SEATTLE, Aug. 5 /PRNewswire-FirstCall/ -- Cell Therapeutics, Inc. ("CTI" or the "Company") (Nasdaq and MTA: CTIC) today reported recent accomplishments and financial results for the second quarter ended June 30, 2010.

"We continue to make progress on moving the pixantrone Marketing Authorization Application ("MAA") forward in Europe with the submission of a revised and expanded Pediatric Investigation Plan ("PIP") as part of the application filing for an MAA in Europe. In the U.S., we look forward to meeting with the U.S. Food and Drug Administration (the "FDA") in August to discuss our proposed new combination trial for pixantrone in aggressive non-Hodgkin's lymphoma ("NHL")," said James A. Bianco, M.D., Chief Executive Officer of the Company. "On the financial front, we have retired all of our convertible debt due in 2010 and removed that obligation from our balance sheet leaving only two convertible debt maturities remaining in April and December of next year for a total of $21 million."

Recent Highlights

    --  Submitted revised and expanded PIP for pixantrone as part of the MAA
        submission process. The company plans to submit an MAA for pixantrone in
        the second half 2010.
    --  Signed a long-term manufacturing agreement with NerPharMa S.r.l (a
        pharmaceutical manufacturing company belonging to Nerviano Medical
        Sciences S.r.l. in Nerviano, Italy) for pixantrone.
    --  Submitted a proposal for a new clinical trial for pixantrone in
        aggressive NHL under the FDA's Special Protocol Assessment process.
    --  Retired all convertible debt due in 2010 including principal and
        interest with a payment of $39.3 million.
    --  Reported exploratory analyses from pivotal trial presented at an
        advisory panel during the 15th Congress of the European Hematology
        Association Reported demonstrated that complete responses to pixantrone
        are correlated with prolonged survival in patients with relapsed or
        refractory aggressive NHL.
    --  Initiated two phase II programs with the Mayo Clinic's clinical trial
        network, North Central Cancer Treatment Group: one program with
        pixantrone in metastatic breast cancer and one trial using brostallicin
        in triple negative metastatic breast cancer.
    --  At the American Society of Clinical Oncology Annual Meeting in June, the
        Company reported on the positive results of a phase II study using
        OPAXIO as a radiosensitizer in the treatment of esophageal cancer.

For the quarter ended June 30, 2010, total net operating expenses were $20.0 million compared to $21.7 million for the same period in 2009. Net loss attributable to common shareholders was $53.6 million ($0.08 per share) for the quarter ended June 30, 2010 compared to a net loss attributable to common shareholders of $27.4 million ($0.06 per share) for the same period in 2009. The increase in net loss is mainly due to non-cash expenses. These non-cash expenses included $30.2 million in deemed dividends on preferred stock and $7.6 million in equity based compensation for the quarter ended June 30, 2010.

For the six months ended June 30, 2010, total net operating expenses were $45.8 million, compared to $28.3 million for the same period in 2009. The increase in net operating expenses is mainly a result of a $15.3 million non-cash equity based compensation expense in the first half of 2010 and a $10.2 million gain on the sale of the Company's investment in the Zevalin joint venture in the first quarter of 2009. Net loss attributable to common shareholders was $97.8 million ($0.15 per share), compared to a net loss attributable to common shareholders of $40.6 million ($0.11 per share) for the same period in 2009. For the six month period, the increase in net loss is mainly due to non-cash expenses including $47.4 million in deemed dividends on preferred stock and $15.3 million in equity based compensation for the first half of 2010.

CTI had approximately $64.5 million in cash and cash equivalents as of June 30, 2010. This amount was before the payment of $39.3 million for retirement of the convertible debt due in 2010, which was paid off in early July 2010, and the receipt of $4.1 million in gross proceeds received from the Company's equity financing in July 2010.

Conference Call Information

On Thursday, August 5, 2010, at 8:30 a.m. Eastern/2:30 p.m. Central European/5:30 a.m. Pacific Time, members of CTI's management team will host a quarterly conference call to discuss CTI's 2010 second quarter achievements and financial results.

Conference Call Numbers

Thursday, August 5, 2010 8:30 a.m. Eastern/2:30 p.m. Central European/5:30 a.m. Pacific Time

1-877-941-2930 (US Participants)

1-480-629-9690 (International)

Call-back numbers for post-listening available at 11:30 a.m. Eastern Time:

1-800-406-7325 (US Participants)

1-303-590-3030 (International)

Passcode: 4329084#

Live audio webcast at www.celltherapeutics.com will be archived for post-call listening approximately two hours after call ends.

About Cell Therapeutics, Inc.

Headquartered in Seattle, CTI is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. For additional information, please visit www.CellTherapeutics.com.

