unit volume of breast tumor because the makeup of skin tissue should be different than the makeup of breast tissue.

PV-10 is both a targeted therapy, and an immunotherapy. As a targeted therapy, it quickly destroys the tumor into which it is injected through its rapid ablative effect, which is the basis for the company's regulatory approval value proposition (locally advanced cutaneous melanoma). As an immunotherapy, the drug generates a systemic tumor-specific immune response in which Moffitt is interested and that has formed the basis for the center's work to date (and which would provide additional data and knowledge to expand the label over time). Although immunotherapies win over targeted therapy because of long tails, there is value to combining their benefits. It's great if your drug does both.

When we last heard from Moffitt (aside from their August 22 PR), pre-clinical murine study work, the center concluded: "...intralesional PV-10, in addition to reducing the growth of a directly injected tumor, leads to the induction of a robust anti-tumor T cell response and supports the use of PV-10 to induce systemic anti-tumor immunity for the treatment of metastatic melanoma and breast cancer."

Moffitt last presented PV-10-related results at the April 2013 Annual Meeting of the American Association for Cancer Research: PV-10 Data Presented by Moffitt Cancer Center Researchers Examines Induction of Systemic Immune Response in Multiple Tumor Types (prior to that, the March 2012 annual meeting of the Society of Surgical Oncology). The 2014 AACR meeting runs from April 5-9. I imagine we may learn more about the center's pre-clinical and clinical work. While unlikely because Moffitt's clinical work is a Phase 1 study, there of course is the 2014 Annual Meeting of the American Society of Clinical Oncology from May 30-June 3.

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What's next?

I'm sure Moffitt researchers are interested in a lot of things as it relates to PV-10. The February 2013 Cancer Watch article about the Phase 1 study noted: "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." Producing lots of T-lymphocytes isn't the issue or challenge. Producing lots of good to great ones is. I imagine Moffitt succeeded in getting their "yes" or "no" answer. I also am curious whether the center is looking at a PV-10 injection into a tumor as an in vivo (in the body) adoptive cell (T-cell) transfer "mini-reactor." Ex vivo (out of the body) adoptive cell transfer ("ACT") therapy is expensive, and limited for now to centers with the expertise and resources (like the NCI, MD Anderson, Moffitt).

At AACR 2013, Provectus also presented a poster entitled Combination of PV-10 Immuno-chemoablation and Systemic Anti-CTLA-4 Antibody Therapy in Murine Models of Melanoma, concluding that for "visceral or other inaccessible disease the combination of PV-10 with CTLA- 4 blockade has important potential for synergy." Given PV-10, according to the company, has no known toxicity nor no known resistance, its combination with PD-1 drugs, among other immunomodulatory agents, may allow these drugs to better function by overcoming the body's eventual resistance to them. Perhaps Moffitt may discuss this as well.

One of my favorite songs...

Big Pharma has a Shrinkage Problem

Big Pharma can't kill tumors. “We are pretty good at shrinking tumors, but not good at getting rid of them. Immune therapy is a way to begin to approach that.” -- Merck senior vice president Gary Gilliland (from an article by Robert Langreth on May 12, 2013)

I think most people would agree killing tumors should go a long way in fighting, arresting and perhaps even killing cancer. Medical literature discusses the positive correlation between complete response -- the tumor, after treatment, goes away -- and overall survival, "...the gold standard primary end point to evaluate the outcome of any drug, biologic, intervention, or procedure that is assessed in oncologic clinical trials."

Big Pharma is making process. Stabilizing the disease, by preventing the further growth of cancerous tumors, is good. Shrinking them is better.

Killing them is best.

While Big Pharma's oncology drugs and drug candidates are increasingly demonstrating better overall responses (or overall response rates), complete response plus partial response (shrinking the tumor), it's struggling to improve complete response (killing the tumor).

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And it doesn't look like Big Pharma will solve the problem of killing tumors -- achieve better complete responses -- anytime soon, because it appears pharmaceutical companies are hitting a ceiling for complete response.

From my November 23, 2013 post [We] now believe...[we] have sufficient information to seek regulatory approval: I read an interesting abstract at the 2013 Society for Immunotherapy of Cancer ("SITC") Annual Meeting, co-authored by Martin Ashdown and Provectus principal investigator Brendon Coventry: Mathematical modeling of immune kinetics in advanced cancer through meta-analyses of complete response rates: immune synchronisation emerges as the likely key determinant of clinical response. Ashdown et al.'s work comprised a meta-analysis of 130 clinical trials, 8,000 patients, different solid tumor cancers, and standard chemotherapy, targeted therapy and iimmunomodulatory therapy compounds IL-2, ipilimumab, tremelimumab, cytotoxic agents, TMZ, dabrafenib, vemurafenib, PD-1s (BMS, Merck) and a PDL-1 (Genentech).

