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)

How Could A $PVCT-$PFE Story Unfold?

I hope to have some fun with the first part of this three-part post. Indulge me.

As you know, I beat the drum from time to time about Provectus and Pfizer. The relationship, as I see it, has steadily grown in depth, but has not yet been consummated.

November 2010: Craig Eagle first engaged Provectus when he traveled to Australia for Dr. Agarwala's presentation of preliminary MM Phase 2 trial data.

Early-2011: Pfizer and Dr. Eagle proffered a unique deal to Provectus that ultimately did not materialize.

Summer/Fall-2011: There is/was the rumor of a cash bid by Pfizer for the company, which management denied (to me) was made and that would have valued Provectus at approximately $1B ($7 in cash per share) at the time. Earlier that year, BioVex (T-Vec) and Plexxikon (Zelboraf) were acquired by Amgen and Daiichi Sankyo, respectively, for approximately $1B (top-line figure) each.

August 2011: Craig Eagle joined the company's corporate advisory board.

March-October 2012: The joint patent application, for combining local and systemic immunomodulative therapies, worked its way through Pfizer (legal) before being filed.

September 2012: The company made an SEC filing for a preferred stock offering, the rationale and structure of which purportedly was to facilitate a strategic equity investment by Pfizer in Provectus.

October 2012: Pfizer supposed role as co-lead on the PVCTP "IPO" did not materialize.

Yet, the stock price has refused to budge upwards, and in actuality has fallen a lot. I previously wrote about disbelief.

The stock market, some/many in the Wall Street community, some/many potential investors and some/many existing shareholders do not believe in nor trust management, and thus do not believe in the data. If they did, they would buy or buy more shares. These disbeliefs, the first more problematic and resulting in the second, have led to the obscuring of value that clearly exists in Provectus and that Big Pharma very much sees and desires. 

Although disbelief in or lack of trust in management mostly results from self-inflicted wounds, these wounds are far from fatal, and there should be no doubt about the immense value management has created in its innovation of PV-10. 

Simple, angelic or divine regulatory clarity will transform disbelief in both management and PV-10 overnight.

One has to assume disbelief of Provectus extends to or has enveloped the notion and reality of a Pfizer relationship, too. Clarity about a monetary relationship with this Big Pharma also will additively transform disbelief in both management and PV-10 overnight.

June 2013: Which brings us to last week and Provectus' Empire State of Mind, where there apparently/purportedly were several meetings between Provectus principals (Peter, Peter and Eric) and Pfizer folks (broadly speaking), as there has been since the relationship began. I think I have a good idea of who, what, where and when, but not why.

It's fair to say there is no small amount of anticipation or expectation brewing for something to happen, soon, whether it is some portion of regulatory clarity or commercial validation through a regional license transaction.

I can't help but think of, anticipate or expect a monetary relationship finally being put into place between Provectus and Pfizer. Without regulatory clarity of any sort (e.g., SPA, breakthrough therapy designation, accelerated approval), it's too early for a global license with or the end game by Pfizer.

But how does Provectus get from here to there, from Friday's 63 cent share price to a multi-billion dollar upfront payment from Pfizer? I wrote the Empire State of Mind post to clarify some things. I also understand there was some chatter about a strategic equity investment by Pfizer last week. I would have to believe the topic of investment has been a longstanding discussion between the two companies.

Maybe, now, whenever now becomes today, and today becomes a PR, there might/could/will be an investment in Provectus by Pfizer (or possibly but less likely some other Big Pharma). Why "now?" With regularity clarity in the offing, potentially simple leading to angelic or divine, an investment from Pfizer assists Provectus to get from here to there.

A substantial investment (say, $25-$75MM) investment by Pfizer at a significantly higher share price (say, $3.50-4 per share) should put a floor under the stock.

