Onyx Wins Backing of FDA Advisory Panel for Cancer Drug

Onyx Pharmaceuticals Inc. (ONXX) (ONXX) rose as
much as 40 percent in early trading after winning support from
a U.S. advisory panel for its drug to treat a deadly blood
cancer that affects 50,000 Americans.

Onyx jumped to $62.15 at 7:34 a.m. New York time, after
gaining 29 percent in the 12 months before today. Ligand
Pharmaceuticals Inc. (LGND) (LGND), which has an agreement with Onyx to
explore an IV version of the medicine, increased 6.5 percent to
$15.49 in early trading.

Food and Drug Administration advisers voted 11 to 0, with
one abstention, that the benefits of Onyx's multiple myeloma
treatment, called carfilzomib, outweigh its risks. If approved
by the agency, annual sales may be $523 million (ONXX) in 2016,
according to the average of five analysts' estimates compiled by
Bloomberg, more than doubling the South San Francisco-based
company's $447 million revenue (ONXX) last year.

"This is an unmet need in a group that has really run out
of options," said Wyndham Wilson, the panel chairman and chief
of lymphoma therapeutics at the National Cancer Institute.
"There is a pretty convincing signal here that is likely, I
believe, to be confirmed in confirmatory trials."

The agency, scheduled to make a decision by July 27, isn't
required to follow the recommendation of the panel, which met
yesterday in Silver Spring, Maryland. Onyx applied for
accelerated approval of the treatment based on the second of
three phases of trials typically needed for market clearance.

Tumors Shrunk

The medicine, with the proposed name Kyprolis, shrunk
tumors in 22 percent of multiple myeloma patients, which may not
offer enough of an advantage in light of the side effects, FDA
staff said in a June 18 report.

Five patients died from heart ailments, the agency said. If
approved, annual sales for the drug may be $523 million (ONXX) in 2016,
according to the average of five analysts' estimates compiled by
Bloomberg, more than doubling Onyx's $447 million revenue (ONXX) last
year.

"This is an incredibly important step in the company's
growth trajectory," Michael King, an analyst with Rodman
Renshaw in New York, said in an e-mail. "This is a much better
drug than the Street has been giving them credit for."

The panel's recommendation, "is an important regulatory
milestone," Ted Love, executive vice president of research and
development at Onyx, said yesterday in a statement. "Onyx is
committed to bringing Kyprolis to patients as quickly as
possible and looks forward to working closely with the FDA as
the agency completes its review."

Side Effects

Side effects for the treatment included cardiac arrest,
chest pain, pneumonia and shortness of breath, the FDA staff
said. More than 70 percent of patients had lung complications
with the drug, according to the FDA report.

Carfilzomib would be used to treat multiple myeloma
patients who have first tried Celgene Corp. (CELG) (CELG)'s Revlimid and
Takeda Pharmaceutical Co. Ltd. (4502)'s Velcade.

About 50,000 people in the U.S. are living with the disease
and 20,000 new cases are diagnosed each year. About 11,000
patients die of the blood cancer annually, according to the
National Cancer Institute.

Ligand, a drugmaker based in La Jolla, California, had
gained 37 percent in the 12 months before today.

To contact the reporters on this story:
Anna Edney in Washington at
aedney@bloomberg.net;
Ryan Flinn in San Francisco at
rflinn@bloomberg.net

To contact the editor responsible for this story:
Reg Gale at
rgale5@bloomberg.net