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TABLE OF CONTENTS QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2009

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

Commission File No. 0-16614

PONIARD PHARMACEUTICALS, INC.
(Exact name of Registrant as specified in its charter)

7000 Shoreline Court, Suite 270, South San Francisco, CA 94080
(Address of principal executive offices)

Registrant's telephone number, including area code:(650) 583-3774

        Indicate by check mark whether the registrant: (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 whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o    No o

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

        Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o    No ý

        As of OctoberJuly 30, 2009, 34,961,4972010, 48,130,866 shares of the registrant's common stock, $0.02 par value per share, were outstanding.

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TABLE OF CONTENTS

QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBERJUNE 30, 20092010

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PART I. FINANCIAL INFORMATION

Item 1.    Financial Statements

PONIARD PHARMACEUTICALS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

See notes to the condensed consolidated financial statements.

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PONIARD PHARMACEUTICALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

See notes to the condensed consolidated financial statements.

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PONIARD PHARMACEUTICALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

See notes to the condensed consolidated financial statements.

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. BasisBusiness Overview and Summary of PresentationSignificant Accounting Policies

Overview

        Poniard Pharmaceuticals, Inc. is a biopharmaceutical company focused on the development and commercialization of cancer therapeutics. The accompanying unaudited condensed consolidated financial statements include the accounts of Poniard Pharmaceuticals, Inc. and its wholly-owned subsidiary, NeoRx Manufacturing Group, Inc. (the "Company"). All intercompany balances and transactions have been eliminated in consolidation.eliminated.

Basis of Presentation

        The accompanying condensed consolidated financial statements contained herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). As permitted under those rules, certain footnotes or other financial information that are normally required by accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations. In the opinion of the Company's management, the accompanying interim unaudited condensed consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the Company's financial position as of SeptemberJune 30, 2009, the2010, results of operations for the three and ninesix months ended SeptemberJune 30, 20092010 and 20082009, and cash flows for the ninesix months ended SeptemberJune 30, 20092010 and 2008.2009.

        The results of operations for the period ended SeptemberJune 30, 20092010 are not necessarily indicative of the expected operating results for the full year.

        The balance sheet as of December 31, 20082009 has been derived from the audited financial statements at that date. The balance sheet does not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. For further information, refer to the financial statements and footnotes thereto included in the Company's annual reportAnnual Report on Form 10-K for the year ended December 31, 20082009 filed with the SEC on March 16, 2009,2010, and available on the SEC's website,www.sec.gov.

        Reclassifications:    Certain balances and results from prior years have been reclassified to conform to the Company's current year presentation. The Company's reclassifications had no effect on net earnings or shareholders' equity.

Use of Estimates:Estimates

        The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

        Subsequent Events Evaluation:Reclassifications    Management has reviewed

        Certain balances and evaluated material subsequent events, if any, occurring afterresults from the balance sheet dateprior year have been reclassified to conform to the Company's current year presentation. In particular, certain legal expenses related to intellectual property and patents have been reclassified from research and development expense to general and administrative expense in the condensed consolidated statements of Septemberoperations to conform with the current year's presentation. The amounts reclassified for these patent-related legal expenses for the three and six months ended June 30, 2009 through the financial statements issuance date of November 6, 2009. All appropriate subsequent event disclosures, if any, have been made in the notes to the unaudited condensed consolidated financial statements.

        Going Concern:    The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assetsare $342,000 and the satisfaction of liabilities in the normal course of business for a reasonable period of time. The Company has historically experienced recurring operating losses and negative cash flows from operations. As of September 30, 2009, the Company had working capital of $23,739,000, an accumulated deficit of $394,866,000 and total shareholders' equity of $20,218,000.

$268,000, respectively. The Company's current loan facility contains covenants that restrict certain financing activities by the Company and require the Company to maintain a minimum amount of unrestricted cash (seereclassifications had no effect on total operating expenses, net loss or shareholders' equity.

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 1. BasisBusiness Overview and Summary of PresentationSignificant Accounting Policies (Continued)

Significant Risks and Uncertainties

        The Company has historically suffered recurring operating losses and negative cash flows from operations. As of June 30, 2010, the Company had net working capital of $18,229,000, an accumulated deficit of $427,231,000 and total shareholders' equity of $17,053,000. The Company's total cash, cash equivalents and investment securities balances, net of restricted cash of $158,000, was $29,269,000 at June 30, 2010. The Company has financed its operations to date primarily through the sale of equity securities, borrowings under debt instruments, technology licensing and collaborative agreements. The Company invests excess cash in investment securities that will be used to fund future operating costs. Cash used for operating activities for the six months ended June 30, 2010 totaled $15,359,000. The Company is focusing its resources on the continued development of its primary product candidate, picoplatin. Based on the Company's activities to date for the development of registration strategies for picoplatin and its evaluation of strategic alternatives, the Company does not anticipate that its picoplatin product will be commercially available before 2014, if at all. As a result, the Company does not have a predictable source of revenue or other cash flows and does not expect to generate cash from operations for the foreseeable future. Thus, the Company is dependent upon its ability to sell equity instruments, borrow, or enter into licensing agreements or other strategic relationships to provide capital to sustain its operations. In March 2010, in connection with the adoption of an initiative to develop registration strategies for picoplatin in multiple indications, the Company engaged an investment banker to conduct a comprehensive review of strategic alternatives, including raising additional capital, a merger or sale of the Company or partnering with another company. The Company may not be able to obtain required additional capital or enter into relationships with corporate partners or other third parties on a timely basis, on terms ultimately favorable to the Company, or at all. Conditions in the capital markets in general, and in the life science capital markets specifically, may affect the Company's potential financing sources and opportunities for partnering or other strategic relationships. If the Company is unable to secure additional capital to fund its working capital and capital expenditure requirements, it may be forced to explore liquidation alternatives, including seeking protection from creditors through the application of bankruptcy laws.

