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FDA Panel Backs Millennium-Ilex-Schering Cancer Drug

Dane Hamilton

A Food and Drug Administration advisory panel Thursday gave Ilex Oncology(ILXO) and Millennium(MLNM) its early Christmas well wishes.

The FDA's Oncologic Drugs Advisory Panel decided by a 14-1 vote that a new leukemia drug called Campath should be approved, pushing Millennium stock up as much as 10%. Now the companies need full approval by the FDA, which generally follows the lead of its advisory panels. The drug, a treatment for chronic lymphocytic leukemia, the most prevalent form of the blood cancer, was developed by a joint venture of the biotech companies.

The approval was mostly expected but represents a milestone for both companies, since it would be each company's first drug on the market. Shares in both companies rose after the decision, with Millennium jumping 7% to $59.56 and Ilex rising 4.4% to $27.68.

The panel, the crucial gateway that must be transversed for almost all cancer drugs, wasn't as kind to Maxim Pharmaceuticals (MAXM) last night. The panel unanimously turned down Maxim's Maxamine for advanced skin cancer, causing shares in that biotech to plunge a third straight day. Maxim dropped 28% to $9.37, after falling 44% and 22% Tuesday and Wednesday.

Campath, a monoclonal antibody, isn't expected to be a huge seller, with some analysts expecting peak annual sales of around $150 million. The drug will be marketed in the U.S. by Berlex Labs, a subsidiary of Germany's Schering(SHR), and will be used for patients who have failed other therapies. Revenue will be split evenly among the three companies.

"This is more of a milestone than a major revenue-building event," says Ellen Lubman, genomics analyst with Robertson Stephens, who has a strong buy rating on Millennium and no formal rating on Ilex. The bank advised Millennium in its fundraising this year. "We were pretty optimistic it would be approved," she says.

If approved, Campath will be "the most significant breakthrough in 10 years for CLL patients and an important addition to current treatments," the companies said in a statement.

Some 120,000 patients in the U.S. and Europe have CLL and are typically initially treated with chemotherapy and later a drug called fludarabine if initial treatment fails. If approved, Campath will be a third option for those who have failed initial treatments.