Stock symbols are the cornerstone of the stock market and a pure source of identity for companies. Billions of investment dollars change hands every day based on those little letters. Among traders of smaller-cap stocks, the companies are often better known by their symbol then the company’s actual name, which can lead to cases of “ticker confusion” on many occasions. It’s plausible that over time significant fortunes have been made and lost with accidental ticker confusion. Speaking with Cellceutix Corporation (OTCBB: CTIX) Chief Executive Officer Leo Ehrlich on the matter, he told us that when meeting with potential new investors, they often have their ticker confused with Cell Therapeutics, Inc. (NASDAQ: CTIC). In that particular case, not only is the ticker very similar, but the names even sound very much alike.
One might think that a Bulletin Board-listed company being confused with a NASDAQ-listed biotech would be flattering, but with the negative comments by The Street Senior Columnist Adam Feuerstein regarding Cell Therapeutics recently, it can actually have a negative impact. “Honestly, it’s not good to be confused with anyone, no matter the circumstances; good or bad,” commented Ehrlich in our conversation. “I don’t know of any company, big or small, that doesn’t want their own brand. We are making a strong name for ourselves and building our identity in the field of cancer research as Cell Therapeutics is also, but we are very different companies.”
Jim Chanos has a new short target in his sights. Earlier this week, the hedge fund manager disclosed that he is betting against "legacy" data centers that face growing competition from the trio of technology giants, which have previously been their biggest customers. The fund manager, who is best known for his winning bet against Read More
Judging by past articles, Feuerstein has not been a fan of Cell Therapeutics for a number of years, but recently got the web buzzing with commentary critiquing the Seattle-based company’s decision to acquire global rights to S*BIO’s pacritinib, a highly-selective JAK2 inhibitor for myelofibrosis. Feuerstein questioned the acquisition of the drug that was cast aside by Onyx Pharmaceuticals (NASDAQ: ONXX) last year for what he called “lackluster efficacy” and an unimpressive side-effect profile.
A bit of due diligence uncovers stark differences between Cell Therapeutics and Massachusetts-based Cellceutix. To begin with, CTIC has several drugs in advanced stages of clinical trials, including a phase 3 trial on Pixuvri for non-Hodgkin’s lymphoma, whereas CTIX is more of a “grass roots” play with their lead compound, an anti-cancer drug called “Kevetrin™,” set to enter human trials at the vaunted Harvard Cancer Center’s Dana-Farber Cancer Institute and Beth Israel Deaconess Medical Center. Beth Israel Deaconess has also requested to conduct their own, hospital-sponsored studies on Kevetrin™ independent of the clinical trials so that they may do combination studies with Kevetrin™ and some of Pfizer Inc. (NYSE:PFE)’s drugs against Renal Cell Carcinoma and Melanoma. Also on the pipeline front, Cellceutix reported that a meeting is scheduled in June with the FDA to discuss protocol regarding CTIX looking for a 505(b)(2) designation for its psoriasis drug Prurisol™ which would allow the drug to begin later stage clinical trials.
Cell Therapeutics is targeting non-Hodgkin’s lymphoma with Pxuvri and myelofibrosis with pacritinib, two sizeable markets. However, data collected in lab research shows that Kevetrin™ is reactivating the critical cell cycle protein p53, known as the guardian angel gene, which has Cellceutix targeting drug-resistant cancers of many types; a market that is more robust and significantly larger than myelofibrosis and non-Hodgkin’s lymphoma combined.
Feuerstein’s latest CTIC ripping was focused on two things: the company’s dilutive practices for funding and the shot at developing a drug that larger pharma dismissed. CTIC has about 225 million shares outstanding (even after a 1 for 6 reverse split last year to save its NASDAQ listing) and burned through almost $20 million in the first quarter. Cellceutix has been internally-funded through its officers and only has 95 million shares outstanding. Cellceutix’s pipeline contains eight novel compounds.
Another big difference: Trading at $1.13 per share, CTIC carries a $230 million market cap, while at $0.50, the CTIX market cap is only at $47 million.
Both companies face clinical stage expenses. CTIC is presently footing the bill for several trials and CTIX will be having expenses for its research on Kevetrin™ and Dana-Farber. The difference is that Cellceutix maintained its share structure while generating and spending millions for laboratory studies; a showcase of management’s fiduciary responsibility that we believe will carry-through into clinical trials. This goes without mentioning the exposure that CTIX is getting by hosting trials at arguably the world’s most prestigious cancer center and the interest already being demonstrated which could lead to partnering in the future to shoulder the expense burden.
The two companies may share some letters in their tickers, both be involved with cancer and have similar sounding names, but a closer look shows two very dissimilar paths at this point towards the common goal of bringing a drug to market. For investors often a single letter difference in the stock symbol can result in whether money is made or lost.