The upcoming annual meeting of shareholders on June 27 potentially will help resolve the issue and company proposal to increase the number of shares of common stock Provectus is authorized to issue from 200-250 million shares. As of March 31, the total shares of common stock issued and outstanding and reserved for issuance for outstanding warrants, options and preferred stock totaled 188 million (no shares of common stock are held in treasury), leaving about 12 million shares for a strategic equity investment by Pfizer (or another Big Pharma). Maybe 11,853,076 unreserved shares of common stock available for issuance is enough.

If an equity investment starts the ball rolling, then one hopes that event is followed by some regulatory clarity, like the receipt of the SPA. Leveraging Provectus board member Al Smith, among others, to build greater awareness in the financial and investment management communities creates more momentum. A regional license deal or two, next, like for India and then China, or for China and then India, helps more. More regulatory clarity, like BTD or AA, speeds up the ball's rolling. And then...

But it's very early Sunday morning at my favorite Starbucks (this blog will post Monday morning at midnight EST), it's just the here and now, and I'm having a little fun.

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A Chicago stockbroker organized a conference call for his clients holding Provectus stock with Peter before ASCO 2013. The broker also invited me to join the call, which lasted about an hour. There were about 50 people on the call. Peter used the company’s website presentation as his talking points, providing informative comments about the company's progress or situation on several fronts. Below are notes that, while not meant to be an exhaustive description of the call or a transcript of it, essentially were a list of things Peter said that I found to be interesting to varying degrees.

Peter used the company’s website presentation as his talking points, providing informative comments about where the company is several fronts as well as some very candid commentary.

The mechanisms of action of PV-10 for oncology and PH-10 for dermatology are not the same but have interesting similarities and high profile researchers are currently investigating.

The synthesis patent application has been approved. Peter described some of the implications of the now approved patent. Provectus will issue a press release next week where I expect the company will describe several key aspects that drive significant shareholder value.

A Phase 3 trial under the SPA that should be agreed to with the FDA, should such a trial ultimately be run, would have treatment without any limits of any concern (i.e., as many retreatments of as many visible tumors as necessary).

In addition to breast cancer and melanoma for which Moffitt (a) confirmed from its murine studies that PV-10 chemoablation resulted in both a direct effect on injected lesions as well as a systemic response that leads to regression of uninjected subcutaneous and lung lesions and (b) concluded intralesional PV-10 treatment led to the induction of tumor-specific immunity, Moffitt also has done work in other indications.

Moffitt seeks to finish its Phase 1 feasibility study of human patients as quickly as possible.

The FDA and Big Pharma realize that to kill cancer one has to effectively kill tumors in a clinically relevant manner.  PV-10 is singularly unique in the approved and emerging cancer agent universe.

Peter mentioned they are having license talks with global and regional pharmaceutical companies, including active dialogue with Dr. Craig Eagle of Pfizer.

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The follow-up to my regulatory clarity and commercial validation pathways post is below.

$PVCT's 10-Q: Q1 2013

Provectus released its 10-Q filing for Q1 2013 today. See here. Some thoughts...

#1. Quarter-over-quarter ("QoQ") -- Q1 2013-over-Q4 2012 -- monthly cash expenditure appears to have decreased by about 11%. Provectus' quarterly and annual filings since and including Q1 2012, the company appears to suggest an average monthly cash burn of approximately $950K (with a standard deviation of $133K).

#2.  Management expanded on their Q4 2012 MD&A statement via the 10-K of...

"We are seeking to improve our cash flow through both the licensure of PH-10 on the basis of our Phase 2 atopic dermatitis and psoriasis results, and the geographic licensure of PV-10 on the basis of our Phase 2 metastatic melanoma and Phase 1 liver results in certain areas of the world, as well as pursuing a strategic investment strategy, including equity sales to potential pharmaceutical and or biotech partners, and continuing with the majority stake asset sale and licensure of our OTC products as well as other non-core assets. 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."

