HENDERSON, Nev. ( TheStreet) -- Spectrum Pharmaceuticals ( SPPI) CEO Raj Shrotriya is obsessed with short sellers. It's not a healthy pastime for him or his company. Shrotriya has been unable to produce business results strong enough to convince shorts to cover their Spectrum positions, which have been rising steadily all year and now represent about 60% of the company's freely traded shares. So, in what looks like a desperation move, Shrotriya has orchestrated a year-end, special cash dividend of 15 cents per share payable to the company's shareholders. Call it Spectrum's Christmas short-squeeze special. Maybe the dividend ploy will work, at least in the short term. Spectrum shares reacted well this morning, up 3% to $11.10. Longer term, investors generally see through cynical moves likes this and start to worry about what Spectrum is trying to hide. The granting of a special dividend at the end of the year could easily be a warning of weak fourth-quarter earnings. Recent Fusilev sales don't inspire confidence, with $25.4 million in October sales reported by Wolters Kluwer, down from $26.1 million in September, which was down from $29.7 million in August. That's a trend heading in the wrong direction.
November sales will be reported next Wednesday. Don't forget, too, that Sagent Pharmaceuticals only recently began supplying the market with generic leucovorin, which could be stunting Fusilev growth. Spectrum posted disappointing third quarter revenue and product sales that were flat sequentially and the company's 2012 guidance implies paltry 3% revenue growth for the December quarter. If Shrotriya is looking for reasons to explain his company's high short interest and poor stock performance (down 26% year to date), he may want to look internally. Cursing at short sellers makes for great theater but is generally not a viable business model. -- Reported by Adam Feuerstein in Boston. Follow @AdamFeuerstein