WASHINGTON, D.C. 20549

 

FORM 10-K

 

 

COMMISSION FILE NO. 0-29608

 

GENETRONICS BIOMEDICAL CORPORATION

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

 

 

SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: NONE

 

Indicate by check mark whether the Company (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ý

 

Indicate by check mark if whether the Registrant is an accelerated filer (as defined, in Exchange Act Rule 12b-2).  Yes o No ý

 

The aggregate market value of the voting and non-voting common equity (which consists solely of shares of Common Stock) held by non-affiliates of the Registrant as of June 30, 2003 was approximately $36,025,639 based on $0.72, the closing price on that date of the Registrant’s Common Stock on the American Stock Exchange.  The number of shares outstanding of the Registrant’s Common Stock, $0.001 par value, was 69,312,880 as of March 12, 2004.

 

DOCUMENTS INCORPORATED BY REFERENCE

 

Portions of the Registrant’s Definitive Proxy Statement issued in connection with the 2004 Annual Meeting of Stockholders of the Registrant are incorporated by reference into Part III.

 

 

TABLE OF CONTENTS

 

PART I
ITEM 1. BUSINESS
ITEM 2. PROPERTIES
ITEM 3. LEGAL PROCEEDINGS
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
ITEM 7A. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
ITEM 9A. CONTROLS AND PROCEDURES
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
ITEM 11. EXECUTIVE COMPENSATION
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
SIGNATURES
CONSOLIDATED FINANCIAL STATEMENTS

 

THIS ANNUAL REPORT ON FORM 10-K CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES. SUCH STATEMENTS INCLUDE, BUT ARE NOT LIMITED TO, STATEMENTS CONTAINING THE WORDS “BELIEVES,” “ANTICIPATES,” “EXPECTS,” “ESTIMATES” AND WORDS OF SIMILAR MEANING. THE COMPANY’S ACTUAL RESULTS COULD DIFFER MATERIALLY FROM ANY FORWARD-LOOKING STATEMENTS, WHICH REFLECT MANAGEMENT’S OPINIONS ONLY AS OF THE DATE OF THIS REPORT, AS A RESULT OF SUCH RISKS AND UNCERTAINTIES. THE COMPANY UNDERTAKES NO OBLIGATION TO REVISE OR PUBLICLY RELEASE THE RESULTS OF ANY REVISIONS TO THESE FORWARD-LOOKING STATEMENTS. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES INCLUDE, BUT ARE NOT LIMITED TO, THOSE FOUND IN THIS ANNUAL REPORT ON FORM 10-K IN PART I, ITEM 1 UNDER THE CAPTION “CERTAIN RISK FACTORS RELATED TO THE COMPANY’S BUSINESS,” IN PART II, ITEM 7 UNDER THE CAPTION “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” AND ADDITIONAL FACTORS DISCUSSED ELSEWHERE IN THIS ANNUAL REPORT AND IN OTHER DOCUMENTS THE COMPANY FILES FROM TIME TO TIME WITH THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING ITS QUARTERLY REPORTS ON FORM 10-Q. READERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON ANY FORWARD-LOOKING STATEMENTS.

 

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PART I

 

ITEM 1. BUSINESS

 

OVERVIEW

 

We are a San Diego-based biomedical company whose technology platform is based on medical devices that use Electroporation Therapy (EPT) to deliver drugs and genes into cells. We are developing and commercializing novel medical therapies to address a number of critical unmet treatment needs using EPT. Our MedPulser System is in late stage development in the United States for the treatment of head and neck cancer.  This system delivers electrical pulses to tumors injected with the generic drug bleomycin. The unique feature of the system, which uses a generator together with disposable needle applicators, is the preservation of healthy tissue at the margins of the tumor. We believe this may afford distinct advantages over surgery in preserving function and improving the quality of life for cancer patients who would otherwise face significant morbidity associated with cancer surgery.  We believe that the planned commercial launch of our CE certified MedPulser System in Europe in 2005 represents an important milestone for us. We have also been developing devices for the delivery of DNA for DNA vaccinations and gene therapy. We believe that through our research efforts and those of our corporate partners, that we will soon execute the first clinical study involving the use of EPT with DNA involving human patients.  We believe that our compelling asset base of intellectual property and scientific and engineering accomplishments, combined with clinical results position us as a leader in EPT.

