Last month, Charly Travers took a provocative look at Allos Therapeutics (NASDAQ:ALTH). At the time, Allos and Genta (NASDAQ:GNTA) had both received the FDA advisory committee's kiss of death -- recommendations that their drugs not be approved.

The vote on Allos' RSR13 was 16-to-1 against approval.

Imagine how surprised Allos and the Oncologic Drugs Advisory Committee (ODAC) -- and, heck, Charly, too -- were when the FDA sent an approvable letter for RSR13. Before you can say "clerical error" or assume this is the new plot for the next installment of Dumb and Dumber, consider what the FDA did.

To breathe life back into RSR13, the FDA had to overlook that the successful test results came from a subgroup of an earlier unsuccessful trial. If you thought the FDA was too tough, the joke is on you. Oh, sweet kiss of life!

To be fair, the FDA approval starts with a big if. "If the study shows effectiveness in this population (increased survival) using the pre-specified analysis, and the study is otherwise satisfactory, we believe it would, together with the subset result in RT-009, support approval." If that sounds like pseudo approval or just plain mumbo jumbo, then you pass. Allos still has to prove RSR13 is worthy.

So, what is the investment case for Allos? The company has no debt. It has the cash to complete the RSR13 phase 3 trial. That's good. But consider that it keeps RSR13 on the FDA's radar -- a subgroup (a smaller market) is now the target.

The two analysts that follow the stock expect it to lose $0.79 this year and $0.83 next year. The stock is down from $15 in 2001 and is currently bobbing on either side if $3, which is still 40% lower for the last 52 weeks (and its May peak). With profits not in the near-term picture, I'd step aside, even though the FDA has given the company the kiss of life.

Relish lawyer pratfalls? Allos, after the ODAC recommendation, was hit with numerous class action suits. The lawyers claimed that the company had misled investors about the potential of RSR13. That Allos can become the next ImClone (NASDAQ:IMCL) and work its way all the way back is no slam dunk, but don't sue them for believing.

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Fool contributor W.D. Crotty does not own any of the stocks mentioned.