UPDATE 1-Eli Lilly says to stop osteoporosis drug development

* Treatment arm showed higher rate of adverse events

* Arzoxifene did not meet late-stage secondary end points

* Says drug met primary endpoint

* Shares down 1 pct

Aug 18 (Reuters) - Eli Lilly and Co (LLY.N) said it would discontinue late-stage trials of its experimental osteoporosis drug and not submit the drug for regulatory approval, as adverse events and a lack of achieving secondary targets offset the study reaching its main goal.

The company said preliminary data showed a higher rate of adverse events, such as venous thromboembolic events, hot flushes and gynecological-related events, in the treatment group.

"After reviewing the overall clinical profile of arzoxifene in light of currently available treatments, including Lilly's own osteoporosis products, the company has decided not to submit the compound for regulatory review," said the company.

Eli Lilly expects to take a 3 cent to 4 cent charge in the third quarter from its decision, but backed its earnings outlook for the full year.

The drug, arzoxifene, met the main goal of significantly reducing the risk of vertebral fracture and invasive breast cancer in postmenopausal women.

However, it did not show significant difference in key secondary efficacy endpoints, such as non-vertebral fractures, clinical vertebral fractures, cardiovascular events and cognitive function, compared to a dummy drug.

Shares of the company were down one percent at $32.50 in trading after the bell Tuesday on the New York Stock Exchange. (Reporting by Vidya L Nathan in Bangalore; Editing by Anthony Kurian)