Does Spectrum Pharmaceuticals Have a Bright Future?

Spectrum Pharmaceuticals (NASDAQ: SPPI) announced on Monday that it had completed the first part of its Phase 1 trial on a new drug designed to treat solid tumors. The treatment showed encouraging activity in patients with various forms of cancer; specifically prostate, breast, and ovarian, among others. CEO Rajesh Shrotriya shared in the enthusiasm. "We are very pleased with the promising top-line data from the SPI-1620 study and believe that it could be an effective drug in the treatment of solid tumors."The news release was one in a line of recent success for the small biotech company. The company's flagship drug Fusilev was approved for the treatment of colon cancer in April, and was primarily responsible for the company's record revenues during the first two quarters of FY2011. The drug's success was due primarily to a shortage in leucovorin, a generic produced by Teva Pharmaceuticals that is also used to treat colon cancer. Investors have taken note, as the stock has doubled in the past year.However, Spectrum's reliance on Fusilev as a stock price driver could prove to be a problem in the near future. Teva has imported supplies of leucovorin from Europe to help shore up stockpiles, and hopes to restore production in the near ...

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