CEO: Myron Holubiak
About: Citius Pharmaceuticals (NASDAQ: CTXR) is a specialty pharmaceutical company dedicated to the development and commercialization of therapeutic products for large and growing markets. Citius products offer new and expanded indications for previously approved pharmaceutical products as a means to achieve leading market position or market exclusivity. By using previously approved drugs with substantial safety and efficacy data, Citius seeks to reduce the risks associated with pharmaceutical product development. Citius is currently advancing two proprietary product candidates, our Mino-Lok™ product and a Hydrocortisone-Lidocaine formulation. Citius believes the markets for its products are large and underserved by the current standard of care.
WSA caught up with Citius CEO Myron Holubiak to provide an update since their previous conversation from January 2018. Mr Holubiak provided an update on CTXR’s Mino-Lok platform, discussed their partnership with MD Anderson, and talked about milestones and hurdles moving forward. Have a listen below:
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WSA: Good day from Wall Street, this is Juan Costello, Senior Analyst for the Wall Street analyzer, joining us today is Myron Holubiak CEO and president of Citius Pharmaceuticals. The company trades on NASDAQ ticker symbol CTXR. Thanks for joining us today there Myron.
Myron Holubiak: Sure, it’s my pleasure.
WSA: Certainly, so yeah starting off please provide us a history and overview of the company for some of our listeners here new to your story?
Myron Holubiak: Sure. The company’s Citius Pharmaceuticals, actually its name comes from the Olympic motto ‘Citius, Altius, Fortius’ which means faster, stronger, higher. And Citius we kept the name Citius after our merger. Leonard-Meron Biosciences which was the original private company merged with Citius and we kept Citius’ name largely because of our strategy. Our strategy fundamentally is to quickly create products with very low development risk, but have indications, applications if you will, that are unique.
That’s not easy to do, but we’ve been able to do it several times now and I’ll take you through some of that shortly. But our lead product, which is sort of an epitome of that strategy is the use of agents such as minocycline, a relatively old antibiotic, disodium EDTA, a chelating agent and ethanol when mixed together provide unique results. And that is that it can actually penetrate biofilm produced by infecting organisms. So it makes this especially useful in treating infected catheters that cause bacteremia.
So, back about a year ago when we had our last discussion, we were just initiating our clinical trials, we are in phase III. We have well over 20 sites that are now treating patients; it is a blinded study in terms of blinded to us. So therefore we don’t know how we’re doing yet, but we expect that somewhere in Q-2 of this year we’ll be able to break the blind—according to the plan that we have with the FDA and see how we’re doing. And we’re hoping that at that point in time, if we have a statistical significant advantage over regular antibiotic blocks, that we may be able to even stop the study. Now we don’t promise that, we think we’ll have to carry this study all the way through to its conclusion, which should be this year, but we do have fast track, we do have priority reviews, so once the NDA is filed, we expect quick action within a six month period time that would place it in 2020.
WSA: Yeah, sure. Please bring us up to speed on some of your recent news as you just announce the licensing agreement for Mino-Wrap ect?
Myron Holubiak: Sure. Well I guess the biggest news was what I just mentioned and that is that Mino-Lok is in the clinic, it is being used and treating patients by all measures, probably these are very, very sick patients. So you have some degree of mortality associated — usually to the underlying disease, which is a cancer. But we are in the clinic and we’re treating patients, so that’s the biggest news. The second biggest news, which just came out last week, we put out an 8-K and ultimately some press releases is that we were able to license again a worldwide license and also with the MD Anderson Cancer Center, another product along that line, we call it Mino-Wrap. It has the same antibiotic component, but in this particular case, it’s used, it’s a gelatin film, it’s used to encapsulate a tissue expander which is used when you’re preparing a patient for a breast implant, post-mastectomy.
