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Seattle Genetics Inc. (SGEN - Snapshot Report) recently received approval from Health Canada for its oncology drug, Adcetris (brentuximab vedotin). Adcetris has been approved under Health Canada's Notice of Compliance with conditions (NOC/c) for the treatment of patients with Hodgkins lymphoma (HL) after failure of autologous stem cell transplant (ASCT) or after failure of at least two prior multi-agent chemotherapy regimens in patients who are not suitable for ASCT.

Adcetris was also approved for the treatment of systemic anaplastic large cell lymphoma (sALCL) after failure of at least one multi-agent chemotherapy regimen.

For similar indications, Adcetris was approved by the US Food and Drug Administration (FDA) in Aug 2011 and in the EU in Oct 2012.

The NOC/c requires Seattle Genetics to conduct clinical trials to confirm the anticipated clinical benefit of Adcetris. Seattle Genetics is currently enrolling patients for two confirmatory phase III studies evaluating the drug for the front-line treatment of HL and mature T-cell lymphoma (MTCL), including sALCL.

Meanwhile, in Jan 2013, a global phase III study (ECHELON-2) was initiated on Adcetris. In this study, Adcetris plus chemotherapy will be evaluated for the front-line treatment of CD30-positive MTCL including patients with sALCL and other types of peripheral T-cell lymphomas.

Our Take

We are positive on Seattle Genetics’ efforts to penetrate new markets. In Canada, Adcetris is the first in a new class of antibody-drug conjugates (ADCs) to be approved. Adcetris’ revenues for the nine months ending Sep 30, 2012 were $102.8 million.

Seattle Genetics carries a Zacks Rank #4 (Sell). Right now Peregrine Pharmaceuticals, Inc. (PPHM - Snapshot Report), Valeant Pharmaceuticals (VRX - Snapshot Report) and Targacept, Inc. (TRGT - Snapshot Report) look more attractive with a Zacks Rank #1 (Strong Buy).

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