Spectrum says FDA refuses to OK new plea on cancer drug

Spectrum Pharmaceuticals said U.S. health regulators declined to approve its supplementary marketing application for its advanced metastatic colorectal cancer drug Fusilev in its current form, sending its shares down 22 percent.

Spectrum said the U.S. Food and Drug Administration (FDA) noted that the submission did not show that Fusilev is non-inferior to standard treatment leucovorin, and it did not request any changes to the currently approved indications.

Spectrum, which received a label expansion approval for another cancer drug last month, said it plans to request a meeting with the FDA to discuss options for the approval of Fusilev.

"There is going to be a delay (in Fusilev approval) and it wasn't really expected," said Morgan Joseph & Co analyst Shiv Kapoor, who in September downgraded Spectrum shares to "hold" from "buy."

Kapoor said he would wait for Spectrum to meet the FDA and determine the next step needed for the approval of the drug.

"The question really here would be, will this be a meaningful delay or not," he said.

Fusilev is currently approved by the FDA as a rescue after high dose of methotrexate therapy in patients with osteosarcoma, a type of bone cancer.

The drug is also indicated to diminish the toxicity and counteract the effects of impaired methotrexate elimination and of inadvertent overdosage of folic acid antagonist, a type of chemotherapy.

Spectrum shares were down 17 percent at $5.17 in late morning trade on Friday. They touched a low of $4.82 earlier in the session, making them one of the top percentage losers on Nasdaq.