UPDATE 3-US panel backs plan for ViroPharma drug copies

* Advisory panel votes 16-0 in favor of FDA rules

* ViroPharma opposes FDA plan

* Shares fall in after-hours trade (Adds details on test guidelines paragraph 14)

By Lisa Richwine

SILVER SPRING, Md., Aug 4 (Reuters) - U.S. advisers on Tuesday backed Food and Drug Administration guidelines for testing less costly generic versions of the antibiotic Vancocin over the objections of manufacturer ViroPharma Inc (VPHM.O).

Analysts said the recommendation should lead to FDA approval in the coming months of generic competitors to ViroPharma's best-selling product used to fight intestinal infections.

The company's shares fell to $7.35 in after-hours trading, down from an earlier close of $7.78 on Nasdaq.

ViroPharma had argued to the panel that the FDA's proposed criteria for generic rivals were not rigorous enough to prove the copies would work as well as the brand-name product.

But panel members said they felt confident in the FDA's suggested test methods for generic pills with the same ingredients as Vancocin. The committee voted 16-0 to back the FDA plan for the drug, known generically as vancomycin.

Many of the outside experts said there was a public health need for cheaper versions of oral vancomycin to fight a growing number of intestinal infections with Clostridium difficile, a common and sometimes deadly cause of diarrhea.

Many hospitals and patients find brand-name Vancocin too expensive, panelists and generic drug industry representatives said. To cut costs, doctors often try an older generic drug that may not work as well, or prepare liquid formulations using a form of vancomycin meant for intravenous use.

"As a clinician, I really am in favor of moving forward on the generic for this drug," said Dr. Thomas Moore, a panelist and professor of medicine at the University of Kansas.

Given the rise in serious Clostridium difficile infections, "it seems more important than ever to increase access to oral vancomycin," Moore added.

Generic drugmakers including Mylan Inc (MYL.O) and Akorn Inc (AKRX.O) have applied for approval to sell copies of Vancocin.

Deutsche Bank analyst Robyn Karnauskas said investors expected the panel decision and are looking for future growth fueled by the company's rare disease drug, Cinryze.

ViroPharma's stock is "fairly valued without Vancocin at current levels" given strong Cinryze sales, Karnauskas said.

Ira Loss, an analyst with Washington Analysis, predicted the FDA would clear a copycat version by the end of the year.

ViroPharma had argued to the panel that the standards recommended by the FDA, which involve lab tests of how the drug dissolves in water, may not accurately reflect how the medicine would be absorbed in real patients with serious infections.

ViroPharma Chief Executive Vincent Milano said he was "very disappointed" by the panel vote. "I think this puts patients seriously at risk," he told reporters.

Milano said it was too early to project how much Vancocin's sales would fall if generic rivals reach the market and said Cinryze remained the "growth engine" for the company. Cinryze treats a rare swelling disease called hereditary angioedema.

Vancocin was ViroPharma's best-selling drug in 2008 with sales of $232 million. Last month, ViroPharma withdrew 2009 sales guidance for Vancocin while projecting Cinryze sales of $80 million to $95 million this year. (Reporting by Lisa Richwine; Editing by Leslie Gevirtz and Carol Bishopric)