...with the following in their Q1 2013 statement:

"We are seeking to improve our cash flow through both the licensure of PH-10 on the basis of our Phase 2 atopic dermatitis and psoriasis results, and primarily the geographic licensure of PV-10 on the basis of our Phase 2 metastatic melanoma and Phase 1 liver results in certain areas of the world, as well as pursuing a strategic investment strategy, including equity sales to potential pharmaceutical and/or biotech partners. In addition, the data now available from Moffitt Cancer Center in Tampa, Florida has been particularly helpful in supporting our development plans with both the FDA and prospective partners. 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. We also expect to continue with the majority stake asset sale and licensure of our non-core assets. However, the primary objective of ours is to strategically monetize the core value of PV-10 and PH-10 through various transactions, leveraging value creation up to and including an appropriate Merger and Acquisition transaction."

primarily suggests to me management is prioritizing a series or string of regional/other licenses (e.g., China, India, Japan, PH-10) to boost company valuation towards their end game valuation expectation.

In addition... suggests repetition of the importance of Moffitt to what the FDA and Big Pharma needed regarding PV-10's systemic benefit and potential, and that is very likely crucial to securing and most assuredly dispositive of receiving breakthrough therapy designation for PV-10 for recurrent and metastatic melanoma.

However... suggests focus on smartly, intelligently and thoughtfully protecting valuation to, again, achievement management's end game valuation expectation. Noteworthy to me was the inclusion of the verbiage "an appropriate Merger and Acquisition transaction."

#3.  Noteworthy to me was the issuance of 1.92MM warrants to consultants in exchange for services in the quarter. To whom and why?

$PVCT: Regional Licenses v. Global License vs. Endgame

As management continues to work towards regional license deals in China, India and Japan, and sees growing interest from Big Pharma in a global license, it is interesting to note a few things.

Pfizer India is an autonomous organization that can and does enter into transactions in India as it deems appropriate.

Relationships Pfizer has in China are more state-governed, requiring more direct contact between Provectus and local pharmaceutical players there.

Should Provectus enter into a global license with Big Pharma, it neither precludes regional license transactions being contemplated in certain geographies from being done nor does it prevent another Big Pharma from acquiring the company entirely (i.e., the end-game).

$PVCT: #Godzilla ($PFE) Vs. #Mothra

A blog reader and frequent e-mailer sent me this article: Is AstraZeneca getting ready to buy a pipeline? by FierceBiotech's John Carroll. Thank you.

The story comes from Reuter's Ben Hirschler's article New AstraZeneca CEO plans to invest through tough year. A notable quote:

After reading both of the articles, I could not help but think of Craig's comments and related presentation slide at the Noble conference.

Godzilla versus Mothra?

Let's get it on!

$PVCT.OB: Buyout Rumor? Uh, no.

Most rumors I hear are not remotely close to being true. There is not even a grain of truth in them, which all good rumors typically possess. If interesting and germane, I try to confirm the substance of a good rumor with separate and distinct shareholder groups with whom I communicate (the PVCT "town" is a small one). I solicit feedback from management, too.

An interesting rumor, from several perspectives, is the one I heard today: a certain group of shareholders is interested in taking/will take Provectus private (i.e., a buyout) at $3 per share. Management is aware of the situation.

I am very skeptical for several reasons including but not limited to:

• I doubt this group or, for that matter, any syndicate or group of existing Provectus shareholders owning a large number of shares can pull this off.

• You have to wonder if you and I will hear more of this kind of talk, whether out of frustration with management or simply to pump up the share price on helium in order to close or in hopes of closing out a share position at a lesser loss.

• Give or take the number of shares this group might own, a buyout at $3 would price the company at about $400-450MM. That is a lot of cheese for a group of existing shareholders.

The journey to a buyout begins with several initial steps. Typically, one starts with at least a 5% ownership or thereabouts. Revelation (formerly Osmium) was the last entity (actually, the only entity, not counting Dr. Adams) to file a beneficial ownership greater than 5%. The filing was a passive one. Their investment style/strategy was/is event driven. They are not activist investors. And we have not heard from them in quite a long time.