        On July 20, 2010, the Company received a letter from The Nasdaq Stock Market stating that the minimum bid price of its common stock has been below $1.00 per share for 30 consecutive business days and that the Company therefore is not in compliance with the minimum bid price requirements of The Nasdaq Global Market. The Company has 180 calendar days, or until January 18, 2011, to regain compliance with the minimum bid price requirement, which would consist of the closing bid price of its common stock meeting or exceeding $1.00 per share for at least ten consecutive business days during the 180-day grace period. If the Company does not regain compliance by January 18, 2011, it may, at that time, appeal any delisting determination to a Nasdaq Hearings Panel. Alternatively, if at that time the Company satisfies all of the initial listing standards, with the exception of the minimum bid price, for The Nasdaq Capital Market, it could apply to transfer the listing of its common stock to The Nasdaq Capital Market and thereby receive an additional 180 calendar days to regain compliance with the minimum bid price requirement. The notification of noncompliance has no immediate effect on the listing or trading of the Company's common stock on The Nasdaq Global Market. There can be no assurance the Company will be able to regain and/or maintain compliance with the minimum bid price or other Nasdaq continued listing requirements. For further information, see "Item 1A, Risk Factors," in Part I of this Form 10-Q.

PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 1. Business Overview and Summary of Significant Accounting Policies (Continued)

        The Company's loan facility with GE Business Financial Services and Silicon Valley Bank, described in Note 5 for further details).below, requires that the Company maintain a minimum amount of cash, cash equivalents and investments ("unrestricted cash") during the term of the loan equal to the lesser of (i) $17,940,000 or (ii) the outstanding aggregate principal balance of the term loans plus $4,000,000. Taking into account the minimum unrestricted cash requirement andunder the Company's loan agreement and its projected operating results, the Company believes that its current cash, cash equivalents and investment securities balances will provide adequate resources to fund operations at least intothrough the first quarterend of 2010. However, givenThereafter, unless the uncertainties of outcomesCompany raises additional funds, or enters into a partnering or other strategic relationship, it will be in default of the Company's clinical trials, there is no assurance thatminimum unrestricted cash requirement and potentially other provisions of the Company can achieve its projected operating results.loan agreements. The Company has no assurance that, especially in light of the current distressed economic environment, the lenders will be willing to waive or renegotiate the terms of the loan agreement to address or avoid financial or other defaults. These factors, among others, raise substantial doubt aboutThe occurrence of an event of default would increase the applicable rate of interest by 5% and could result in the acceleration of the Company's payment obligations under the loan agreement. If an event of default were to occur, the Company might not have sufficient funds to repay the loan or to fund its continuing operations. Provisions of the loan agreement would limit the Company's ability to continue as a going concern. Management is developing plans to addressdispose of certain assets, engage in certain mergers, incur certain indebtedness, make certain distributions, and engage in certain investment activities without the Company's liquidity needs, including raising additional capitalprior consent of the lenders.

Subsequent Events Evaluation

        The Company has reviewed and evaluated material subsequent events through the public or private sale of equity or debt securities or through the establishment of credit or other funding facilities and entering into strategic collaborations, which may include joint ventures or partnerships for product development and commercialization, merger, sale of assets or other similar transactions, and taking actions to limit the Company's expenditures. There can be no assurancedate that the Company can obtain financing or otherwise raise additional funds,financial statements were available for issuance and all appropriate subsequent events disclosures, if at all, on terms acceptableany, have been made in the notes to the unaudited condensed consolidated financial statements.

Recent Accounting Standards

        In October 2009, the Financial Accounting Standards Board ("FASB") issued new standards for revenue recognition with multiple deliverables. These new standards impact the determination of when the individual deliverables included in a multiple-element arrangement may be treated as separate units of accounting. Additionally, these new standards modify the manner in which the transaction consideration is allocated across the separately identified deliverables by no longer permitting the residual method of allocating arrangement consideration. These new standards are required to be adopted in the first quarter of 2011; however, early adoption is permitted. The Company believes that these new standards would have an impact on its consolidated financial statements in the future were it to enter into an arrangement with multiple deliverables.

        In April 2010, the FASB issued updated guidance on defining milestones and determining when it may be appropriate to apply the milestone method of revenue recognition for research and development transactions involving arrangements with deliverables in which one or more payments are contingent upon achieving uncertain future events or circumstances. The updates are effective on a prospective basis for milestones achieved in fiscal years, and interim periods within those years, beginning on or after June 15, 2010, with early adoption permitted. The Company believes that this new guidance would have an impact on its consolidated financial statements if it were to its lenders.enter into any milestone-based revenue agreements in the future.

PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 2. Fair Value Measurements

        We categorizeThe Company categorizes assets and liabilities recorded at fair value in ourits condensed consolidated balance sheetsheets based upon the level of judgment associated with inputs used to measure their value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We useThe Company uses valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs when determining fair value and then we rankranks the estimated values based on the reliability of the inputs used following the fair value hierarchy set forth by the Financial Accounting Standards Board ("FASB").FASB. The three levels of the FASB fair value hierarchy are as follows:

•

Level 1—Quoted prices in active markets for identical assets or liabilities.



•

Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.



