UPDATE 2-Roche says Xeloda combo works in colon cancer

* Phase III study shows Xeloda with oxaliplatin effective

* Roche plans to apply for label extension for Xeloda

* Stock rises more than 1 percent

(Rewrites, adds details, analyst comment and stock)

ZURICH, July 20 (Reuters) - Swiss pharmaceutical group Roche (ROG.VX) said on Monday its oral drug Xeloda met its main aim in a late stage colon cancer study, increasing the time patients live.

The Phase III study showed drug Xeloda in combination with intravenous cancer drug oxaliplatin -- also known as Eloxatin and marketed by Sanofi-Aventis (SASY.PA) -- was effective in colon cancer compared with an intravenous chemotherapy combination.

Xeloda is already approved for the treatment of early-stage colon cancer as a monotherapy and Roche plans to file the data with health authorities to extend use of the drug.

"The headline of meeting the primary endpoint for Xeloda in the adjucant setting in combination with platinum based therapy is good news for Roche," Vontobel analyst Andrew Weiss said.

Weiss currently estimates peak sales of 900 million Swiss francs ($838 million) for Xeloda and could increase that by 300 million francs, depending on the details of full data from the trial which is yet to be presented.

The stock rose 1.1 percent to 152.80 francs by 0942 GMT, behind a 1.8 percent gain in the DJ Stoxx European health care index .SXDP.

Roche, the world's largest maker of cancer medicines, trades at a premium to other large drugmakers thanks to its promising new treatments and lack of exposure to copy-cat generic competition.

It is due to report first half results on Thursday and analysts expect a 12 percent drop in net profit, hit by financing for its $47 billion takeover of U.S. biotech group Genentech. [ID:nLH113282]

Colorectal cancer is the second most common cause of death from cancer across all cancer types in men and women in Europe, Roche said. (Reporting by Lisa Jucca and Sam Cage; Editing by Mike Nesbit and David Cowell) ($1=1.074 Swiss Franc)