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Ashdown and Conventry concluded:"Mathematical analyses of over 130 clinical trials, inclusive of over 8000 patients, has demonstrated that the CR rate for patients treated with widely divergent therapies is remarkably fixed at between 5 and 10%. The probability of this occurring by chance alone is extremely close to zero, and is both scientifically and clinically implausible. Therefore, an underlying predictive operative biological mechanism must apply. It is highly likely that the known principles of immune kinetics between effector and regulatory homeostatic functions must therefore determine a degree of immune synchronization to produce these observed CR’s. We have derived a mathematical model and equation using the principles of controlled homeostatic systems, which can be used to explain our meta-analysis findings, and the clinical efficacy." Bold and underlined emphasis is that of Ashdown et al. from their SITC poster presentation.

Why? [Now] You Know Why.

Sometimes, it's what isn't said that may be as important or more so than what's said. Sometimes, it's not just how you say what you say, but how you say what you don't say.

We don't talk at all about serious adverse events ("SAEs") related to PV-10 trials and the compassionate use program ("CUP"). We rarely talk about AEs in general, aside from the mild to moderate ones experienced thus far in the trials and CUP.

Sometime between last year, sometime, and this year, sometime, Provectus arrived at an agreement with the FDA on a special protocol assessment ("SPA") for its pivotal metastatic melanoma ("MM") Phase 3 trial. How do I know? I don't. Do I know for sure? No. If one presumes or contends management is feckless or incompetent, then they're still working to convince the FDA that the local agent PV-10 has some sort of value, and wasting value cash in a pointless task. The SPA still is M.I.A.

I don't presume anything of the sort, even though there have been breadcrumbs of the SPA scattered among company communications and medical conference presentations, that tantalize us about parameters, timing, enrollment, etc. With each of these crumbs we thought the SPA and trial commencement are upon us, or within our grasp.

I think the breakthrough therapy designation ("BTD") arrived essentially in the middle of the process of management working towards the SPA with the Agency, "upsetting" the old SPA path and setting the company onto a new BTD one (whether in parallel, or as an extension). I'm guessing the supposed agreement was verbal in nature, proffered to Eric and his regulatory team, but set it aside in pursuit of an accelerated path to approval.

But, not everyone sang from the same hymn book. In hindsight, those "off key" notes were prescient.

It's not a bad thing the SPA up and vanished like a fart in the wind. It's the "good" option. It always has been. Interim Phase 3 results would provide Big Pharma with the traditional data they required to consider a worldwide license or acquisition of the company.

It might feel to some like we've been down this road before. High expectations: 2010. Accelerated approval. 2012. SPA. Today, nothing...yet.

Is this time different? Everyone seems to be singing from the same hymnal. Finally.

The current regulatory affairs narrative seems to have several facets to it:

• The company has filed its BTD application. Previously, there'd been, at times, an almost absurd did-they-file, did-they-not-file charade to the process.

• The company filed for BTD around October 1st, starting the/a so-called 60-day clock. Adding about 15 days because of the recent partial federal government shutdown (precisely, October 1-16), an expectation for communication from the FDA on this conceivably could come around or before mid-December. Since you never know about federal government mailrooms, and with business time inevitably slowing after Thanksgiving, it's conceivable Provectus, and thus we, don't hear until the end-of-December or January.

• The BTD process to date [sort of] works like this: Work with the FDA and their process, such as it is, get "pre-qualified," and you get BTD. 100% of the companies [purportedly] that worked with the Agency in such a fashion received the designation. Don't work with the FDA, don't follow their process, don't get pre-qualified, and you don't get BTD. 100% of the companies [purportedly] that did not work with the Agency in the required fashion did not receive the designation. Provectus worked with the FDA. So, they'll get BTD, right? BTD was the "better" option.

• They asked for a meeting with the FDA to discuss BTD, and how (how best?) to request accelerated approval ("AA") or outright approval ("OA") in this context. I don't believe management has any doubt, and if one of them has it's small or de minimis, that they've successfully demonstrated PV-10's clinical value proposition for MM Stage IIIb-IIIc patients refractory to prior treatments. AA/OA was the "best" option.

I said I wouldn't discuss the details of my call with Dr. Weber, but here's a small perspective of how he said what he said, and how he said what he didn't. I have no doubt he is very experienced talking to "outsiders" like me. Dr. Weber was generous with his time, and thoughtful in his answers. "Methought the professor dost protested too much."

