Spectrum Pharmaceuticals Shares Plummet After Receiving Complete Response Letter from FDA

Spectrum Pharmaceuticals (NASDAQ:SPPI) stock dropped over 20%, after the company announced that it received a Complete Response Letter from the the US Food and Drug Administration relating to its EVOMELA injection drug.
According to a press release:

Shares in Spectrum Pharmaceuticals (“Spectrum” or the “Company”) (NASDAQ: SPPI) have plunged over 20% today after the company announced that it received a Complete Response Letter from the United States Food and Drug Administration (“FDA”) related to the company’s EVOMELA injection drug. An FDA Complete Response Letter informs companies that the FDA cannot approve a new drug application as submitted.
In the months prior to today’s news, the Company and its officers made numerous statements about EVOMELA, including statements reflecting the company’s belief that the pending application before the FDA would be successful, and that EVOMELA would contribute to Spectrum’s revenue in late 2015. As such, the FDA’s Complete Response Letter came as a complete surprise to investors.
Block & Leviton LLP is investigating the Company and certain of its officers and directors to learn the facts behind the company’s EVOMELA application, its statements about the drug’s approval process, and the FDA’s subsequent rejection of the company’s new drug application. The firm is also investigating whether any insiders at Spectrum profited from alleged misstatements made about EVOMELA in the weeks and months prior to today’s announcement.

Click here to read the full press release.