•

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

        The determination of a financial instrument's level within the fair value hierarchy is based on an assessment of the lowest level of any input that is significant to the fair value measurement. The Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

        The following tables present a summary of the Company's assets that are measured at fair value on a recurring basis (in thousands):

        As of June 30, 2010 and December 31, 2009, the Company's cash equivalents and investment securities are recorded at fair value as determined through market prices and other observable and corroborated sources. At June 30, 2010, the cash equivalents balance consists of $7,301,000 in money market funds and $1,150,000 of corporate debt securities purchased with a maturity date less than

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 2. Fair Value Measurements (Continued)

        The following table presents a summary of the Company's assets that are measured at fair value on a recurring basis (in thousands):

        As of September 30, 2009 and December 31, 2008, the Company's cash equivalents and investment securities are recorded at fair value as determined through market prices and other observable and corroborated sources. At September 30, 2009 the cash equivalents balance consists of $16,216,000 in money market funds and $1,304,000 of corporate debt securities purchased with a maturity date less than 90 days from the purchase date. Investment securities are comprised of corporate debt securities and federal government and agency securities (see Note 3 below for further details on investment securities).

        When the estimated fair value of a security is below its carrying value, the Company evaluates whether it is more likely than not that it will be required to sell the security before its anticipated recovery in market value and whether evidence indicating that the cost of the investment is recoverable within a reasonable period of time outweighs evidence to the contrary. The Company also evaluates whether or not it intends to sell the investment. If the impairment is considered to be other-than-temporary, the security is written down to its estimated fair value. In addition, the Company considers whether credit losses exist for any securities. A credit loss exists if the present value of cash flows expected to be collected is less than the amortized cost basis of the security. Other-than-temporary declines in estimated fair value and credit losses are charged to investment income. The Company has not deemed it necessary to record any charges related to impairments or other-than-temporary declines in the estimated fair values of its marketable debt securities or credit losses as of SeptemberJune 30, 2009.2010.

Note 3. Investment Securities

        The Company's investment securities, consisting of debt securities, are classified as available-for-sale. Unrealized holding gains or losses on these securities are included in other comprehensive income gain/(loss). on the condensed consolidated balance sheets. Realized gains and losses and declines in value judged to be other-than-temporary (of which there have been none to date) on available-for-sale securities are included in interest income and other, net.net, in the condensed consolidated statements of operations.

        Investment securities consisted of the following at June 30, 2010 (in thousands):

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 3. Investment Securities (Continued)

        Investment securities consisted of the following at September 30,December 31, 2009 (in thousands):

        Investment securities consisted of the following at December 31, 2008 (in thousands):

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 4. Accrued Liabilities

        Accrued liabilities consist of the following (in thousands):

Note 5. Note Payable

        On September 2, 2008, the Company entered into an Amended and Restated Loan and Security Agreement ("loan agreement"), with GE Business Financial Services Inc. (formerly known as Merrill Lynch Capital) and Silicon Valley Bank. The loan agreement amends and restates in its entirety the earlier Loan and Security Agreement dated as of October 25, 2006 ("original loan"), with Merrill Lynch Capital and Silicon Valley Bank,the lenders, pursuant to which the Company obtained a $15,000,000 capital loan that was to mature on April 1, 2010.

        The loan agreement provides for a $27,600,000 senior secured term loan facility ("loan facility") to be made available as follows: (i) an initial term loan advance in the amount of $17,600,000, which is comprised of (a) the outstanding principal balance of $7,600,000 remaining on the original loan and

PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 5. Note Payable (Continued)

(b) an additional cash advance in the amount of $10,000,000 ("cash portion"), which was fully funded on September 2, 2008; and (ii) a second term loan advance in the amount of $10,000,000, which was fully funded on September 30, 2008. The cash portion of the initial term loan advance and the proceeds of the second term loan advance will be used to fund the Company's clinical trials and for general corporate purposes. The advances under the loan facility are repayable over 42 months, commencing on October 1, 2008. Interest on the advances is fixed at 7.80% per annum. Final loan payments in the amounts of $1,070,000 and $900,000 are due upon maturity or earlier repayment of the initial term loan advance and the second term loan advance, respectively. Additionally, as a condition to the amendment and restatement of the original loan, the Company agreed to modification of the final payment obligations under the original loan, pursuant to which the Company paid $600,000 to Silicon Valley Bank on September 2, 2008, the effective date of the loan facility, and will pay $675,000 to GE Business Financial Services on the earlier of March 31, 2010 or the date of repayment of the loan facility.2010. All final payment amounts are being accreted to the note payable balance over the term of the loan facility using the effective interest rate method and reflected as additional interest expense. All interest payable under the loan agreement and the full amount of the final payments must be paid upon any prepayment of a term loan advance. The loan facility is secured by a first lien on all of the non-intellectual property assets of the Company. At June 30, 2010, the outstanding principal balance under the loan facility was $14,667,000, net of discount of $1,103,000.

        In connection with the loan agreement, the Company issued to the lenders ten-year warrants to purchase an aggregate of 219,920 shares of the Company's common stock at an exercise price of $4.297 per share. The fair value of the warrants using the Black-Scholes option-pricing model was approximately $928,000 based upon assumptions of expected volatility of 90%, a contractual term of ten

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 5. Note Payable (Continued)

years, an expected dividend rate of zero and a risk-free interest rate of 3.74%. The portion of the loan proceeds allocable to the warrants is approximately $806,000 based on the relative fair value of the warrants, which the Company recorded as additional discount to notes payable. The total of the final loan payments and the proceeds allocated to the warrants of approximately $4,051,000 areis being amortized to interest expense using an effective interest rate of 13.8%. At September 30,The warrants became exercisable upon issuance and are exercisable anytime during their term. In October 2009, Silicon Valley Bank exercised its warrants held in connection with the 2006 and 2008 loan agreements to purchase an aggregate of 197,169 common shares, net of equivalent shares at market to cover the total exercise price. In November 2009, the outstanding principal balance underCompany amended the warrants held by GE Business Financial Services in connection with the 2006 and 2008 loan facility was $20,409,000, netagreements to purchase an aggregate of discount197,169 common shares to change the exercise price to $2.00 per share resulting in an increase in shareholders' equity and a charge to interest expense of $1,951,000.$33,000 in 2009.

