Shares in Eli Lilly & Co.(NYSE:LLY) rose more than 4 percent on Monday and added further 1.50% to $53.30 this morning after the company said that trials on a drug for treating stomach cancer had met the goals of improved patient survival and progression-free survival in a late-stage study that compared it to a dummy treatment.
The company said in a statement that the most common side effects for the medicine, ramucirumab, were high blood pressure, diarrhoea and headache.
The drug was tested in patients with gastric cancer that had spread to other parts of the body.
Gastric cancer affects the stomach lining and often goes undetected while developing slowly, Lilly said. Gastroesophageal junction cancer forms where the oesophagus connects to the stomach.
According to Leerink Swann analyst Seamus Fernandez who has upgraded the stock to Buy from Hold, the drug has an 80 percent chance of approval as a second line of treatment. The drug is in the final stage of testing for regulatory approval by the US FDA.
The drug has the potential to generate revenues of $600 million.
Shares in Eli Lilly rose 4.12 percent to close at $52.53. The shares have risen 37 percent in the past one year. Moreover, this morning the stock made a new high at $53.88.
The company said it planned the release details of the study at an upcoming scientific meeting. It is also studying the drug in combination with "the chemotherapy drug paclitaxel in a separate, late-stage trial. It also is examining the drug in late-stage testing as a potential treatment for breast, colorectal and lung cancers."