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Updated from 11:07 a.m. EDT

The Food and Drug Administration has issued a mixed review of


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experimental cancer drug Iressa, one day ahead of an important advisory panel meeting convening to discuss the drug's merits for lung cancer patients.

In a staff report released on the agency's web site Monday morning, the FDA did not make a final recommendation on Iressa's approval. While acknowledging that Iressa demonstrates "hints of drug activity," the regulatory agency raises questions about the design of the clinical studies designed to test the drug. These deficiencies make it more difficult to assess the true clinical benefit of the drug, according to the FDA.

AstraZeneca is seeking FDA approval of Iressa as a new treatment for patients with advanced lung cancer who have run out of all other medical options.

Last May, AstraZeneca released

test results that showed Iressa was effective in shrinking tumors in just under 11% of patients with advanced lung cancer, while 36% of patients showed an improvement in their lung cancer symptoms. These results backed up similar positive results from an international study of Iressa conducted earlier last year. These two studies formed the basis of AstraZeneca's FDA approval application for Iressa.

The FDA review team, however, raises questions about these results. "While there are hints of drug activity -- i.e., an objective response rate of 10.8% in the third-line treatment setting -- the absence of a non-

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Iressa treated control group makes it difficult to evaluate these results," the review states.

In other words, the FDA is concerned that AstraZeneca did not conduct a controlled study, which would have provided stronger evidence of Iressa's ability to shrink tumors in a meaningful way.

A big part of AstraZeneca's case for Iressa approval also relies heavily on the drug's ability to improve patients' quality of life. But again, the FDA staff raises concerns.

"There are fundamental study design issues with the sponsor's quality of life improvement and symptom benefit analyses, including absence of a suitable control group, absence of blinding as all patients received

Iressa, dropout of patients with early disease progression and meaningfulness of the criteria used to designate benefit," states the review.

In August, AstraZeneca reported

disappointing results in two subsequent Iressa clinical trials, known as the INTACT studies. These studies showed that Iressa, when given with standard chemotherapy, failed to improve the survival rate of patients with less-advanced lung cancer.

These poor results, while in a different population of lung cancer patient, could stop the agency from approving Iressa based on an accelerated timeline. AstraZeneca was hoping to get the FDA to rule on Iressa by the end of the year, but in its review, the agency seems to suggest that such a timeline may be in jeopardy, and that it will seek the opinion of the members of Tuesday's advisory panel meeting before making a decision.

"These results raise a question regarding accelerated approval of Iressa," the FDA review states. "Accelerated approval regulations require additional studies that demonstrate clinical benefit. Can FDA consider accelerated approval when it has already been demonstrated in the INTACT trials that there is no survival advantage?

Shares of AstraZeneca were down 50 cents, or 1.7%, to $29.05 in recent trading.