2 Questions for Seattle Genetics

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

The easiest way to see where a drug company might get tripped up by a Food and Drug Administration advisory panel is to look at the questions the agency has for the panel of outside experts. There are often four or five -- sometimes more -- questions about different issues the FDA has with the drug. Some have requests for a vote, others just ask for a discussion, and there's always the ultimate question on whether the committee recommends approval of the drug.

So you could tell the FDA is fairly impressed with Seattle Genetics' (Nasdaq: SGEN  ) lymphompa drug brentuximab vedotin when there were just two questions for each of the indications that Seattle Genetics has applied for. Sure, there's mention in the briefing documents about side effects, but the lack of a question about them leads me to think the FDA probably isn't that worried about the potential for nerve damage or depletion of immune cells.

The two questions on the docket:

  1. Should brentuximab vedotin get a full approval, an accelerated approval, or no approval at all?
  2. What should a confirmatory trial look like if an accelerated approval is given?

I think we can take a regular approval off the table for both types of lymphoma. The drug was tested in relatively small clinical trials without control arms. The response rates produced by brentuximab vedotin are sufficient to be convinced that the drug is working, but the panel members will want to see more data before giving the drug a full approval. Except for having to run an additional trial, there's no downside to getting an accelerated approval.

Seattle Genetics has already started a confirmatory trial in Hodgkin's lymphoma; it remains to be seen whether the FDA panel likes the design. If worse comes to worst, Seattle Genetics has to modify the trial or run an entirely different trial altogether. For anaplastic large-cell lymphoma, the other indication it's applying for, the company hasn't started a confirmatory trial yet.

At this point, the confirmatory trials seem like the only stumbling block that could trip up Seattle Genetics. Eli Lilly (NYSE: LLY  ) , Bristol-Myers Squibb (NYSE: BMY  ) , Amgen (Nasdaq: AMGN  ) , and many others have failed to complete confirmatory trials after their cancer drugs received accelerated approvals, which doesn't make the FDA very happy. The agency may want to see Seattle Genetics' trials in process before giving brentuximab vedotin an accelerated approval for the indications.

Looking for more stock ideas? Here are five stocks that The Motley Fool owns and its analysts think you should, too.

Fool contributor Brian Orelli holds no position in any company mentioned. Check out his holdings and a short bio. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (0) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1518876, ~/Articles/ArticleHandler.aspx, 10/24/2016 10:22:20 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,243.17 97.46 0.54%
S&P 500 2,151.62 10.46 0.49%
NASD 5,302.56 45.16 0.86%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/24/2016 10:06 AM
AMGN $158.65 Up +0.14 +0.09%
Amgen CAPS Rating: ****
BMY $49.69 Down -0.33 -0.66%
Bristol-Myers Squi… CAPS Rating: ****
LLY $77.89 Down -0.36 -0.46%
Eli Lilly and Co. CAPS Rating: ***
SGEN $50.10 Down -0.73 -1.44%
Seattle Genetics CAPS Rating: ****