Genentech Inc.'s drug Avastin will likely remain dominant in the lung cancer market over rival ImClone Systems Inc.'s Erbitux, several analysts said Monday following the release of clinical data at the American Society of Clinical Oncology's annual meeting in Chicago.
ImClone (nasdaq: IMCL - news - people ) said adding Erbitux to standard chemotherapy added about 5 weeks to a patient's life when compared with a chemotherapy regimen alone. The FLEX study results were positive, but Wall Street still expects Avastin prescriptions to lead Erbitux because the drug's survival benefit is nearly a month longer.
However, many patients can't take Avastin because of blood disorders or blood thinner regimens, and if approved for lung cancer, analysts think Erbitux will be the prescription of choice for that patient population - leaving ImClone and partner Bristol-Myers Squibb Co. (nyse: BMY - news - people ) with at least some portion of a lucrative market. Lung cancer is the leading cause of cancer death in the United States.
"Initial feedback from physicians confirms our theory that Avastin will still be considered the gold-standard front-line agent and Erbitux's use will be predominantly in Avastin-ineligible patients," said Piper Jaffray (nyse: PJC - news - people ) analyst Thomas Wei, in a note to investors.
Avastin, which is FDA-approved to treat colon, lung and breast cancer, is Genentech (nyse: DNA - news - people )'s key revenue driver and brought in just under $2.3 billion in 2007. Erbitux - ImClone's only product - is approved to treat colon and head and neck cancers and the company hopes it will be approved for lung cancer.
"FLEX (study data) is Erbitux's ticket into the lucrative lung cancer market," said Cowen and Co. analyst Eric Schmidt. He said that with 40 percent to 50 percent of lung cancer patients ineligible for Avastin treatment, ImClone and Bristol-Myers could see peak Erbitux sales in lung cancer of $700 million.
Dr. Edward Kim, an assistant professor of medicine at the University of Texas' M.D. Anderson Cancer Center, said the addtiional five weeks of survival time can be significant for many of the advanced lung cancer patients he sees each week. Those patients are often told they have less than a year to live, even with treatment.
"When I put my physician hat on and I'm seeing patients, I'm extremely happy that I have more options to offer patients," he said in an interview with The Associated Press.
Other lung cancer developments at ASCO included an M.D. Anderson Center study showing Pfizer Inc. (nyse: PFE - news - people )'s arthritis drug Celebrex could help prevent lung cancer in heavy smokers. The findings are still early, though, and Kim said additional work on identifying risk factors and assessing the drug's benefit need to be done.
"We'll be looking at tissue to try and define who is at highest risk for cancer and who may benefit the most from a drug like Celebrex," he said.
Meanwhile, Exelixis Inc. (nasdaq: EXEL - news - people ) said midstage study data showed its drug candidate XL-647 appeared to attack lung cancer tumors. The company hopes to start a late-stage study by the second half of 2009.
Shares of South San Francisco, Calif.-based Genentech rose $2.47, or 3.5 percent, to reach $73.33 in afternoon trading, while shares of New York-based ImClone fell $2.63, or 6 percent, to $40.95.
New York-based Pfizer saw shares fall 26 cents to $19.10, while shares of South San Francisco, Calif.-based Exelixis fell 20 cents, or 3.1 percent, to $6.12.
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