Spectrum Pharmaceuticals Management Discusses Q2 2012 Results - Earnings Call Transcript

Spectrum Pharmaceuticals (NASDAQ:SPPI)

Q2 2012 Earnings Call

August 08, 2012 1:30 pm ET


Shiv Kapoor - Vice President of Strategic Planning & Investor Relations

Brett L. Scott - Acting Chief Financial Officer, Principal Accounting Officer and Senior Vice President

Rajesh C. Shrotriya - Chairman, Chief Executive Officer, President, Chairman of Placement Committee and Chairman of Product Acquisition Committee


Joseph Pantginis - Roth Capital Partners, LLC, Research Division

George B. Zavoico - MLV & Co

Michael G. King - Rodman & Renshaw, LLC, Research Division


Good day, ladies and gentlemen, and welcome to Spectrum Pharmaceuticals Second Quarter 2012 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded.

I would now like to turn the conference over to Mr. Shiv Kapoor, Vice President, Strategic Planning, Investor Relations. Sir, you may begin.

Shiv Kapoor

Good morning, and thank you for joining us today for Spectrum's Second Quarter 2012 Financial Results Conference Call. I'm Shiv Kapoor, Vice President of Strategic Planning and Investor Relations for Spectrum Pharmaceuticals. With me today are Dr. Raj Shrotriya, Chairman, CEO and President; Brett Scott, Acting CFO; Dr. Steve Fruchtman, Chief Medical Officer; Jim Shields, Chief Commercial Officer; and other senior members of the Spectrum management team.

Here's an outline of today's call. First, Brett will provide a summary of our second quarter financial performance. Dr. Shrotriya will then provide you with highlights of the second quarter and recent news. Following this, we will open up the call to questions.

Before I hand the call over to Brett Scott, I would like to remind everyone that during this call, we will be making forward-looking statements regarding future events of Spectrum Pharmaceuticals, including statements about the product sales, profits and losses, the safety, efficacy, development time lines and clinical results of our drug products and drug candidates that involve risks and uncertainties that could cause actual results to differ materially. These risks are described in further detail in our reports filed with the Securities and Exchange Commission.

These forward-looking statements represent the company's judgment as of the date of this conference call, August 8, 2012, and the company disclaims any intent or obligation to update these forward-looking statements. However, we may choose to update them. And if we do so, we will disseminate these updates to the investing public. For copies of today's press release, historical press releases, 10-Ks, 10-Qs, 8-Ks, other SEC filings and other important information, please visit our website at www.sppirx.com.

And now, I would like to hand the call over to Brett.

Brett L. Scott

Thank you, Shiv, and good morning to everyone on the call today. I am delighted to report this is our seventh consecutive profitable quarter. We closed the quarter with cash, cash equivalents, investments and accounts receivable of more than $279 million after paying $25.4 million in cash for the ex-U.S. ZEVALIN rights. This is up from $253 million in the previous quarter.

Now let us review the results for the quarter ended June 30, 2012. All numbers are approximate. For the 3-month period ended June 30, 2012, we had total revenues of $68.7 million compared to $45.4 million in the second quarter of 2011, an increase of 51.5%. Product revenues were $65.6 million as compared to $42.3 million in the second quarter of 2011, an increase of 55.2%. FUSILEV sales were approximately $56.6 million, with ZEVALIN worldwide sales being approximately $9 million.

Net income was $18.1 million or $0.31 per basic and $0.29 per diluted share as compared to net income of $7.2 million or $0.14 per basic and $0.12 per share -- per diluted share in the second quarter of 2011. On a non-GAAP basis, basic earnings per share for the second quarter of 2012 were $0.40 per share.

Total research and development expenses for the second quarter were $9.6 million as compared to $7.7 million in the same period of 2011.

Selling, general and administrative expenses for the second quarter of 2012 were $23.3 million as compared to $18.7 million in the same period of 2011.

Now to the 6-month period ended June 30, 2012. Total revenues for the 6 months were $128.6 million, a 44.5% increase over the same period of 2011. Product revenues were $122.4 million, a 47.8% increase over the same period in 2011.

