ImClone Systems Inc. Thursday won U.S. approval to sell cancer treatment Erbitux, the drug at the center of an insider-trading scandal that landed the company’s founder in jail and put Martha Stewart on trial.
The Food and Drug Administration said it had approved Erbitux for treating patients with advanced colon cancer that has spread to other parts of the body.
Erbitux is the first commercial product for ImClone, whose image and share price were battered by a regulatory setback late in 2001 that led founder and former Chief Executive Sam Waksal to attempt to dump ImClone shares before the bad news was announced.
Bristol-Myers Squibb has rights to co-market the drug in the United States.
Shares of New York-based ImClone fell 23 percent before the FDA announcement and were halted on the Nasdaq stock market. Bristol-Myers shares gained 2.4 percent after the Erbitux news to $30.75 on the New York Stock Exchange.
Erbitux is ImClone’s first drug to win U.S. marketing approval. It was cleared for use with another cancer drug, irinotecan, or alone if patients cannot tolerate irinotecan, the FDA said.
When used in combination with chemotherapy, Erbitux shrank tumors in 23 percent of colon cancer patients who had exhausted all other options, according to a clinical trial by ImClone’s European marketing partner, Merck KGaA.
Erbitux fights cancer by blocking a protein called epidermal growth factor that helps cancer cells multiply.
The drug can cause serious side-effects that may include difficulty breathing and low blood pressure, the FDA said. Infrequent cases of interstitial lung disease, or ILD, were reported in Erbitux patients, “however it is difficult to determine if Erbitux caused ILD,” the agency said.
ImClone had sought U.S. approval for Erbitux in 2001, but the FDA refused to accept that application, calling the company’s main study sloppy.
That surprising setback led to the conviction of Waksal, ImClone’s chief executive at the time, for insider trading, as well as securities fraud charges against home decorating maven Martha Stewart. Stewart has pleaded not guilty.