Biotech Notebook: Pipex, Gilead, Biogen Idec.

There's a growing body of scientific data showing that colon cancer patients with a non-mutated form of the KRAS gene respond better to EGF receptor antibody drugs like ImClone Systems' (IMCL Quote - Cramer on IMCL - Stock Picks)Erbitux, Amgen's(AMGN Quote - Cramer on AMGN - Stock Picks) Vectibix and OSI Pharmaceuticals' (OSIP Quote - Cramer on OSIP - Stock Picks)Tarceva.

In December, Vectibix was granted European approval to treat colon cancer patients that possess wild-type (non-mutated) KRAS. It's a matter of debate whether the FDA will follow that path and require all colon cancer patients here to be tested for KRAS before going on EGFr drug therapy, but it's a definite possibility.

In a recent report, Rodman & Renshaw biotech analyst Mike King brings this neat bit of science back to Wall Street: "The $640 million question: Is KRAS status positive or negative for the anti-EGF antibodies?"

Based on some recent conversations with colon cancer thought leaders, King believes the rise of KRAS stands a good chance of expanding the market opportunity for drugs like ImClone's Erbitux and Amgen's Vectibix. Estimates vary, but generally, it's believed that 40%-60% of newly diagnosed colon cancer patients possess the non-mutated KRAS gene and are therefore ideal candidates for EGFr drug treatment.

Conversely, this means that between 40%-60% of colon cancer patients have mutated KRAS and therefore shouldn't be receiving Erbitux or Vectibix. This sounds like a big negative, but don't forget the Genentech(DNA Quote - Cramer on DNA - Stock Picks) experience with Herceptin. That very successful breast cancer drug is approved for the approximately 20% of breast cancer patients who over-express the Her2 gene. This "genetic limitation" hasn't stopped Herceptin from being an enormously profitable drug for Genentech.

Writes King: "If the KRAS hypothesis holds up (and the world should know in less than six months,) improved outcome could lead to increased utilization. Further ... the most straightforward way for the anti-EGF antibodies to challenge Genentech's Avastin hammerlock in first- and second-line treatment of metastatic colon cancer is through the determination of patients' KRAS status."

There is work to do here before ImClone or Amgen (or OSI Pharma for that matter) see a boost to their colon cancer sales through KRAS testing. Obviously, testing needs to be adopted widely in the U.S., and that hasn't happened yet. Just as important, clinical studies need to show that the benefit of drugs like Erbitux or Vectibix is equal to or better than Avastin in patients with wild-type KRAS.

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Is it just me, or does Carl Icahn's continued efforts to force Biogen Idec(BIIB Quote - Cramer on BIIB - Stock Picks)to sell itself seem to be a replay of the activist investor's unsuccessful attempt to accomplish the same thing with ImClone?

As my colleague Elizabeth Trotta reported this week, Icahn is trying to muscle some hand-picked cronies onto the Biogen Idec board and generally sneering at the company's CEO Jim Mullen, basically accusing Mullen of scuttling good-faith efforts to sell the company.

This is almost exactly what Icahn did with ImClone Systems in 2006. Ultimately, Icahn was made chairman of ImClone and able to install his own slate of directors and a new CEO. But his efforts to attract a buyer for ImClone failed.

If you believe the chatter, there were interested bidders, but Icahn was impossible to deal with and was asking an impossibly high price for the company.

As I wrote earlier this month, there is still a chance that Biogen Idec is acquired by someone, but perhaps not if a Big Pharma bidder has to negotiate with Icahn.

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