        The loan agreement contains restrictions on the Company's ability to, among other things, dispose of certain assets, engage in certain mergers and acquisition transactions, incur indebtedness, create liens on assets, make investments, pay dividends and repurchase stock. The loan agreement also contains covenants requiring the Company to maintain unrestricted cash in an amount equal to the lesser of (i) $17,940,000 or (ii) the outstanding aggregate principal balance of the term loans plus $4,000,000. The loan agreement contains events of default that include nonpayment of principal, interest or fees, breaches of covenants, material adverse changes, bankruptcy and insolvency events, cross defaults to any other indebtedness, material judgments, inaccuracy of representations and warranties, and events constituting a change of control. The occurrence of an event of default would increase the applicable rate of interest by 5% and could result in the acceleration of the Company's payment obligations under the loan agreement. The Company was in compliance with all loan covenants as of SeptemberJune 30, 2009.2010.

PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 6. Committed Equity Line of CreditCommon Stock Purchase Agreement

        On August, 19, 2009,February 23, 2010, the Company entered into an equity line of credit arrangementfacility with Azimuth OpportunityCommerce Court Small Cap Value Fund, Ltd. ("Azimuth"Commerce Court") pursuant to a Common Stock Purchase Agreement ("Purchase Agreement"), which. The facility provides that, upon the terms and subject to the price and share amount parameters and other conditions set forth therein, Azimuththereof, Commerce Court is committed to purchase up to $60 million$20,000,000 worth of shares of the Company's registered common stock over approximately 18 months; provided, however, that in no event may the 18-month termCompany issue to Commerce Court more than 8,423,431 shares of common stock, which is equal to one share less than 20% of the Purchase Agreement. From time to time overCompany's outstanding common shares on the termclosing date of the Purchase Agreement,facility, less 121,183 shares issued to Commerce Court as a commitment fee. The purchase price of the Company may, at its sole discretion and upon presentation of a draw down notice, require Azimuthshares will be equal to purchase its common stockthe daily volume weighted average price over teneight consecutive trading days or such other draw down period mutually agreed upon by the Company and Azimuth ("Draw Down Period"). Each draw down is subjectparties, less a discount ranging from 3.125% to limitations5.0%, based on the trading price of the Company's common stock and a limit of 2.5%stock. In addition, Commerce Court may not at any time acquire shares if, after giving effect to such purchase, Commerce Court would beneficially own 9.9% or more of the Company's market capitalizationoutstanding common stock. Commerce Court is not obligated to purchase shares at the time of the draw down. The Purchase Agreement requires a minimum price of $3.00that is less than $1.00 per share to allow(before taking into account the discount). On March 15, 2010, the Company to issue shares to Azimuth. Under the Purchase Agreement, the Company may sell to Azimuth up to 6,955,606completed a draw down and sale of 4,229,000 shares of its common stock. The Company may present Azimuth with upstock, at a price of approximately $1.49 per share, to 24 draw down notices during the term of the Purchase Agreement with only one such draw down notice allowed per Draw Down Period and a minimum of five trading days required between each Draw Down Period. As of September 30, 2009, no shares have been soldCommerce Court under the Purchase Agreement.equity line of credit facility. Net proceeds of approximately $6,092,000 were received, after deducting offering costs of approximately $228,000.

Note 7. Restructuring and Asset Impairment

        EffectiveApril 2010 Restructuring

        On March 24, 2010, the Company announced a restructuring plan in connection with its decision to suspend efforts to pursue a New Drug Application for its drug candidate, picoplatin, in small cell lung cancer. This restructuring plan resulted in a decrease in the number of employees by approximately 45%, to a total of 12 employees, effective April 30, 2010. In connection with this plan, the Company recorded a restructuring charge of approximately $543,000 for the period ended March 31, 2009,2010, consisting of one-time employee termination benefits, which will be paid in their entirety by January 31, 2011. As a consequence of the Company implementedrestructuring, approximately 965,000 restricted stock units ("RSUs"), which were awarded in February 2010 pursuant to the Amended and Restated 2004 Incentive Compensation Plan (the "2004 Plan"), became fully vested in accordance with the terms of the underlying RSU agreements (see Note 10 for additional information). These RSUs converted to common stock on a strategic restructuring plan to refocus its cash resources on clinical and commercial development of picoplatin, resultingone-for-one basis in the discontinuationsecond quarter of the Company's preclinical research operations and reducing its workforce by approximately 12%, or eight employees.2010. The Company incurred severance charges totaling $296,000recognized approximately $1,486,000 in share-based compensation expense for terminated employees during the six month period ended June 30, 2010 related to the reduction in staff. All severance charges related toaccelerated vesting of these RSUs as a result of the restructuring.

        The following table summarizes the impact of the restructuring have been paid ascharges reported in the condensed consolidated statement of Septemberoperations for the six months ended June 30, 2009. The2010 and in accrued liabilities

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 7. Restructuring and Asset Impairment (Continued)

in the condensed consolidated balance sheet as of June 30, 2010 related to the April 2010 restructuring (in thousands):

February 2010 Restructuring

        On February 5, 2010, the Company implemented a restructuring plan to conserve its capital resources, resulting in a reduction in the Company's workforce by approximately 57%, to 22 employees. The Company incurred restructuring charges of approximately $1,083,000, primarily consisting of one-time employee termination benefits. As a consequence of the restructuring, approximately 130,000 RSUs, which were awarded in July 2009 pursuant to the 2004 Plan, became fully vested in accordance with the terms of the underlying RSU agreements (see Note 10 for additional information). These RSUs converted to common stock on a one-for-one basis in February 2010. The Company recognized approximately $174,000 in share-based compensation expense in the first quarter of 2010 related to the accelerated vesting of these RSUs as a result of the restructuring.

