Short Ideas

[gfp927z]

CHM, These days I follow biotech mainly out of general interest. To invest again I'd probably do it via 'Motif Investing', which allows you to create your own ETF of up to 30 stocks for a single $9.95 trade. I mainly prefer other safer sectors, but biotech is fun to follow.

While antibiotics are the main focus, the Oral Mucositis indication by itself is enough to justify interest in Cellceutix from a commercial standpoint. But defensin mimetics is such a huge breakthrough, it's easy to get all gaga and be blinded by the cool science, ala Cortex.

CTIX's cash level at the end of Q3 was only $7 mil, so they need some type of financing soon. Other potential problems lurking include getting the Phase 3 approved. In the recent investor presentation they said the FDA requested some additional data analysis from the Phase 2. For various reasons, I've always worried that the FDA would try to 'deep six' the defensin mimetics technology as it relates to antibiotics.

Another source of worry is the new FDA clinical trial guideline that emphasizes a mere 20% reduction in symptoms after 2-3 days. That seems like a really low barrier, so when CTIX says they had similar efficacy to Cubicin in the Phase 2 using only a single dose, they're using that weak 20% criteria.

Back in the previous Phase 2 done by Polymedix, we saw the data for the entire treatment period out to a month post-treatment. That trial had a longer dosing period, and Brilacidin showed excellent efficacy, but had some side effects including the paresthesia and cardio effects. Now they're proposing a single dose for the Phase 3, but between the low 20% criteria and the lack of transparency in showing us the full data, there is significant room to worry. Once the FDA approves the Phase 3 I'll feel a lot better.