FUSILEV sales were approximately $107.8 million, with ZEVALIN sales being approximately $14.6 million. Net income was $64.6 million or $1.10 per basic and $1.01 per diluted share compared to net income of $20 million or $0.39 per basic and $0.35 per diluted share in the 6-month period of 2011. On a non-GAAP basis, basic earnings per share for the first 6 months of 2012 were $0.86 per share.

Total research and development expenses for the 6-month period ended June 30, 2012, were $18.5 million as compared to $13.5 million in the same period of 2011.

Selling, general and administrative expenses were $41.6 million compared to $31.5 million in the same period in 2011. This increase is primarily attributable to approximately $4 million in costs associated with Allos transaction cost and an acquisition of the ex-U.S. ZEVALIN rights, plus increases in selling expenses related to the expansion of our sales force.

In summary, our revenues were up a strong 51.5% over the same quarter last year, due primarily to better market penetration of FUSILEV in the metastatic colorectal cancer market, showing the significant operational leverage of our business. In the same period, our net income was up approximately 151% over the same quarter last year, resulting in a strong cash balance. We ended the quarter in the strongest financial position in our history, with $279 million in cash, cash equivalents, investments and accounts receivable.

I now will hand the call over to Dr. Raj Shrotriya.

Rajesh C. Shrotriya

Thank you, Brett, and good morning, everyone. We had another outstanding quarter. As Brett just noted, we have had 7 consecutive profitable quarters, which has been exciting. We continue to achieve a robust revenue growth and profitability while maintaining a strong system discipline. As certain as we are of our achievement in the past quarter, we got even more excited about our growth prospects going forward.

There are 3 primary drivers of growth that are most important to mention here. One, we believe there is opportunity for further growth from the cash flows generated from our 2 approved drugs, FUSILEV and ZEVALIN. With a potential addition of FOLOTYN, we should continue to enhance operating leverage.

Second, given we have an exciting and robust pipeline, largest in Spectrum's history. Spectrum now has some 10 drugs in clinical development, of which there are 3 in late-stage development.

And third, the important and significant growth driver is our aggressive and successful business development strategy. This year alone, in first 6 months, we have already closed on 2 transactions and anticipate on closing a third one later this quarter.

Now let's talk about these growth drivers in more detail. I would like to focus first on our marketed drugs, FUSILEV and ZEVALIN. FUSILEV was approved by the FDA in April 2011 for the treatment of advanced metastatic colorectal cancer, the third leading cause of cancer-related death in the United States. Since the approval of FUSILEV, physicians continue to increasingly use FUSILEV because of its purity, safety profile and supply reliability. Physicians are now increasingly aware of many benefits that FUSILEV offers, and Spectrum has proven to be a reliable supplier of the vital drugs. As a result, an increasing number of practitioners continue to adopt FUSILEV. This quarter, we had over 1,500 accounts that ordered FUSILEV. This is significantly up from over 1,200 accounts in first quarter of this year and over 500 accounts in fourth quarter of 2011.

Since 2011, FUSILEV has been supported by a team of dedicated sales representatives, exclusively calling on oncologists that treat colorectal cancer. Aggressive promotional support of FUSILEV is being now rewarded by customer loyalty and increased market penetration. We continue to have a high reorder rate. We estimate that FUSILEV now has approximately 29% penetration in the folate analog market over the past 4 quarters, which is up from approximately 21% at the end of last year. These concurrent trends, we expect the penetration to increase going forward.

Colorectal cancer treatment regimen usually lasts within 4 to 6 months. Typical physicians do not change drugs midstream, as long as patients are not progressing. In other words, once a physician has started the patient on FUSILEV-containing regimen, they are confident that they will be able to complete therapy without concerns of product availability. We are pleased to see the traction and growth that FUSILEV is achieving.