There is a period of time when the risk of infection is fairly high, somewhere in the neighborhood of 10%. And today they use preoperative IV antibiotics; sometimes they irrigate the pouch itself that’s been developed for the future breast implant. In this case we actually put the tissue expander itself; we wrap it with the gelatinous substance that has minocycline and Rifampin. And that provides antibiotic protection for a longer period of time than just the irrigating and that means that at least at the time of greatest risk when patients still have drains in their suture area, we provide coverage at that point in time.
So, about 100,000 women have breast reconstructions, well over 80% use tissue expanders to prepare that breast for an implant in the future and we think that this is a very interesting opportunity for the company; it helps expand our minocycline platform and also it’s another reason — well we work with MD Anderson and we’re developing a very good relationship with them that we hope continues to provide new interesting important products that we would be able to develop and ultimately commercialize.
WSA: Yeah, certainly you have a good ongoing partnership with them. And so most of these products are based on preventing, I guess further infections and also more for comfort of the patient?
Myron Holubiak: Well I would say that the Mino-Lok product is not for prevention, it’s for treatment. So we actually use it when you have an infected catheter and that’s a scary situation, there’s morbidity as high as 25%. So it’s a very important area. The second product is for prevention, so that is correct. And in that particular case, we want to provide protection in the surgical site for a long enough period of time when the patient is at risk. Both of them do help with comfort — avoid discomfort.
Removing and replacing central venous line is not a pleasant experience; we avoid all that, because we treat the catheter in situ, which means it’s in the body you don’t manipulate it as you would with the standard of care, which is to remove the catheter and ultimately replace it, so we avoid all that. And yeah we’ve had 100% success in sterilizing the catheter and basically salvaging the catheter after it’s been treated.
In the breast situation, now we’re still in preclinical stage, we’ve not put this in human yet. So you know just to clarify, our Mino-Lok is in phase III, so we’re getting pretty close to approval. The Mino-Wrap we have yet to go into humans, but we’ve done a lot of preclinical work –we’ve been involved with the preclinical work with MD Anderson as conducted.
WSA: Yeah, so what are some of the milestones and hurdles here in terms of efficacy?
Myron Holubiak: Yeah, I’ll take them both — one at a time. Mino-Lok, we expect to have somewhere in Q2 an interim analysis where we’ll break the blind and see what we’re doing and that’ll determine what the future pathway is, either it will be available in early 2020 or will be available in later 2020. But that is a major milestone; it’s a major event that of course we’ll be reporting when that happens. On Mino-Wrap, the first decision we have to make is which regulatory pathway would be appropriate for the development of this product for human use. We’ve done a number, as I mentioned preclinical studies; the next step is to find out through the office of combination products, as you can imagine this could be considered a device or it could be considered a drug, it actually is a combination of both. So our intended pathway is to go the OCP, The Office of Combination Products and get some ruling on the jurisdiction of which division, whether it’s CDRH or if it’s CDER that will be governing our development. And that will either be as a device or as a drug. If it’s a device that means it will be a relatively short period of time. We expect that that means about a year even though I don’t know that for sure, this is our planning stage, it will take about a year to develop and make available for market. If it’s a drug we envision that to be at least two years.
WSA: Certainly and so in terms of Mino-Lok you have that patent locked up until after 2030?
Myron Holubiak: Yeah, I guess that was another development that I neglected to mention. We have another patent issued for us several months ago. So we’re good until 2036 with a new formulation patent that was issued. We do have a composition of matter patent that had been issued some time ago that took us past 2024, we now go up to 2036. But I do want to remind investors that we also have QIDP, the Qualified Infectious Disease Product part of the GAIN act, which adds five years of patent life — actually market exclusivity at the time of NDA. So with all that in place, we know we have a very healthy intellectual property protection for that long period of time. On Mino-Wrap that also has a patent and you know we expect that to — and I’m not exactly sure — you know I don’t have it in front of me, but I know that it’s good into 2030s, but I can provide that data to you some other time.