        The following table summarizes the impact of the restructuring charges reported in the condensed consolidated statement of operations for the six months ended June 30, 2010 and in accrued liabilities in the condensed consolidated balance sheet as of June 30, 2010 related to the February 2010 restructuring (in thousands):

March 2009 Restructuring

        On March 31, 2009, the Company implemented a strategic restructuring plan to refocus its cash resources on clinical and commercial development of picoplatin, which resulted in the discontinuation of the Company's preclinical research operations and in the reduction of its workforce by approximately 12%, to a total of 57 employees. The Company incurred severance charges totaling $296,000 related to the reduction in staff. All severance charges related to the restructuring were paid in 2009. The Company incurred additional charges totaling approximately $172,000 related to the closure of its lab facilities in South San Francisco, California. Of this amount, $6,000 was incurred as share-based compensation expense, $12,000 was a write-off of prepaid expenses, and $154,000 was incurred for contract and other termination costs. As of September 30, 2009, $14,000 remained unpaidAll outstanding liabilities for contract and is payable within one year.termination costs were paid in 2009.

PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 7. Restructuring and Asset Impairment (Continued)

        The following table summarizes the impact of the restructuring charges through Septemberreported in the condensed consolidated statements of operations for the periods ended June 30, 2009 and 2010 and in accrued liabilities in condensed consolidated balance sheets as of December 31, 2009 and June 30, 2010 related to the March 2009 restructuring (in thousands):

        In conjunction with the decision to discontinue the Company's preclinical research operations during the quarter ended March 31, 2009, the Company recognized an asset impairment loss of $588,000 on certain facilities and equipment related to the lab in South San Francisco, California. The loss on the assets was determined based on estimates of potential sales values of used equipment. These impairment charges established new cost bases for the impaired assets, which are included in assets held for sale and reported in the prepaid expenses and other current assets line on the accompanying Condensed Consolidated Balance Sheets.condensed consolidated balance sheets. All remaining impaired assets held for sale were sold in January 2010.

        The following table summarizes information related to the impairment charges (in thousands):

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8. Picoplatin License and Amendment

        The Company has entered into an exclusive worldwide license, as amended, with Genzyme Corporation (successor to AnorMED, Inc.) for the development and commercial sale of picoplatin. Under that license, the Company is solely responsible for the development and commercialization of picoplatin. Genzyme retains the right, at the Company's cost, to prosecute its patent applications and maintain all licensed patents. The parties executed the license agreement in April 2004, at which time the Company paid a one-time up-front payment of $1,000,000 in common stock and $1,000,000 in cash.

PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8. Picoplatin License and Amendment (Continued)

The original agreement excluded Japan from the licensed territory and provided for $13,000,000 in development and commercialization milestones, payable in cash or a combination of cash and common stock, and a royalty rate of up to 15% on product net sales after regulatory approval. The parties amended the license agreement on September 18, 2006, modifying several key financial terms and expanding the licensed territory to include Japan, thereby providing the Company worldwide rights. In consideration of the amendment, the Company paid Genzyme $5,000,000 in cash on October 12, 2006 and an additional $5,000,000 in cash on March 30, 2007. The amendment eliminated all development milestone payments to Genzyme. Genzyme remains entitled to receive up to $5,000,000 in commercialization milestones upon the attainment of certain levels of annual net sales of picoplatin after regulatory approval. The amendment also reduced the royalty payable to Genzyme to a maximum of 9% of annual net product sales and eliminated the sharing of sublicense revenues with Genzyme.

        The Company accounted for all payments made in consideration of the picoplatin license, as amended, by capitalizing them as an intangible asset. The Company's capitalization of the total $12,000,000 of picoplatin license payments is based on the Company's reasonable expectation at the time of acquisition and through the date of the amendment that the intravenous formulation of picoplatin, as it existed at the time of the acquisition of the picoplatin license and the license amendment, would be used in research and development ("R&D") projects and, therefore, had alternative future uses in the treatment of different cancer indications. At the time of acquisition, the Company planned to use intravenous picoplatin in a Phase II2 clinical trial in patients with small cell lung cancer and reasonably expected that the intravenous formulation could be used in additional, currently identifiable R&D projects in the form of clinical trials for other solid tumor cancer indications, such as prostate and colorectal cancers.

        The Company, at the time of acquisition of the picoplatin license, reasonably anticipated using intravenous picoplatin in clinical trials that could be conducted during the remaining term of the primary patent, which is active through 2016. The Company concluded that the twelve12 years remaining for the primary patent term was the appropriate useful life for the picoplatin intangible asset, in accordance with the FASB's guidance for intangibles, and is amortizing the initial $2,000,000 license payment over this twelve12 year useful life beginning in April 2004. The Company concluded that no change in the twelve-year12 year useful life of the picoplatin intangible asset occurred as a result of the 2006 license amendment and is, therefore, continuing to amortize the initial $2,000,000 license payment over the twelve12 year useful life and is amortizing the license amendment payment of $10,000,000 over the remainder of the twelve12 year useful life of the picoplatin intangible asset.

        The Company reviews its long-lived assets for possible impairment whenever significant events indicate such impairment may have occurred. In November 2009, the Company announced that its pivotal Phase 3 SPEAR trial of picoplatin in the second-line treatment of patients with small cell lung cancer did not meet its primary endpoint of overall survival. The Company considers this event to be a trigger for testing its picoplatin intangible asset for possible impairment; however, upon review of the expected future undiscounted net cash flows identifiable to the picoplatin license, the Company determined that the picoplatin intangible asset is recoverable and that no impairment occurred.

