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Celsion's Got No Reason to Be Blue

By Rich Duprey - Jan 10, 2013 at 3:04PM

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This biotech is ready to get white hot

If I remember my high school chemistry class right, the hottest part of a flame flaring up from a Bunsen burner isn't the flickering orange or yellow tip, but rather the inner blue core.

Biotech investors have put cancer-killer Celsion (CLSN -2.13%) right at the tip of that blue flame, more than quadrupling the value of its shares over the past year in anticipation of approval from the Food and Drug Administration for its novel therapy. It delivers a hot payload of drugs deep within tumors using heat-sensitive nanoparticles that are activated when radio frequency ablation, or RFA, turns up the heat. Instead of attacking the tumor from the outside, it is killed from within.

When you're hot, you're hot
There are a number of ablation technologies out there used for a number of indications. AngioDynamics (ANGO 0.00%) uses radio frequency ablation in its cancer treatments, while BSD Medical (NASDAQ: BSDM) advocates the use of microwave thermal ablation technology as the best means of killing a tumor. Boston Scientific (BSX -1.40%) treats excessive uterine bleeding in premenopausal women with hydrothermal ablation therapy, and Covidien (COV.DL) uses RFA to treat liver lesions. C.R. Bard (BCR) manufactures equipment to treat a variety of conditions.

Celsion is unique because some cancers are difficult to otherwise kill or even reach with drugs. Its treatment, ThermoDox, works with any of them as the heat-sensitive liposome changes structure when subjected to hyperthermic treatments, including RFA, microwave, and high-intensity focused ultrasound. Once heated, the drugs flood the tumor and can then do their work.

At least that's the theory it's trying to prove to the FDA, and results from its phase 3 HEAT trial are due any minute. ThermoDox, Celsion's proprietary liver cancer drug that could be a $1 billion blockbuster opportunity, has already received authorization from European regulators to submit a marketing plan based on results it achieved in the past. It's also been given orphan drug status here and abroad, though that's no guarantee of approval.

A global conflagration
As investors understand, the risks are large, but if successful the rewards are greater. The FDA has certainly cleared the decks for Celsion should the results prove to be as positive as management has indicated. It's endorsed rapid trials, a quick reading of the results, and the ability to file a new drug application very quickly.

No doubt that's because the need is so great. According to the National Cancer Institute, more than 21,000 men and 7,000 women in the U.S. will have been diagnosed with liver cancer in 2012, the disease for which ThermoDox is currently targeted. While lung cancer is currently the leading cause of death in the U.S. claiming more lives each year than colon, prostate, ovarian and breast cancers combined, the World Health Organization says liver cancer will surpass lung cancer by 2020 as there are about 750,000 new cases of liver cancer are diagnosed globally each year.

Although the most effective treatment for liver cancer is a tumor's surgical resection -- that is, the removal of all or part of the cancer -- Celsion says 80% to 90% of patients are ineligible for the procedure due to the tumor's progression. It's difficult to catch liver cancer early on because there are few symptoms that present themselves, so detection and diagnosis are often delayed. I can attest to that fact as my otherwise seemingly healthy father was diagnosed with liver cancer and four weeks later was dead.

Tuning in to effectiveness
Radio frequency ablation has increasingly become the standard of care for non-resectable liver tumors, but the treatment becomes less effective with larger tumors. Which is why ThermoDox is so important and the opportunity so great: It gets the drugs to the tumor regardless and kills it from the inside.

But Celsion still needs to reach 380 progression-free survival events to complete the HEAT study, which it expected to achieve by the end of last year. So assuming they've realized that end, we should be hearing the results soon and assuming further they're positive, the biotech could feasibly have a drug on the market by the end of the year. I've pointed out before there are some vocal skeptics who don't believe Celsion will make it across the finish line, but I've also said I'm of the mind its technology looks promising enough that I believe ThermoDox will heat up Celsion's stock further.

Let me know in the comments box below whether you agree the biotech will become white hot, or if it will flame out.

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Stocks Mentioned

Celsion Corporation Stock Quote
Celsion Corporation
$1.84 (-2.13%) $0.04
Covidien plc Stock Quote
Covidien plc
Boston Scientific Corporation Stock Quote
Boston Scientific Corporation
$37.27 (-1.40%) $0.53
AngioDynamics, Inc. Stock Quote
AngioDynamics, Inc.
$19.35 (0.00%) $0.00
C. R. Bard, Inc. Stock Quote
C. R. Bard, Inc.

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