DISEASE CHARACTERISTICS:

• Diagnosis of multiple myeloma meeting one of the following criteria:

  • Relapsed or refractory disease (phase I)

    • Must have failed at least one prior regimen, not including dexamethasone alone

  • Newly diagnosed, previously untreated disease (phase II)

    • Prior dexamethasone allowed provided dose was ≤ 300 mg
• Quantifiable monoclonal protein or light chain identified by serum protein electrophoresis, urine protein electrophoresis, or serum free light chain assay

PATIENT CHARACTERISTICS:

• ECOG performance status 0-2
• ANC ≥ 1,500/mm^3
• Platelet count ≥ 75,000/mm^3
• Serum creatinine ≤ 2.0 mg/dL
• Serum bilirubin ≤ 1.2 mg/dL
• AST/ALT ≤ 2.5 times upper limit of normal (ULN)
• Alkaline phosphatase ≤ 2.5 times ULN
• Not pregnant or nursing
• Negative pregnancy test
• Fertile patients must use effective contraception during and for ≥ 6 months after completion of study treatment
• LVEF ≥ 50% by MUGA
• No other concurrent severe disease, history of serious organ dysfunction, or disease involving the heart, kidney, liver, or other organ system that may place the patient at undue risk for undergoing study treatment
• No uncontrolled systemic fungal, bacterial, viral, or other infection, defined as exhibiting ongoing signs/symptoms related to the infection with no improvement, despite appropriate antibiotics or other treatment

• No other malignancy within the past 3 years, except for the following:

  • Non-melanoma skin cancer, in situ carcinoma, or cervical intraepithelial neoplasia for which patient has completed definitive treatment
  • Organ-confined prostate cancer with no evidence of recurrent or progressive disease based on PSA values for which patient has started hormonal therapy or has undergone a radical prostatectomy
• No concurrent significant illness, condition, or psychiatric disorder that would compromise patient safety or compliance or that would interfere with informed consent, study participation, study follow-up, or interpretation of study results

PRIOR CONCURRENT THERAPY:

• See Disease Characteristics
• No prior allogeneic stem cell transplantation
• No prior autologous stem cell transplantation (phase II)

• No prior cumulative dose of doxorubicin hydrochloride ≥ 400 mg/m^2

  • This level must not be exceeded during study treatment
• More than 30 days since prior anticancer therapy and recovered
• No other concurrent chemotherapy, radiotherapy, or immunotherapy