 

The primary front line treatment of solid tumors involves surgical resection and/or radiation to debulk and control tumor growth prior to initiating systemic therapy with chemotherapeutic agents. Because surgeons often  cannot distinguish the border, or margins, between healthy and diseased tissue, they will often resect an area outside of the obvious tumor mass. This can result in the loss of function and appearance of the surrounding tissues and organs, reducing the patient’s quality of life. Examples include the loss of speech from resection of tumors on the tongue and larynx or loss of erectile function from resection of the prostate. Recent advances in non-surgical forms of tumor ablation, such as cryoablation, microwave or high frequency radio ablation therapy, fail to meet clinical needs in preserving normal healthy tissue. Given the desire for improved outcomes in the surgical resection of a large number of solid tumors such as head and neck, cutaneous, pancreatic, breast and prostate cancer, we believe that there will be significant demand for its technology from surgical oncologists.

 

We believe that attempts to pioneer new therapies based on DNA have been hampered by the use of viral vectors to deliver DNA. In addition to safety issues, viral vectors are difficult and expensive to manufacture. Because electroporation has proven efficient and safe in animal experiments, we are developing a MedPulser DNA Delivery System. By engineering different applicators, we can deliver DNA to the muscle, skin or vasculature. This should facilitate attempts to use DNA for therapies ranging from vaccination to gene therapy of single or multiple gene defects, including cancer and vascular diseases. As with our oncology program, we believe that our efforts in DNA delivery position us as a leader in the field.

 

Our Internet website address is www.genetronics.com.  We make our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, Forms 3, 4, 5 filed on behalf of directors and executive officers, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities and Exchange Act of 1934, available free of charge on our website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission (the “SEC”).  You can learn more about us by reviewing such filings on our website or at the SEC’s website at www.sec.gov.

 

RECENT DEVELOPMENTS

 

On July 16, 2003, we issued a press release announcing that we had raised an aggregate of $15,670,000, through the sale of $8,170,000 of our Series A Cumulative Convertible Preferred Stock and $7,500,000 of our Series B Cumulative Convertible Preferred Stock, to institutional and accredited investors. All proceeds from the sale of Series A and Series B Cumulative Convertible Preferred Stock have been received.

 

On October 20, 2003, we announced that we had entered into an agreement with Vical Incorporated (NASDAQ: VICL) pursuant to which Vical has an option to a worldwide exclusive license for the use of our proprietary in vivo electroporation delivery technology in combination with Vical’s vaccine and therapeutic DNA

 

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technology for undisclosed targets. Upon completion of a collaborative research program, our partnership with Vical could lead to a definitive licensing agreement, encompassing multiple indications with the potential for commercialization.

 

On November 10, 2003, we announced that we appointed Gene Larson to our Board of Directors.

 

On December 2, 2003, we announced that we had extended our collaborative agreement with Chiron to conduct additional experiments using electroporation to test an HIV DNA vaccine. We are testing our preclinical and clinical grade electroporation devices in combination with Chiron’s PLG DNA particle technology for use in DNA vaccination applications. The agreement was extended in order for Chiron to complete studies that explore the feasibility of future clinical development of a DNA vaccine against HIV, the causative agent for AIDS. In addition to the studies covered by this agreement, we have an agreement with Chiron to explore electroporation-assisted delivery of a second DNA vaccine for an unnamed indication.

 

On December 18, 2003, we announced that we had appointed Simon X. Benito to our Board of Directors.

 

On January 20, 2004, we announced that we have been granted two new U.S. patents. The first patent includes claims to novel, less severe methods for delivering an agent, such as a drug or polynucleotide, into a cell. We believe that this patent enhances the intellectual property for the oncology, gene therapy and DNA vaccine applications of electroporation. The second patent includes claims to methods for reducing changes in target muscle tissue from the application of an electric field, the key elements including electric pulsing parameters. We believe this patent has applicability in the field of gene therapy and DNA vaccines.