From a 5% position, a shareholder (or group) could either agitate for change or launch a full blown tender for shares (among other things it or they could do). Unless a buyout group -- whether a cadre of existing shareholders or prospective new ones -- has the real ability to manage the science, regulatory and science communications processes here, among other necessary and needed experience sets to take the company to the end-game, the notion of buying the company for $3 and "flipping it" to Big Pharma is just fanciful.

A more interesting scenario develops if Pfizer or another Big Pharma currently watching the company closely fears a move towards a buyout would forclose the opportunity for them (PFE or another Big Pharma) to buy Provectus. Rumors or hints of a buyout might provoke Pfizer, among others, to act. While you should not hold your breath, it is worth paying a small bit of attention to see if anything more develops.

First-Half 2012 Life Sciences Deal Trends

By Deloitte Recap LLC. The full report is here. A selection of slides is below.

The Tip Of The Iceberg

As the dog days of summer get doggier, and we wait for the SPA to be received, much, much more Moffitt data to arrive, a dermatology and/or mini-oncology deal(s) to materialize, and other events to occur, it might be constructive and cooling to think about Pfizer...

If the addition of Dr. Craig Eagle to Provectus' corporate advisory board is the tip of the iceberg, what's below the waterline?

Below-the-waterline items not in chronological order.

Pole Position

None of us can predict or foresee who will acquire Provectus (or, for that matter, who will do a mini-oncology or dermatology deal with the company). Well, maybe Eddie Morra knows. We can try to predict or we can think we're making educated guesses, but it's mostly speculation for now. Management's thoughts on this topic are key.


Craig Eagle's presence on Provectus' corporate advisory board (CAB) is an important data point. Executives within Big Pharma have different degrees of flexibility in their respective business mission, role and responsibilities. How many oncology-focused biotechnology companies have executives from Pfizer's Oncology Business Unit (OBU) associated with them in a formal or informal fashion? How many executives within OBU are associated with oncology-focused companies? For that matter, how about other Big Pharma?

In a world where there are few drug in development that work and fewer still that work well, Big Pharma teams tasked with refilling drug pipelines (outside of internal R&D) keep their eyes on a short list of candidates. No one wants to be uninformed or late to the game when it comes to understanding who has a drug that works and works well. No one wants to be too far down in line when it comes times to act.

Craig Eagle's extensive and germane experience clearly is a very big plus for Provectus to access and from which to benefit. It does strike me, however, that he occupies the pole position on behalf of Pfizer for when it comes time to act.

Musings on May 13

For a little while I've been trying to pull together certain necessary pieces in order to purchase a large number of Provectus shares at current prices (current = somewhere in the range of where the share price has been for the last 3 to 6 months).

As part of this process, I called the markets makers on Friday looking for pricing on a 5MM share block. The goal is (was) to ascertain what average price they thought could buy (and ultimately, if engaged, would commit to buying) on my behalf such an amount in what reasonable period of time.

It is (has been) easy and straightforward to accumulate tens and hundreds of thousands of shares at a time in the current market. Sit on the bid at various levels during various times of the day, and you get hit. Occasionally pay the offer (buy shares offered at various prices and times of the day), but not often enough to let the price runaway from you.

Why is price important? My expectation and experience suggested it was nearly or effectively impossible to by 5MM shares -- at current prices, this only is $4-5MM -- without moving the price into the $1.50 to $2.00 range, or higher (set aside for the moment the impact of warrants being exercised at these prices, or going directly to warrant holders and negotiating to buy their warrants).

If I think I will get $25-50 or more per share in the end-game, should I quibble over cost bases of $0.80-$0.95 or $1.50-2.00? Absolutely. My ROI gets cut in half or more. The outcome still is robust and I could acquiesce, but it is hard to give in and so I doubt it: "A George divided against itself cannot stand!"

