IDM Pharma says FDA declines to approve cancer drug

(Adds details)

Aug 27 (Reuters) - Biopharmaceutical company IDM Pharma Inc IDMI.O said U.S. health regulators declined to approve its experimental drug for the treatment of a rare bone cancer that affects teenagers, sending shares down about 20 percent.

The company received a "non-approvable letter" from the U.S. Food and Drug Administration for the drug, called mifamurtide or L-MTP-PE.

IDM said it plans to amend its current new drug application with additional survival data of patients who participated in the late-stage trial of the drug.

The FDA is seeking data from additional clinical trials to demonstrate the benefit of the drug as well as information on other sections of the NDA, the company said.

In May, a FDA advisory panel had said data for the drug, formerly known as Junovan, failed to show that it was effective in treating bone cancer, or osteosarcoma.

"While the FDA has asked for data from additional clinical trials, we believe that this decision was made in context of the lack of complete data in the submitted NDA and that capturing supplemental data will overcome the need for additional trials," Chief Executive Timothy Walbert said in a statement.

The Irvine, California-based company expects to submit an amended NDA to the health regulators by the first quarter of 2008 and address the other points raised in the FDA letter.

Mifamurtide, which is called Mepact in Europe, was granted orphan drug status in the United States in 2001.

The designation, meant for drugs that treat rare conditions affecting fewer than 200,000 people in the United States, entitles drugmakers to tax credits and other incentives for their products, as well as seven years of marketing exclusivity.

Osteosarcoma most commonly occurs in teenagers during their growth spurt and tends to affect thigh, arm and shin bones. According to the American Cancer Society, about 900 new U.S. cases are diagnosed each year, with about 400 annual cases diagnosed in those younger than 20.

IDM shares, which have lost almost 40 percent of their value so far this year, were trading down 40 cents at $1.62 in midday trade on the Nasdaq. Earlier, they hit a new year-low of $1.50.

(Reporting by Tenzin Pema in Bangalore)

((Editing by Anil D'Silva, Pratish Narayanan; Reuters Messaging: tenzin.pema.reuters.com@reuters.net; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800)) Keywords: IDMPHARMA CANCER/MIFAMURTIDE

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