Cosmo shares jump on colonoscopy trial results

ZURICH (Reuters) - Shares in Swiss-listed drugmaker Cosmo Pharmaceuticals jumped more than 10 percent on Thursday after it reported its dye tablets helped doctors detect intestinal growths during colonoscopies.

Cosmo’s late-stage phase III trial of some 1,200 people in Europe and North America showed improved detection of adenomas, or pre-cancerous growths in the colon and rectum, compared with a placebo, it said.

Cosmo will release more complete results on Nov. 29.

It is hoping its LuMeBlue-brand tablets, meant to be taken orally, become standard for endoscopists who perform 30 million colonoscopies annually to find and remove growths before they turn into cancer.

Cosmo plans to file for approval with the U.S. Food and Drug Administration by April 2017, after which it hopes to win the okay to begin sales within 12 months.

“What is likely ... is that we will substantially increase the ability of endoscopists to detect pre-cancerous growths,” Chris Tanner, Cosmo’s head of transactions, said in an interview.

“Then, it’s very likely that doctors are going to have to use this,” Tanner said. “Because if they don’t, then the risk of them not performing an endoscopy according to best practice is greater.”

Cosmo shares were up 11 percent at 1300 GMT, cutting this year’s slide to just 2 percent and boosting its market capitalization to 2.2 billion Swiss francs ($2.2 billion).

Cosmo plans to use data from epidemiologists in its discussions with insurers over LuMeBlue’s price, which it aims to set based on the projected savings to be reaped by reducing the number of undetected adenomas that progress to become expensive-to-treat colon cancer.

“It’s pretty clear that you can calculate how much a colon cancer patient costs,” Tanner said. “If you say, ‘I can reduce colon cancer patients by X percent,’ you can say, ‘These are the savings.’ “

(Corrects to remove a reference to Novartis’s pricing model for Entresto, which Cosmo said it is not pursuing for its product.)

Reporting by John Miller; Editing by MarkPotter