The commercial validation narrative appears singular: Regional deals and the Big Pharma end-game follow regulatory clarity.

[Now] you know why.

Tipper: You know what? I can get a couple of my brother's loser ass friends to go over to Mason's apartment, knock on the door and when he opens it wham! They'll junk-punch him all up in his man business and he'll fall to the floor whaling and crying "why?" and then we'll say "you know why!" (What Happens In Vegas)

$PVCT Blog Reader Cracks Me Up

Been reading your blog for a year now. Informative, well thought out, interesting, amusing, irritating. It's everything it should be. Am holding 50k shares-bought cheap and losing it all will not change my life. Having said that, any rise in price will be a nice surprise. I intend to ride the horse until he either dies or makes it back to the stable. One final thought. You are one optimistic, glass half full guy.

Classic. Thank you.

ASCO 2013: Overcoming Resistance to Cancer Drug Therapy: "Dr. Charles Sawyers, MD, current President of the American Association for Cancer Research (AACR) on June 2nd 2013, received the American Society of Clinical Oncology (ASCO) 2013 Science of Oncology Award and subsequently gave a plenary lecture on overcoming resistance to cancer drug therapy."

The author of the above Storify, Pieter Droppert, wrote that Dr. Sawyers said "...drug resistance is universal. It represents one of the key challenges in cancer treatment" and that "...we need to combination therapy faster in order to overcome cancer drug resistance."

Moffit's Dr. Jeffrey Weber's interest in and excitement over PV-10 is much clearer to me, only once I better understood (realized) Dr. Sawyer's message, which I repeat by writing that the heart of the matter to researchers and clinicians is utilizing combination therapy as a way to overcome drug resistance.

Combination therapy is very important to Moffitt Cancer Center and Dr. Weber because, presumably, they believe it is the key to addressing and potentially overcoming drug resistance.

PV-10 is very important to Dr. Weber et al. in no small part because Dr. Weber and his Moffitt colleagues believe they can overcome resistance to cancer drug therapy with PV-10, due to this drug's unique mechanism of action and orthogonality with other drugs (in addition to its efficacy, safety, and beneficial features of being both a targeted therapy and an immunotherapy).

I Think it's a Good Time to be a $PVCT Shareholder

Shareholders are closer to the end-game for the stock than to their journey's beginning. The company's  life sciences technology is head and shoulders above its peers. The lead compound presents a compelling clinical value proposition capable, perhaps, of indeed shifting the paradigm of cancer treatment (and treatment of inflammatory skin disorders). The drug already is productized, with a product business proposition to match that of the underlying technology. Provectus appears to be nearing transparency regarding regulatory clarity for oncology. The company also appears to be nearing certain license deals that will provide initial market validation. In sum, management, Provectus and its shareholders are nearing the end-game.

Provectus' technology is a game changer, productized to effect the change, and can be delivered and scaled to profit from the change to come.

The technology, PV-10 for oncology, is an effective local treatment capable of as effectively treating distant disease and visceral metastases. The drug, through expression of antigens in context in tumors into which PV-10 is injected fortifies the immune system against cancerous agents. Immunization occurs because PV-10's chemoablation causes rapid, complete, durable necrosis of tumor lesions.

"Scientists have been trying for decades to understand why the body's immune system didn't see cancer cells as the enemy and attack them. Recent discoveries revealed that tumors are adept at cloaking themselves by hijacking the body's own mechanism for preventing the system's T-cells, the infection- and disease-fighting cells of the immune system, from running amok against healthy tissue."

The above quote from Wall Street Journal (WSJ) article New Cancer Drugs Harness Power of Immune System (5/15/13) is not quite on-point. Rather, the quote below from Bloomberg article Human Immune-Boosting Cancer Drugs Seen Extending Lives (5/12/13) is more to the point.

"Now many believe that by strengthening the immune system’s ability to identify and kill cancer cells, they can broaden the attack so it will fight any dangerous malignancy. “You’re setting up a fair fight” with the disease, said Nils Lonberg, a senior vice president at Bristol-Myers, in a telephone interview. “The immune system is just as adaptable as the cancer.”"

How do you strengthen the immune system? Medical science has done it before with infectious diseases. Immune systems can be overwhelmed and, thus, are unable to help the human body fight back. Antibiotics themselves do not cure patients of infectious diseases that have afflicted them. Rather, the immune system cures the hosts with the help of antibiotics. Treating infectious diseases requires that antibiotics should have near absolute specificity for the infectious agent. Tough infections require multiple agents.

