At last,

ImClone Systems

(IMCL)

gets the chance to talk about science without the words "insider trading" or "investigation" being injected into news about the company.

That's because ImClone and its partner

Bristol-Myers Squibb

(BMY) - Get Report

said Thursday that ImClone asked the Food and Drug Administration to approve the drug Erbitux for treating colon cancer patients for whom chemotherapy has failed.

The request reprises the companies' efforts undertaken more than two years ago to seek FDA approval for the drug. The FDA's rejection of the application in late December 2001 set off a chain reaction of events that led to an insider trading scandal in which ImClone's founder and former CEO, Samuel D. Waksal, was sent to prison for 87 months and fined $4.2 million after pleading guilty to bank fraud, securities fraud and conspiracy to obstruct justice.

In its Thursday filing, ImClone asked the FDA to give Erbitux "priority review," a process by which the FDA would evaluate the drug within six months rather than the traditional review cycle of 10 months.

This application is "a milestone that all of us at ImClone have worked diligently

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on, on behalf of colon cancer patients," said Daniel S. Lynch, the company's acting chief executive, in a prepared statement.

"This is very noteworthy," said Cory Kasimov, who follows ImClone for the New York investment bank of Ryan Beck & Co. "It's another step in a string of important developments."

Kasimov said Thursday he expects the FDA to decide by the end of September whether to grant the priority review. "We like the drug's chances," he said. "It's targeting an unmet need."

Kasimov rates New York City-based ImClone's stock as market perform; he doesn't own shares and his firm doesn't have an investment banking relationship with ImClone.

C. Anthony Butler, a drug-industry analyst at Lehman Brothers, told clients Monday in a research note that he continues to expect an early 2004 launch of the drug. He predicted Erbitux could produce $735 million in annual sales by 2006.

Butler follows Bristol-Myers Squibb but not ImClone. He rates Bristol-Myers Squibb as underweight; he doesn't own shares and his firm doesn't have an investment banking relationship with the giant drug company.

New York City-based Bristol-Myers Squibb, which has the U.S. and Canada marketing rights to Erbitux, owns just under 20% of ImClone.

ImClone's stock was crushed after the FDA rejected its Erbitux application, and it was further flattened as the insider trading scandal unfolded. But the shares have been on a dramatic rebound -- doubling since May and rising five-fold since last Labor Day. The stock gained 46 cents to $40.23 on Thursday after the companies announced their FDA application; in early afternoon trading Monday, ImClone's shares were up 27 cents to $40.25.

Shares have been spurred, in part, by recent research on Erbitux and colon cancer presented June 1 at the American Society of Clinical Oncology's annual meeting in Chicago. The research was sponsored by the German chemical and drug company Merck KGaA, another partner with ImClone in developing Erbitux.

Merck said the test results showed that Erbitux plus chemotherapy "represents a significant advance" in treating people with advanced colon cancer. The research said the combined treatments slowed the progression of the disease by four months and reduced tumors by 50% or more in 23% of patients tested. Half of the patients "saw their disease stabilize or improve," said Merck, which is unrelated to the U.S. drug company, Merck & Co.

The German company has licensed Erbitux from ImClone for marketing outside of the U.S. and Canada. In late June, it asked the European Union and medical regulators in Switzerland to approve the drug for treating colon cancer patients.