As I expected, the market makers could not follow through. Perhaps when my query is addressed substantively next week, they may have a different response. But right now, I cannot get such size at an attractive fixed price in a reasonable time frame. One market maker observed there were some willing sellers in the 80s and 90s (cents) but not enough to fill my size. If another potential investor wants to do a similar size (to my desired amount), there's not enough to go around right now.

Why is time important? Time matters now more than ever. I can try to sit around and slowly, very slowly,  accumulate my desired position at my desired price target range ($0.80-$0.95). Or, I can more aggressively act.

But the pipeline of catalysts is backing up, and the clock is ticking on when these catalysts will catalyze the share price. Among them, the usual suspects:

• The MM Phase 3 SPA;
• A dermatology term sheet;
• More Moffitt immunology data;
• The Munich MM Phase 2 data;
• Accelerated approval for MM
• Additions to the board of directors and corporate advisory board;
• A NASDAQ listing;
• An HCC Phase 2/3 trial suitable for an SPA;
• Etc.

Time is not on my side.

An interesting cascade effect. Take a look at the current table of outstanding warrants (not including, of course, those issued in Q1 2012) here: nearly 12MM at exercises prices of $0.95 and $1.00, and about 12.5MM at $1.12, $1.25 and $1.50, all at terms or durations of 2 to 4 years (from December 31, 2011)

As the share price runs over the next weeks, months and quarters from the catalysts in the pipeline through these exercise prices, the company enjoys significant cash infusions for contemplated operations when these warrants are exercised.

Blog Reader Question

Why is characterizing why PV-10 works systemically so important?

The HemOnc Today conference last month displayed the momentum in and recognition by the medical community for PV-10's application to systemically treat melanoma. I posted a comparison by Dr. Andtbacka's comparison of IL-2, BCG, Allovectin-7, OncoVEX and PV-10. If you use the search bar along the right hand side of the blog, towards the bottom, and enter keywords "hemonc today," you'll be able several more related posts.

It's clear, and has been for a while, that PV-10 is a robust local regional ("loco-regional") treatment, particularly among intralesional therapies. Local treatments for disease have a place in the oncologist's tool kit, and there is a nice but modest valuation for companies that produce drugs of such limited use.

But when you are able to demonstrate deploying a drug effectively systemically treats disease, the utility and thus the value of the drug dramatically increases. Dr. Zager's presentation from HemOnc Today does a nice job (towards the end of the presentation) illustrating the application of systemic and other therapies (based on systemic tumor burden and and loco/regional tumor burden).

Utility increases because the physician can easily pick out the tool out of his or her kit for the job, rather than having to rummage around. Utility increases because surgery may not always have to be the first or best treatment option. Utility increases because diseases in far flung, remote, hard-to-find or detect parts of the body receive much-needed treatment, and help mitigate relapse or insufficient cleansing.

Do all or a lot of the above, and the drug's value provide tremendous valuation for the company that produces it.

Aside from the clinical demonstration of such systemic success, Moffitt's immunology-related work is helping to characterize that PV-10 works systemically, and works very effectively systemically. Thus, better for physicians and their patients, and, eventually, better for shareholders.

When does Provectus' share price start representing its true (or intrinsic) value?

With the stock in a ridiculous holding pattern (I am being subjective with the duration of the stock pciture below), now is as good a time as any to answer a question from Mammon's list.

Per Google Finance, the current market capitalization at closing Thursday was $88.75MM.

The true or intrinsic value of the company may well lie in the eyes of the beholder. The graphic below highlights the outcome of different valuation methodologies.

Setting aside a rather geek-filled discussion regarding "fully diluted," which relates to per share value, the value of Provectus might be in the range of $5-10B using a discounted cash flow analysis.

Comparable company valuations yield a lower enterprise value for Provectus.

But, as in my introduction in this post, Provectus trades at a significant discount to its peers.

Recent or precedent transactions provide a higher valuation.

So, how does Provectus' valuation get from $88.75MM to $5-10B, and when?

