UPDATE 2-US FDA panel rejects King imaging drug data

* Panel: King did not show CorVue equivalent to other drug

* FDA will weigh input before making approval decision

* King says drug works, safer than alternative

* Shares down 1.4 percent in extended trade (Adds panel member, company comments, shares)

By Lisa Richwine

SILVER SPRING, Md., July 28 (Reuters) - King Pharmaceuticals KG.N failed to show a proposed imaging drug worked as well as an approved product in tests to diagnose heart disease, a U.S. advisory panel said on Tuesday.

Company studies compared the CorVue injection to an approved drug, adenosine. Both drugs widen blood vessels so doctors can get a better look inside the heart when they run imaging tests such as CT scans.

Advisers to the Food and Drug Administration voted 11-5 that King's studies did not show a high degree of similarity between images made using CorVue and others with adenosine.

"I had enough uncertainty that I felt more data was warranted," said Dr. Robert Harrington, a Duke University cardiologist and the panel's chairman.

He and other panelists, however, said CorVue appeared safer and urged the company to do more studies to back its effectiveness.

"The safety data are compelling ... I hope it comes back and ultimately gets marketed," said Dr. Michael Domanski, a panel member and cardiologist at the National Heart, Lung and Blood Institute.

King shares fell to 1.4 percent to $9.20 in after-hours trade after closing at $9.33 during the regular session on the New York Stock Exchange.

The company argued to the panel that CorVue's effectiveness was similar to adenosine's with fewer and less severe side effects.

King's data provides "compelling evidence" of "similar clinical utility" with adenosine, Dr. Eric Carter, the company's chief science officer, told the panel.

CorVue "fills an unmet need" for an imaging agent with fewer side effects, Carter added. A rare but serious disruption of the heartbeat, a possible complication of adenosine, was unseen with CorVue. King's drug also reduced flushing, chest pain and shortness of breath in the company's studies.

Natixis Bleichroeder analyst Corey Davis estimates CorVue sales of $70 million in 2012 if the drug wins approval, making it one of the company's smaller products. King's total revenue hit nearly $1.6 billion in 2008 on sales of muscle relaxant Skelaxin, painkiller Avinza and other products.

The FDA will consider the panel's input as it decides whether to approve CorVue, known generically as binodenson. The agency usually follows panel recommendations. A decision is due by Oct. 18, although the agency has missed several deadlines in recent months.

FDA reviewers criticized King's findings in remarks to the panel before the vote. Agency staff said effectiveness data raised several questions because the company changed its main effectiveness analysis after it had reviewed results from an earlier study.

King said the analysis it used was more appropriate for comparing the two agents, and the change was made before the data was revealed to the researchers.

CorVue is designed for use in people who cannot undergo cardiac stress tests, usually done by exercising on a treadmill, to increase blood flow to the heart. Doctors instead use a drug to widen the vessels and boost blood flow.

An estimated 4.3 million of those procedures are performed annually, King said.

A similar drug from Gilead Sciences (GILD.O) and Astellas Pharma (4503.T) won FDA approval in 2008 under the brand name Lexiscan.

(Editing Bernard Orr)