I think it's a good time to be a Provectus shareholder.

The volume of the conversations about immunotherapy has grown much, much louder. Take Xconomy's Luke Timmerman's article Genentech Follows Fast at ASCO as Cancer Immunotherapy Picks Up (5/15/13) for example.

"Genentech made its name in cancer by creating targeted antibody drugs that zero in on tumor cells while mostly sparing healthy tissue. Now it’s seeking to compete in the next wave of cancer immunotherapies, which are designed to spark the immune system to attack tumors like a virus."

Or take NBC's Nightly News report Immunotherapy targets cancer cells with remarkable results (5/15/13).

"Cancer cells typically put up a chemical shield to protect against the body’s disease-fighting T cells. But immunotherapy can break down the shield and let the T cells get to work."

The more the biopharmaceuticals industry, investing community and general public talk about immunotherapy, the better the environment or atmosphere for PV-10 and Provectus to flourish.

From the same WSJ article above: "More broadly, Leerink [Swann, a middle market investment bank] believes the "immuno-oncology" drug market could amount to a $20 billion category annually, putting it on a par with the cholesterol-lowering statin market at its height."

From dendritic cells (Dendreon's Provenge) to antitumor antibodies (Bristol-Myers' anti-CTLA-4 agent Yervoy) to immune checkpoint blockades (ASCO 2013's anti-PD1 and anti-PDL-1 agents):

"The immunotherapy of cancer has made significant strides in the past few years due to improved understanding of the underlying principles of tumor biology and immunology...[t]he pillars of human cancer therapy have historically been surgery, radiotherapy, and chemotherapy, but a fourth modality of immunotherapy has been well documented since 1890..." (Kirkwood et al.).

Big Pharma is tacking closer to the ultimate goal, but they mostly still are sailing wide of the objective.

"If the new generation of immune therapies lives up to its promise, “this is going to be a paradigm shift for treating cancer,” said Merck senior vice president Gary Gilliland in an interview. “We are pretty good at shrinking tumors, but not good at getting rid of them. Immune therapy is a way to begin to approach that.”"

Yes, Big Pharma is pretty good at shrinking cancerous tumors, but not yet good enough at making them go away.

Craig's postulation that you treat cancer like you treat an infectious disease requires a/the drug treatment to possess near absolute specificity for diseased tissue (spare normal tissue and clear rapidly from it) and induce a host response (combined apoptosis-autophagy of treated targets because intralesional delivery produces a “vaccine-like” systemic effect that enhances normal human body defenses) over a very wide range of activity (broad spectrum antibiotic-like)


PV-10 chemoablation causes rapid, complete, durable necrosis of tumor lesions.

I think it's a good time to be a Provectus shareholder.

The general discourse at the moment about immunotherapies, however, is far from well understood or a consensus. Take last week's exchange on Adam Feuerstein's Twitter feed @adamfeuerstein below.

Feuerstein had been explaining the fundamental bear case for Vical's Allovectin-7, but aside from perhaps some valid trial design questions, his "red flags" included a lack of positive statements by melanoma experts and institutional healthcare investors as well as a lack of immune-related toxicity by Allovectin-7. Church is not a fan of immune-related toxicity because of the long-term dangers of altering the immune system in order to use it. All of this despite the on-point replies of other respondents: directing T-cells to attack tumors rather than a broad uncontrolled response, the beauty of local treatment is limited toxicity, revolutionary if the local treatment works on visceral mets, etc.

Many monoclonal immunotherapies do cause terrible toxicities, which are related not just related to "taking the brakes off" the immune system. Their target antigens are not only on/in the immune cells they wish to suppress. Just like chemotherapy agents, immunotherapy agents also can cause collateral damage with more adverse side effects like cancer and death.

The nature of the conversation Feuerstein, Church and the others need to have has to be deeper and more substantive. It's too simplistic to say Allovectin-7 does or will not work. Whether it's Allovectin-7 or talimogene laherparepvecone (T-Vec, formerly OncoVEX), or PV-10 itself, one has to balance positive effects with side effects. Think of it as a biological signal-to-noise ratio. One can titer up dosages until one sees bad things happen.

I think Pfizer probably refused to do this with its anti-CTLA-4 agent tremelimumab, which is why it has a greater failure record in clinical trials than it's Bristol-Myers' ipilimumab. Bristol-Myers probably had a higher tolerance for "bad things to happen" in order to suss out the optimal or near-optimal signal-to-noise or benefit-to-side-effect ratio.

