) is off to a good start in the second half of the year after a
disappointing first half as far as its oncology drug, Fusilev, is
concerned. The drug performed miserably in the first half of the
year due to lower shipments to wholesalers.
Spectrum Pharma reported third quarter of 2013 loss (including
stock-based compensation but excluding other special items) of 2
cents per share, narrower than the Zacks Consensus Estimate of a
loss of 8 cents. The company had reported earnings of 37 cents
per share in the year-ago quarter. Results were affected by lower
Spectrum Pharma's revenues in the reported quarter came in at
$42.4 million, down 38.5% year over year. The massive decline in
total revenues was primarily due to lower product sales. Revenues
in the third quarter were however above the Zacks Consensus
Estimate of $41 million.
Quarter in Details
Spectrum Pharma recorded quarterly revenues from product sales
and licensing fees during the quarter. Product revenues in the
reported quarter were down 37.1% year over year to $41.4 million.
This consisted of revenues from Fusilev, Folotyn, Zevalin and
Fusilev's performance has improved in the third quarter of 2013,
after a disappointing first half this year. The drug is approved
for the treatment of metastatic colorectal cancer. Spectrum
Pharma recorded Fusilev sales of $23.1 million in the reported
quarter, up from $12 million and $13 million in the first and
second quarters, respectively. The improvement in Fusilev sales
was primarily due to higher shipments to wholesalers, which were
sluggish earlier in the year.
Spectrum Pharma expects Fusilev sales to remain in the range of
$20−$25 million per quarter in the forthcoming quarters.
Sales from Folotyn, which was added to Spectrum Pharma's
portfolio following its acquisition of Allos Therapeutics, Inc.
in Sep 2012, came in at $10.5 million in the third quarter of
2013, down 16.7% sequentially. Folotyn is available in the U.S.
for the treatment of patients with relapsed or refractory
peripheral T-cell lymphoma (PTCL).
Zevalin sales during the reported quarter came in at $7.8
million. In Apr 2012, Spectrum Pharma acquired the licensing
rights to market Zevalin outside the U.S. Zevalin is currently
marketed for the treatment of non-Hodgkin's lymphoma. Spectrum
Pharma is looking to expand the drug's label. Zevalin is being
studied in a phase III study for the treatment of patients
suffering from diffuse large B-cell lymphoma.
Marqibo, launched in the U.S. for the treatment of adults
suffering from Philadelphia chromosome-negative (Ph-) acute
lymphoblastic leukemia (ALL) during late third quarter 2013,
contributed $0.1 million to the company's net revenues. Spectrum
Pharma gained worldwide rights to Marqibo following the
completion of the acquisition of California-based Talon
Therapeutics in Jul 2013. Marqibo is also being developed for the
treatment of non-Hodgkin's lymphoma.
Spectrum Pharma also received $1.0 million as licensing fees
during the quarter, compared with $3.2 million in the year-ago
The company's adjusted research and development (R&D)
expenses of $12.2 million during the quarter shot up 28.8% year
over year. The increase in R&D expenses during the quarter
was primarily due to higher clinical expenses. Adjusted selling,
general and administrative (SG&A) expenses in the third
quarter of 2013 came in at $23.2 million, up 21.3% year over
Spectrum Pharma also revealed that it is all set to file a New
Drug Application (NDA) for its pipeline candidate, Belinostat
(relapsed or refractory peripheral T-cell lymphoma), later in the
year. The company expects to launch Belinostat next year.
Furthermore, the company plans to file for Captisol-enabled
melphalan (a conditioning agent for stem cell transplant and
multiple myeloma) by mid 2014.
We are encouraged by Fusilev's turnaround after a disappointing
first half this year. Fusilev has been the key revenue generator
for Spectrum Pharma. Moreover, the addition of Marqibo is
expected to boost the company's top-line further. We are also
encouraged by the company's efforts to expand its product
portfolio and pipeline.
Spectrum Pharma currently carries a Zacks Rank #3 (Hold). Other
) presently look more attractive with a Zacks Rank #1 (Strong
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