Spectrum Pharma's Ugly December Quarter Hurt By Falling Fusilev Sales

HENDERSON, Nev. (TheStreet) -- Spectrum Pharmaceuticals (SPPI) turned in another disappointing period of flat sales for the fourth quarter last year. The company declined to offer specific financial guidance for 2013, only forecasting an "increase" in revenue and operating income.

Total revenue reported by Spectrum has remained essentially flat for three consecutive quarters, hurt by decreasing sales of Fusilev, the company's most important colon cancer drug. Not even the addition of sales from the newly acquired cancer drug Folotyn helped Spectrum grow total revenue in the December quarter.

Fusilev sales in the fourth quarter totaled $44.6 million, flat year over year but down 14% sequentially. Fusilev sales have now fallen for three consecutive quarters in a row. Spectrum blamed lackluster Fusilev sales on "greater gross-to-net adjustments" in the fourth quarter Left unsaid is the likelihood that the re-supply of cheaper, generic leucovorin to the market is also contributing to falling Fusilev sales.

Spectrum did note that Fusilev end-user sales are "stable year to date," which doesn't exactly exude confidence for the company's ability to grow sales in 2013.

Sales of the non-Hodgkins lymphoma drug Zevalin were $7.7 million in the fourth quarter, a 20% increase compared to the same period last year but down 4% sequentially. Importantly, Spectrum now records ex-U.S. Sales of Zevalin which was not done in the year-ago period.

For the entire 2012, Zevalin sales totaled $30.3 million, an increase of just 10% increase over 2011 despite Spectrum's many promises that loosened regulatory requirements and new marketing strategies would boost sales significantly.

The only bright spot in Spectrum's December quarter was the $14.4 million in sales recorded by Folotyn, the lymphoma drug acquired through the Allos Pharmaceuticals deal.

But even with better-than-expected Folotyn sales, Spectrum's total revenue in the December quarter of $70.1 million only met consensus analyst expectations. On an adjusted basis, Spectrum earned 27 cents per share, one penny higher than consensus.

Spectrum shares closed Wednesday at $11.83.

-- Reported by Adam Feuerstein in Boston.

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