Remind yourself of Provectus' combination therapy work at AACR 2013 utilizing PV-10 and a systemic anti-CTLA-4 antibody. The highest dose of the latter killed the murine subjects more quickly. Lower doses were less effective but also less dangerous. Interestingly, the results the company concluded that while PV-10 is highly effective when all existing tumor is accessible for injection, for visceral or other inaccessible disease the combination of PV-10 with CTLA-4 blockade has important potential synergy. Nevertheless, the apparent toxicity at high doses of the anti-CTLA-4 antibody markedly reduced the effect of the antibody alone and the combination of PV-10 and the antibody.

If an immunotherapy is working, there has to be some response (e.g., inflamation, redness, blistering, itching, etc.). These "side effects" come with the territory, and merely are signs the immune system is now in the game. So, while one indeed is generating a toxic response by recruiting the immune system, the key is focusing this toxicity as much as possible.

The problem with Yervoy, and perhaps immunotherapies like anti-PD-1, anti-PDL-1 agents and other treatments, is the collateral damage they cause to the body. PV-10's great strength has been and is its ability to the target only what it kills and kill only what it targets. Another strength is the drug's ability to generate a very specific, targeted, immune response with very little collateral damage to anything but the tumor itself. So, some blistering occurs, body temperature rises, etc. Nothing more.

I think it's a good time to be a Provectus shareholder.

Still, regulatory clarity has to become transparent. Is it an MM Phase 3 trial under SPA powered for for a 6-month progressional free survival for PV-10 vs. 2-month plus PFS for the comparator DTIC?Or is it breakthrough designation therapy and accelerated approval or another accelerated pathway?

Further still, commercial validation through one or more meaningful license transactions (global, regional, dermatology) is required. For example, will it be Hisun-Pfizer Pharmaceuticals in China? Or another company or entity? The Hisun-Pfizer joint venture was established in 2012 to sell off-patent medicines in China and other emerging markets. But economics are economics. Pfizer's 49% equity ownership and thus 49% ownership of any PV-10 sales in China would be a strong inducement to widening the entity's mandate through a license deal with Provectus.

Who will it be in India? In Japan? When will PH-10 be licensed, and to whom?

Provectus is squarely in the eye of key cancer patient advocates. The company participated in Melanoma Research Alliances' (MRA's) Fifth Annual Scientific Retreat in February. In April Peter joined MRA's President and CEO Wendy Selig, LiveSTRONG's President and CEO and Provectus corporate advisory board member Doug Ulman, Moffitt Cancer Research Center's Dr. Shari Pilon-Thomas and some media for dinner.

Key opinion leaders like Moffitt's Dr. Jeff Weber and Dr. Vernon Sondak and Pfizer's Dr. Craig Eagle are enthused about PV-10 as both a monotherapy and combination therapy.

More data is on the way. And data is driving and will drive the deals.

Yes, I think it's a good time to be a Provectus shareholder.

Big Pharma: "We are pretty good at shrinking tumors, but not good at getting rid of them."

Houston, Big Pharma has a problem. Lots of drug candidates, and lots of shrinking. But Big Pharma still cannot get rid of cancer tumors.

A blog reader forwarded me Dr. Sally Church PhD's post on ASCO 2013 highlights of PD-1 and PDL-1 immunotherapy, which are capturing media attention. Thank you. Her key points include (a) too much focus on overall respons rate (ORR), (b) ORR is a measure of disease control, not disease cure or a measure of response durability, (c) being sure to compare apples to apples when examining these ASCO abstract results, and (d) ORR not being an ideal endpoint, but rather how long do patients live, do they feel better and do they have a better quality of life.

ORR = CR + PR. Overall response rate equals complete response plus partial response. From RECIST criteria, CR (complete response) = disappearance of all target lesions, and PR (partial response) = 30% decrease in the sum of the longest diameter of target lesions.

PV-10's clinical value proposition is very simple: Very safe. Very efficacious (effective). Very useful (on many different solid tumor cancers).

Key, within this value proposition, are how high CR is -- the elimination of tumors, not merely the shrinkage of them -- and the durability of the response to PV-10 -- one the tumors are eliminated, they don't come back. Thus, PV-10's more nuanced value proposition: Permanent elimination.

Only shrinking tumors, but not fully eliminating them, has the effect of allowing resistance to build up to drug treatment. Harnessing the immune system to turn tumor heterogeneity on its head is facilitated by tumor elimination.

