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Cell Therapeutics (CTIC)
Q3 2012 Earnings Call
November 01, 2012 8:30 am ET
James A. Bianco - Principal Founder, Chief Executive Officer, President and Executive Director
Steven E. Benner - Chief Medical Officer and Executive Vice President
Matthew J. Plunkett - Executive Vice President of Corporate Development
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Jack W. Singer - Founder, Executive Vice President of Global Medical Affairs & Translational Medicine and Executive Director
Robert Cummins Hazlett - Roth Capital Partners, LLC, Research Division
Ladies and gentlemen, welcome to the Cell Therapeutics Q3 2012 Conference Call on the 1st of November 2012. [Operator Instructions] I will now hand the conference over to James Bianco. Please go ahead, sir.
James A. Bianco
Thank you. Good morning. Before we get started, let me remind you, as is common with presentations of this type, we will be making forward-looking statements. And as such, we recommend that you refer to our SEC filings for certain risks and uncertainties associated with such statements and more information about the company. Let me also remind you that this call will be recorded and available for playback on our website and that any unauthorized recording of this call or use of this recording is prohibited without written consent from the company.
So today, we're going to review the financial results for the third quarter, and we'll update you on our commercial activities, including the product rollout and reimbursement-related activities for Pixuvri in the EU. Steve Benner, our Chief Medical Officer will cover our primary product development focus, namely getting the Phase III trials for pacritinib up and running, and I'll briefly touch on tosedostat and upcoming events for OPAXIO, as well brostallicin before we open up for questions. And then lastly, Matt Plunkett, our VP of Corporate Development, will review these activities and give you some feedback on preliminary interest in pacritinib.
Let me start with financial results for the third quarter -- for the quarter, total operating expenses were $14.7 million compared to $15.3 million for the same period in 2011, which is in line with our guidance. Our net loss for both the quarter and the 9 months ended September 30 continue to decrease compared to the prior year, excluding the $29.1 million for the acquisition of pacritinib from S*Bio, the net loss for the 9 months decreased to $67 million compared to a net loss of $103 million for the same period in 2011.
We ended the quarter with approximately $14.3 million in cash and cash equivalents, and that was prior to raising $55.6 million in net proceeds from the underwritten public offering which we completed in October.
We move on to updating you on Pixuvri. In the first quarter, as you may recall, we've worked with PricewaterhouseCoopers, the European Life Sciences partners on developing a cost-effective go to market strategy. In Q2, we started working with our vendors, both in completing end market research, pricing reimbursement analysis, third-party logistic provider relationships and then we entered into a contract with Quintiles for hiring our sales force.
In Q3, we began hiring, through Quintiles, our sales force initiated training program for sales personnel and begun product introductions in Sweden, Finland and in Denmark. In this quarter, we continued the product rollout in Austria and Norway, and this month in Germany, U.K. and the Netherlands. And this month, meaning November.
And we had our preliminary meeting with the GBA, the German health regulatory body that determines reimbursements. The feedback we received at that meeting reaffirmed our strategy, and the approach for our value dossier development. And they know that's a critical document, which is reviewed by both IQWiG and GBA when determining innovation scores and the ability to achieve pricing and reimbursement.
And we had similar preliminary feedback from NICE, the U.K. agency critical for reimbursement. Once we launch in Germany later this month, we will begin submissions in France, Italy and Spain. Product rollout in these latter countries will take place once reimbursement and pricing discussions have been completed because unlike other countries, they are not free market access countries.
With regard to just Spain and Portugal, we're also exploring the possibility of revenue and establishing a field force for Quintiles, rather working with a Spanish pharmaceutical company to be a partner in that region given some of the issues surrounding the timing of payments.
So we really want to underscore that we're not looking to build infrastructure or incurring related cost to liabilities as we bring on a commercial organization in the EU. We're following a model that worked well for the EU in production of Celeris [ph], naproxen and Yondelis, to name a few, all of which were conducted initially through relationship similar to the one we have established or Quintiles. As each country comes online, we identified, train and deploy experienced oncology sales personnel, but they're hired through Quintiles, but they're solely dedicated to the Pixuvri products.
And this allows us the ability to control the timing and the cost of the field force ramp-up and deployment by not having the cost associated with developing the legal entity status, the labor law requirements and associated liabilities cost, as these are not key to our employees, but rather Quintile employees. To give you a sense of the size of that organization by the end of next year, we expect to have 31 field-based personnel, and by the end of 2014, approximately 40 field-based personnel.