CTI BioPharma Corp (fka CTIC)

[savannah1021]

What’s Next For CTIC
March 24th, 2010 by admin Leave a reply » .So here is what I see happening, we have seven scenarios, I will list them in order of best to worst case scenarios for investors, they are:

Best Case: Cell is able to raise cash to fund another study of Pixantrone via a private placement

2nd Best Case: Cell is able to partner with a major drug company to fund further trials of Pixantrone

3rd Best Case: Cell is able to raise capital through a public offering, which dilutes shareholders (note if this happens, I wouldn’t be surprised to see management do a reverse stock split as well)

4rd Best case: Cell is able to issue more debt in the form of regular debt

5th Best Case: Cell is able to sell themselves to a major drug company (the reason this isn’t high on my list is because I think any major pharma company is going to have huge negotiating leverage and be able to scoop Cell up for a much cheaper price than fair value because of Cell’s Debt load)

6th Best Case: Cell issues more convertible debt in the form of death spiral bonds which can put significant downward pressure on the stock (note if this happens, I wouldn’t be surprised to see management do a reverse stock split as well, if you aren’t familiar with death spiral bonds click here)

Worst Case Scenario: Cell cannot find further financing and is forced to declare bankruptcy (this is exactly what happened to Vion after their lead product Onrigin got shot down at an ODAC panel meeting, keep in mind though that Cell is in a slightly better financial position than Vion was).

The reality is, if Cell wants to fund another trial for Pixantrone (which in my opinion is in their best interest, rather than throwing anymore money at Opaxio) then they are going to have to get capital somewhere. It may not be pretty and may be dilutive to shareholders, but I have seen several companies pull off miracles in this area. In terms of their current financial situation they are on: I would say they are on somewhat temporaray footing for a little bit because we don’t know what the companies next move is and they do have cash on hand. They will eventually have to pay off their debt and find a way to finance a final study of Pixantrone though. Genta was able to fund a final trial of their lead product genasense for melanoma patients by issuing convertible bonds and doing a reverse stock split so it is possible, however the drug ended up failing in the final Phase III trial.

cont’d on next page
Complete article available at:
http://www.gekkowire.com/

btw...not that anyone cares...I'm still completely out of CTIC at this point in time...I expect to wait out the possibilities and if they start a new trial and share price is right I'll buy back...I still think PIX will eventually get the nod. All completely my pipe dream of an opinion.