Cancer Drug Zevalin May Finally Thrive Under Spectrum

The small oncology company may be able to succeed with the non-Hodgkin lymphoma drug where others have failed.

Zevalin (ibrutumomab) is a drug that no one has really heard of. Maybe it's the ill-fated origins of the non-Hodgkin lymphoma treatment - the drug was being recommended by an FDA advisory panel as two commercial airplanes crashed into the World Trade Center. Or maybe Zevalin just has never gotten the attention it has deserved.

Either way, a decade later Zevalin finally may be getting its fair shake.

Zevalin, a radio-labeled monoclonal antibody that seeks and binds to cells with the CD20 receptor, was shown to be extremely effective in clinical trials conducted before its approval, as well as more recently. Yet, the drug never really has taken off, despite three companies trying to make it succeed. The drug posted sales of $16.8 million in 2007, $11.4 million in 2008 and $15.7 million in 2009.

Now owned by Spectrum Pharmaceuticals, Inc., the cancer drug is expected to pull in revenues of $28 million to $30 million for the full year 2010 -the most the drug has sold since it hit the market in 2002. But that isn't really Spectrum's fault.

Zevalin's first problem is its cutting-edge technology - the drug is designed to seek out cancer cells and dump a radioactive blast of cancer-killing medicine. While Zevalin requires only a one-time intravenous infusion that takes less than an hour, the preliminary testing adds an extra seven to nine days to the treatment; this has led to some resistance from physicians.

The previous owners of the drug have not helped the situation. Zevalin was created and brought to market by Idec Pharmaceuticals, which later merged with Biogen to become Biogen Idec Inc. Neither Idec nor Biogen was overly zealous about pushing Zevalin to succeed; largely because Zevalin's success would cut into the sales of the company's other non-Hodgkin lymphoma treatment Rituxan (rituximab). While Rituxan became a blockbuster, Zevalin was left to flounder, never reaching sales of more than $25 million annually.

Eventually, Biogen sold the drug to Cell Therapeutics, Inc. in 2007. But the cash-strapped biotech failed Zevalin once again. It wasn't long before Cell Therapeutics needed more cash and decided to sell the cancer drug to Spectrum Pharmaceuticals. Spectrum acquired 100% of the marketing rights for Zevalin in March 2009; now the drug may actually have a chance (Also see "CTI Bags Cash, Turns Its Back On Zevalin" - Pink Sheet, 16 Mar, 2009.).

Spectrum Begins The Turnaround

Shortly after Zevalin became the property of Spectrum, it received FDA approval for an expanded label, allowing the small oncology company to market the drug to a much wider swath of NHL patients, as well as in tandem with other treatments. Beyond that, Spectrum was able to finally garner a first-line indication for the treatment in consolidation and salvage settings, no longer sanctioning it to be a last resort.

Unlike any of the cancer drug's previous owners, Spectrum has made Zevalin its number one priority. The few strides the company has taken already to make the drug more widely used have pushed revenues beyond what the drug has yielded the past. Now, Spectrum is working to overcome the final hurdles to achieving peak sales for the drug.

"In 2009, we achieved for the first time full-reimbursement from CMS," said Spectrum Chief Executive Rajesh Shrotriya in an interview. "Why would doctors use this drug when it was not reimbursed? Rituxan can cost $100,000 a year, while Zevalin costs less than a third of that" (Also see "Zevalin Completes Transition To ASP-Based Reimbursement In OPPS" - Pink Sheet, 9 Nov, 2009.).

Zevalin costs about $30,000 for a course of treatment, but a test called a bio-scan must be performed twice before a patient can receive the therapy. The scan costs another $3,500 and requires the patient to go to a hospital. Spectrum currently is seeking FDA approval to do away with the scan, eliminating the extra cost and time associated with Zevalin use. That decision is expected at the end of January.

In early December, Spectrum indicated that once the results of further clinical testing are available, it plans to pursue the approval of Zevalin as a first-line monotherapy.

Spectrum already has had more success with the drug than any of its predecessors, but it remains to be seen if Zevalin will ever achieve sales in the hundreds of millions.

"Now, it's a very different story for Zevalin," added Shrotriya. "We now have a strong sales force educating doctors about Zevalin use. We believe that we will be able to turn Zevalin around."

And at least one analyst agrees, "In short, I believe they can," said Rodman & Renshaw analyst Reni Benjamin. "Their primary focus is Zevalin, unlike previous companies which have owned the drug. With the reimbursement picture clearing up, sales turning around, and additional clinical trials validating the efficacy of the drug, we believe Spectrum should be able generate significantly better revenues than previous owners of the drug."

-Lisa LaMotta ([email protected])