CEO Interview: ADVENTRX Pharmaceuticals, Inc. - Brian M. Culley

• On 12:08 pm EDT, Tuesday October 20, 2009

67 WALL STREET, New York - October 20, 2009 - The Wall Street Transcript has just published its Biotechnology Report offering a timely review of the sector to serious investors and industry executives. This 70-page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Heightened M&A Activity - Trend Toward Orphan Disease Drug Development - Generic Drug Competition - Current Length Of FDA Approval Process - Ownership Ego Preventing Shareholder Returns - IPO And Secondary Offering Window Opening - Big Pharma R&D Pipeline - Decreased Clinical Development Risk - Impact Of Health Care Reform - Convergence Of Large-Cap Biotech And Pharmaceutical Companies - Easier Credit For Small Cap Biotech Companies - Developments In Cancer Chemotherapeutics - Gene Delivery Technology

Companies include: ADVENTRX (ANX); Abbott Labs (ABT); Advaxis (ADVX); Amedisys (AMED); Amgen (AMGN); Amylin Pharmaceuticals (AMLN); Antares Pharma (AIS); BioDelivery Sciences (BDSI); Biogen Idec (BIIB); Biomarin (BMRN); Boston Scientific (BSX); Bristol Myers (BMY); CVS Caremark (CVS); Celgene (CELG); Cerner (CRN); Cerus (CERS); Coke (KO); CombiMatrix (CBMX); Coventry Health Care (CVH); DARA (DARA); Eisai (ESALY); Eli Lilly (LLY); GenVec (GNVC); Gilead (GILD); GlaxoSmithKline (GSK); Health Management Associates (HMA); Human Genome Sciences (HGSI); Inspire Pharmaceuticals (ISPH); Intellect Neurosciences (ILNS.OB); InterMune (ITMN); International Stem Cell (ISCO.OB); Javelin Pharmaceuticals (JAV); Johnson & Johnson (JNJ); Keryx Biopharmaceuticals (KERX); Kraft (KFT); MAP Pharmaceuticals (MAPP); Medco (MHS); Merck (MRK); Merit Medical (MMSI); Novartis (NVS); Novelos (NVLT.OB); Novo Nordisk (NVO); Nutrisystem (NTRI); OSI Pharmaceutical (OSIP); Orexigen (OREX); Pepsi (PEP); Pfizer (PFE); Rite Aid (RAD); Schering-Plough (SGP); Takeda (TKPHF); Teva Pharmaceuticals (TEVA); Viropro (VPRO.PK); Walgreens (WAG); Wyeth (WYE); XOMA (XOMA); ZIOPHARM (ZIOP).

In the following brief excerpt from the 70-page report, Brian M. Culley, CEO of ADVENTRX Pharmaceuticals, Inc., discusses the outlook for the sector and for investors.

TWST: What are your leading therapies?

Mr. Culley: We currently have two programs, both of which are new formulations of cancer chemotherapeutics. One of them is a new formulation of vinorelbine, a drug commonly used to treat breast cancer and non-small cell lung cancer. This product candidate, known as ANX-530, was designed to reduce phlebitis, a severe injection site reaction, which is a common problem with off-the-shelf generic versions of vinorelbine. Our formulation was designed to reduce this side effect without affecting the underlying pharmacokinetics or efficacy of vinorelbine. The other product that we are developing is ANX-514, which is a detergent-free formulation of docetaxel. Docetaxel is widely known by its brand name, Taxotere, and is used to treat solid tumors such as breast, lung, prostate and gastric cancers. A big problem with Taxotere is that it's formulated with detergent, and the detergent can cause side effects such as hypersensitivity reactions. To mitigate these side effects, physicians often pre-treat patients with steroids, but these have costs and themselves have side effects. Our formulation, known as ANX-514, is completely detergent-free, so we obviously wouldn't expect to observe any of the side effects which are caused by detergent. We're trying to provide alternatives to currently available chemotherapies but without starting from scratch and reinventing the wheel, so to speak.

TWST: Like other companies, you have felt some pain from the economic downturn and tightening of credit. What adjustments have you had to make to continue moving forward?

Mr. Culley: There are two important changes that we've implemented. First, we have gone to a highly outsourced business model. We retain a small number of full-time employees and contract for most of our development activities. That provides us with tremendous financial and operating flexibility, and we're able to attract experienced advisers at very reasonable rates. Second, we've had to be realistic about raising capital. I'm never pleased about raising money at low valuations, but the capital markets have been so selective that in some ways, raising money as a small-cap biotech firm is itself an imprimatur of high value and a testimonial to our business.

TWST: You recently announced a stock sale that will prove you with about $11.3 million. Would you tell us about that?

Mr. Culley: This was our fourth financing since June, the other three were much smaller. With this latest round, we believe we have the funds to get us deep into 2010 and through an important milestone - the FDA decision on ANX-530. So via this financing, we have eliminated a substantial amount of financing risk, which is something that investors are paying a lot of attention to. And being able to raise capital on four separate occasions in a difficult market reflects positively on our strategy, our product candidates and our core formulation technology.

TWST: How would you like to see the company evolve over the next couple of years?

Mr. Culley: We're strongly committed to creating value for ADVENTRX stockholders. That might mean we will be acquired or will remain as an independent business, and we will make those determinations as we grow, but we will always make the decision that we believe maximizes our value on a risk-adjusted basis. We know that focusing on products that are desired by patients and doctors will naturally create a high-value company, so we are open-minded as to the ultimate outcome. We have and will continue to entertain credible discussions concerning partnering and acquisition, but in the meantime we will move forward on the regulatory and commercial plan I've described and build the business with both long- and short-term value in mind.

TWST: What makes ADVENTRX a good investment?

Mr. Culley: As investors begin to return to the micro-cap markets, I think that ADVENTRX offers them a lower-risk regulatory path, shorter timelines to major value-creating events and hopefully a good return on their investment. Our shares are widely held with significant trading volume and within a complex biotech space; we have an easy-to-understand story. I also think that much of our success next year will be driven by execution rather than by clinical risk. So as investors look at the health care sector, ADVENTRX is well poised to offer a comfortable place to make an investment in what is still a time of considerable uncertainty.

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 70-page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online .

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