* Median survival 86 weeks vs expected 24 weeks
* Full results from Phase II trial expected mid-2011
* Shares rise 18 percent (Adds share price, analyst comment)
By Deena Beasley
LOS ANGELES, Oct 18 (Reuters) - Interim results from a mid-stage trial of an experimental brain cancer drug developed by Peregrine Pharmaceuticals Inc (PPHM.O) show that patients lived about 3 1/2 times as long as would be expected if they were left untreated, according to the company.
The promising data sent Peregrine shares up nearly 27 percent.
Peregrine said the trial's first 14 patients lived a median of 86 weeks, compared with expected survival of about 24 weeks for patients whose cancer has recurred.
"It's extremely encouraging," Joseph Shan, the company's head of clinical and regulatory affairs, told Reuters in a telephone interview.
Shan said a couple of patients treated in an earlier trial of the drug, Cotara, are still alive nine years later.
The current trial is expected to enroll up to 40 patients with glioblastoma multiforme -- the most common and deadly form of brain cancer -- whose disease has recurred following standard treatment.
The initial findings are from patients enrolled at a medical center in New Delhi, India. Full trial results, including U.S. sites, are expected by mid-2011.
"The interim data from the lead clinical site looked very strong for the 14 patients," said Stephen Dunn, an analyst for Lifetech Capital.
"This is in patients who had their first relapse, so they had already failed another treatment. Median survival of 86 weeks, that's pretty impressive," Dunn said.
Cotara is a genetically engineered antibody designed to target certain cancer cells that also carries a cell-killing radioactive isotope. It is infused directly into the tumor, with the aim of sparing healthy tissue from the radiation.
Peregrine said it plans to meet with U.S. regulators next year to discuss how best to move forward with development of the drug.
"Physicians know how long these patients are expected to survive on average and that's why these data are very, very promising," said Joseph Pantginis, an analyst for Roth Capital Partners.
Because there is a huge unmet medical need for new treatments for this type of brain cancer, Pantginis said, Peregrine may seek an accelerated approval that could avoid lengthy Phase III clinical trials.
"The data are certainly positive, but they still need to define what the potential approval path will be."
Similar "radioimmunotherapies" like Zevalin, now sold by Spectrum Pharmaceuticals Inc (SPPI.O) for non-Hodgkin's lymphoma, have had limited commercial success due largely to a combination of reimbursement issues and the complexity of coordinating patient care between oncologists and hospitals.
Steven King, Peregrine's chief executive officer, said Zevalin, which is infused throughout the body, is associated with bone marrow suppression -- which is not an issue with Cotara since it is sent directly into brain tumors.
He explained that a radiation/oncology group is involved in delivering the drug, but patients are being overseen by a neurosurgeon.
"Clearly we think there is a nice market for a drug like Cotara," King said. "It is only used as single agent, single infusion, but there is the potential to combine it with other drugs."
Side effects of Cotara seen in the trial included swelling of the brain, seizures and headaches.
The study results were presented at the Congress of Neurological Surgeons Annual Meeting in San Francisco.
Peregrine shares were up 30 cents, or 18.3 percent, at $1.94 on Nasdaq after climbing as high as $2.08 earlier in the day.