Spectrum Pharma Shares Fall After Drug Fails in Study

Thursday, 05 Apr 2012 03:40 PM

 

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Shares of Spectrum Pharmaceuticals Inc. fell the most in a month Thursday after the company'ts experimental bladder cancer drug apaziquone failed to prevent tumors from recurring in two studies.

Spectrum dropped 7.9 percent to $11.25 at 2:19 p.m. New York time, after earlier sliding 14 percent in its largest intraday decline since March 1. The Irvine, California-based company had gained 35 percent in the 12 months before Thursday.

The drug developer wants to discuss the results with regulators, Chief Executive Officer Rajesh Shrotriya said in an interview Thursday. The company plans to present pooled data from the two trials to the U.S. Food and Drug Administration for more guidance on how to proceed.

“There is a question whether the size of the study that you designed can pick up the statistical significant difference or not,” Shrotriya said. “Each study alone did not do it, but when you put them together, then we found highly significant statistical differences.”

Spectrum has enough cash on hand to finance additional research if necessary, Shrotriya said.

Spectrum also said today it agreed to acquire Allos Therapeutics Inc., maker of the cancer medicine Folotyn, in a deal valued as much as $206 million. The transaction, which includes contingent value rights for shareholders if the drug reaches certain targets, will add to Spectrum’s earnings in the fourth quarter.

Allos’s Folotyn, an intravenous treatment for T-cell lymphoma, will be sold to the same doctors that Spectrum targets with its own lymphoma drugs, Zevalin and Fusilev, Shrotriya said.

Fusilev, an injection known chemically as levoleucovorin, first won FDA approval in 2008 for patients with a bone tumor called osteosarcoma. The agency cleared the drug for wider use a year ago for patients with advanced colon cancer.

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