UPDATE 3-U.S. limits use of risky Sanofi antibiotic Ketek

(Adds comment from former FDA reviewer, Sanofi spokeswoman; updates stock price)

By Susan Heavey

WASHINGTON, Feb 12 (Reuters) - Sanofi-Aventis SA's (SNY.N) (SASY.PA) antibiotic Ketek should no longer be used to treat sinusitis and bronchitis, U.S. officials warned on Monday, saying the controversial drug was too risky to treat those diseases.

Ketek, which will remain on the market to treat pneumonia, will also carry stronger warnings about possible side effects such as blurred vision and loss of consciousness, the U.S. Food and Drug Administration said.

The FDA also said the drug will carry a "black box" warning -- the strongest possible -- against its use by patients with myasthenia gravis, a disease that causes muscle weakness.

The warning follows a year-long FDA investigation into reports of severe liver damage and death in some Ketek patients that sparked debate over the drug's safety and the agency's handling of its approval.

The concerns also triggered a Senate Finance Committee probe led by Iowa Republican Sen. Charles Grassley, and an FDA advisory panel recommendation for limited use in December.

"FDA has determined that the balance of benefits and risks for Ketek do not support continued approval of Ketek for these generally nonserious and often self-limited illnesses," said Dr. John Jenkins, director of the FDA's Office of New Drugs.

Pneumonia is a more serious illness that generally does not clear up without antibiotic treatment, Jenkins said.

Ketek, known generically as telithromycin, already comes with a bold warning for possible liver damage. Jenkins said officials saw no need to strengthen it.

Still, the FDA has received one additional report of possible liver complications. Previously, the FDA reported 13 cases of severe liver failure that included five deaths.

Sanofi, in a statement, defended Ketek's continued use against pneumonia as "an important option in the therapeutic anti-infection arsenal" that responds to a medical need.

Analysts had largely anticipated the FDA's ruling, which came before Sanofi was set to release its latest results on Tuesday. Various research notes also said this factored into analyst expectations for Ketek, which saw U.S. sales of about $71 million last year.

Shares of Paris-based Sanofi gained 51 cents to close at $44.29 on the the New York Stock Exchange.

The FDA announcement also came a day ahead of a House Energy and Commerce subcommittee hearing on drug safety issues, including Ketek.

Grassley, who was scheduled to testify, has criticized the agency for withholding information about Ketek's approval.

"When a spotlight was turned on the questionable way in which Ketek got approved ... the FDA was held accountable," Grassley said on Monday. He has sponsored a bill aimed at improving FDA's safety oversight.

FDA spokeswoman Susan Cruzan said the agency had no comment on the hearing. The agency in the past has said it followed protocol in approving the antibiotic and was cooperating with Grassley's investigation.

The FDA cleared the drug in 2004 even though an investigation found a key safety study was tainted by fraud. FDA officials said other data provided adequate reassurance.

Some critics, including former FDA scientist David Ross, have questioned the original approval. Also set to testify on Tuesday, Ross on Monday said it was still unclear how much data from the original Ketek application was reliable.

"Until they get the fraud issues resolved, they need to withdraw this drug from the market," Ross, a lead reviewer on Ketek before leaving the FDA last year, told Reuters.

Sanofi spokeswoman Lisa Kennedy said the company had acted in good faith in conducting the Ketek studies and had cooperated in all investigations.

(Additional reporting by Lisa Richwine in Washington and Ben Hirschler in London)

((Editing by Phil Berlowitz; Reuters Messaging: susan.heavey.reuters.com@reuters.net, Phone: 202-354-5848)) Keywords: SANOFI KETEK/

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