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CEL-SCI Investors Cheer a Bit Too Loudly

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I don't usually write about the starts of clinical trials, and I've even been known to send snarky replies to PR people who pitch them to me via email. I mean, really, tell me when the thing ends; that's the data investors care about, since it drives the stock price.

So I found it curious that CEL-SCI (AMEX: CVM  ) shot up more than 25% Wednesday when the company announced it was starting a phase 3 trial testing its cancer therapy Multikine as a treatment for newly diagnosed head and neck cancer patients. Shares eventually settled up more than 8% -- still an impressive gain considering the seemingly mundane announcement.

Did CEL-SCI suddenly figure out a way to start and complete a clinical trial in one day? Was there something in the press release that gave investors additional confidence that Multikine would work? Not that I can see.

As best I can tell, this was just investors saying, "Finally!" The trial, which it's running with Teva Pharmaceutical (Nasdaq: TEVA  ) and Orient Europharma, was supposed to start in the third quarter, and CEL-SCI has been talking about it since January 2007. Momentum day traders probably helped it along.

There's likely also a little excitement as investors look at CEL-SCI as the next Dendreon (Nasdaq: DNDN  ) . Multikine is a cancer immunotherapy like Dendreon's Provenge, but unlike Provenge, which takes patient's cells and activates them at Dendreon's facility before putting them back into patients, Multikine acts internally to train the patient's immune system to attack the tumor. It's easier to manufacture since it isn't a personalized treatment, but whether it'll make it more likely that the treatment will help cancer patients remains to be seen.

The phase 3 trial looks well-planned, but I don't see much reason to jump in at this point. It's not clear that Multikine will work -- the phase 2 trial didn't have a control group -- and it's going to take a long time to get an answer. The endpoint is overall survival, which CEL-SCI believes will take three years in the standard of care group and hopefully longer in the Multikine group.

Investors looking for a company that's a little further along would be better off looking at Regeneron Pharmaceuticals (Nasdaq: REGN  ) , which will see readouts from three phase 3 trials for its cancer drug Aflibercept over the next year. For now, keep CEL-CSI at the bottom of your watchlist.

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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool owns shares of Teva and has a disclosure policy.


Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 31, 2010, at 1:48 PM, figbar wrote:

    You have got to be kidding me! You make me laugh—if it wasn’t so sad. So, you want me to invest my hard earned $100 for three shares of a cancer stock that's already $33 a share. Oh boy--I get my three shares and stock goes up like Dendreon to $50-$60 dollars a share. Wow-- I now have $150-- boy I can retire on that. –you know us small guys can-not invest thousands—or is not part of your world? Or let’s see---I could invest my $100 to buy 100 shares of Cel-Sci and if it goes up to $50 a share I can get a around $4900. So---you want me put Cel-Sci at the bottom of my watch list????? The only conclusion I can come up with is who's paying you to pump the other company and how much do you have in calls against Cel-Sci?

  • Report this Comment On December 31, 2010, at 2:36 PM, ccot wrote:

    Brian,

    You wrote that Phase 2 didn't have a control group? I direct you to the below information that appears to contridict your statement. If once you review the below information and agree, I would expect you to correct your article.

    Total Patients: 54

    27 - Control

    27 - LI

    http://gateway.nlm.nih.gov/gw/Cmd?linkVars=BROWSER_STATE%3DG...

    Total Patients: 39

    20 - Control

    19 - LI

    http://jco.ascopubs.org/content/23/15/3421.full

    Disclosure: Yes,,,you guessed it, I'm cheering too loudly.

  • Report this Comment On January 02, 2011, at 5:08 PM, messageclown wrote:

    CCOT,

    No worries, Brian was to Dendreon what Adam F. is to CEL-SCI.....he's since changed his recommendation (hindsight is 20/20). I hold Brian's bio recommendations as closely as I would hold one from Mike Ditka.....this article proves no DD was done in advance...shame on Brian. shame on the Fool.

