With a new drug application (NDA) recently filed for Captisol-enabled melphalan (CE melphalan) in multiple myeloma (MM) and SPI-2012, a long-acting granulocyte stimulating factor (G-CSF) said to have billion-dollar potential, going into phase III trials next year for chemotherapy-induced neutropenia, Spectrum Pharmaceuticals Inc.'s only cloud on the horizon seems to be the patent battle over the folate analog Fusilev (levoleucovorin) in cancer.

And Spectrum, of Henderson, Nev., is hoping for a brisk decision on the case made by first filer – in 2012 – Sandoz International GmbH (Basel, Switzerland-based Novartis AG's generics group). Other challengers include Innopharma Inc., of Piscataway, N.J., and Ben Venue Laboratories Inc., a division of Boehringer Ingelheim GmbH, of Ingelheim, Germany.

"We believe Fusilev has a strong composition of matter patent that expires in 2022 and orphan exclusivity protection in the key metastatic colorectal cancer [mCRC] indication that expires in 2018," opined analyst Ryan Martins with Jefferies, who views "a settlement as the most likely outcome, although a judgment in favor of Sandoz and/or other abbreviated new drug application filers is possible."

How possible is what onlookers are trying to determine. The trial is set to begin in mid-January, with a ruling as early as March. That's when orphan drug status expires, seven years from the approval of Fusilev in osteosarcoma. The drug also is cleared for use in combination chemo with 5-FU in the palliative treatment of patients with mCRC, as well as for diminishing the toxicity/counteracting the effects of impaired methotrexate elimination and of inadvertent over-dosage of folic acid antagonists.

Fusilev sold about $27 million of about $48 million in total product sales for Spectrum in the third quarter, and sales annualized would be about $192 million with Fusilev or $84 million without, estimated RBC Capital Markets analyst Adnan Butt in a research report.

Thomas Riga, chief commercial officer for Spectrum, talked about the product's rising sales during the third-quarter earnings call with investors. "The team that we have on the field with Fusilev, they are formidable, they've been in this space and they're executing exceptionally well," he said. "If we look at what is driving that, there was a 12 percent growth in end user demand, driven purely where we are focused – in the oncology space. It is representing 90 percent of the business. And those partnerships in alignment we have with community oncology [centers are] bearing fruit."

Like RBC's Butt, Jefferies' Martins appreciates the prospects for SPI-2012, and said Spectrum is "significantly leveraged to the drug's success." The G-CSF candidate met its primary endpoint in a phase II study, with full data expected at the American Society of Clinical Oncology meeting next year.

"We believe specific patient sub-populations could benefit from flexible weight-based dosing, although the full phase II data [have] not been presented yet and regulatory input for phase III trials is being sought," wrote Martins, who estimated the drug will launch in 2018 and capture about 10 percent of a market that could include one or more biosimilars. He pegged U.S. sales at about $170 million in 2021.

Meanwhile, the NDA for CE melphalan is wending its way through the FDA, which will decide about the injected compound's approvability as a high-dose conditioning treatment prior to hematopoietic progenitor (stem) cell transplants in MM. (See BioWorld Today, April 24, 2014.)

CE melphalan contains no propylene glycol, a solvent used in existing transplant conditioning treatments that is associated with renal and cardiac side effects – it's anti-freeze. The compound also boasts an improved stability profile that could help in the transplant-conditioning market. Captisol technology, which involves a chemically modified cyclodextrin, permits slower infusion rates and longer duration of administration. This means doctors may intensify the dose for pre-transplant chemo. Shelf life could be longer than eight hours, too.

ANC MEASURE SPEED PHASE III

Martins predicted CE melphalan will be approved by the end of next year, and he assumed peak adjusted sales of $37 million, thanks to the product's above-listed advantages over Alkeran, the melphalan from London-based Glaxosmithkline plc. (Roth Capital Partners analyst Joseph Pantginis put the total market opportunity at $100 million to $130 million.)

Spectrum's Beleodaq (belinostat), the histone deacetylase inhibitor indicated for relapsed or refractory peripheral T-cell lymphoma (PTCL), "may be the lone growth product" in the commercial hopper, according to Martins' view. In the earnings call, Riga agreed and said the company is "thrilled to have our second product in PTCL. It puts us in a leadership position." He said Spectrum is "leveraging our commercial infrastructure; it gives us more share of voice with the customers. And when we look at the use of Beleodaq, it is really a mix, and depends on how the customer is treating these patients – knowing that they are going to cycle through products."

Folotyn (pralatrexate) "may have reached its potential in PTCL, but also is facing pressure from generics with a September 2016 trial date," Martins wrote, and Zevalin [ibritumomab tiuxetan] will continue to see sales slightly decline. Zevalin is cleared for low-grade or follicular B-cell non-Hodgkin's lymphoma (NHL) that has relapsed during or after treatment with other anticancer drugs, as well as newly diagnosed follicular NHL following a response to the first anticancer therapy. Marqibo (vincristine sulfate, liposome injection) "remains a niche product in acute lymphoblastic leukemia," Martins said.

The pipeline, though, is "all upside," touted RBC's Butt. An end-of-phase II meeting is completed with the European Medicines Agency and was planned with the FDA for this quarter. "The development plan is straightforward, similar in the U.S. and the EU, and could move rapidly," Butt said. He viewed SPI-2012, as a new molecule, unlikely to be hampered by biosimilars or by intellectual property held by Thousand Oaks, Calif.-based Amgen Inc. – for which the white blood cell booster Neulasta (pegfilgrastim) sells about $5 billion-plus yearly. "Even a small market share is a significant opportunity for SPI-2012, which could be differentiated, and an upside opportunity for Spectrum shares," Butt said.

Spectrum CEO Raj Shrotriya said during the earnings call that the development of the G-CSF compound "is really a very exciting opportunity for any anticancer company because, unlike other drugs where we have to wait for overall survival for years or for progression-free survival for years, in this case after 10 days you measure the white blood cell count, what's called ANC, or absolute neutrophil count, and you basically have your endpoint." He said he was confident that "we can run this program based on our phase II data rather quickly. The second aspect of my excitement is that FDA has already approved a drug in this space [with Amgen's product]. So there is a program that has already been laid out."

Shares of Spectrum (NASDAQ:SPPI) closed Wednesday at $6.94, up 15 cents.