May 29 (Bloomberg) -- A single gene may help Merck KGaA and ImClone Systems Inc. find which patients are best treated with their Erbitux cancer drug, helping gain an edge over Roche Holding AG and add 600 million euros ($938 million) in sales.
Merck may win European backing as soon as today to sell the medicine for deadly bowel tumors that have spread throughout the body. Results of a study to be released June 1 may show the drug is especially useful for the 60 percent of colorectal cancer patients who carry an intact version of a gene called kras.
Data that enable doctors to link the kras gene to successful treatment may change the way oncologists treat the cancer, increasing the use of Erbitux and allowing it to compete against Roche's Avastin, said Amit Roy, an analyst at Citigroup. Avastin, the first of a new generation of targeted drugs to win approval for treating malignant bowel cancer, generated $3.4 billion for Basel, Switzerland-based Roche last year.
``Erbitux is very impressive,'' Dirk Jaeger, an oncologist at the University of Heidelberg said. ``We can already say it is as good if not better than Avastin for patients that carry unmutated kras.''
Jaeger routinely employs a test that can cost about 120 euros to detect the version of kras a patient carries. The new research, to be presented at the American Society of Clinical Oncologists meeting in Chicago, may persuade other doctors to follow the same procedure.
Shares Gain
Darmstadt, Germany-based Merck rose 43 cents, or 0.5 percent, to close at 92.71 euros in Frankfurt trading today. The stock has gained more than 7 percent this year on optimism Erbitux may win wider use against colon cancer. Investors are also awaiting results of a clinical trial to be presented at the research meeting that may show that Erbitux may extend survival of lung cancer patients longer than the average eight weeks already shown in studies of Avastin.
The shares of Roche, which developed Avastin with South San Francisco, California-based Genentech Inc., have dropped about 8 percent in the period.
``Avastin works regardless of kras status - it is the only option for patients with mutated kras and the best option for patients with wild-type kras,'' Roche spokesman Alexander Klausner said in an e-mailed message.
Erbitux is approved to treat head and neck tumors as well as colon cancer that has progressed despite treatment with other drugs. Merck, which bought non-U.S. rights from New York-based ImClone in 1998, is conducting research in other tumor types and for wider use of the medicine to capture additional sales. The German drugmaker was the first to win approval for Erbitux when Swiss regulators cleared the treatment for sale in December 2003.
Crystal Trial
ImClone shares fell 30 cents to $42.82 in Nasdaq Stock Exchange trading.
Results last year of the so-called Crystal trial, which the German drugmaker used to support the European application to market Erbitux against colon cancer, showed the treatment slowed the disease's progression by 28 days compared to conventional drug therapy. Morgan Stanley analyst Andrew Baum said this advantage may still not be enough for European regulators to make Erbitux a first-choice treatment over Avastin.
To find those patients who may respond best to Erbitux, researchers examined tissue removed from people enrolled in the Crystal trial to test whether their tumors contain an intact or mutated version of the gene.
Speculation
Other smaller studies have suggested that the cancer may progress more slowly in patients with a normally functioning kras gene who are treated with Erbitux and Amgen Inc.'s Vectibix. That has prompted speculation the same effect may also be demonstrated in the Crystal trial.
``Kras is important, it helps us to tell in advance who will benefit,'' said Eric van Cutsem, an oncologist at the University of Leuven in Belgium, who led the Crystal study.
Kras signals the body to make a protein linked to the growth of cells. In some tumors, the so-called ras pathway goes haywire, telling cells to multiply non-stop. Erbitux can help halt the message if the kras protein is intact. The drug doesn't work when the kras is damaged, the Crystal study may show. Scientists don't know why the gene gets damaged in certain patients.
The ability of Erbitux to take on Avastin depends on how long the medicine can stall the disease. The benefit of one over the other is difficult to judge based on available data because each was paired with different chemotherapy treatments in clinical trials, Jaeger said.
Man-Made
Citibank's Roy said patients with normal kras should have an even better response than the 28-day benefit seen in the Crystal trial. Those patients could see their cancer stop growing for as long as 1.5 months, he said in a note to clients.
``It will take away sales slowly at first, but we do expect Avastin to suffer,'' Markus Mayer, an analyst at UniCredit SpA in Munich said. Mayer raised his Merck rating to ``buy'' from ``hold'' on May 19.
Erbitux is a man-made antibody, a substance naturally produced by the immune system in response to infection. The drug works by latching onto cancerous cells and blocking replication. The flaw in the kras gene, which holds the blueprint for part of a messaging system inside the cell, is thought to render Erbitux ineffective.
Data that prove Erbitux works in people with a normally functioning kras gene would allow doctors to find the most- suited patients and offer health-care payers a way to save costs, analysts say.
``This is good for patients, good for doctors and good for us,'' said Oliver Kisker, who leads the clinical development of a group of cancer drugs at Merck, in an interview. ``This really differentiates us from the competition.''
To contact the reporter on this story: Eva von Schaper in Munich at evonschaper@bloomberg.net.
