What happened

Shares of the small-cap cancer-treatment company Clovis Oncology (CLVS) are having a rather volatile session today. The drugmaker's shares dropped by as much as 12.8% immediately out of the gate this morning, but have since clawed their way back. As of 11:05 a.m. ET Thursday morning, Clovis' stock was only down by 2%.

What's particularly interesting about the biotech's struggles today is that the industry as a whole is glowing green. The SPDR S&P Biotech ETF, for instance, is presently up by 3.12% at the time of this writing. 

So what

What's causing Clovis' stock to move against the broader upward trend in biotech today? Yesterday, the company filed an 8-K with the Securities and Exchange Commission saying that the Food and Drug Administration (FDA) is recommending that Clovis wait for more mature overall survival data before applying for a label expansion for its ovarian cancer drug rucaparib as a first- line maintenance treatment.

Without these data, the FDA said that an advisory committee meeting could be required to discuss the drug's clinical profile in this high-value setting. Despite this advice, though, Clovis noted that it plans on filing a label-expansion application for this indication later this year.

Overall, this isn't great news for Clovis. The company has an exceptionally high cash burn rate, meaning that time is of the essence.  

Now what

Is this dip a buying opportunity? Clovis is in a tough spot. The company simply hasn't been able to compete effectively in the jam-packed advanced ovarian-cancer treatment market. And it's not altogether clear how an additional indication for rucaparib would change this fundamental problem.

While a buyer might materialize if the company can snag another label expansion, a takeover is far from a sure thing in this case. As such, it's probably best to watch this story from the sidelines.