UPDATE 2-AstraZeneca's Recentin flunks colon cancer tests

* Astra won't submit drug for first-line colorectal cancer * Horizon II study shows no improvement in overall survival

* Follows earlier failed trial comparing Recentin to Avastin * AstraZeneca shares up 0.8 percent

(Adds comment from spokeswoman, shares, sales forecast)

By Ben Hirschler

LONDON, May 28 (Reuters) - AstraZeneca (AZN.L) dropped plans to file experimental cancer drug Recentin as a first-line treatment for colon cancer on Friday after disappointing results from a second pivotal clinical trial with the medicine.

Many investors had been sceptical about the drug's prospects in this area after it failed in the previous study.

The latest Phase III clinical trial, known as Horizon II, showed that while Recentin combined with chemotherapy helped patients live longer without their disease progressing, there was no improvement in overall survival compared with chemotherapy alone.

The drug, also known as cediranib, had already flunked another study comparing it head-to-head with Roche's (ROG.VX) blockbuster Avastin in March.

"Looking at the results from both these trials, we felt they were not strong enough to justify moving forward in this area, given other treatment options available," said company spokeswoman Abigail Baron.

The decision, while not a huge surprise, will likely prompt some analysts to revise their numbers. The consensus had been that Recentin sales would reach around $400 million by 2014, according to Thomson Reuters data.

The setback underlines the problems facing AstraZeneca as it tries to refill its pipeline ahead of loss of patent protection on some of its biggest-selling products, including acid reflux treatment Nexium and Seroquel for schizophrenia.

The group is also due to hear by July whether or not a U.S. judge will uphold its patent on cholesterol fighter Crestor.

AstraZeneca shares were up 0.77 percent at 0731 GMT, slightly outperforming a 0.5 percent advance in the European healthcare sector .SXDP.

Despite its failure in first-line colon cancer, Recentin may still have a role in different cancer types.

Results of a Phase III study evaluating it in treating recurrent glioblastoma, a brain cancer, are expected soon and AstraZeneca is also examining whether it may have applications in a number of other tumour types, including lung cancer. (Editing by Dan Lalor, Mike Nesbit)