* What: FDA to decide on Spectrum's cancer drug
* When: Sept 7, Monday
* Analysts expect a positive response from FDA
By Anand Basu
BANGALORE, Sept 3 Analysts are expecting a favorable decision from U.S. health regulators on the additional use of Spectrum Pharmaceuticals' (SPPI.O) cancer drug Zevalin as a first-line therapy for non-Hodgkin's lymphoma (NHL), which will give a much-needed boost to declining sales of the drug.
The U.S. Food and Drug Administration (FDA) is expected to reach a decision on Zevalin as a first-line consolidation therapy for NHL on Sept. 7. Zevalin is already approved for the treatment of patients with relapsed or refractory NHL.
In July, the FDA denied approval for Zevalin as a first-line treatment for patients with NHL, requesting the company to submit data sets from the late-stage study to verify a subset of the data that was under review for the proposed labeling. [ID:nBNG174679]
"Based on the data that's been submitted, the feedback from the company and the fact that Zevalin is already approved in the third-line setting, the potential is favorable for an approval," said Rodman & Renshaw analyst Reni Benjamin, who gives Zevalin a 80-85 percent chance of winning approval.
Morgan Joseph & Co's Shiv Kapoor also believes an approval is on the way for Zevalin.
"We expect several key catalysts for the company in 2H09. We expect approval of Zevalin in the first line consolidation therapy of NHL on Sept. 7," Kapoor wrote in a note dated Aug. 14.
Sales of Zevalin could touch $150 million if it gets an approval, said Benjamin, who has a "market outperform" rating on Spectrum shares.
Zevalin sales have been dropping since its launch in 2005 when it reached about $20 million. They declined to about $16 million in 2006 and to about $11.4 million last year.
Spectrum spokesman Paul Arndt said the company's goal would be to stabilize and reverse Zevalin's declining sales trend.
Arndt, who did not give any outlook on Zevalin sales, said, "If we stabilise revenue this year we will consider that a win."
He also said the company would market the drug on its own and had enough cash and a sales force to do so.
As of June 30, the Irvine, California-based company had cash, equivalents, and financing receivables of $106 million.
Rodman & Renshaw's Benjamin said Spectrum could hold an edge over rival GlaxoSmithKline's (GSK.L) NHL drug Bexxar as it already has a sales force in place to market Zevalin. (Editing by Himani Sarkar)