UPDATE 2-US panel narrowly backs new use for Schering drug

* FDA panel votes 6-4 in favor of new use

* Agency will consider recommendation, make final decision

* Shares near flat (Adds comments from panelists, background on drug, share price)

GAITHERSBURG, Md., Oct 5 (Reuters) - Schering-Plough Corp SGP.N narrowly won support from a U.S. Food and Drug Administration advisory panel on Monday to market its injectable drug PegIntron for melanoma patients undergoing surgery for the skin cancer.

The panel of outside experts voted 6-4 that the benefits of PegIntron, in helping to prevent a relapse, outweighed its toxic side effects.

"This could be helpful," said panel chairman Dr. Gary Lyman, director of cancer research at Duke University Medical Center. "There are very few options for these patients."

Schering is seeking FDA permission to sell the drug for use in patients whose melanoma has spread to the lymph nodes and who undergo surgery to remove both the cancer and the surrounding lymph nodes. It is already approved to treat liver disease.

PegIntron is a type of alpha interferon protein-based drug that aims to help the body fight off tumors, infection and other diseases. Schering's other interferon drug, Intron A, contains higher doses of the active ingredient.

Unlike Intron A, which is approved for melanoma patients as intensive daily infusions at doctors' offices for four weeks, PegIntron is self-injected once a week for five years.

Representatives for Schering told the FDA's panel of outside experts that the lower-dose PegIntron was less toxic and also more convenient for patients who might otherwise not opt for the intensive Intron A regiment.

Side effects with Intron A include heart attacks and other cardiac problems, depression and suicidal behavior, and vision complications, among others. PegIntron patients also experienced some heart problems and depression, according to FDA reviewers.

While the FDA panel was mixed, most said that the drug would give patients another option.

"This will provide an alternative that is at least more convenient for patients," said Dr. Michael Link, head of oncology at Stanford University School of Medicine.

Still, some panelists noted that while Intron A data earlier showed at least some overall better survival for patients, PegIntron's data was limited to showing a longer time before some patients' cancer returned. And they noted that instead of one month of serious complications, patients could face side effects for years, and it was still unclear whether they would live longer.

"I don't think this drug demonstrates any significant survival advantage," said Dr. Ronald Richardson, a consultant at the Mayo Clinic in Rochester, Minnesota.

The FDA will consider the panel's recommendation before making its final decision.

In a statement, Schering welcomed the panel's vote. Shares of the drugmaker were down 6 cents, or 0.2 percent, at $28.12 in afternoon trade on the New York Stock Exchange. (Reporting by Susan Heavey; Editing by Tim Dobbyn and Gerald E. McCormick)