Licensed products consistconsists of the picoplatin amortizable intangible asset with a gross amount of $12,000,000, net of accumulated amortization of $4,104,000$5,015,000 and $3,193,000$4,408,000 at SeptemberJune 30, 20092010 and December 31, 2008,2009, respectively.

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 9. Net Loss Per Common Share

        Basic and diluted loss per share are based on net loss applicable to common shares, which is comprised of net loss and preferred stock dividends in all periods presented. Shares used to calculate basic loss per share are based on the weighted average number of common shares outstanding during the period. Shares used to calculate diluted loss per share are based on the potential dilution that would occur upon the exercise or conversion of securities into common stock using the treasury stock method. The calculation of diluted loss per share excludes the effect of the following stock options and warrants to purchase additional shares of common stock because the share increments would not be dilutive.

        In addition, 14,966 and 39,015 shares of common stock that would be issuable upon conversion of the Company's Series 1 preferred stock are not included in the calculation of diluted loss per share for the periods ended SeptemberJune 30, 20092010 and 2008,2009, respectively, because the effect of including such shares would not be dilutive.

Note 10. Stock-basedShare-based Compensation

        A summary of the Company's fully vested stock options is presented below (shares and aggregate intrinsic value in thousands):

        The Company recorded the following amounts of stock-basedshare-based compensation expense, not including expense for options granted to non-employee consultants, for the periods presented (in thousands):

        The share-based compensation expense for the ninesix months ended SeptemberJune 30, 20082009 includes the grant ofa stock options inoption granted during the first quarter of 2009 to a Company officersofficer to purchase an aggregate of 460,000 shares of

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 10. Stock-basedShare-based Compensation (Continued)

200,000 shares of common stock.stock that vests over a four year period. The share-based compensation expense for the six months ended June 30, 2010 includes a stock option granted during the first quarter of 2010 to a Company officer to purchase an aggregate of 500,000 shares of common stock that vests over a four year period. There were no options granted during the three month period ended June 30, 2010.

        Estimated fair values of stock options granted have been determined using the Black-Scholes option pricing model with the following assumptions for the periods presented:

        Certain options that were granted to officers of the Company during 2006 and 2007 vest 50% in equal monthly installments over four years from the date of grant and vest 50% on the seven-yearseven year anniversary of the date of grant, subject to accelerated vesting of up to 25% of such portion of the options, based on the Company's achievement of annual performance goals established under its management incentive plan, at the discretion of the equity awards subcommittee of the compensation committee of the Company's board of directors. Based on the overall achievement of corporate goals in 20072009, the equity awards subcommittee accelerated vesting with respect to 20%25% of the shares subject to the seven-yearseven year vesting schedule in the first quarter of 2008.2010. As of SeptemberJune 30, 2009,2010, the cumulative accelerated vesting for options subject to the seven year vesting schedule equals 60%85% of the shares subject to the seven-year vesting schedule.

        Estimated fair values of stock options granted have been determined using the Black-Scholes option pricing model with the following assumptions for the periods presented:

        During 2008 the Company awarded 92,000 restricted stock units ("RSUs") under the 2004 Incentive Compensation Plan, as amendedin 2006 and restated (the "2004 Plan"), to non-officer employees as an incentive for future performance. An additional 4,000 RSUs were awarded in 2009 for this incentive program. Upon vesting, each RSU is payable with one share of the Company's common stock. The average fair value of the RSUs was $3.13 per unit, or approximately $299,000 in total, based upon the closing market price of the Company's common stock on the award dates. The RSUs vest based on the achievement of certain performance milestones during 2009 and 2010. As of September 30, 2009, the first two performance milestones were achieved and therefore 40%65% of the shares have vested and been released. The third performance milestone, if achieved no later than June 30, 2010, would resultgranted in the vesting of the remaining 60% upon the date of achievement. As of September 30, 2009, the Company determined that the third milestone is probable of being achieved and is therefore recognizing the related stock-based compensation expense on a pro-rata basis through the estimated date of achievement.

        On July 23, 2009 the Company awarded an additional 290,400 RSUs under the 2004 Plan to non-officer employees as an incentive for future performance. The fair value of the RSUs was $7.34 per unit, or approximately $2,132,000 in total, based upon the closing market price of the Company's common stock on the award date. The RSUs vest based on the achievement of certain performance milestones during 2010. As of September 30, 2009, the Company determined that milestones are probable of being achieved and is therefore recognizing the related stock-based compensation expense on a pro-rata basis through the estimated dates of achievement.

        On July 11, 2009, a Company director, was awarded 170,000 RSUs as compensation for consulting services. The RSUs vest 50% on each of the first two anniversaries of the grant and is subject to 100% acceleration upon the achievement of a performance milestone. The fair value of the award is2007.

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 10. Stock-basedShare-based Compensation (Continued)

        The Company's share-based compensation expense also includes RSUs awarded to employees and non-employee consultants. The table below summarizes RSU awards outstanding as of June 30, 2010 (RSUs in thousands):

        No income tax benefit has been recorded for stock-basedshare-based compensation expense as the Company has a full valuation allowance and management has concluded that it is more likely than not that the Company's net deferred tax assets will not be realized. As of SeptemberJune 30, 2009,2010, total unrecognized costs related to employee stock-basedshare-based compensation was $11,074,000, whichis approximately $7,146,000. Unrecognized share-based compensation expense from outstanding stock options is approximately $3,861,000 and is expected to be recognized over a weighted average period of approximately 2.32.0 years. Unrecognized share-based

PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 10. Share-based Compensation (Continued)

compensation expense from outstanding RSUs is approximately $3,285,000 and is expected to be recognized over a weighted average period of approximately 1.3 years subject to acceleration with the occurrence of certain qualifying events.

