Publish date:

FDA Panel Recommends Approval for Allos Cancer Drug

An FDA panel votes 10-4 in favor of approving Allos Therapeutics' lymphoma drug pralatrexate.

BOSTON, Mass. (

TheStreet

) --The FDA's cancer drug advisory panel voted 10-4 to recommend approval of

Allos Therapeutics'

(ALTH)

lymphoma drug pralatrexate.

Allos wins! (For now -- the FDA still needs to listen to the panel's positive recommendation and approve the drug.)

I'll have more to say about the panel later. Right now, I need to take a deep breath and walk back from the ledge. Allos snatched victory from what seemed like certain defeat. This was a brutal panel at times, with sentiment swinging wildly.

FDA Panel to Review Allos Cancer Drug

BOSTON, Mass. (

TheStreet

) --Rough day Tuesday for

Genzyme

(GENZ)

and

Vion Pharmaceuticals

(VION.OB)

and their respective leukemia drugs at the FDA's cancer drug advisory panel meeting. Both drugs received

recommendations against approval

and by fairly wide margins.

Next up is

Allos Therapeutics

(ALTH)

, which brings its lymphoma drug pralatrexate in front of the same panel of cancer experts this afternoon. This is a tough panel, but I'm sticking with my

earlier prediction for a positive vote

on pralatrexate.

Allos' advantage, I think, is that the company reached an agreement with the Food and Drug Administration on the design of its single-arm (non-controlled) pivotal trial for pralatrexate in patients with peripheral T-cell lyphoma (PTCL). This "special protocol assessment" or SPA is something that neither Genzyme nor Vion had. And as we saw yesterday, that proved to be a big impediment.

I expect some nit-picking and tough questions about the quality of the pralatrexate data (we've already seen that in the FDA's briefing documents released Friday) but overall, the pralatrexate data look strong in a disease and patient population for which there is no currently approved treatment.

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As I did yesterday, I"ll be watching a webcast of the Allos panel this afternoon, which starts at 1 PM EDT, so check back for updates. The panel's vote on pralatrexate should take place between 4-5 PM.

New BofA/Merrill Analyst Launches Biotech Research

(At 6:52 AM EDT)

SAN FRANCISCO, Calif. (

TheStreet

) -- Bank of America/Merrill Lynch's new senior biotech analyst Rachel McMinn launched coverage last night on big-cap stocks. (McMinn left Cowen last year to join the bulge bracket firm.) She's most bullish on

Genzyme

(GENZ)

(Buy, $68 price target) and

Gilead Sciences

(GILD) - Get Report

(Buy, $54 price target.)

On Genzyme, McMinn writes, "GENZ, a biotech company focused on treatment of rare genetic disorders, has been the most controversial large-cap biotech in 2009, and we believe the dislocation in shares from the Cerezyme manufacturing glitch provides a unique buying opportunity. While the worst case of an additional disruption is not yet off the table, we see the most likely scenario as recovery of key product Cerezyme revenues in 2010."

McMinn's $54 price target for Gilead is based on a P/E of 16 times her 2010 EPS estimates, which she says, "is at the higher end we assign to the peer group, based on our belief that upside to consensus estimates over the next few years is likely, driven by increased penetration of GILD's products in the HIV market with few competitive threats. GILD has diversified its portfolio over the years, but HIV products are 80% of revenues, and we forecast HIV will dominate for the foreseeable future. We expect investor focus to increasingly shift towards GILD's next generation HIV medicines, which have the potential to drive significant upside to Street estimates starting in 2011."

As for the rest of the big-cap group, McMinn rolls out neutral ratings on

Celgene

(CELG) - Get Report

($58 price target) and

Amgen

(AMGN) - Get Report

($63 price target) and an underperform rating on

Biogen Idec

(BIIB) - Get Report

($45 price target.)

-- Reported by Adam Feuerstein in Boston

Adam Feuerstein writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback;

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