This press release includes forward-looking statements that involve a number of risks and uncertainties, the outcome of which could materially and/or adversely affect actual future results and the market price of the Company's securities. Specifically, the risks and uncertainties that could affect the development of pixantrone include risks associated with preclinical and clinical developments in the biopharmaceutical industry in general, and with pixantrone in particular, including, without limitation, the potential failure of pixantrone to prove safe and effective for the treatment of relapsed or refractory aggressive NHL and/or other tumors as determined by the FDA and/or the EMEA, that the FDA may not accept the Company's SPA and/or proposed design for the protocol of the Company's clinical trial and/or may request additional clinical trials, that if the Company conducts an additional clinical trial, it may not demonstrate the safety and effectiveness of pixantrone, that the Company cannot predict or guarantee the pace or geography of enrollment of its clinical trials, that the Company may not initiate a new clinical trial for pixantrone in 2010, that the Company may not submit the MAA during the second half of 2010, that the EMEA may not accept the MAA, that the EMEA may not accept the PIP, that the Company may not be able to retire its 2011 debt, and the Company's ability to continue to raise capital as needed to fund its operations, competitive factors, technological developments, costs of developing, producing and selling pixantrone. Further risks and uncertainties include that the Company continues to have a substantial amount of debt outstanding and the quarterly interest expense associated with the debt is significant, the Company's operating expenses continue to exceed its net revenues, that the Company may not be able to further reduce its operating expenses, that the Company will continue to need to raise capital to fund its operating expenses and may not be able to raise sufficient amounts to fund its continued operation, and that the Company may not obtain shareholder approval to amend the Company's amended and restated articles of incorporation to increase the Company's authorized shares of common stock at the Company's Annual Meeting of Shareholders scheduled to be held on September 16, 2010, as well as other risks listed or described from time to time in the Company's most recent filings with the SEC on Forms 10-K, 10-Q and 8-K. Except as required by law, the Company does not intend to update any of the statements in this press release upon further developments.

    Media Contact:
    Dan Eramian
    T: 206.272.4343
    C: 206.854.1200
    F: 206.272.4434
    E: deramian@ctiseattle.com
    www.celltherapeutics.com/media.htm

    Investors Contact:
    Ed Bell
    T: 206.282.7100
    Lindsey Jesch Logan
    T: 206.272.4347
    F: 206.272.4434
    E: invest@ctiseattle.com
    http://www.celltherapeutics.com/investors

                                  Cell Therapeutics, Inc.

                      Condensed Consolidated Statements of Operations
                        (In thousands, except for per share amounts)
                                        (unaudited)

                            Three Months
                                Ended              Six Months Ended
                              June 30,                 June 30,
                              --------                 --------
                            2010             2009          2010         2009
                            ----             ----          ----         ----
    Revenues:
      License and
       contract revenue     $299              $20          $319          $40
                            ----              ---          ----          ---
        Total revenues       299               20           319           40
                             ---              ---           ---          ---
    Operating
     expenses, net:
      Research and
       development         6,914            7,320        14,274       15,276
      Selling, general
       and
       administrative     13,068           10,580        31,485       19,330
      Restructuring
       charges                 -            3,820             -        3,944
      Gain on sale of
       investment in
       joint venture           -                -             -      (10,244)
                             ---              ---           ---      -------
        Total operating
         expenses, net    19,982           21,720        45,759       28,306
                          ------           ------        ------       ------
    Loss from
     operations          (19,683)         (21,700)      (45,440)     (28,266)
    Other income
     (expense):
      Investment and
       other income,
       net                     1               37           263           71
      Interest expense      (776)          (1,583)       (1,563)      (3,200)
      Amortization of
       debt discount
       and issuance
       costs                (219)            (497)         (434)      (5,348)
      Foreign exchange
       gain (loss)          (825)              54        (1,300)          95
      Debt conversion
       expense            (2,031)               -        (2,031)           -
      Make-whole
       interest expense        -                -             -       (6,345)
      Gain on
       derivative
       liabilities, net        -            1,596             -        7,218
      Gain on exchange
       of convertible
       notes                   -            7,201             -        7,201
      Equity loss from
       investment in
       joint venture           -                -             -       (1,204)
      Settlement
       expense, net            -           (3,198)            -       (3,368)
                             ---           ------           ---       ------
    Net loss before
     noncontrolling
     interest            (23,533)         (18,090)      (50,505)     (33,146)
      Noncontrolling
       interest               51               63           103          152
                             ---              ---           ---          ---
    Net loss
     attributable to
     CTI                 (23,482)         (18,027)      (50,402)     (32,994)
      Gain on
       restructuring of
       preferred stock         -                -             -        2,116
      Preferred stock
       dividends               -               (1)            -          (24)
      Deemed dividends
       on preferred
       stock             (30,157)          (9,398)      (47,434)      (9,648)
                         -------           ------       -------       ------
    Net loss
     attributable to
     CTI common
     shareholders       $(53,639)        $(27,426)     $(97,836)    $(40,550)
                        ========         ========      ========     ========
    Basic and diluted
     net loss per
     common share         $(0.08)          $(0.06)       $(0.15)      $(0.11)
                          ======           ======        ======       ======
    Shares used in
     calculation of
     basic and
     diluted
      net loss per
       common share      665,963          446,174       632,658      366,293
                         =======          =======       =======      =======

                                (amounts in
    Balance Sheet Data:          thousands)
                                   -----------

                                           December
                         June 30,             31,
                               2010             2009
                               ----             ----
                        (unaudited)
    Cash and cash
     equivalents            $64,534          $37,811
    Working capital           3,295          (21,694)
    Total assets             94,578           69,595
    Convertible debt         60,553           62,142
    Accumulated deficit  (1,526,919)      (1,429,083)
    Total shareholders'
     equity (deficit)         4,616          (18,769)

SOURCE Cell Therapeutics, Inc.