I now will briefly talk about our second marketed product, ZEVALIN, a targeted antibody-drug conjugate. For the first time since its approval, ZEVALIN has one champion across the world. It is Spectrum. It's now managing all worldwide commercial operations and clinical development related to ZEVALIN. This includes independent investigators and various cooperative groups worldwide. Despite its plethora of exciting data in several lymphoma types and ZEVALIN's approval in over 40 countries, we believe that lack of awareness and education about the benefits of ZEVALIN, and Spectrum is going to change that.

Trials like RoZetta, ZEST and SPINOZA should provide physicians opportunities to experience the safety, efficacy and convenience of ZEVALIN, which in our opinion, is the most effective, single-dose and simple therapy for lymphoma.

Before we talk about these trials in more detail, let me share my enthusiasm for the international growth opportunities with ZEVALIN. ZEVALIN is approved in over 40 countries outside the United States. It includes countries in Europe, Latin America and Asia. The incidence of follicular non-Hodgkin's lymphoma is even higher outside the United States. And recent interest is strong, with presence at major x U.S. medical conferences.

In most countries outside the United States, there has been very little promotion of ZEVALIN. For example, in Japan, it was approved only in 2008, the same year that they decided to discontinue active promotions of many hematology drugs, including that of ZEVALIN. Over the next 6 to 9 months, we plan to continue to ramp up the Spectrum's operations in Europe and Japan, which we expect would begin to improve our sales and economics outside the United States.

Let's now talk about clinical development of ZEVALIN. We are anticipating early data from a head-to-head study of a single dose of ZEVALIN versus rituximab maintenance in front-line follicular non-Hodgkin's lymphoma. This is the first time we expect to have a head-to-head data in the front-line setting against rituximab. This study was a target by a Spanish cooperative group several years ago as the ZAR study, ZEVALIN against rituximab. And we are expanding this to a worldwide study, which now will be called RoZetta, the rituximab or ZEVALIN efficacy trial therapeutic alternatives.

A key growth initiative for ZEVALIN is the ZEST study, which has the potential to significantly expand usage of ZEVALIN beyond follicular non-Hodgkin's lymphoma. Our active data from several Phase II studies has raised our confidence about ZEVALIN's usage in diffuse large B-cell lymphoma, commonly known as DLBCL, which is the most common form of aggressive non-Hodgkin's lymphoma. The rituximab may include sales [ph] in this setting and the 5-year survival is less than 58%. We believe there is a significant unmet medical need for this terrible disease.

In addition to the ZEST and RoZetta, we are studying ZEVALIN in the transplant setting through the SPINOZA trial. Early results from this study show that there is the statistically significant overall survival advantage with the use of ZEVALIN, when it is added to standard chemotherapy, a combination of 4 drugs. I will now briefly address a planned acquisition of Allos Therapeutics, Inc., which was announced during the second quarter.

The acquisition of Allos makes a strategic sense because of the several synergies entailed. Soon after the closing of this acquisition, we expect to begin realizing operational cost-related synergies. FOLOTYN and ZEVALIN are marketed in the same group of doctors. This should create enhanced opportunities in our commercial efforts. FOLOTYN also maybe combined FUSILEV to lower the toxicity of FOLOTYN therapy, thereby helping increased dosage and duration of collagen treatment and offering more help to patients with DBCL. We have had several extensions of the offer period in connection with the tender offer. And these are in relation to additional information and material that has been requested by the Federal Trade Commission since May under the Hart-Scott-Rodino bill. I think you will understand that I cannot provide additional information at this time.

I would like to discuss our robust pipeline now. We have a diversified oncology product pipeline with more than 10 drugs in development. No 2 drugs of these have the same mechanism of action.

Let me say a few words about belinostat. Belinostat is currently in a registrational trial. We call it the BELIEF Study, and this study is being run under an SPA from the FDA. It is a monotherapy for relapsed and refractory PTCL. We expect top line data from the pivotal trial in -- sometime in the fourth quarter.

Regarding our other advanced-stage asset, Apaziquone, while each of the 2 pivotal trials did not achieve the statistical significance, when the data from the 2 studies were combined, the results are statistically significant and appear to be clinically meaningful. We anticipate a meeting with the FDA before the end of this year.