 

On February 4, 2004, we announced that we have entered into an agreement with RMR Technologies, LLC (“RMR”), to permit us to commercialize RMR’s electroporation methods and devices on a worldwide exclusive basis. This extends a long-standing relationship with University of South Florida scientists and RMR founders Drs. Richard Heller, Mark Jaroszeski, and Richard Gilbert, dating back to the co-development of our CE marked MedPulser technology for the treatment of solid malignant tumors including head and neck cancers.

 

During the first quarter of 2004, we initiated two Phase III head and neck clinical trials in the United States and Europe. On February 23, 2004, we announced that we have completed the Special Protocol Assessment review process with the FDA for the two Phase III pivotal studies to evaluate the use of our MedPulser® Electroporation Therapy System as a treatment for recurrent and second primary squamous cell carcinomas of the head and neck (SCCHN). Three Institutional Review Boards (IRBs) in the U.S. have approved the two protocols to date, and we have initiated patient enrollment.  These trials compare EPT to surgery using a primary endpoint of function preservation and secondary endpoints of local tumor control, disease-free survival and overall survival. Shifting from a primary endpoint of survival to a quality of life outcome allows us to carry out clinical trials that we expect may be faster, less costly and have a higher likelihood of success. As a result, our previously announced Phase III head and neck trials focusing on survival as a primary endpoint have been discontinued.

 

On March 1, 2004, we announced that we have begun treating patients with primary or recurrent squamous cell carcinoma of the head and neck (SCCHN) in a post European regulatory approval clinical study. The clinical study is designed to support the commercialization of our MedPulser® Electroporation System in the European Union (EU). The European clinical study will facilitate adoption of the technology by thought leaders and allow us to apply for reimbursement.   Prior clinical trials established the safety and performance of the MedPulser® System for the treatment of SCCHN, leading to approval for sale in the EU based on achieving the CE Mark.

 

On March 9, 2004, we announced the selection of Quintiles Transnational Corp., a leading global pharmaceutical services organization, as the clinical research organization (CRO) for our clinical trials in the U.S. and Europe for the treatment of head and neck cancer.

 

BUSINESS OBJECTIVES AND MILESTONES

 

	Our goal is to accomplish the following business objectives and milestones over the next 18 months:
(1)	expand patient enrollment in phase III recurrent and second primary head and neck cancer study

 

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	(see “Oncology —Overview”);
(2)	support and manage CRO efforts for U.S. and European clinical trials (see “Oncology – Overview”);
(3)	advance the European clinical study in primary or recurrent squamous cell carcinoma of the head and neck (SCCHN) to support the commercialization of our MedPulser® Electroporation System in the European Union (EU). (see “Oncology —Overview”);
(4)	advance the European clinical study for primary and recurrent skin cancers to support commercialization of the MedPulser® (see “Oncology —Overview”) ;
(5)	develop additional indications, such as cutaneous, prostate, breast, pancreas and liver cancers (see “Oncology —Overview”);
(6)	obtain codes for reimbursement and early sales of the MedPulser® System for the treatment of H&N or cutaneous cancers in Europe (see “Oncology —Overview”);
(7)	enter into further industry relationships for the use of our EPT technology in the delivery of specific genes (see “Gene Therapy — Overview”); and
(8)	initiate the first Phase I human clinical study involving the use of electroporation with DNA, most likely in the areas of DNA vaccination for infectious disease and/or cancer. (see “Gene Therapy – Overview”)

 

DRUG AND GENE DELIVERY

 

We develop equipment that is designed to allow physicians to use EPT to achieve more efficient and cost-effective delivery of drugs or genes to patients with a variety of illnesses. Although there are many diseases where improved drug or gene delivery is important, we believe that our greatest opportunities lie in applying EPT in the areas of oncology and gene therapy (including DNA vaccines) and we are focusing our efforts on these applications.

