Shares of Irvine drug maker Spectrum Pharmaceuticals Inc. slumped Tuesday as investors appeared to weigh its prospects for a cancer drug that won regulatory approval for expanded use last week.
Spectrum’s shares closed down more than 13% with a market value of about $300 million.
Last week, Spectrum said that the Food and Drug Administration approved its Zevalin drug as an early treatment for patients with non-Hodgkin’s lymphoma, a blood cancer.
The drug had previously only been used for patients whose tumors hadn’t responded to other treatments.
Spectrum’s shares saw a run-up prior to the expected approval.
“If you want to worry about something, then fret about Spectrum’s ability to execute on the expanded Zevalin label,” wrote Adam Feuerstein, a columnist at TheStreet.com.
Zevalin never grabbed more than 12% of the market before, and, even with wider usage, will be a “challenge” for Spectrum, he said.
Zevalin is clinically effective but hasn’t been a commercial success for several reasons, including the fact that it’s radioactive, making it more difficult to use.
Spectrum is the fourth drug maker that’s owned Zevalin, which only had sales of $11 million last year, since it was first approved in 2001.
The company plans to hire more sales representatives for Zevalin, with a goal of relaunching it later this year.