The company's valuation begins to get where it needs to go by steadily increasing in step function-like jumps in share price because of: the MM Phase 3 SPA, a dermatology term sheet, more Moffitt immunology data, the Munich MM Phase 2 data, additions to the board of directors and corporate advisory board, a NASDAQ listing, liver progress, etc.

These step-ups likely will be exaggerated by market euphoria or exuberance. That means higher share prices at points in time.

When does the share price represent the company's intrinsic value? When Pfizer buys Provectus. That event will represent the largest and final step function jump in share price.

As shareholders or prospective shareholders, we must ask ourselves: When do we get in?/When do we buy?

And also: When do we get out?/When do we sell? Or do we?

CEO Letter Thoughts

PV-10
Metastatic Melanoma


During 2011 we held our second and third meetings with the FDA to discuss the design of a pivotal Phase 3 randomized controlled trial ("RCT") suitable for Special Protocol Assessment ("SPA"). In December the FDA provided us further guidance regarding the submission of our Phase 3 protocol for review, notifying us that they did not require an additional end-of-Phase 2 meeting. Using the recommendations that we received from senior FDA officials regarding patient population and primary endpoint, we are requesting SPA review of our protocol. While the review process could occur in as little as 45 days from the date of submission, we expect it will be an iterative process, and thus, more time may be required to work with the FDA on a study design agreement. This, we believe, represents a major step for our company, probably the most significant achievement yet, in our pathway to approval for PV-10.


⬆ I will address this in a separate post.


As you may recall, too, the Australian Therapeutic Goods Administration ("TGA") has agreed in November 2010 to the same primary endpoint of progression free survival that has been proposed to the FDA. In our meetings with TGA we discussed the use of interim data from the first half of Phase 3 study subjects, in conjunction with safety data collected in earlier studies of PV-10 for melanoma, to allow early evaluation for marketing approval in Australia for metastatic melanoma. TGA agreed that these data should be sufficient for this review if the analysis confirmed efficacy.

⬆ This appears to be just a recap.


In addition, nonclinical studies, designed to characterize the immunologic response to PV-10 chemoablation, have been conducted by researchers at the Moffitt Cancer Center in Tampa, Florida, with initial results reported in March 2012 at the Society of Surgical Oncology Annual Meeting. Paul Toomey, M.D., presented his work and that of his colleagues, confirming that PV-10 chemoablation of melanoma lesions leads to induction of systemic, tumor-specific anti-tumor immunity. Additional nonclinical studies are underway with confirmatory clinical studies planned. This work is fundamental for full characterization of PV-10's systemic benefit and may provide pivotal support for accelerated approval in the U.S.

⬆ I previously posted that the full scope of Moffitt's work -- completed, in-process and in the near future -- makes accelerated approval a real possibility.


Liver Metastasis


In April 2011 we received orphan drug designation from the FDA for Rose Bengal, the active ingredient in PV-10, for the treatment of hepatocellular carcinoma ("HCC"), the most common form of primary liver cancer. This designation entitles Provectus to exclusive marketing rights for PV-10 for HCC in the U.S. for up to seven years if we are the first company to receive marketing approval for this therapeutic drug product. We are also eligible to apply for a waiver from the FDA of certain user fees required by the Prescription Drug User Fee Act ("PDUFA"). In other words, once regulatory approval is received, orphan drug designation provides assurance for the value of our company's proprietary property, grants us market exclusivity, thereby affording us both financial and regulatory benefits. This orphan drug designation for HCC is in addition to that received for metastatic melanoma in December 2006.

⬆ This appears to simply highlight what management has been doing to move PV-10 for HCC along.


We are conducting nonclinical drug-drug interaction studies to verify safety of combining PV-10 with sorafenib, the standard of care for nonresectable locally advanced primary liver cancer. This supports advanced development of PV-10 for HCC in clinical studies comparing PV-10 with the standard of care versus the standard of care alone, to demonstrate an overall survival benefit of treating HCC with PV-10. We expect to provide further guidance on this important indication when we are closer to commencing a Phase 2 or Phase 2/3 clinical study.