Another drug in our development pipeline is lucanthone, which is a novel drug for brain cancer. Lucanthone enhances sensitivity to chemotherapy or radiotherapy, and it is initiated in Phase II trial in glioblastoma multiforme, which is a deadly disease

Another exciting novel drug, SPI-2012, is a long-acting granulocyte colony-stimulating factor, similar to Neulasta. We are currently finalizing a Phase II protocol and plan to initiate a randomized trial in chemotherapy-induced neutropenia, in patients with breast cancer.

At least a week before the end of this year, we plan to start enrolling patients in Phase II trial to evaluate SPI-1620, a novel endothelin agonist. SPI-1620 has unique mechanism of action, and Phase I clinical data are very promising.

In conclusion, I'm extremely pleased with our progress this year. We believe 7 consecutive profitable quarters is an impressive achievement for any biopharma, and we anticipate strong results going forward. We are confident that going forward, we will continue to maintain a strong fiscal discipline while increasing revenues and profitability. Before we move on to questions, let me recap for you some of our potential growth catalysts in the near term.

One, we expect to increase the market penetration of FUSILEV. Two, we expect to grow ZEVALIN sales through worldwide expansion. Three, we expect early data from ZAR study towards the end of this year. Four, we plan to initiate ZEST study in diffuse large B-cell lymphoma. Five, we expect to meet with the FDA regarding Apaziquone some time in Q4. Six, we expect top line data from RenaZorb clinical study in Q4. Seven, we expect top line data in Q4 from a pivotal trial with belinostat. Nine, we anticipate to close the Allos acquisition and expect to realize synergies soon thereafter. And ten, we continue to be aggressive and opportunistic in business development areas.

We will now open the call to questions. As you can understand, we will not be taking any questions with regard to the Allos transaction, in light of the fact that the tender offer is still pending. We look forward to addressing those questions at the close of the transaction, when we plan to have a dedicated conference call.

Shiv Kapoor


Question-and-Answer Session


[Operator Instructions] Our first question comes from Joe Pantginis from Roth Capital Partners.

Joseph Pantginis - Roth Capital Partners, LLC, Research Division

Congratulations, guys, on another great quarter and your ability to strongly sustain the FUSILEV franchise. And that really leads to my first question. Obviously, you keep delivering on the numbers. You're growing the brand, and it's very sustainable. And you have the ability to show that and yet, at the same time, in -- with investors' abilities or lack thereof, to track the growth of FUSILEV, it also is the 800-pound gorilla in the room. And I'm referring specifically to potential disappointment today, or I should put disappointment in quotation, because I guess of some recent blog postings, if you will, regarding what was -- at least according to the blogs, supposed to be a very strong quarter based on some exorbitant numbers you were supposed to deliver in June, alone. So my question is, what is the discrepancy that we're seeing here with regard to how FUSILEV has tracked? We have our own prescription data. We think that trends are very strong there, but what is the [indiscernible] missing? How they could be so far off with regard to their types of numbers that they're looking at?

Rajesh C. Shrotriya

Joe, that's a good question. I can only tell you that we can't comment on the blogs of these people and their source of information. We know that even IMS data sometimes does not reflect the true usage of the drug or the orders of the drug. We are presenting you exactly what the data is -- what our data is. In 3 months, what are our net sales are, and that's what matters. We have been growing sales of FUSILEV quarter after quarter, and we are very pleased with the progress. And we expect this growth to continue. I just cannot comment on these blogs. I don't know what their objective is. I don't know where they get their data. I just don't have enough information. I've not dived into any of those blogs. And frankly, we focus just on the sales that we generate, and we are very pleased with the progress we are making with the brand. We are...

Joseph Pantginis - Roth Capital Partners, LLC, Research Division

And I agree with you. And I agree with you wholeheartedly.

Rajesh C. Shrotriya

We're seeing more traction. We are seeing more reorders. We are seeing practitioners that are very happy with the drug, with the brand. So we are very pleased with it.