Note 11. Comprehensive Loss

        The Company's comprehensive loss for the three and ninesix months ended SeptemberJune 30, 20092010 and 20082009 is summarized as follows (in thousands):

Note 12. Recent Accounting Pronouncements

        In June 2009, the FASB established the FASB Accounting Standards Codification ("FASB ASC") as the source of authoritative accounting principles recognized by the FASB. The FASB will issue new standards in the form of Accounting Standards Updates ("ASUs"). FASB ASC is effective for financial statements issued for interim and annual periods ending after September 15, 2009 and therefore is effective for the Company in the third quarter of 2009. The issuance of FASB ASC does not change accounting principles generally accepted in the United States and therefore the adoption of FASB ASC only affects the specific references to accounting literature in the notes to the Company's consolidated financial statements.

        In August 2009, the FASB issued ASU 2009-05, "Fair Value Measurements and Disclosures (Topic 820)—Measuring Liabilities at Fair Value" ("ASU 2009-05," currently within the scope of ASC Subtopic 820-10). ASU 2009-05 provides clarification regarding valuation techniques when a quoted price in an active market for an identical liability is not available in addition to treatment of the existence of restrictions that prevent the transfer of a liability. The ASU also clarifies that both a quoted price in an active market for an identical liability at the measurement date and the quoted price for an identical liability when traded as an asset in an active market (when no adjustments to the quoted price of the asset are required) are Level 1 fair value measurements. The ASU is effective for the first reporting

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PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 12. Recent Accounting Pronouncements (Continued)

period, including interim periods, beginning after issuance. Adoption of ASU 2009-05 did not have a material effect on the Company's condensed consolidated financial statements.

Note 13.12. Commitments and Contingencies

        The Company entered into a picoplatin active pharmaceutical ingredient ("API") commercial supply agreement with W.C. Heraeus GmbH ("Heraeus") in March 2008. Under this agreement Heraeus will produce the picoplatin API to be used for preparing picoplatin finished drug product for commercial use. Manufacturing services are provided on a purchase order, fixed-fee basis, subject to certain purchase price adjustments and minimum quantity requirements. The costs to Heraeus for the purchase and set-up of dedicated equipment as required under the commercial supply agreement, estimated to be approximately $1,800,000 (including interest charges of approximately $336,000) will be repaid by the Company in the form of a surcharge on an agreed upon amount of the picoplatin API ordered and delivered on or before December 31, 2013. If the Company orders and takes delivery of less than the agreed upon amount of picoplatin API through December 31, 2013, it will be obligated to pay the balance of the dedicated equipment cost as of that date. As of September 30,December 31, 2009, Heraeus had completed partial construction of the dedicated equipment at a total cost of approximately $1,722,000 (including interest). Because$1,485,000. The Company determined that the Company is not underequipment should be accounted for as a presentcapital lease and accordingly recognized an asset and long term obligation to pay this amount andfor the agreement is not under any potential circumstanceequipment of default or termination, it is not probable that a financial liability exists for this amount as of September 30, 2009 and therefore no such liability was recorded$1,485,000 on the condensedits consolidated balance sheet as of that date.December 31, 2009. The Company anticipates thatwill reflect the surcharge payments as reductions to the capital lease balance outstanding, and will accrete a finance charge to interest expense as specified under the agreement. The balance of the obligation at June 30, 2010 was $1,529,000, including accreted interest of approximately $44,000. The Company does not anticipate beginning production of commercial supplies of picoplatin API, thereby utilizing the dedicated equipment, will be readywithin the next 12 months and has, therefore, classified the obligation as long-term. Due to the delay in the Company's plans for usethe commercialization of picoplatin, the Company determined that its capital lease asset for equipment under the Heraeus agreement was impaired as of December 31, 2009 and, therefore, recognized an asset impairment charge of $1,485,000 in the consolidated statement of operations during the fourth quarter ended December 31, 2009.

PONIARD PHARMACEUTICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 13. Exchange of 2009, after which it expectsPreferred Stock

        On February 6, 2010, the Company issued 379,956 shares of its common stock to accountan institutional shareholder in exchange for the equipmentshareholder's delivery to the Company of 126,572 shares of the Company's outstanding $2.4375 convertible exchangeable preferred stock, Series 1 ("Series 1 shares"). The shareholder approached the Company with the proposed exchange transaction and related surcharge paymentsthe final terms of the exchange were determined by arms-length negotiation between the parties. A portion of the common stock issued by the Company in the exchange was in addition to the number of shares that were calculable under the exchange provisions of the Series 1 preferred stock designation of rights in the Company's articles of incorporation. This portion was accounted for by the Company as a capital lease.an in-kind dividend, the fair value of which is $570,000. The Series 1 shares received by the Company in the exchange constitute authorized but unissued shares of preferred stock of the Company.

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Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations

Important Information Regarding Forward-Looking Statements

        This Form 10-Q contains forward-looking statements within the meaning of the Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. TheseForward-looking statements relate toare those that predict or describe future events or future financial performancetrends and are subjectthat do not relate solely to change based on various important factors, many of which are beyond our control.historical matters. In some cases, you can identify forward-looking statements by terminology such as "currently," "may," "will," "could," "should," "expect," "plan," "intend," "anticipate," "believe," "target," "estimate," "predict," "project," "potential," "propose" or"propose," "continue," the negative of these terms"assume" or other terminology. Thesesimilar expressions, or the negatives of those expressions. All statements contained in this Form 10-Q regarding our corporate objectives and strategies, future operations, potential partnering and other strategic transactions, projected financial position, planned product development activities, proposed registration strategies and product indications, future regulatory approvals, proposed product commercialization, adequacy of current cash resources, projected costs, potential sources and availability of capital, ability to regain and maintain compliance with Nasdaq continued listing requirements, future prospects, the future of our industry, and results that might be obtained by pursuing management's current plans and objectives are forward-looking statements.