 

ONCOLOGY

 

OVERVIEW

 

In the area of oncology, we have initiated Phase III clinical trials and have completed Phase II clinical trials in the United States using the MedPulser® System to deliver bleomycin for the treatment of late stage head and neck cancer. Bleomycin is an effective generic chemotherapeutic agent that induces single and double strand DNA breaks in cancer cells.  However, because of its size and electrical charge it is difficult to deliver across the cell membrane. We have chosen bleomycin as the chemotherapeutic agent that we deliver for the treatment of cancer because of its unmatched efficacy as a chemotherapeutic agent when delivered by electroporation. Bleomycin has been approved by the FDA in the United States and the Health Protection Branch in Canada, and has been used as a chemotherapeutic agent in North America for the treatment of certain cancers for more than 25 years.

 

Initially, we made head and neck (H&N) and cutaneous cancers our highest priority. A Phase II trial using EPT and bleomycin to treat late stage recurrent H&N squamous cell carcinoma produced a 25% complete response and 57% objective response, which we believe are excellent results at this disease stage. In a European early stage oral cavity squamous cell carcinoma trial, 16 out of 20 patients (80%) showed no viable cancer cells, which we believe validates EPT’s potential as a primary treatment for H&N cancer. Anecdotally, in a cutaneous cancer trial, 130 of 146 tumors (89%) demonstrated a complete response. Using significantly smaller chemotherapeutic doses than in conventional chemotherapy, results to date indicate that EPT matches or exceeds tumor response and survival results of current traditional therapies while preserving healthy tissue, and resulting in nominal systemic drug distribution and related side effects, and potentially at lower cost. EPT potentially preserves a patient’s appearance or ability to speak, smell, eat, or taste, potentially uniquely enhancing the quality of life of such patients suffering from cancer’s harsh effects.

 

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We have completed a number of other clinical studies in Europe using the MedPulser® System to deliver bleomycin for the treatment of liver, pancreatic, basal cell and Kaposi’s sarcoma cancers. The results from the clinical studies that we carried out in Europe have allowed us to obtain a CE Mark certification qualifying the MedPulser® System for sale in Europe. We are continuing to carry out and expand our market seeding clinical studies in Europe using the MedPulser® System to deliver bleomycin for the treatment of both early and late stage head cancer.

 

In addition to our work in head and neck cancer, we plan to use the MedPulser® System to deliver bleomycin for the treatment of other cancers. We are currently reviewing a number of other cancer indications in order to assess our competitive advantage for the treatment of cancers and the size of the market that we might serve. The next application for which we are preparing protocols for submission to the FDA are for disfiguring cutaneous cancers that may benefit from the tissue and function sparing attributes of EPT+bleomycin.

 

PARTNERSHIPS AND COLLABORATIONS

 

On September 20, 2000, the University of South Florida Research, Inc. (“USF”) granted us an exclusive, worldwide license to its rights for certain patents and patent applications generally related to needle electrodes. We jointly developed these electrodes with USF. The terms of the exclusive license include a royalty to be paid to USF based on net sales of products under the license. As of December 31, 2002, no royalty had accrued as no sales were generated from this product. In addition, we issued a total of 150,000 Common Shares and a total of 600,000 Warrants (some of which will vest subject to the occurrence of specified milestones) to USF and its designees, Drs. Heller, Jaroszeski, and Gilbert.

 

On August 8, 2000, we entered into a new supply agreement with Abbott Laboratories (“Abbott”) to purchase the approved anti-cancer drug bleomycin for use in the United States with our MedPulser® System after regulatory approval had been granted for its use for the treatment of patients with solid tumor cancers. Under a separate agreement, we entered into a supply agreement with Faulding, Inc. to purchase bleomycin for use in Canada after regulatory approval had been granted for its use. Both agreements provide that we may purchase bleomycin from time to time in accordance with the terms of the respective agreements.

 

MARKET

 

We hope to market our MedPulser® System to deliver chemotherapeutic agents, such as bleomycin, for the treatment of cancer. EPT can address many diseases, but we have focused on oncology’s significant unmet needs.  There is still much that scientists do not know about cancer; consequently, there are significant unmet needs in its treatment. We have initially targeted those indications, such as head and neck cancer, for which current treatments result in a poor quality of life and very high mortality rates.