Joseph Pantginis - Roth Capital Partners, LLC, Research Division

Absolutely, and I guess I was almost hesitant to bring it up, but it just seems like the amount of press that it was getting, obviously, the way we're tracking the space, it seems to be in line with what you guys are doing. And I expect to see the same type of growth that we've been looking at all along. So anyway, I appreciate those comments. If you could just move over quickly to...

Rajesh C. Shrotriya

Oh, we lost Joe.


Our next question comes from George Zavoico from MLV & Co.

George B. Zavoico - MLV & Co

The question about the FUSILEV penetration, you said today are 49% penetration. Can you just briefly review how you get to that number?

Rajesh C. Shrotriya

Well, I didn't say, George, 49% penetration. Maybe some other comment is being misunderstood. So no, I didn't talk about the penetration. I think it was about 49%. When I tell that we are very happy that -- if you take this quarter sales, we are already doing close to $0.25 billion a year with FUSILEV, and I can tell you that I couldn't be happier than that. In terms of penetration, I didn't use the word 49%, but I think the number is more like 29%. The number -- our numbers about 29%, our estimated number.

George B. Zavoico - MLV & Co

Oh, I'm sorry. I thought -- I must have heard 49% for some reason. Okay, 29%. And so there's obviously plenty of room for growth there, much better than if it was 49%.

Rajesh C. Shrotriya

Indeed. We think so, and we agree with you, yes.

George B. Zavoico - MLV & Co

What are you doing -- I mean you've had now the whole world for ZEVALIN. Now what are you putting in place, say, in Europe or Latin America this quarter, that will hopefully drive sales in those regions?

Rajesh C. Shrotriya

So George, right now, the sales are being managed by our partner. In fact, we have a transition agreement with the [indiscernible], that right now, they are managing our sales activity. This is a very complex process by which the ownership of the NDAs have to be transferred to Spectrum. So we have a legal team working with the Japanese authorities and with authorities in Europe to transfer the ownership of the brand to Spectrum. Until that happens, Spectrum cannot market the drug by itself. So for the next 18 months, we have transition team in place, where there will be doing all the activities that they have been doing. But gradually, Spectrum plans to take over. In fact, Rick Gonzalez has been made in charge of that project, and he and Andy have been spending some time both in Japan and in Europe trying to streamline our operations there. It will take several quarters before we have complete control on those activities.

George B. Zavoico - MLV & Co

But meanwhile, obviously, you're collecting the revenue from the sales. There's no...

Rajesh C. Shrotriya

Yes, [indiscernible].

George B. Zavoico - MLV & Co

Yes, okay. So you have plenty of time to plan for how you're going to do this. And by then, I presume, you'll also have results of some of these -- more results of these clinical trials, the RoZetta, ZEST and SPINOZA. And you'll be able to incorporate that into all your marketing plans, I presume then, not only in Europe and Asia but also in the U.S.

Rajesh C. Shrotriya

George, you're so right. In fact, it is amazing. 2 weeks ago, we were in Hawaii with the Pan-Pacific Lymphoma Conference, and the interest in ZEVALIN brand is absolutely amazing. The doctors after doctors would tell us of their exciting patients, how they have been treating with single dose of ZEVALIN, how convenient it is and how safe and how effective it is. Response rates are going excess of 90%, complete response that go above 80% with a single-dose treatment. You don't need a second dose for the next 2.5 years. There's not a single oncology drug that I know that is as effective as ZEVALIN is after a single-dose of therapy. So we have a lot of believers that like Spectrum, all around the world. In fact, we just had a meeting with the Japanese health authorities in Japan, and they are very excited, what we heard from them.

George B. Zavoico - MLV & Co

And my last question is about RenaZorb. This is a fairly, well, it's not -- you aren't the first one in the market in that space. You're like going to be the third or fourth or maybe in the fifth, especially if [indiscernible] comes out. They come -- their last trial comes out okay, and they can file an NDA. Can you speak a little bit to what your expectations for RenaZorb are?

