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FPMI: Positive CardioPET Data. Q2 Results

By Brian Marckx, CFA


Q2 2014 10-Q Filed

FluoroPharma (FPMI) filed their 10-Q for the second quarter ending June 30, 2014.  Results remain in-line with our expectations as does cash burn.  

Q2 operating expenses were ~$1.2M, slightly better than our $1.5M estimate.  We continue to expect operating expenses to increase with clinical trials progression.  Q2 net loss and EPS, excluding non-cash securities and derivative related items, were $1.4M and ($0.05), compared to our $1.7M and ($0.06) estimates.  Cash used in operating activities was $508k, compared to $1.0M in Q1.  Ex-changes in working capital, Q2 cash used in operating activities was $1.0M, flat from Q1.  FPMI exited Q2 with $101k in cash and securities.  Subsequent to Q1 quarter-end the company raised $1.2M (gross) via the sale of one-year 8% promissory notes.   

We have made no changes to our financial model following the close of Q2.  We continue to expect that FPMI will not generate revenue prior to 2017.  We are maintaining our Outperform rating and $2.15/share price target.  See below for access to our 22-page report on FPMI.

Recent operational progress, which we discuss in greater detail below, includes additional positive data from the CardioPET phase II study which was presented in July and an agreement with PPD Development, a CRO, to manage the phase II BFPET study, which is expected to commence enrollment in the second half of this year.      

Quantitative Phase II Data Provides Additional Support of CardioPET Utility  

FPMI presented additional data from its ongoing phase II study of CardioPet at the Society of Nuclear Medicine and Molecular Imaging Annual Meeting (SNMMI), held in early June in St. Louis.

As a reminder, CardioPET is being developed as a PET imaging agent to better diagnose acute and chronic coronary artery disease (CAD), among other potential indications. The Belgian-based phase II trial is an open label study designed to assess safety and performance of CardioPET compared to SPECT myocardial perfusion imaging (MPI) agents and angiography.  

In February of this year, at the SNMMI mid-Winter meeting held in Pam Springs, FPMI presented data on fifteen patients that demonstrated CardioPET has the ability to attain high quality images very shortly after injection (below we provide additional detail on this interim data). 

The data presented at SNMMI in St. Louis reinforced the findings of the earlier data and provided quantitative output of results.  The quantitative output is presented in graphical form, showing both the rapid uptake and clearance (chart left) of CardioPET as well as how CardioPET can differentiate between normal and damaged tissue (chart right).  While the excellent quality of CardioPET images provides a reliable qualitative measure for physicians in diagnosing CAD, this quantitative output demonstrated with the current data provides what is essentially a double-check of the images, offering physicians another tool with CardioPET PET imaging.

The compilation of the clinical data continues to reinforce our belief that CardioPET has potential to unseat the current standard imaging agents for coronary artery disease imaging.  FPMI expects the Belgian-based CardioPET trial to conclude in the second half of 2014, additional data from which we expect will provide even greater insight into the efficacy of the agent.        

Promising Phase II Data Reinforces Our Confidence in CardioPET

The SNMMI presentation follows initial data from the CardioPET phase II trial which were presented in early February 2014 at the Society of Nuclear Medicine and Molecular Imaging Meeting in Palm Springs, CA. 

Fifteen patients with known or suspected coronary artery disease were included in the analysis.  Images were taken in three to five minute durations at intervals of one to ten minutes and at 15, 30, 45 and 55 minutes after injection.  Image quality was graded as either optimal, sub-optimal or non-interpretable.  Changes in blood pool activity, liver activity and delineation defects over time were recorded.

Relative to safety, there were no adverse events and no other safety issues related to CardioPET (one patient had a panic attack from being in the imaging system).  Relative to quality of the images and performance of CardioPET, images at all time points from three minutes following injection were considered excellent.  Blood pool activity began to decline in the initial one to three minute timeframe and blood pool clearance was totally completed in all patients at five minutes (image below).  Rapid blood pool clearance is beneficial as it allows for imaging shortly following injection and reduces patient exposure to imaging radiation.

CardioPET enters the myocardium similar to the way of fatty acids and remains there long enough to allow for PET imaging.  The images also showed that fatty acid uptake decreased over time.  In ischemic heart conditions, uptake of fatty acids is reduced, which would be expected in these patients.  The interim data, image quality and safety were considered very promising.  The ability to attain high quality images very shortly after injection is of particularly benefit and significant. 

Product Development Progress

Although development timelines slipped during 2013 as FPMI needed to raise additional capital, the company has made significant progress on moving both CardioPET and BFPET through the development pipeline.  Capital infusions since Q3 2013 have allowed the company to dedicate more resources towards the ongoing phase II study of CardioPET and should facilitate enrollment of BFPET studies, slated to begin at Massachusetts General Hospital.  

As noted above, we expect additional data coming out of the CardioPET studies in the near-term.  BFPET studies had been expected to commence enrollment by the end of 2013.  That was delayed but we think that will happen in the second half of this year.      

CardioPET data to-date has been consistently very positive and our expectations that follow-on results will be similarly positive.  The Belgian-based phase II trial is an open label study designed to assess safety and performance of CardioPET compared to SPECT myocardial perfusion imaging (MPI) agents and angiography.  Interim data, presented in February and June of this year (as discussed above), provided the most substantive evidence to-date of the potential performance benefits of CardioPET over current standard imaging agents.     

Relative to BFPET, in January 2013 FPMI announced that phase II trials will be conducted at Massachusetts General Hospital.  Similar to the investigator-led study, the phase II study will compare BFPET to Rb-82 and/or traditional SPECT agents such as sestamibi which suffer from certain drawbacks such as high cost or comparably (relative to BFPET) lower image quality. 

As a reminder, in July and November 2012 FPMI announced image results from a 20-patient investigator-sponsored clinical trial conducted in China where patients with CAD were imaged using BFPET. 

Alan Fishman, principal investigator of the BFPET phase I trial (completed in 2008), commented on the initial results of the China-based study released in July 2013, noting that the "initial results are impressive.  Image quality obtained using PET is superb. BFPET shows clear diagnostic qualities as well as increased resolution, inherent in PET.  The initial images look spectacular and we are confident that when all the patients are imaged, the data will further support clinical development of the agent."  His confidence was further bolstered when additional data was available in November 2013, noting "We saw a high level of agreement between the angiography, the SPECT and the BFPET images. These additional images demonstrate that BFPET shows clear diagnostic qualities as well as the increased resolution, inherent in PET."

As highlighted in the images below, image quality with BFPET as compared to standard imaging agents appears to be excellent.   

                         Difference In Image Quality Is Obvious Even To The Untrained Eye

                                Image Using Sestamibi                  

                          Image Using BFPET


While we had expected this phase II BFPET study at Mass General to initiate by year-end 2013, this was delayed.  In May FPMI entered into an agreement with PPD Development, a clinical research organization to provide clinical research services for the BFPET phase II study.  The study is now expected to commence enrollment in the second half of 2014.


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