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CELLCOR FOCUSING ON FDA APPROVAL FOR AUTOLYMPHOCYTE THERAPY

Executive Summary

CELLCOR FOCUSING ON FDA APPROVAL FOR AUTOLYMPHOCYTE THERAPY after having cut off sales and marketing operations for the cellular therapy in a corporate restructuring announced March 30. Cellcor said it hopes to achieve a 50% reduction in its overall cash burn rate, which will allow the firm to direct funds toward obtaining regulatory approval for ALT in metastatic renal cell carcinoma. FDA has not regulated ALT in the past, considering it a medical procedure to be controlled by physicians. However, the recent reorganization of the agency's Center for Biologics Evaluation and Research created a Division of Cellular and Gene Therapies, which Cellcor expects to establish procedures for premarket approval of cellular and gene therapies. The agency has been working on defining the boundaries between somatic cell therapy -- which it regulates -- and transplantation -- which it does not ("The Pink Sheet" Jan. 20, 1992, p. 11). Cellcor CEO Richard D'Antoni pointed out that FDA approval "would provide external validation for ALT's safety and efficacy and facilitate market acceptance and insurance reimbursements" for the therapy. Approval would also enable Cellcor to transport cells on an interstate basis, which would improve physicians' and patients' access to the treatment and accelerate market penetration, D'Antoni said. ALT is a multi-step outpatient process in which lymphocytes are removed from a patient's blood and exposed ex vivo to drugs and biologics which activate the T-cell component. The patient is then reinfused with activated cells, and the treatment is repeated each month for six months. Cellcor began providing ALT to patients on a commercial basis in May 1990 and raised approximately $22 mil. through an initial public offering in early 1992 ("The Pink Sheet" Feb. 24, 1992, p. 9). The company plans to make arrangements for all current commercial and research patients to receive the full course of their therapies after commercial operations are shut down. Under the restructuring plan, Cellcor will close its commercial operations in Boston, Atlanta and Orange, Calif. effective April 30 and cease its associated sales and marketing operations. The company will centralize its cell-processing capacities and reduce its workforce by approximately 50% to 45 people. Cellcor will begin its second randomized controlled trial of ALT in metastatic renal cell carcinoma later this year. The trial is expected to be a comparison of ALT to alpha interferon conducted at approximately 15 independent academic centers in the U.S. The National Cancer Institute will monitor the study, and it will be managed by an independent clinical research organization, Cellcor said. The firm said it has withdrawn from a trial that was to be conducted by the Eastern Cooperative Oncology Group because the study would not aid in obtaining FDA approval for ALT. Cellcor is continuing work on its current Phase III trials of ALT in renal cell cancer and its early pilot work on ALT applications for chronic hepatitis B. However, the company emphasized that continued development of ALT for indications other than metastatic renal cell carcinoma will depend upon establishing additional funding sources. As a part of its realignment, Cellcor is increasing its efforts to find corporate strategic partners interested in further developing ALT as well as in leveraging Cellcor's cell-processing infrastructure and expertise. On March 30, the company released its final audited results for 1992. The restated results reflect a $2.3 mil. one-time charge for restructuring, leaving Cellcor with a net loss of $12.5 mil. for the year ended Dec. 31, compared with a loss of $9.8 mil. in 1991. At the end of 1992, the company had cash and short-term investments on hand of approximately $13 mil. Cellcor's restated fourth quarter loss grew to $5.3 mil. from $2.6 mil. in 1991.
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