Rajesh C. Shrotriya

So George, RenaZorb is being developed for chronic kidney disease. It's a phosphate binder. Our idea is that once we complete the clinical study, we would most likely find a partner to license it out. We don't plan to market RenaZorb ourselves. In fact, every time we make a press release on RenaZorb, we have numerous parties that approach us for licensing this drug. We just haven't -- we just don't want to license it yet. We want to bring enough value than we can expect for our shareholders, and we want to find a partner at appropriate time in its development. Currently, we are managing its development internally at Spectrum.

George B. Zavoico - MLV & Co

Because that way, you also maintain your oncology focus.

Rajesh C. Shrotriya

Indeed. George, thank you. And I think Joe Pantginis was cut off for some reason. And George, I just want to say that what -- your question was left in the middle, that the progress with FUSILEV, we are now averaging almost $0.25 billion a year in sales. And sales are growing, there are new accounts and adding every quarter. And the accounts that are existing, they're reordering. And we are very, very happy with the progress we are making. And we think this is sustainable, and we'll keep growing further because we think we have only about 29% penetration at this time.


Our next question comes from Mike King from Rodman & Renshaw.

Michael G. King - Rodman & Renshaw, LLC, Research Division

Raj, I think one of the other questions linked to FUSILEV, just to pick up where Joe Pantginis left off, is that there's a common perception that once the generic leucovorin shortage is alleviated, that basically, you guys are toast. And so what I'd like to hear from you is, number one, what's your understanding about the recent developments in the -- sort of the leucovorin shortage. And number two, assuming that at some point in the future, the generic leucovorin does make it back to the marketplace, how does Spectrum continue to obtain further share against generic equivalent?

Rajesh C. Shrotriya

Mike, that's a very good question. So I think first thing that you say that -- it's a pity that, that question keeps coming up for last 7 or 8 quarters. I heard that the day in fact they got approval on April 28, last year, when we got approval, somebody put out a blog and saying that this drug is going to be – Spectrum is going to go down the hill, and we lost the huge market cap on that day, on a day when we got approval for FUSILEV. Quarter after quarter, around the -- our earnings release, there are some blogs appear and that misinformation appears. And there is absolutely no basis. That information appears we try to manipulate our stock or some malicious intent. In fact, numbers speak for themselves. I think people have to understand that FUSILEV is not leucovorin generic, which is a mixture of -- racemic mixture of 50% biologically dextrorphan [ph] and 50% levorphan [ph]. Dextro [ph] has been around for 60 years. In Europe, there is no shortage of generic leucovorin. And still the sales of FUSILEV, or levoleucovorin, in Europe and Japan x U.S. are close to $150 million to $ 200 million a year. And this drug has been available for over 15 years x U.S. So we believe not only the fact that FUSILEV got approval in 2011, as compared to generic leucovorin approval of 1952, the fact that ZEVALIN has a unique J-code should clearly tell people, who are educated enough to understand the marketing and selling oncology drug, that it's a differentiated product and it has nothing to do with generic leucovorin. That's number one. Number two, generic companies come in and out of market. The shortage of generic leucovorin, why is it shortage generic leucovorin? There are many companies that make it. They will compete with each other. There are companies in -- that get approval. More drugs -- more companies will get generic approval. In fact, as generic leucovorin supply is increasing in the marketplace -- so in other words, the shortage is abating. FUSILEV sales continue to grow. So the penetration and traction of FUSILEV is sustainable, and I believe that generic companies will compete with themselves, not with FUSILEV.

Michael G. King - Rodman & Renshaw, LLC, Research Division

Okay. And then the other question is about -- regarding the ZEVALIN. And just -- there's a lot of -- it seems like a lot of inertia out there in the community. Docs have been very comfortable and frankly very profitable by giving many, many cycles of Rituxan. So what's your key challenge in helping convince them that they'd be better off giving ZEVALIN? Because you got your codes settled now. The -- I think you've knocked down a lot of the -- sort of the reimbursement hurdles with respect to ZEVALIN but you still have that ingrained, I would say, inertia in the treating community, that whatever the question is, the answer is the community gives Rituxan. So what's your -- how do you get over that and how do you make it clear to the community oncologists that ZEVALIN is a better approach?