⬆ I find it interesting to read that non-clinical drug-drug interaction studies to verify safety of combining PV-10 with sorafenib are ongoing (i.e., confirming the orthogonality of PV-10 and sorafenib). I do not have an expectation of the potential timing of a Phase 2 or Phase 2/3 trial yet.


Breast Cancer and Other Oncology Indications


One of our many objectives during 2011 was to demonstrate that PV-10 has multi-indication potential, and we intend to continue that quest in 2012. We are now in a position for a Phase 2 study in recurrent breast carcinoma, following the completion of our Phase 1 study several years ago. We look forward to being able to report further progress on this indication as well. Furthermore, we have shown success with PV-10 in treating pancreatic cancer in nonclinical studies and are considering a proof of concept clinical study in this equally important indication.

⬆ I take two things away from this. First, the company can start a Phase 2 trial, and second, they appear to me to be assessing whether to start such a trial. I also find it interesting to read about the success in treating pancreatic cancer in non-clinical studies. If you recall, Craig mentioned this in talks late last year.

Compassionate Use Program


I am also pleased to report that our Compassionate Use Program for PV-10 for patients with non-visceral cancers continues, with over 70 patients enrolled in six centers across the U.S. and Australia. The protocol for this program enables subjects to undergo more frequent and extensive treatments with PV-10 over a longer period of time than was allowed under the protocols used for the Phase 1 and 2 trials. We believe this dose regimen serves as a blueprint for our planned Phase 3 clinical trial for metastatic melanoma.

⬆ I previously posted that the utility of Provectus' compassionate use program, outside of the great benefit it has had and continues to have for patients accepted into it, is not fully appreciated.

PH-10
Psoriasis


Our largest clinical trial to date was completed in 2011. The data from this Phase 2C RCT, which enrolled ninety-nine subjects with mild-to-moderate plaque psoriasis, corroborated the potential effectiveness of PH-10 observed in these patients in our earlier clinical study.

⬆ This appears to be just a recap.


Reaching this milestone has also triggered increased efforts for our company to seek a licensure of PH-10 for the treatment of serious dermatological diseases, which would include psoriasis and atopic dermatitis, another indication for which PH-10 has completed Phase 2 clinical trials. We remain on track to secure a term sheet from a potential partner that would lead to a proposed licensing agreement and the engagement of a financial advisor to effect this transaction.

⬆ This also appears to be just a recap.


We have also successfully completed various dermatological toxicity studies which are appropriate at this stage of development of PH-10. We will work with the FDA to design the remaining toxicity studies necessary to support a New Drug Approval (NDA) filing. Because of the well-tolerated safety profile of Rose Bengal, we are enthusiastic about the potential for widespread acceptance of PH-10 upon eventual expected approval.

⬆ Again, another recap. I think management also is sharing their perspective about the licensing process and prospective partner feedback on PH-10.


PRESENTATIONS AT SCIENTIFIC CONFERENCES


PV-10 was the subject of several scientific presentations this year. Of particular note, Dr. Sanjiv Agarwala, Principal Investigator for the Phase 2 melanoma study, presented data at the European Association of Dermato-Oncology ("EADO") Conference in Nantes, France, in June 2011. This audience of prospective European investigators who specialize in dermato-oncology had a special interest in injectable therapies, and we were encouraged by the level of interest this group had in PV-10, particularly as we prepare for a global Phase 3 trial.

⬆ This appears to be just a recap.


In November 2011, Professor Merrick Ross, M.D., a Principal Investigator for our Phase 2 Melanoma trial, delivered a presentation at the 2011 International Melanoma Congress during the 5th Meeting of Interdisciplinary Melanoma/Skin Cancer Centres meeting in Tampa, Florida. His presentation included a discussion on the role of intralesional therapies for controlling both local disease and their possible effect on systemic disease, such as that which has been shown in Phase 2 testing of PV-10.