  • Report this Comment On January 03, 2011, at 11:18 AM, Tomarcoo wrote:

    Someone mentioned "poorly researched" and that must be my conclusion too. I don't see malice, I see ignorance which can be educated. Let's start.

    So much was left out, but let's start with what was misinformation -- "no control group". Note the links provided. Not CVM, but places you should be able to feel confident with. There WAS a control group and currently, with this newly started Phase III trial all they need to achieve is a ten percent improvement to become THE standard of care treatment in Head and Neck Cancer. Repeat: THE standard of care treatment everyone gets. In the phase II trial, Multikine improved the patients by 33 percent (or something near that) far exceeding what is needed for approval.

    What was also missing is Multikine is a game changer. The FIRST off the shelf NON-Toxic cancer treatment ever. This means that the main reason most drug trials fail (they do more harm than good) is NOT an issue with Multikine. It will either work or it will not.

    Another important fact that was missing is the way the trial is set up and the way Multikine works. CVM is conducting the largest head and neck cancer trial ever. No skimping by with minimum enrollment. This speaks volumes regarding the confidence of the company in their product. Further, this is an open-label trial where results will be seen quickly.

    The way Multikine works is unique also. It is given prior to any current treatments when the immune system is strong three weeks prior to current standard of treatment. The idea is to shrink the tumor so the harmful current standard of care can be lessened or reduced doing less harm to the patient. The article should have mentioned in 12 percent of cases the tumor is removed completely within those three weeks with no further treatment needed. Yes, you read that right. The tumor is gone in three weeks without harm to the patient 12 percent of the time.

    There is reason to be interested in CVM and this trial as 1) If successful Multikine will become the standard of care, not a second line treatment when other treatments don't work. 2) Upon approval CVM will not be able to meet demand just for H & N cancer alone from the get go. 3) If Multikine works for H & N cancer, it will work for ALL cancers. 4) Results are known within three weeks of dosing. 5) May fail FDA (doubt it) requirements, but fulfill requirements for other countries so still have a product to sell. 6) The pipeline. Their other product, LEAPS is another game changer currently in a clinical trial with John Hopkins to treat ALL FORMS of the flu virus. You read that right "all mutations" of the flu virus. A game changer!

    Actually, I could go on and on but what your readers need to know is CVM is currently 85 cents a share. DNDN $36.00. Multikine is superior to DNDN as it is an off the shelf product. Phase II trials of Multikine gave a 33 percent improvement when only ten percent improvement was needed to become the standard of care. Patients, doctors, nurses, neighbors, family members and others will know the results within three weeks of dosing worldwide in the countries participating in the trial and they will be talking. If the first 100 dosings remove the tumor completely, how long before the FDA who helped plan the trial gives early approval to this NON-TOXIC treatment (granted, stretching a little)?

    I think the writer should revisit Cel-Sci and give both Multikine and LEAPS another look. Personally, I feel LEAPS will be the flagship of Cel-Sci with their RA treatment and other indications. However, Multikine is the one just starting Phase III final clinical trials at 85 cents and as an investor is truly expect this stock to at least double during the next few years based on the facts any investor doing DD can find out for themselves.

    There is a reason we share holders are excited and I think you will also share our excitement if you look a little closer. I look forward to the next story. Thank you.

    Happy New Year.

  • Report this Comment On January 03, 2011, at 7:27 PM, southernbeachguy wrote:

    Figbar.... great, I feel the same, your idea is like so many small investors. It may be a gamble, but I'd rather try for the Big money and lose than know that I'm not going to make anything if the shares do great.

    Everyone told me that it was to much of a gamble when I bought 100,000 shares of Sirus under 10 cents, but I just helds and it is at 1.70 in 22 months and going up. Good Luck.

    Cel-Sci is going into Phase 3 that is a Big step and one that deserves looking at.

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