This pilot study is designed to evaluate outcomes with the combination of CPX-351 salvage therapy and haplo-cord graft stem cell transplantation for subjects with relapsed or refractory AML or myelodysplastic syndrome.

Inclusion Criteria:

1. Subject must have refractory or relapsed Acute Myeloid Leukemia (AML) according to previously established criteria:

   1. Primary induction failure (PIF) after ≥ 2 cycles of chemotherapy
   2. First relapse
   3. Relapse refractory to salvage chemotherapy
   4. Second or subsequent relapse

2. Subjects with Myelodysplastic Syndrome (MDS):

   (a) Either Refractory Anemia with Excess Blasts I or Refractory Anemia with Excess Blasts II (RAEB I or RAEB II)

3. Karnofsky performance status ≥ 70

4. Willing to participate as a research subject and sign an informed consent form

5. Adequate physical function measured by:

   1. Cardiac: asymptomatic, or if symptomatic then Left Ventricular Ejection Fraction (LVEF) at rest must be ≥ 45% and must improve with exercise
   2. Hepatic: ≤3 x upper limit of normal (ULN) alanine aminotransferase (ALT) and ≤ 1.5 total serum bilirubin, unless liver is involved with the disease or there is congenital benign hyperbilirubinemia
   3. Renal: serum creatinine within normal range, or if serum creatinine is outside the normal range, then calculated creatinine clearance ≥ 60 ml/min
   4. Pulmonary: asymptomatic, or if symptomatic, diffusing capacity of the lungs for carbon monoxide (DLCO) ≥ 45% of predicted (corrected for hemoglobin)

6. If subject has prior malignancy, must be without any evidence of disease of that prior malignancy for at least 2 years (excludes skin cancers that may have been excised within that 2 year period).

Exclusion Criteria:

1. Serious active or uncontrolled infection or medical condition
2. Women who are pregnant or breast feeding. Women of childbearing age must use adequate contraception and have a negative pregnancy test.
3. Prior daunorubicin therapy with a cumulative dose of more than 368 mg/m2 or equivalent
4. Other systemic anticancer therapy or ongoing clinically relevant toxicities from such therapy (at discretion of the investigator)
5. History of and/or current evidence of myocardial impairment (e.g. cardiomyopathy, ischemic heart disease, significant valvular dysfunction, hypertensive heart disease, congestive heart failure), resulting in heart failure by New York Heart Association Class III or IV staging.
6. Subjects with Wilson disease or other Copper-related disorders.