Allos Therapeutics’ (ALTH) first quarter fiscal 2010 loss per share came in at 20 cents, compared to the Zacks Consensus Estimate of a loss of 22 cents and a loss of 19 cents reported in the year-ago period. The company recorded $7.4 million in sales during the quarter.

In January 2010, Allos launched Folotyn in the US. The drug received accelerated approval from the US Food and Drug Administration (FDA) to treat patients with relapsed or refractory peripheral T-cell lymphoma (PTCL).

Allos has agreed to conduct additional clinical trials to further verify the benefit of Folotyn. The requirement of additional trials comes with accelerated FDA approval as the agency requires further studies after the launch to confirm the drug’s benefits.

Operating expenses during the quarter increased 77.5% to $27.2 million. Selling, general and administrative expenses went up 158% due to increased expenses associated with the commercial launch of Folotyn. Research and development expenses recorded an 11% increase to $9.3 million for supporting the various research programs being conducted by the company. Folotyn is also being studied in patients with non-small cell lung cancer and metastatic breast cancer.

Allos exited the first quarter of 2010 with $137.5 million in cash, cash equivalents and investments, down from $158.5 million in December 2009. In October last year, the company received net proceeds of approximately $93 million from a public offering of 14 million shares. Allos had to raise funds to support the commercial launch of Folotyn in addition to carrying out its other clinical trials.

Allos reiterated its guidance for 2010. The company expects total operating costs in the range of $120 – $130 million (excluding non-cash stock-based compensation expense). Given the recent launch of Folotyn, Allos has not provided any revenue guidance. A marketing authorization application forFolotyn is expected to be submitted in Europe by the fourth quarter of 2010. Additionally, the company intends to target other markets including Japan.

We are Neutral on the stock.

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