Seattle Genetics (Nasdaq: SGEN) lists seven drugs on its pipeline page. And there are another 11 clinical-stage drug candidates and quite a few preclinical ones being developed by partners from large companies, such as Roche, Pfizer (NYSE: PFE), and Abbott Labs (NYSE: ABT), in addition to smaller ones like Progenics Pharmaceuticals (Nasdaq: PGNX) and Celldex Therapeutics (Nasdaq: CLDX)

But the big bet on Seattle Genetics right now is on its lymphoma drug brentuximab vedotin. The drug is a cell-killing agent attached to a monoclonal antibody that targets cells that express CD30, a marker of Hodgkin lymphoma and anaplastic large cell lymphoma.

Brentuximab vedotin proved successful in helping late-stage Hodgkin lymphoma patients, eliciting a 75% response rate. That's a pretty astounding considering that a 25% to 30% rate would likely be enough to get the drug approved.

A few weeks later, the drug also helped ALCL patients, so Seattle Genetics and its partner Takeda decided to submit a marketing application for both indications. This week, investors will get a first look at what the Food and Drug Administration thinks of brentuximab vedotin when an advisory panel meets to discuss it.

How the bet wins, how it loses
The drama will start on Tuesday when the FDA posts briefing documents for the panel of outside experts. You should be able to find the documents here. They usually show up before the market opens, but the FDA isn't really bound to that.

The documents offer a view into the mind-set of the FDA reviewers. The briefing documents are especially important because the advisory committee only makes a recommendation, but the FDA has the final say. There are plenty of examples of the FDA's negative view serving as a preview for a rejection despite a positive recommendation by the FDA panel -- Dendreon (Nasdaq: DNDN) and InterMune (Nasdaq: ITMN) experienced that, for example.

That's not to say the committee meeting is unimportant. Doctors on the panel often shrug off minor issues that the FDA brings up, which can help focus the agency on the bigger picture, increasing the likelihood of approval. Alternatively, a negative recommendation by an advisory committee can be a death sentence even if the FDA doesn't seem that negative about the drug in the briefing documents.

There's always some anxiety priced into the shares, but positive briefing documents will likely only result in a small increase in the share price given investors expectations of an approval. If that's the case, the advisory committee meeting may simply be a rubber stamp and therefore not result in much of a bump.

The potential downside, on the other hand, looks fairly substantial. Anything but a slam-dunk love-fest from the FDA on Tuesday may be seen as a loss. Same goes for the advisory committee on Thursday. The company needs close to a unanimous endorsement to keep investors' fingers off the sell button.

Survey says
I see two potential concerns that the FDA could bring up in their briefing documents. For one, Seattle Genetics' antibody conjugation technology is new and could theoretically cause worry with the FDA.

The other issue is that both of the trials were relatively small without a placebo control. That's usually acceptable for drugs that treat diseases without any other treatment options. The FDA offers an accelerated approval with the condition that a larger post-approval trial be run.

I have a hard time seeing the FDA rejecting brentuximab vedotin on either issue, but it's difficult to buy at these inflated levels where Seattle Genetics can fall a lot if the FDA focuses on some unforeseen issue.

On the other hand, the drug clearly seems to be working. Even if the FDA were to reject brentuximab vedotin now, it still looks like it would have no problem passing a larger phase 3 trial. If you're in it for the long haul, taking the risk now -- perhaps with a half position -- could be a decent bet.

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Fool contributor Brian Orelli holds no position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Abbott Laboratories. Motley Fool newsletter services have recommended buying shares of Abbott Laboratories and Pfizer. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.