Spectrum (SPPI) Pops Higher Following Reacquisition of Apaziquone Rights

January 31, 2013 12:43 PM EST
Spectrum Pharmaceuticals (Nasdaq: SPPI) shares are trading strong the session following a news release earlier of a notable acquisition.

Shares are up about 7.3 percent on the session Thursday.

According to the release, "Spectrum Pharmaceuticals announced the Company has reacquired development and commercialization rights for apaziquone in the United States, Europe and other territories pursuant to an agreed-upon restructuring of Spectrum’s collaboration with Allergan, Inc (NYSE: AGN). In exchange, Allergan will receive a royalty on future revenue. Apaziquone is an anticancer agent being developed for the treatment of non-muscle invasive bladder cancer (NIMBC) as a single instillation following transurethral resection of bladder tumor (TURBT).

Notably, Allergan's royalties will be a "tiered single digit royalty not to exceed mid single digits on certain products containing Apaziquone, and Allergan being relieved of its obligations for development, commercialization and other activities." The info was in an 8-K filing this morning.

The release continues, "Spectrum also announced that a scheduled meeting with the U.S. Food & Drug Administration (FDA) was held last month to discuss the results from the Company’s Phase 3 clinical trials. Based on the discussions with the FDA, Spectrum understands that the FDA can accept the NDA filing with the current Phase III data and will likely convene an Advisory Committee meeting. Further, based on discussions with the FDA, Spectrum has agreed to conduct one additional Phase III study following consultation with the FDA on its design.

Apaziquone is an anticancer drug that requires activation by bio-reductive enzymes that are over-expressed in bladder cancer cells, to render it a cytotoxic alkylating agent. Spectrum conducted two multi-center, international Phase 3 trials of a single dose of intravesical instillation of apaziquone into the bladder in the immediate post-operative period after surgical resection of low-grade, non-muscle invasive bladder tumors. In April 2012, Spectrum announced that the Phase 3 trials did not meet their primary endpoint of a statistically significant difference in the rate of tumor recurrence at 2 years between treatment and placebo arms. However, analysis of the pooled data from both studies showed a statistically significant treatment effect in favor of apaziquone in the primary endpoint of the rate of tumor recurrence at 2 years (p-value = 0.0174) and in a key secondary endpoint, time to recurrence (p-value = 0.0076).

NMIBC is a form of bladder cancer localized in the surface layers of the bladder that has not spread to the deeper muscle layer. Approximately 70% of all patients newly diagnosed with bladder cancer have NMIBC. More than one million patients in the U.S. and Europe are estimated to be affected by the disease, which is treated predominantly by urologists. Professional urology associations and NCCN Guidelines recommend instillation of a cytotoxic agent following transurethral resection of bladder tumor (TURBT) for NMIBC. However, in the US, there are no FDA-approved agents for this indication."

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