Shares of Spectrum Pharmaceuticals, Inc. (SPPI) had added about $1 per share – or about 9 percent – in the past few weeks, pushing through the 50 and 200 day moving averages to take on a more bullish look, but as can generally be said, “news trumps technicals.” The Henderson, Nevada-based biotech delivered a corporate update Tuesday that forecasted a continued struggle for sales of its colorectal cancer drug Fusilev, sending shares in a tailspin in extended trading.
Citing communications with customers, Spectrum expects a change in ordering patterns of Fusilev and now estimates first-quarter sales in the range of $10 million to $15 million. For all of fiscal 2013, the company sees sales in the area of $80 million to $90 million for its largest drug. Revenue from Fusilev was about $204 million in 2012. In February, Spectrum guided a rise in annual sales.
On the bright side, Spectrum expects their hematology franchise, including peripheral T-cell lymphoma drug Folotyn and non-Hodgkins lymphoma drug Zevalin, to grow during the year and for, on the whole, the company to be profitable for the full-year 2013 on an adjusted basis.
Spectrum anticipates total revenue in the range of $160 million to $180 million for all of 2013, a far cry from the $297 million that Wall Street was expecting and down about $100 million from 2012 sales.
Fusilev first garnered FDA approval in 2008 for osteosarcoma, a form of bone cancer, as a rescue treatment after methotrexate therapy. In 2011, it received clearance as a treatment for advanced colon cancer. Fourth-quarter 2012 sales were essentially flat year-over-year, but fell about 14 percent from the third quarter.
Shortages of generic versions of Fusilev, or levoleucovorin, have buoyed sales, but the FDA has made moves to increase supplies, including approving Sagent Pharmaceuticals Inc.’s (SGNT) bioequivalent late in 2012, putting pressure on Fusilev sales.
In a corporate statement, Spectrum noted, “while hospital sales are shifting to generics, the end-user demand for Fusilev remains stable in the clinics, and the company continues to anticipate solid demand in this segment in 2013.” The company added that it expects most of the impact from the shift to generics of Fusilev will occur in the first half of 2013.
Also looking ahead, Spectrum said it intends to file a New Drug Application for belinostat mid-year and commercialization of the HDAC inhibitor for lymphoma, pending FDA approval. It also expects to file an NDA for apaziquone for bladder cancer in 2014.
As mentioned, shares were trying to climb with the upbeat outlook in February, but plunged about 40 percent in extended trading on Tuesday with the latest corporate update and projections of diminishing Fusilev sales. After wrapping the regular trading session ahead by 4 percent at $12.43, shares fell to $7.40 in after-hours action. With the drop, shares are at their lowest levels since hitting $6.85 in early October 2011.
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