Warning Issued on Cancer Medicine

Genentech Inc.’s colon cancer drug Avastin can increase the risk of blood clots, heart attacks and strokes, the company and the Food and Drug Administration disclosed Friday. Genentech’s shares fell 6% on the news.

Avastin went on sale in February, becoming the first drug to treat tumors by shrinking the blood vessels that feed them. The drug is important to Genentech’s growth, so bad news about Avastin rattles investors.

Genentech said in a letter to doctors last month that colon cancer patients who took Avastin with chemotherapy had double the risk of arterial blood clots than patients on chemotherapy alone. Clots in the arteries can cause heart attacks or strokes.

Up to 5% of patients on Avastin in clinical trials developed clots, Genentech said in its letter. Patients over 65 with a history of blood clots face added risk, Genentech warned.

The FDA posted Genentech’s letter on its website Friday.

The warning is unlikely to slow Avastin sales, doctors and analysts said. They said many of the patients who use the intravenous drug are seriously ill and have few other treatment options.

“These patients have incurable cancer. With that in mind, these risks don’t assume that big of a proportion,” said Fairooz Kabbinavar, a researcher at UCLA’s Jonsson Cancer Center who has worked with Avastin for about a decade. “The risks are important to keep in mind, but there are ways to minimize the risks,” he said.

Kabbinavar said he expected that doctors would use blood-thinning drugs or anti-clotting agents to reduce the risks of clots with Avastin. The warning would probably not hamper the use of Avastin in earlier stages of colon cancer, he said.

“These types of letters are very common for new drugs,” Eric Ende of Merrill Lynch said in a research note. “We do not believe the letter will have an impact on Avastin.”

Matt Geller of CIBC World Markets said in a note that the warning would have “little impact on Avastin sales” and that the selloff of Genentech shares was “overdone.”

Genentech first raised the issue in a conference call with analysts in July when it said it noticed a higher rate of stroke and heart attacks in patients taking Avastin than in patients not taking it.

The company added that it was unclear whether the complications were caused by the drug and that the FDA was reviewing the data.

The warning letter posted by the FDA was the first disclosure that there is evidence of a link between Avastin and blood clots in arteries, which lead to heart attacks and strokes.

Genentech shares fell as low as $43 in New York Stock Exchange trading Friday, before recovering to close at $44.23, off $2.88. The company, based in South San Francisco, is the nation’s second-largest biotechnology firm after Amgen Inc.

Colon cancer is the second-leading cause of cancer death next to lung cancer, and 148,000 cases are diagnosed in the U.S. each year. Avastin, which costs $4,400 a month, is used as a first treatment for patients whose colon cancer has spread to other organs.

In a large clinical trial last year, Avastin in combination with chemotherapy added five months to the lives of colon cancer patients when compared with patients on chemotherapy alone.

Wall Street expects Avastin sales of $500 million this year and believes that it may one day have sales of $2 billion.