) suffered a loss of 11 cents in the first quarter of 2012 as
opposed to a loss of 14 cents per share incurred in the year-ago
quarter. An increase in total revenue coupled with lower costs led
to the narrower loss in the first quarter of 2012. The Zacks
Consensus Estimate hinted at a loss of 5 cents per share. The
results were announced through a filing with the Securities and
Total revenue in the reported quarter climbed 4.3% to $11.3
million. Net product sales at Allos fell 10.1% to $9.8 million.
Allos derives its product revenues from selling Folotyn. Folotyn
(pralatrexate) is marketed for the treatment of patients suffering
from relapsed or refractory peripheral T-cell lymphoma (PTCL).
Despite the fall in Folotyn sales, revenues increased year
over year due to the presence of $1.6 million as license and other
revenues pertaining to Allos' deal with Mundipharma (inked in May
2011) for the co-development of Folotyn. The Zacks Consensus
Estimate was $14 million.
Both selling, general and administrative (SG&A) and research
& development (R&D) expenses were on the downswing during
the quarter, declining 12.5% and 29.3%, respectively, primarily due
to the company's prudent cost management strategy.
Allos to be taken over by Spectrum Pharma
On April 4, 2012, Allos announced that it will be acquired by
). Per the terms of the deal, Spectrum Pharma agreed to acquire
Allos for $1.82 per share in cash, in addition to one contingent
value right (CVR).
Spectrum Pharma has initiated a tender offer to buy the entire
outstanding shares of Allos for the above mentioned purchase price.
At the time of announcing the deal, expected to close shortly, the
companies stated that the CVR makes each Allos shareholder eligible
to receive a further 11 cents per share in cash depending on the
conditional European approval and achievement of certain milestones
At the time of announcing the deal, management at Spectrum
Pharma had stated that the acquisition, which has been cleared by
the Boards of both companies, is expected to boost Spectrum
Pharma's earnings in the final quarter of 2012.
Currently, we have an Outperform Recommendation on the stock.
The company carries a Zacks #2 Rank (short-term Buy rating).
ALLOS THERAPEUT (ALTH): Free Stock Analysis
SPECTRUM PHARMA (SPPI): Free Stock Analysis
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