⬆ At the HemOnc Today conference in NYC earlier this month, Dr. Ross publicly said PV-10 should be approved. I have much more blog post material on PV-10 and the HemOnc Today conference.


We expect additional presentations at scientific conferences this year that will be announced when appropriate, as well as various peer-reviewed publications either this year or next.

⬆ Management is trying to push for the publication of the MM Phase 2 and/or HCC Phase 1 trial results in globally recognized peer-reviewed periodicals in 2012. Only time will tell if they are successful.

CORPORATE DEVELOPMENTS


Prominent leaders joined our Board of Directors and Corporate Advisory Board this year. Alfred E. Smith IV, Senior Advisor for the Marwood Group, joined our Board of Directors. Mr. Smith has extensive financial and healthcare experience. His knowledge of business and medicine has already helped provide our company with guidance on several drug development and corporate strategies.

⬆ This appears to be just a recap.

Dr. Craig Eagle, MD, Vice President of Strategic Alliances and Partnerships for the Oncology unit at Pfizer, and Stuart Fuchs, Chairman and CEO of CognoSPECTi, joined our Corporate Advisory Board. Dr. Eagle's experience in drug development, and Mr. Fuchs's venture capital and investment banking experience in the biotech industry, are great assets to our company as we further our path towards commercialization. Mr. Fuchs joined the Corporate Advisory Board after having served eight years on our Board of Directors. We expect to appoint others to our respective Boards this year and next.

⬆ Comments related to Eagle and Fuchs also appear to be just a recap. I think the comment related to the potential future appointments to the Corporate Advisory Board and the Board of Directors is very interesting to read.

Our balance sheet remains strong, with $7.7 million in cash and cash equivalents, providing us ample cash to fund our operations through 2013. Since we seek to spin-off our non-core subsidiaries, and concentrate our efforts on our drug development activities, in December 2011 we completed an unregistered offering of Units. Each Unit, which included shares of common stock in Pure-ific and a warrant to purchase ¾ share of the Company's common stock, were sold to accredited investors. The net proceeds of this transaction are expected to be used to spin-off Pure-ific as a new publicly traded company. We plan to fund and spin-off the remaining four non-core subsidiaries as well.

⬆ This also appears to be just a recap.

Also, we are in the process of implementing a new executive bonus plan that is expected to be based upon certain additional performance-based criteria, such as stock price and the signing of partnership agreements. This plan will replace the prior one which had been based on the attainment of certain scientific, medical and clinical milestones. We will disclose the details of the new plan once it is finalized.

⬆ I think the comments related to a new bonus compensation plan are interesting to read. I plan to follow-up with more due diligence, analysis and commentary on this topic.

Topics for Future Posts

Mammon at the Silicon Investor stock chat board for Provectus raised severals topics for discussion. I'm going to try to blog my thoughts on these topics:

• What are the pros and cons of doing a pivotal MM phase III trial with or without a partner?
• What a potential dermatology deal might look like?
• How does Provectus compare to other biotechnology companies that have recently been bought out?
• Is there a chance for accelerated approval given Moffitt's immunology-related work?
• How do the psoriasis Phase 2c results compare to other gels (not systemic treatments)?
• How might PV-10 work as a first-line treatment?
• What is big pharma's perception of Provectus?
• When does Provectus' share price start representing its true (or intrinsic) value?

Triggers

Very Quick Hits for March 30

ex·cit·ed. Coming out of SSO, there is a palpable sense of excitement in management.

clar·i·ty. Following a call with management earlier today, I think I have never been more clear in my projection for or estimation of the company's trajectory.

CEO letter. I think the letter will come out next week.

Much more later (shortly).

Legend

"Myrmidons, my brothers of the sword. I'd rather fight beside you than any army of thousands. Let no man forget how menacing we are, we are lions! Do you know what's there, waiting, beyond that beach? Immortality! Take it, it's yours!"

Who are you? Do you want to be legendary? Or do you want to do something legendary?