U.S. OKs use of Genentech's Avastin in lung cancer

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By Deena Beasley, 11 Oct 2006

LOS ANGELES (Reuters) - U.S. regulators agreed to expand the use of Genentech Inc.'s drug Avastin, now used against colon cancer, to include treatment of the most common type of lung cancer, the company said on Wednesday.

Avastin, the first drug designed to starve tumors of blood and nutrients, was approved as an initial treatment, in combination with chemotherapy, for patients with non-small cell lung cancer.

The FDA nod, while expected, "is a billion-dollar-plus opportunity for Genentech," said Mike King, an analyst at Rodman & Renshaw.

The company's shares, which fell 2 percent to close at $84.15 on the New York Stock Exchange, were little changed at $84.07 after hours.

Approval was based on a study showing Avastin and chemotherapy resulted in a 25 percent improvement in survival compared to chemotherapy alone, the South San Francisco, California-based company said.

"Lung cancer is responsible for more than one-third of all U.S. cancer deaths, killing more people than breast, prostate, colon, liver and kidney cancers combined," Laurie Fenton, president of the Lung Cancer Alliance, said.

U.S. sales of Avastin, which is being studied as a treatment for a range of solid tumors, totaled $1.13 billion last year.

King estimated that annual sales will reach $4 billion by 2009.

Susan Desmond-Hellmann, head of product development at Genentech, said the lung cancer approval would make another 65,000 to 81,000 patients candidates for the drug.

The company put the monthly price of Avastin at about $4,400 for patients with colon cancer, but said a higher dose is needed for advanced lung cancer, bringing the monthly cost to $8,800 and the average cost of a course of therapy to about $56,000.

Genentech said it plans to cap the overall expense of Avastin to $55,000 per year per eligible patient, regardless of whether they are insured, for any FDA-approved indication.

"It's a small concession," King said, referring to the price cap, but added that it makes sense for makers of expensive cancer drugs to ensure patient access.

The company, which is majority owned by Swiss drugmaker Roche Holding AG, plans to begin the price program in January.

In addition, Genentech said it has doubled its contribution to independent charities that provide co-pay assistance to a total of $50 million.

The FDA last month asked for more information about the safety and efficacy of Avastin as a treatment for breast cancer, delaying a decision on the company's application to expand Avastin's use into that patient population.

King said an FDA decision on Avastin's use in breast cancer is unlikely before late next year.

Side effects of the drug include low white blood cell count, fatigue, high blood pressure, infection and hemorrhage.

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