ImClone Systems ( IMCL) shares gained Thursday after its Erbitux cancer drug won approval by a European regulatory advisory committee.

ImClone said its European distribution partner, Germany's Merck KGaA, received notification from the scientific advisory body of the European Agency for the Evaluation of Medicinal Products that the data submitted were comprehensive enough for it to "recommend full approval of Erbitux with no specific post-approval obligations."

In February, ImClone and U.S. partner Bristol-Myers Squibb ( BMY) received long-awaited approval from the Food and Drug Administration to sell the colorectal cancer drug. It had previously been approved by Swiss regulators.

Merck said the panel's recommendation will be forwarded to the European Commission and "marks a positive step towards European approval of Erbitux, which is anticipated in mid-2004."

Erbitux's FDA approval process has a storied past. The company's former co-founder and CEO, Samuel Waksal, is now serving a prison sentence for trying to dump ImClone shares in 2001, ahead of the announcement of an unfavorable FDA ruling on the drug. Home-fashion diva Martha Stewart, a friend of Waksal and founder of Martha Stewart Living ( MSO), was recently convicted on obstruction of justice and other charges relating to the circumstances under which she sold shares of ImClone shares around the same time.

Billionaire financier Carl Ichan recently disclosed in an SEC filing that he had accumulated a 6.9% stake in ImClone.

ImClone shares rose $1.10, or 2.5%, to $45.85.

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