Updated with new information.
SUMMIT, NJ ( TheStreet) -- The cancer drug Abraxane prolonged the survival of patients with advanced pancreatic cancer in a closely watched phase III study, Celgene (CELG - Get Report) said Friday night.
A competing pancreatic cancer drug from Clovis Oncology (CLVS)failed to prolong survival in its phase III study, the company announced early Monday.
Celgene plans to seek regulatory approval to expand Abraxane's label to include treatment for pancreatic cancer based on the positive study results. In a best case, pancreatic cancer could add another $1 billion in Abraxane sales.Abraxane sales totaled $320 million in the first nine months of the year, mainly from use in advanced breast cancer. In October, the FDA approved Abraxane for use in non-small cell lung cancer and Celgene reported positive results from a phase III study in melanoma. In this latest study, 861 treatment-naive pancreatic cancer patients were randomized to treatment with Abraxane plus the chemotherapy gemcitabine or gemcitabine alone. The combination of Abraxane/gemcitabine demonstrated a statistically significant improvement in overall survival, the study's primary endpoint. Abraxane was well tolerated. Further details from the study will be presented at a cancer research meeting in January, Celgene said. Celgene designed the pancreatic cancer study to show an approximate two-month survival advantage for Abraxane plus gemcitabine over gemcitabine alone. Historically, patients treated with gemcitabine alone live about six months. Investors are likely to view a survival benefit of 8 months for Abraxane/gemcitabine compared to 6 months for gemcitabine alone as a very positive result. Analyst models, on average, are forecasting $733 million in Abraxane sales in 2015, according to ISI Group analyst Mark Schoenebaum. That estimate will rise significantly if the Abraxane pancreatic cancer survival benefit is robust. An estimated 44,000 people are diagnosed with pancreatic cancer in the U.S. each year and 37,000 die, according to U.S. health statistics. Celgene shares closed Friday $71.50 ahead of the Abraxane data announcement. The stock rose 6% to $75.57 in after-hours trading. The Celgene CVR jumped 80% to $5.60 in Friday's after-hours session. Celgene created the contingent value right linked to Abraxane when it acquired the drug's original owner Abraxis BioScience in 2010. In September, hedge fund manager and TheStreet contributor Jim Silverman recommended buying the Celgene CVR based on his belief that the Abraxane pancreatic cancer trial would be successful. "What I like about the Celgene CVR is the potential for a nearly $7.50-per-share payout should a phase III study of Abraxane in pancreatic cancer succeed," Silverman wrote. At that time, the Celgene CVR was worth $2.50 per share. TheStreet contributor Nate Sadeghi also predicting a win for Abraxane in pancreatic cancer in an October column. Abraxane generated a lot of positive buzz at a European cancer research meeting in early October. Friday's Abraxane data could impact Threshold Therapeutics (THLD - Get Report) and partner Merck KGaA, which are planning to soon begin a phase III study of their drug TH-302. Clovis Oncology said Monday experimental drug CO-101 failed to prolong survival compared to treatment with gemcitabine. Based on the negative result, Clovis is disontinuing all development of the drug. -- Reported by Adam Feuerstein in Boston. Follow @AdamFeuerstein