Other historical therapies -- from the previous standard of care of DTIC to anti-CTLA-4 agents like treme and ipi to intralesional therapies immunotherapies like Allovectin-7 and OncoVex (T-Vec or talimogene laherparepvec) to emerging immunotherapies like anti-PD-1 and anti-PDL-1 agents -- do not have the complete response of tumors that PV-10 generates.

Merck's anti-PD-1 agent that received breakthrough therapy designation:

In the Phase 2 trial, there was an 80% treatment success rate of individual lesions with an associated complete response ("CR") of more than 50%. Think of a set of data comprising all lesions treated, irrespective of patient. Success was achieved in 80% of these datapoints. 80% success was achieved despite limited treatment (i.e., 1 initial injection and up to 3 additional injections), physician error while injecting lesions (i.e., some lesions were improperly injected), patients and their lesions left the trial, and patients with compromised immune systems and ravaged bodies from failed prior treatments had their lesions injected.

Final results of patients included:

$PVCT: China vs. The World

Big Pharma interest in a global license of PV-10 steadily grows. Regional license interest in PV-10 also is growing.

On page 20 of the recently filed S-1: "The geographic areas of interest for PV-10 principally include China, India, Japan and Middle East and North Africa (MENA). We are also considering the global licensure of PV-10 as well since it has come to our attention that this is of interest to potential partners."

The world continues to get smaller and smaller. Big Pharma operates where it does and can -- mainly, the U.S. and Europe, and also elsewhere -- but with an eye to so-called developing markets (recall the now or near obsolete BRIC moniker for Brazil, Russia, India and China), and beyond, where it has entered as foreign wholly owned subsidiaries together with partnerships and joint ventures with as well as acquisitions of local players.

I appreciate management's enthusiasm and persistence in pursuing a regional license deal in China. In the S-1 mentioned above: "According to Global Cancer Facts & Figures, 2nd Edition, liver cancer is the fifth leading cause of deaths related to cancer in the world in men and seventh in women. Approximately 750,000 people are newly diagnosed annually with primary liver cancer, also known as Hepatocellular carcinoma (HCC), with China alone accounting for about 55% of the cases diagnosed each year. The world market for liver cancer drugs is projected to exceed $2.0 billion by 2015 and does not include the full impact of the China market potential." Like with most things China-related, it is Big Pharma's new frontier, and a monstrously-sized addressable market at that.

I also understand and appreciate management having to balance enthusiasm for and the potential of near-term cash upfront with China with Big Pharma interest in a global PV-10 license.

I don't want management to do a premature or cheap China deal simply for the cash or to bump up the share price, and diminish the value of a global license and/or the end-game. On the other hand, I don't want management to pursue a global license without taking into consideration sufficiently raising valuation through a string of regional deals before giving way to a global license and/or the end game. I don't think management is doing either.

Rather, regional deals like China (and others) are being considered in the context of a global license and the end game, and vice versa.

$PVCT Europe Bound

Peter leaves for Europe on Monday for business development activities, which may include meetings with some or all of prospective pharma partners, industry KOLs, potential investors and existing shareholders. This trip appears more focused on partners and partnerships.

$PVCT: Big Pharma Interest

This blog is one of the primary sources of information about Provectus. 

The blog can see, among several other things, where visitors come from (e.g., IP address, city, state/region, country, etc.) and how often they stay and read (page views, visits, visit lengths, etc.). Anytime you visit any destination on the world wide web, you are being tracked. Unless you use something like Tor to protect your privacy.

About 10 days ago I speculated about Daiichi Sankyo interest in PV-10. Why? Because...

First, folks from Daiichi Sankyo ("DS") in Japan visited multiple times and spent many, many hours on the blog. These visitors' IP address(es) originated from the pharmaceutical company's headquarters in Tokyo.

Then, folks from DS in the U.S. visited the blog. These visitors' IP address(es) originated from the pharmaceutical company's U.S. headquarters in Parsippany, New Jersey.

So, I began connecting dots available to connect; those above, and others. I think DS has been informal (formal, in this context, means one engages the target company) doing due diligence on Provectus. Why? For one thing, simple activities like scouring web-based sources of information and data is merely one way of doing due diligence on a target, without directly engaging the entity in which you're interested. If you spend a lot of time reading a blog about a biotechnology company not written by said company, you're either really bored or really interested. For another, historical information about Daiichi Sankyo does suggest they can and will do global licenses. DS is a global Big Pharma company, with additional regional interests in Japan and India (through Rambaxy Laboratories) and maybe elsewhere in Asia Pacific. For example, in February 2011, Daiichi Sankyo announced its acquisition of Plexxikon for $805 million up-front and near-term milestone payments associated with the approval of PLX4032 (vemurafenib, now Zelboraf) for up to an additional $130 million. The deal closed in April.

