(Reuters) - An experimental Eli Lilly and Co lung cancer drug that some investors had given up on due to past setbacks, extended patient survival in a late-stage study, reviving hopes for the medicine and sending company shares 4 percent higher.
Lilly, which badly needs lucrative new products as its older ones face competition from cheaper generics, said it plans before the end of 2014 to seek U.S. approval of the medicine - called necitumumab or IMC-11F8 - as a first-line treatment.
“Expectations were close to zero” for necitumumab, said J.P.Morgan analyst Chris Schott. But given the trial’s success, Schott said he now believes it could generate annual sales of more than $1 billion, assuming still-undisclosed trial data are satisfactory and the product is approved.
Lilly said full data from the study will be presented at a medical meeting this year.
The Indianapolis drugmaker said the drug, when combined with standard chemotherapy agents gemcitabine and cisplatin, increased overall survival compared with patients taking chemotherapy alone. But side effects included blood clots, a problem that put an end to an earlier late-stage trial of the injectable medicine.
In the latest study, called SQUIRE, necitumumab was tested in patients with the “squamous” form of non-small cell lung cancer (NSCLC) that had spread to other parts of the body. The squamous form is seen with about 30 percent of patients with NSCLC, the most common form of lung cancer.
Lilly said necitumumab would be the first biotech treatment for the condition, if it is cleared by regulators. The new generation of drugs, which are grown in living cells and target specific gene mutations linked to cancer, can cost tens of thousands of dollars a year.
Necitumumab was developed as a potential successor to the lung cancer drug Erbitux that Lilly acquired in its $6.5 billion purchase in 2008 of U.S. biotechnology company ImClone. Both drugs work by blocking a protein called EGFR.
Bristol-Myers Squibb Co, through a longstanding ownership stake in ImClone, claimed shared rights to necitumumab. But early this year, Bristol-Myers backed out of a collaboration with Lilly and surrendered rights to the drug to its smaller rival.
At the time, Bristol-Myers’ decision to walk away was not a great surprise to many industry analysts because a separate late-stage trial of necitumumab had been stopped in early 2011 due to concerns about its potential to cause blood clots.
In that trial, called INSPIRE, it was being tested in combination with Lilly’s Alimta lung cancer drug and cisplatin among patients with the more common non-squamous form of the disease.
Even as Wall Street ponders necitumumab’s favorable trial results, investors are eagerly awaiting data any day now from late-stage trials of ramucirumab, an experimental Lilly treatment for breast cancer that is deemed one of the company’s most promising experimental drugs.
Lilly in October said ramucirumab, when used as a stand-alone treatment, improved overall survival in a late-stage study of patients with stomach cancer.
Acquired as well through the ImClone deal, the biotech drug is also undergoing late-stage trials for cancers of the colon, lung and liver.
Some analysts have predicted it could achieve annual sales of $2 billion if it is approved for either lung cancer or breast cancer.
Lilly shares were up 4.4 percent to $55.92 in late-morning trading on the New York Stock Exchange.
Reporting by Esha Dey in Bangalore and Caroline Humer; Editing by Maju Samuel and Sofina Mirza-Reid