 

TREATMENT OF HEAD AND NECK TUMORS

 

The use of EPT is quite simply understood and easy to apply:

 

•                       The physician selects and connects the sterile applicator appropriate for the nature and location of the tumor;

 

•                       The patient is given general anesthesia in a hospital operating room setting. Certain future applications may require only local anesthesia;

 

•                       The drug is injected into the selected tissue, followed by a brief few-minute interval;

 

•                       The applicator needles are then inserted into the tumor;

 

•                       The physician activates the electrical pulse using a foot pedal or hand switch;

 

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•                       For a larger tumor or area, the applicator is reinserted in an overlapping pattern to cover the entire tissue area requiring treatment;

 

•                       After treatment, the needle array applicator is disposed of.

 

The entire procedure can be completed within 20 minutes or less and typically needs to be done only once. The dosage of drug used is based on tumor volume and is typically a small fraction (1/3 to as little as 1/50th) of the dosage that would be used if injected systemically into the patient’s blood during chemotherapy. As a result of the lower dosage administered locally, side effects have been minimal. No episodes of injury to normal (non-tumor) tissue adjacent to the tumors have been observed in the patients treated to date.

 

CLINICAL TRIALS - Head and Neck Cancer

 

North America Trials

 

We recently completed the Special Protocol Assessment review process with the FDA for two Phase III pivotal studies to evaluate the use of our MedPulser® Electroporation Therapy System as a treatment for recurrent and second primary squamous cell carcinomas of the head and neck (SCCHN). Three Institutional Review Boards (IRBs) in the United States have approved the two protocols to date. We have initiated patient enrollment. Both protocols will compare our MedPulser® Electroporation Therapy System to surgery in patients that have resectable recurrent or second primary SCCHN. The primary endpoint is to demonstrate that patients treated with electroporation therapy have superior preservation of function (e.g. eating, swallowing, and talking) when compared to surgery. The secondary endpoints include comparing quality of life, safety, and pharmacoeconomics, in addition to showing local tumor control and survival that are equivalent to surgery.

 

In late 1997 the FDA granted us clearance to initiate multi-center Phase II clinical trials in the United States utilizing the MedPulserÒ System in combination with bleomycin to treat squamous cell carcinoma of the head and neck in late stage patients who had failed conventional therapies such as surgery or chemotherapy.  We also obtained IND clearance from the Canadian Health Protection Branch to initiate the Phase II trials in Canada.  Two Phase II protocols were initiated.  The first Phase II was a single crossover controlled study evaluating the effectiveness of the MedPulser EPT System with bleomycin to treat tumors that failed an initial bleomycin-alone treatment.  The second Phase II protocol was a single arm study that evaluated the effect of EPT with bleomycin as the only treatment.

 

Twenty-five patients (37 tumors) were enrolled in the crossover-controlled study and initially received bleomycin-alone treatment.  Only one tumor demonstrated a partial clinical response.  Seventeen of these patient’s lesions were subsequently treated with bleomycin and EPT.  Of the 20 lesions treated, 55% achieved an objective  clinical response, i.e., complete and partial responses of 50% or greater reduction of tumor size.

 

In the open-label Phase II (single arm) study, all patients received full bleomycin and EPT as their initial treatment.  Among the 25 patients (31 tumors) treated, 58% achieved an objective clinical response.

 

In a similar open-label single arm study conducted in France, 56% of lesions achieved an objective clinical response, consistent with the North American results.

 

More recently, market seeding trials in Europe evaluated bleomycin and EPT for early stage primary or recurrent oral cavity squamous cell carcinoma.  Sixteen of 20 patient tumors (80%) had no evidence of cancer cells by histopathology assessment following bleomycin EPT four weeks after treatment, which we believe validates EPT’s potential as a primary local treatment for H&N cancer.

 

The results of these H&N cancer studies are provided in the table below.

