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Shares of Spectrum Pharmaceuticals (SPPI -0.7%) slip after Credit Suisse initiated the shares...
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Tuesday, January 15, 3:18 PM ETShares of Spectrum Pharmaceuticals (SPPI -0.7%) slip after Credit Suisse initiated the shares with a tepid Neutral rating ealier this morning. The firm says its concerned about the impact of increased competition from Leucovorin, which is a generic SPPI's Fusilev. Sales of Fusilev may decrease from 2012 highs and limit near-term stock performance, and Credit Suisse feels it's more prudent to take a wait-and-see approach and look to buy SPPI once there's greater visibility.
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This news story has 6 comments:
Wait and see approach... yeah right. I see them raising their ratings and price targets furiously AFTER sppi hits 20 dollars mark.
Fusilev has been around three years, newly approved, and has gotten 31% market share.
So how does "increased competition from Leucovorin" even enter the discussion. The focus should be how many of the 12 generic makers will cease production. How many ways can you split a shrinking pie -- and my guess is 1/12th is too little to maintain profits.
Given the reduced dosage, less side effects, and better efficacy, if you, your spouse, or child needed "the drug", which would YOU ask for, Leucovorin or Fusilev?
With the new hires away from Amgen, Keller and Turgeaon, their experience, contacts, and focus should bring a new dimension in sales. Plus the doubling of the sales staff now allows coverage to all related physicians.
Take out cash (as they quote with AAPL) then SPPI is trading at a 4 PE.
SPPI, based on comparable metrics to other equally as profitable and growth oriented biotechs, should be $30.
Your well written note and your well thought out comments should be sent directly to Credit Suisse for a reply. I for one would like to hear their response.
Don
90% of the world's stock analysts should be in jail. It's like they are all in a race to win the Most Incompetent Stock Analyst Ever. What are they good for? They only create noise.