WSA: Right. Is that just in the US or you also have European?
Myron Holubiak: Both Mino-Lok and Mino-Wrap are worldwide patents, other product which we haven’t even talked about CITI-002 which is Halo-Lido topical preparation for symptomatic hemorrhoids treatment that is a US only development.
WSA: Right, yeah I know we had discussed it last time and I guess it’s still in the early stages?
Myron Holubiak: Well its beyond early, but what we’ve been able to do is we were unhappy with the performance of the corticosteroid, the initial trial, the initial phase II trial use hydrocortisone and hydrocortisone plateaued after a while, no matter if you increase dose, you still don’t get an increased effect. So we are interested in changing the corticosteroids, which we were able to do after discussions with the FDA. So we had an FDA meeting, at that meeting we proposed changing over to Halo-Lido – halobetasol which now we call CITI-002; they requested us to do an animal toxicity study before we can jump back into a phase II. So that’s the next thing that’s going to happen on that particular product. We expect the animal toxicity study should take place towards the end of this quarter, meaning in the March-April time period.
WSA: Yeah, certainly. So what are some of the key company drivers that you believe investors should be aware of?
Myron Holubiak: Well, I think the biggest one is, everything we’re doing is relatively low risk. And the reason it’s low risk is that we’re using agents that have been used in man before. So a driver there is you’re going to have lower risk in terms of the development pathway, but probably the other kind of balancing feature is that we’re looking at brand new indications. As an example, there were no antibiotics solutions that have been approved for a therapy in salvaging infected catheters in catheter related blood stream infections.
So it’s a brand new indication, it’s a very serious unmet medical need that we’re addressing with agents that have been there before, so that’s a driver. Secondly, is Mino-Wrap, you know that’s an innovative new way to take a look at providing extended protection particularly when you have implants. We believe that there will be application that goes well beyond breast implants such as even the metallic implants that one has in knees and hips and things like that. Now it’s very early before we jump into anything like that, but it has that kind of a promise and we all know how important it is that an implant not get infected.
And then lastly the hemorrhoid product, there are no approved FDA products, prescription products for hemorrhoid treatment. So even though we’re using substances that have been used on man before, it would be the only product with an official indication from FDA prescription product with evidence. So all of those are important differentiations which make us different from just about anybody else and I think you take a look at the risk/reward in that scenario and it’s quite good.
WSA: Certainly and you also completed a recent capital raise?
Myron Holubiak: Yes, we did. We raised $10 million and what I would say, we did a very limited raise and half of that raise was myself and my partner who’s our executive chairman, Leonard Mazur, the two of us put half of that amount in. So obviously we believe in what we’re doing. I might mention that the two of us have put in $18 million to date into the company. And I think it’s rare to find a management team that believes so much in what they’re doing, but they commit to that degree.
WSA: Yeah, certainly. And so once again joining us today is Myron Holubiak CEO and President for Citius Pharmaceuticals which trades on NASDAQ ticker symbol CTXR, currently trading at 1.11 share and market cap is about 20 million. So before we conclude here, Myron is there else that you’d like to add about Citius?
Myron Holubiak: Well, the only thing I would say is that we believe we’re grossly undervalued. We have a phase III asset; it’s got huge market potential. I think that the difficulties of the trials themselves are what’s sort of keeping people away. And also it’s not the new sexy biotech yet, yet we’re treating very serious illnesses. So I think over the next year our job will be the proof of the potential of the products that we’ve developed in and people to understand what our strategy is and the soundness of that strategy in terms of minimizing risk and enhancing the reward. So I think as we educate people along the way here, as we meet our milestones, as we discuss the results of our trials, we expect that this should become a very attractive investment.
WSA: Well, we certainly look forward to continue and track the company’s growth and report on your upcoming progress. And we’d like to thank you for taking the time to join us today Myron and update our investor audience and Citius, it’s always good to have you on.
Myron Holubiak: Thank you Juan.