 

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								Objective Tumor Response(1)
Study		H&N Cancer Type / Treatment		# Patients		# Tumors		Responding Tumors		Non-Responding Tumors
Phase I/II North America		Advanced Bleo-EPT		10		10		8 (80	)%	2 (20	)%
Phase II - Study 1 North America		Advanced Bleo-alone		25		37		1 (3	)%	36 (97	)%
Phase II - Study 1 (cross-over) North America		Advanced Bleo-EPT		17		20		11 (55	)%	9 (45	)%
Phase II - Study 2 North America		Advanced Bleo-EPT		25		31		18 (58	)%	12 (42	)%
Phase II - Study 3 EU		Advanced Bleo-EPT		12		18		10 (56	)%	8 (44	)%
Market Seeding EU		Primary and Early Recurrent Bleo-EPT		20		20		16 (80	)%	4 (20	)%

 

(1) Objective tumor response includes complete and partial responses to treatment.  Complete response means that no sign of the tumor is present.  Partial response means that response to the treatment is greater or equal to a 50% reduction in tumor size.

 

International Trials

 

Currently, we have begun treating patients with primary or recurrent squamous cell carcinoma of the head and neck (SCCHN) in a post European regulatory approval clinical study. The clinical study is designed to support the commercialization of Genetronics’ MedPulser® Electroporation System in the European Union (EU). Prior clinical trials established the safety and performance of the MedPulser® System for the treatment of SCCHN, leading to approval for sale in the EU based on achieving the CE Mark. The European clinical study will:

 

• document the clinical and pharmacoeconomic benefits of the MedPulser® Electroporation System in support of reimbursement approval throughout Western Europe,

 

• establish centers of excellence to facilitate early sales,

 

• create a reference and customer base among key opinion leaders for a projected European commercial launch in 2005,

 

• generate safety and efficacy data to support marketing applications in North America.

 

The European multi-center study will enroll approximately 100 patients with primary or recurrent SCCHN at 12-15 hospitals located in the UK, Germany, Italy, France, Austria, and other western European countries. The study will evaluate the MedPulser® Electroporation System’s pharmacoeconomic impact on the cost of operative and post-operative care. It will also examine patient quality of life, preservation of organ function (i.e. ability to speak, swallow, and eat in public), and local tumor control. This data will help to define the overall benefits of the MedPulser® Electroporation System for the treatment of SCCHN relative to surgery, the standard of care, which frequently compromises a patient’s ability to speak or swallow and may be grossly disfiguring. The European study differs from the current US Phase III clinical trials, which are controlled two-armed trials for the purpose of filing a New Drug Application (NDA) in the US and are restricted to the treatment of recurrent SCCHN.

 

In late 1997 and early 1998, we received regulatory approval to initiate clinical trials in France for head and neck cancer, metastatic cancer of the liver, pancreatic cancer, metastatic melanoma and Kaposi’s sarcoma and in Australia to initiate an expanded metastatic melanoma study.   These trials involved treating multiple lesions with bleo-EPT and control lesions with bleomycin-only on each patient.  The overall results of the cutaneous and subcutaneous cancer studies sponsored by Genetronics, Inc. is provided in the table below.

 

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				Bleo-EPT Tumor Response				Bleo-alone Tumor Response
Study		# Patients		# Lesions		Objective Response(1)		# Lesions		Objective Response(1)
Melanoma		44		178		141 (79	)%	61		13 (21	)%
BCC		25		64		64 (100	)%	8		1 (13	)%
KS		5		13		13 (100	)%	11		6 (55	)%

 

(1) Objective tumor response includes complete and partial responses to treatment.  Complete response means that no sign of the tumor is present.  Partial response means that response to the treatment is greater or equal to a 50% reduction in tumor size.

 

The overall average tumor response rate following EPT with bleomycin to cutaneous and subcutaneous cancer was 86% (ranging from 79% for metastatic melanoma to 100% for basal cell carcinoma (BCC) and kaposi’s sarcoma (KS) compared with an overall tumor response rate of 25% for bleomycin-alone treated lesions (ranging from 13% for BCC, 21% for metastatic melanoma to 55% for KS cancer).

 

Th