Rajesh C. Shrotriya

Mike, that's a very good question. So let me begin by saying, first of all, Rituxan is a monoclonal antibody, anti-CD20. That's it. And that's exactly what ZEVALIN is. ZEVALIN is an anti-CD20 monoclonal antibody. Both drugs were discovered by Biogen Idec or Idec at that time. The difference is ZEVALIN was developed 6 years later, after Rituxan is developed. It's a better drug. It's superior drug because of these monoclonal antibodies are like missiles. You inject them intravenously and then they go in homing in on the cancer cells and then attach to them and they destroy them. So the scientists though, and why not put it in nuclear payload on this missile. And if payload is Y-90 -- we know that lymphoma cells are very radiosensitive. But you calibrate radiation. If you give radiation to the whole body, they do lot of side effects and a lot of damage. So this is like a topical radiation delivery by ZEVALIN. People who understand this, people who take time to understand this, they love this drug. It's a single-drug treatment -- single-dose treatment. So I think it's just about education. We have come within honest position, and I know what it takes to find a drug that a single dose is effective treatment for treatment of cancer. This drug has no side effects like chemotherapy. People don't lose hair. There is no [indiscernible] toxicity. There's no neuropathy, Some things that are rampant with drugs like and CHOP and what have you. So I think people who understand ZEVALIN love it. Last 7 or 8 years, this drug has been poorly promoted. Let me remind you, Mike, when we acquired rights to this drug on March 15, 2009, its sales were going down in the U.S. of like $11 million. Today, we're recording $9 million in a quarter. So we are already doing about $36 million of sales annualized basis. We are very happy with the progress we are making. This is a drug that is here to stay, and I expect the sales could be hundreds of millions of dollars, if we can get only about 5% to 10% market share. So I'm personally very excited and committed and add hundreds of doctors around the world, who have the same commitment as Spectrum has. So I believe this is a first time that Spectrum, a company is becoming a global champion for this drug, for this brand. And I think we are going to make a difference, but it won't be quick. If we take several quarters before you start seeing the results. But I'm very happy with today, with $9 million in sales in the quarter, $36 million a year. Hey, I'm happy with this. While we have FUSILEV sales coming at $0.25 billion a year, the complete acquisition of FOLOTYN. FOLOTYN has sales of about $50 million last year. We start adding $50 million here, $40 million there, $200 million there, soon you will see Spectrum will have sales in the range of $500 million to $1 billion a year in sales. And that is my goal in the next 3 to 5 years.


I'm showing no further questions at this time. I'd like to turn the conference back over for any closing remarks.

Rajesh C. Shrotriya

As we approach our 10-year anniversary on August 15, 2012, I'm very proud of the success that Spectrum has realized over the years. In its first 5 years, we successfully grew Spectrum from a struggling small entity, in which only a few people believed -- handful of people believed, to a growing development stage company. In the subsequent 5 years, we have transformed it into a commercially acceptable company that is among the few profitable enterprises in the biotechnology sector. Based on our current product portfolio, strong financial position, robust pipeline and a very aggressive and opportunistic business development strategy, we believe today Spectrum is in its honorable position to further grow our company over the next 5 years. We didn't ignore blogs. We didn't ignore lot of misinformation that's floating around, and I expect my message will do the same. We are very proud of our dedicated employees who make a difference every single day in the lives of cancer patients. Once again, Spectrum has been judged as one of the best places to work. We in Spectrum are in an exceptional position to differentiate ourselves from other biotech companies, and we keep thinking of every patient that we can help every day. Every person in this company that works thinks every day what difference they can make in the lives of cancer patients. And that's what drives our 3-pronged model of this company is, we think of cancer patients that we can help, we think of our investors who have made investment in the company, and we think of our employees that they should see that they are making a difference and they are empowered to make the difference. And with this, I would like to say that stay tuned. And I would like to end by saying the best is yet to come. Thank you very much for your participation this morning.


Ladies and gentlemen, thank you for participating in today's conference. This concludes our program for today. You may all disconnect and have a wonderful day.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.


If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!