The next course action would be to ask various questions of Provectus management and gauge their responses, should of course they respond to questions about this topic.


At his presentation in New York in March, Craig noted Provectus was in the due diligence process of a pharmaceutical company for a global license. One presumes he did so because this Big Pharma had formally approached Provectus and were in formal due diligence with the company.

Is DS in formal due diligence with Provectus yet? If so, DS would make at least two Big Pharmas with a stated interest in the company.

If one assumes Pfizer has stated interest through Dr. Eagle's presence on Provectus' corporate advisory board, that would make three Big Pharmas. 

There's a fourth. It's IP address(es) comes from...

A $PVCT Snippet

Management was focused on the reaction from the FDA and Big Pharma to Moffitt's poster at AACR, rather than the immediate attention (or lack thereof) of life sciences investors. Short interest for the period ending 3/28/13 fell 26%. I am traveling out of the country through the end of the week, and may blog sporadically until I return home.

$PVCT Pricing Power

Last week, when news surfaced about Biogen Idec setting the price for its new multiple sclerosis pill, a blog reader who informed me of this asked about Provectus' pricing perspective for PV-10. Tecfidera, Biogen's drug, is more commonly known as dimethyl fumarate. A good read about Tecfidera's pricing comes from Corante's David Lowe: "It [Tecfidera] joins the (not very long) list of industrial chemicals (the kind that can be purchased in railroad-car sizes) that are also approved pharmaceuticals for human use."

Management thinks it has significant pricing flexibility and thus tremendous pricing power for both PV-10 and PH-10 because of the compounds' manufacturing cost structures. Treatment cost, particularly in the context of evidence of PV-10's clinical superiority (as well as that of PH-10's), undoubtedly will be an important aspect of Provectus' discussions with prospective pharmaceutical partners, whether Big Pharma or pharma in China, India and elsewhere around the world.

Management understands and expects any pricing of PV-10 and PH-10, however, will be driven by Provectus' partners, up to (i.e., partners in regional license transactions, and the sale/license of the dermatology business) and including when the company is acquired by Big Pharma.

In other words, management will not set PV-10's price independent of partner guidance. More than likely, any PV-10 pricing will be determined after Provectus has been acquired, at least insofar as being publicly stated. Price points that management currently is considering solely are being used for business valuation purposes and done in consultation with prospective regional and global partners.

I have long been aware of and understood the cost structure underlying PV-10 (and PH-10); specifically, potential gross margins and costs of goods sold. Rose bengal's cost to manufacture and potential treatment prices, together with the drugs' efficacy and safety, make a very compelling value proposition.

Take melanoma, for example. The company surmises what each 5 ml vial of PV-10 a partner might price the vial at depending on the region of the world (e.g., U.S., European Union, Japan, Latin America, China, India, etc.). Management also can surmise the average number of vials per melanoma patient required. Such information, combined with the drug's superior clinical benefit, suggests PV-10's total value proposition (price + efficacy + safety) could very well fracture the competitive landscape of cancer treatment.

Trying to Connect $PVCT Dots to Pfizer

As readers of this blog know, I've been trying to connect the dots from Provectus to Pfizer for a while. I think the larger company ultimately acquires the smaller one. When Pfizer would move to acquire Provectus is unclear, in the absence of a bid for the company by another Big Pharma, and whether it would do so certainly is not certain. Nevertheless, I think there simply are too many dots. The public ones are the corporate advisory board's Dr. Eagle and joint Provectus-Pfizer patent application.

Management denies Pfizer made an all cash $7 per share bid for the company in 2011, valuing the company around $1B. Since no 8K form was filed (formality, language, materiality), no bid was made, right? That year, melanoma treatments vemurafenib/Zelboraf (Plexxikon) and talimogene laherparepvec/T-Vec (BioVex) were acquired for $1B top-line figures. Interestingly, partial T-Vec MM Phase 3 trial results caused Amgen shares to rally last week, while the takeaway from the HemOnc Today conference in New York this past Friday and Saturday was systemic benefit from injectables is a keen area of focus.

Is Pfizer a passive spectator on Provectus' sidelines, or is it more vocal and active than we know?

I had hoped to connect another dot between Pfizer and Provectus through more information about a China deal. China is a unique market, and partnerships with local players rather than in-country Big Pharma subsidiaries appear to be the way to go. A vocal Pfizer might encourage Provectus to partner up with Sinopharm or Hisun or maybe Shanghai Pharma, Chinese pharmaceutical companies with Pfizer relationships of one sort of another. Interestingly, injectables are the preferred route of administration for oncology drugs in China.

