Loxo Oncology (LOXO) - Get Report received clearance from the U.S. Food and Drug Administration for a plan that could lead to the accelerated approval of its precision cancer pill larotrectinib based on a novel clinical trial enrolling patients with a specific genetic mutation and not the anatomical location of tumors, the company announced Monday.

The Loxo phase II "basket" study of larotrectinib (previously known as LOXO-101) is expected to complete patient enrollment in early 2017 and report results in the second half of the year.

If the study is successful, Loxo intends to file for approval of larotrectinib at the end of 2017 or early in 2018, the company said Monday.

Larotrectinib targets a mutation known as TRK gene fusions found in a cluster of different anatomically identified cancers. Patients are eligible for enrollment into Loxo's study as long as they have a solid tumor that harbors a TRK gene fusion.

All the patients, who are no longer responding to currently available therapies, are being treated with larotrectinib and followed for tumor shrinkage and duration of response.

On Sunday, Loxo presented updated results from a phase I study of larotrectinib at a cancer meeting in Singapore. Eight patients with cancer containing TRK fusions have been enrolled and treated with larotrectinib to date. Six of the patients achieved a confirmed partial response with no progression to date. The duration of responses in these patients range from 11 months to 22 months, all ongoing.

A seventh patient had a minor tumor response to larotrectinib that did not meet the criteria necessary for partial response. The eighth patient treated has not been followed long enough to assess efficacy, the company said.

The phase I study also enrolled patients with tumors that did not harbor TRK gene fusions, and as expected, none responded to larotrectinib.

The most common adverse events attributable to larotrectinib in the phase I study have been fatigue, dizziness, anemia and shortness of breath.

Results from the phase I study of larotrectinib were last presented in April.

One of the jobs of a gene known as NTRK is to produce a TRK protein which help regulate neurons. But in rare instances, a part of the NTRK gene snaps off and becomes fused with another gene. The resulting fused gene produces a malfunctioning TRK fusion protein that acts like an on switch for cancer cells.

Larotrectinib, developed originally by chemists working for Array Biopharma (ARRY) - Get Report , blocks the "on" signal made by the mutated TRK fusion protein.

At Friday's close of $26.91, Loxo had a market cap of $583 million. The stock is down 5% for the year compared to a 20% loss for the Nasdaq Biotechnology Index.

Ignyta (RXDX) is also developing a cancer drug that targets TRK gene fusions.

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