Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of biotechnology company Spectrum Pharmaceuticals (Nasdaq: SPPI ) dipped as much as 14% following an update from the company regarding its pipeline and after announcing an acquisition.
So what: Spectrum's experimental drug apaziquone, which is aimed at treating the most common form of bladder cancer, failed to show statistical significance in late-stage clinical trials versus the placebo. The drug was developed in partnership with Allergan (NYSE: AGN ) , and the two did note that the statistical data pooled from their studies could lead to other avenues for apaziquone. Spectrum also announced the acquisition of Allos Therapeutics (Nasdaq: ALTH ) for $1.82 per share, or an 11% premium to yesterday's close.
Now what: Allos' lead drug, Folotyn, and Spectrum's Zevalin are both prescribed by hematologist-oncologists, but they attack different types of blood cancer. With both drugs under the same roof, Spectrum expects to save $40 million-$50 million per year, as the sales force pitches the non-competing treatments to the same doctors.
Those savings are nothing to sneeze at, but neither is today's negative news on apaziquone. For now I'm going to call today a wash and put Spectrum on my watchlist for further research.
Craving more input? Start by adding Spectrum Pharmaceuticals to your free and personalized watchlist so you can keep up on the latest news with the company.
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