NEW YORK (AP) -- Shares of drugmaker Bristol-Myers Squibb climbed Monday after the company reported positive results from an early-stage study of its cancer drug nivolumab.
THE SPARK: Bristol-Myers Squibb said 42 percent of lung cancer patients treated with nivolumab were alive after one year, and 24 percent of patients were alive after two years. The analysis was based on 129 patients with non-small cell lung cancer. All of them had received at least one other drug regimen before the trial, and most of them had tried three or more different treatments.
THE BIG PICTURE: Bristol-Myers Squibb Co. is studying nivolumab as a treatment for several different types of cancer. The drug is designed to allow the immune system to attack tumors by blocking a method that cancer cells exploit to hide themselves, shielding tumors from immune responses.
In April, Bristol-Myers said the FDA granted nivolumab a fast-track designation as a treatment for lung cancer, renal cell carcinoma and advanced melanoma. Fast-track status gives companies extra meetings and correspondence with regulators throughout the review process, and it allows the company to submit data as it compiles it.
The Princeton, N.J., reported its third-quarter results on Wednesday. Its overseas sales are growing, but U.S. revenue is suffering from generic competition to drugs like its blood thinner Plavix and blood pressure drugs Avapro and Avalide. Those products once brought in billions in annual revenue. Bristol-Myers' current top seller is the antipsychotic drug Abilify, and it said sales of three cancer drugs climbed during the third quarter. Revenue from Yervoy, Erbitux and Sprycel rose by a combined 20 percent to $737 million.
THE ANALYSIS: Citi Investment Research analyst Andrew Baum said Bristol-Myers and Roche are his top choices among drug companies working on immune therapies. He maintained a "Buy" rating with a price target of $55 per share.
Earlier this year Baum said he expects the FDA to approve nivolumab in late 2014.
SHARE ACTION: Shares of Bristol-Myers Squibb rose $3.02, or 6.2 percent, to $51.79 in afternoon trading. The shares are trading at their highest prices in more than a decade and have advanced more than 50 percent in 2013.