What: Shares of Seattle Genetics , a biotechnology company that utilizes its antibody-drug conjugate technology to develop therapies to fight cancer, dipped 12% in December, based on data from S&P Capital IQ , following the release of scientific data at the American Society of Hematology's annual meeting.

So what: Here's the interesting part: the study data presented by Seattle Genetics at ASH wasn't bad. The unfortunate part is the company was upstaged by cancer immunotherapies, and Wall Street is concerned about the long-term future of antibody-drug conjugates, or ADCs, in light of the recent success of these cancer immunotherapies that work with the body's immune system to identify and attack cancer cells.

For instance, Seattle Genetics presented four-year survival data on FDA-approved Adcetris in patients with relapsed or refractory systemic anaplastic large cell lymphoma at ASH. The company highlighted that an impressive 64% of patients were still alive, with half of the patients that achieved a complete response remaining disease-free. It also delivered positive phase 3 data with partner Takeda Pharmaceutical in the AETHERA trial for post-transplant Hodgkin lymphoma patients at risk for a relapse that were treated with Adcetris.

Source: Bristol-Myers Squibb.

The problem is that Seattle Genetics was upstaged by PD-1 inhibitors like Bristol-Myers Squibb 's Opdivo and Merck 'sKeytruda. Both showed remarkable efficacy in treating Hodgkin's lymphoma during ASH after patients had been treated with Adcetris and showed disease progression. The worry here is these PD-1 inhibitors may begin working their way up the scale to first- or second-line indications and push Adcetris and other ADCs out of the way.

Now what: This was a rough month for Seattle Genetics shareholders, and I suspect it could get rougher in 2015. While I'm a fan of ADCs in general and believe we'll see Adcetris' label expanded to new indications in the coming years, I also can't deny that immunotherapies are picking up steam, and that Seattle Genetics is accordingly looking very pricey.

Source: Seattle Genetics.

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Why Seattle Genetics, Inc. Stock Dove 12% in December

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