Alternatively, Provectus might elect to do something with another Big Pharma in China along the lines of what AstraZeneca did with Ironwood. If this happens, Godzilla (Pfizer) might have a fight over the company on its hands.

Like with China, several of the leading local players in India are very interested in PV-10. Pfizer's Indian subsidiary, Pfizer Limited, India (which appears to be a wholly owned but independent subsidiary), may also be a potential player too. Could (would) Pfizer encourage (direct) Provectus to do a deal with Pfizer India, which might not have nearly as many shortcomings or competitive disadvantages in India as Pfizer China has in China (when compared to the likes of Sinopharm or Hisun)?

Can management ultimately optimize ROI, an effort that is no small feat? Any Big Pharma would be hard pressed to pay Celgene-Abraxis upfront money, which is management's expectation, for a sub-$100 million market capitalization company like Provectus is valued at now. Regional license discussions continue in China, India and Japan. Global license interest grows. Moffitt data surfaces in two weeks. Action and time will tell.

The Bigger $PVCT Picture

I previously wrote management could and would protect Rose Bengal’s economics in a size and scope commensurate with the depth and breadth of their innovation.

During Craig's presentation at the AFund/Wall Street Healthcare Symposium Luncheon, he noted the company was negotiating with potential partners for regional licenses (China, India, Japan, MENA) and in a due diligence process with a potential global license partner. Since Peter returned from China on March 3 (his second trip), there has been no comment from management.

What might be going on?

From both scientific/medical/clinical and capital markets perspectives, management is setting expectations. Most folks tend towards the negative in the absence of information. It's natural. No news is bad news. Some shareholders, particularly many of the more vocal ones, and prospective investors are skeptical of management. I understand, but do not agree.

Management has, for quite some time, said Provectus' primary customers are the FDA and Big Pharma. Implicit in this perspective is the stock price is better optimized with an appropriate deal rather than just any deal.

Monetization of Provectus' innovation to some is simple and straightforward, and should mirror what most small biotechnology companies do at different stages of drug compound development. If Provectus can, in their view.

I think it's more complex.

Management, and in particular Craig, had a very good sense early on of the import of their innovative discovery. Time progresses. More information came to light and was produced to broaden and deepen the size and scope of Provectus' innovation (even greater than Craig's expectations, to which he will freely admit). Data drives the value.

As a result, and from management's perspective, optimizing value or return on investment requires of them to determine whether additional data drives incremental or fundamental value. Have they done enough to complete the valuation picture for their discussions with Big Pharma.

In what appears and feels to be the last stretch of the journey, I think management thinks it makes sense to evaluate China, India and Japan in the context of the significance of the Moffitt data and its implications for breakthrough therapy designation from the FDA and global Big Pharma transactions.

If management remains silent on China for now, no news is not bad news. For me, no news is good news.

$PVCT: A Clarification

My posts $PVCT: Clarity and nov·el & ex·cit·ing $PVCT are unrelated in that the seminal conversation that led to my moment of clarity is not the interaction with the Big Pharma senior executive.

nov·el & ex·cit·ing $PVCT

The following comes from my due diligence, and not from Provectus management. A senior executive at a Big Pharma company, a counterpart of Pfizer's Dr. Eagle, believes it is rare to see a novel and exciting new compound or drug candidate come along in this industry. PV-10 has the potential to be that one new and exciting drug. There is an elevated level of excitement surrounding PV-10 in the pharmaceutical community and with that comes an elevated level of scrutiny as is to be expected with a novel compound that is producing such profound results.

#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.

$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: Reading, When You Have All The Time In The World

I've been laid up for more than a few days with some version of the flu, and have fallen behind in many things. As I recover, catch-up, and look forward to being laid up again (at least up to 4 more times [once per petri dish, er, child]), here's some reading I did that you may find informative, because goodness knows I did a lot of reading, sleeping, coughing, sneezing, ...

From FierceBiotech's Nick Taylor: "The largest Big Pharma investments in China are about much more than just numbers; they tell the story of the fight over the biggest game in town. Each million-dollar headline marks the latest salvo in a struggle to take control of a market that could make or break Big Pharma players."

There are links at the bottom of the article speaking to each major Western Big Pharma player investment in China.

$PVCT: Horse Race (updated)

Last updated here. For the moment, I returned the first group of horses to all being equally close to the finish line. In the second group, India, since my last update, has pulled ahead of Japan.