Updated from 1:19 p.m. EDT

Procter & Gamble

(PG) - Get Procter & Gamble Company Report

rose Monday, buoyed in part by news the company had received

U.S. Food and Drug Administration

approval for its osteoporosis drug Actonel.

"Investors are breathing a collective sigh of relief that this announcement is out," said William Steele, an analyst at

Banc of America Montgomery

, noting that the market had expected the FDA to approve Actonel last quarter.

P&G was up 4 1/4, or 7%, to 67 1/4 in Monday afternoon trading. (P&G closed Monday up 6, or 9.5%, at 69.)

Steele said he expects sales of Actonel to contribute about 4 cents to P&G's earnings in its fourth fiscal quarter, which he estimates at 64 cents a share, compared with 55 cents a year ago. Steele rates P&G a buy and has not done any underwriting for the firm.

Dr. Valerie Peck, clinical associate professor of medicine at

New York University Medical Center

and co-director of their bone density unit, warned, however, that Actonel might have a tough time competing with


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Fosamax treatment, which was approved in 1995.

"I think that if there is a drug that's been around for several years with good results, then it's harder for a new drug to come in," Peck said, noting that Actonel and Fosamax belong to the same family of drugs, known as bisphosphonates.

Peck noted, however, that Actonel might have some advantages against Fosamax among patients who have gastrointestinal diseases. P&G said Actonel was "well tolerated" among these patients, and Peck estimated that about 10% of the targeted population might prefer Actonel over Fosamax if indeed Actonel proved not to exacerbate gastrointestinal problems.

A P&G spokesman was not immediately available for comment.

Cincinnati-based P&G is hoping that doctors will recommend Actonel because of its ability to reduce spinal fractures after one year of treatment.

"Actonel significantly reduced the risk of new vertebral fractures by 65% in one year in postmenopausal women compared to a control group of women taking supplemental calcium and, if needed, vitamin D," P&G said.

Peck questioned the ability to accurately study the drug's effects within one year of treatment, but added that if Actonel proved to work more quickly than the competition to stave off fractures, then this would be a positive development and strong selling point.

P&G will jointly market Actonel with

Aventis Pharmaceuticals

, the U.S. pharmaceutical business of

Aventis SA