        You should not place undue reliance on our forward-looking statements because these statements reflect our current views with respect to future events and are based on assumptions and are subject to risks and uncertainties that are difficult to predict. In evaluating these statements, you should specifically consider various factors described below in the section entitled "Risk Factors." These and other factors may cause our actual results to differ materially from any forward-looking statements contained in this report or otherwise made by us.

        Although we believe the expectations reflected in theOur forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. You should not place undue reliancebased on our forward-looking statements, whichthe information currently available to us and speak only as of the date of this report. Wereport or, in the case of forward-looking statements incorporated herein by reference, the date of the filing that includes the statement. Over time, our actual results, performance or achievements may differ from those expressed or implied by our forward-looking statements, and such difference might be significant and materially adverse to our security holders. Except as required by law, we undertake no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this report, or to reflect the occurrence of unanticipated events.

        We have identified some of the important factors that could cause future events to differ from our current expectations and they are described in our Annual Report on Form 10-K for the year ended December 31, 2009, filed with the SEC on March 16, 2010 and available on the SEC's website,www.sec.gov, including under the heading "Risk Factors" in the Form 10-K, and in this Form 10-Q, including in this "Management's Discussion and Analysis of Financial Condition and Results of Operation" and in the section entitled "Risk Factors" in Part II of this report. Please consider our forward-looking statements in light of these risks as you read this report.

Background and Corporate Update

        During the first quarter of 2010, we completed a management restructuring and reduced our workforce as we refocused our clinical and regulatory goals. On March 24, 2010, we announced that we were suspending our effort to file a New Drug Application, or NDA, seeking approval of picoplatin as a second-line treatment for patients with small cell lung cancer. We made this decision following a detailed analysis of primary and updated data from our Phase 3 SPEAR (Study of Picoplatin Efficacy After Relapse) study and an evaluation of the NDA process with the U.S. Food and Drug Administration, or FDA. We now are focusing our efforts on developing registration strategies for picoplatin in colorectal, prostate, ovarian and small cell lung cancers and are continuing to evaluate partnering and other arrangements to fund these strategies. In April 2010, we restructured our operations to conserve resources and support our registration and partnering strategies. This followed an earlier reduction in workforce headcount in February 2010. Through these two restructuring steps, our headcount was reduced from 22 to 12 employees. Concurrent with these events, we engaged

Leerink Swann LLC to conduct a comprehensive review of strategic alternatives aimed at supporting and optimizing the value of our picoplatin program to our shareholders. These alternatives may include a potential cash raise, merger, sale or partnership. As of June 30, 2010, we had approximately $29.3 million in cash, cash equivalents and investment securities balances, net of restricted cash of $158,000, which we believe will provide adequate resources to fund our operations at least through the end of 2010. Thereafter, we will need to raise additional funds or enter into a partnering or other strategic relationship to avoid a default under our current credit facility and sustain our current operations. Our ability to continue to evaluate strategic alternatives and potentially resume development activities with respect to picoplatin will be dependent on our ability to obtain substantial additional funding. We may seek to raise necessary additional funds through public or private equity, debt financings, collaborative arrangements with corporate partners or other sources. We can provide no assurance that any particular alternative will be pursued or that any transaction will occur, or on what terms. We do not plan to release additional information about the status of the review of alternatives until a definitive agreement is entered into or the process is otherwise completed.

Critical Accounting Policies and Estimates

        Our critical accounting policies and estimates have not materially changed from those reported in our Annual Report on Form 10-K for the year ended December 31, 20082009 filed with the SEC on March 16, 2009.2010. For a more complete description, please refer to our Annual Report on Form 10-K.

Results of Operations

Three and NineSix Months Ended SeptemberJune 30, 20092010 Compared to the Three and NineSix Months Ended SeptemberJune 30, 20082009

Research and Development

        Our major research and development program is picoplatin, a new generation platinum-based chemotherapeutic designed to overcome platinum resistance in the treatment of solid tumors. We completed patient enrollment in our Phase II clinical study of picoplatin in small cell lung cancer in August 2006 and, based on positive median overall survival data from that study, we initiated a Phase III pivotal trial of picoplatin in small cell lung cancer in April 2007. We completed enrollment in our Phase III trial in March 2009. In September 2009, we announced that 320 evaluable events (patient deaths) have occurred in our Phase III trial, enabling us to begin final analysis of data. We currently anticipate completing and reporting results of our preliminary analysis in November 2009 and, if positive, initiating a rolling submission of a new drug application ("NDA") with the U.S. Food and Drug Administration ("FDA") by year-end.

        In May 2006, we treated our first patients in two Phase I/II studies evaluating picoplatin as a first-line treatment of: (1) advanced colorectal cancer and (2) castration-resistant (or hormone-refractory) prostate cancer. We initiated enrollment in the Phase II component of our colorectal cancer study in November 2007 and completed enrollment in May 2008. We initiated the Phase II component of our prostate cancer study in July 2007 and completed enrollment in December 2007. We also have completed a Phase I study of an oral formulation of picoplatin in advanced solid tumors.

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Research and development expenses decreased 40%61% to $5.4 million from $9.0approximately $2.1 million during the thirdsecond quarter of 20092010 and decreased 22%48% to $19.2 million from $24.5approximately $7.0 million in the ninefirst six months ended September 30, 2009 compared toof 2010 from the comparable periods in 2008.2009. The significant decrease in our research and development expenses during the three and six months ended June 30, 2010 is primarily a result of our picoplatin trials winding down. Our research and development expenses are summarized as follows: