Spectrum Pharmaceuticals, Inc
.
SPPI
announced that the company has received a Complete Response Letter (CRL) from the FDA regarding its new drug application (NDA) for pipeline candidate, poziotinib.
Shares were down on the news but the decline was later on pared with shares gaining 7.6% and the company finally ended trading in green on Nov 25.
The company sought approval of the candidate for the treatment of patients with previously treated locally advanced or metastatic non-small cell lung cancer (“NSCLC”) harboring HER2 exon 20 insertion mutations.
The FDA issued a CRL indicating the poziotinib application cannot be approved in its present form and the agency requires additional data, including a randomized controlled study, prior to approval.
The CRL did not come as a surprise to the company, as the Oncologic Drugs Advisory Committee of the FDA had earlier voted 9-4 that the current benefits of poziotinib did not outweigh its risks.
Consequently, the company will de-prioritize poziotinib program activities and reduce its workforce by 75%. Per the company, the anticipated cost savings from this restructuring should enable the company to generate the working capital required to support its strategic refocusing through 2024.
Poziotinib is a novel, oral epidermal growth factor receptor tyrosine kinase inhibitor (EGFR TKI) that inhibits the tyrosine kinase activity of EGFR as well as HER2 and HER4, which, in turn, leads to the inhibition of the proliferation of tumor cells that overexpress these receptors.
The company has an exclusive license from the South Korean company Hanmi Pharmaceutical to develop and commercialize poziotinib all over the world, excluding Korea and China.
Shares of Spectrum have plunged 61.5% in the year-to-date period compared with the
industry
’s decline of 30.3%.
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Spectrum will now focus its efforts on driving growth from its recently launched commercial drug, Rolvedon. The drug was approved in September 2022 for adult patients with non-myeloid malignancies receiving myelosuppressive anti-cancer drugs associated with a clinically significant incidence of febrile neutropenia.
As of Sep 30, 2022, Spectrum had $100.3 million of cash, cash equivalents, and marketable securities.
Zacks Rank & Stocks to Consider
Spectrum currently carries a Zacks Rank #2 (Buy). Some other top-ranked stocks in the healthcare sector include
Biogen
BIIB
,
Gilead
GILD
and
Solid Biosciences
SLDB
. All three carry a Zacks Rank #2. You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
Over the past 30 days, earnings estimates for Biogen have increased by 30 cents to $16.98. Biogen also surpassed estimates in three of the trailing four quarters, with the average being 7.02%.
Over the past 30 days, earnings estimates for Gilead have increased by 55 cents to $7.09. Gilead also surpassed estimates in three of the trailing four quarters, with the average being 0.35%.
Over the past 30 days, loss estimates for Solid Biosciences have narrowed to $8.04 from $10.15. SLDB missed estimates in three of the trailing four quarters, with the average being -4.15%.
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