Sept. 5 (Bloomberg) -- Merck & Co.'s Isentress, a novel drug against HIV, should be approved for patients who have developed resistance to other AIDS medicines, a U.S. advisory panel said.

Merck's studies show Isentress reduces levels of human immunodeficiency virus, or HIV, in the blood of patients when other AIDS drugs are no longer effective, the advisers to the U.S. Food and Drug Administration said today. The panel voted unanimously to recommend that the agency give accelerated approval to the pill for use in combination with other HIV medicines.

Isentress, Merck's first HIV therapy since 1999, may generate more than $1 billion in annual sales, according to Mario Corso, an analyst with Summer Street Research Partners in Boston. As many as 40,000 people with AIDS in the U.S. have limited options for treatment because of drug-resistant HIV, and about three-quarters of patients worldwide have hard-to-treat strains.

``There's no doubt this is a great drug,'' said panel member Peter Havens, a professor of pediatrics at Medical College of Wisconsin, who voted to recommend approval. ``It is very useful for patients who have experienced a lot of failure.''

Under the accelerated, six-month review, the FDA is due to decide on approval by mid-October. Merck filed its Isentress application in April, according to company spokeswoman Amy Rose.

Merck, based in Whitehouse Station, New Jersey, fell 64 cents, or 1.3 percent, to $49.40 at 4:02 p.m. in New York Stock Exchange composite trading and has gained 13 percent this year.

The FDA usually follows the recommendations of its advisory panels, although it isn't required to do so. The panel met today in Silver Spring, Maryland.

Blocks HIV Process

Isentress, the first in a new class of AIDS drugs, blocks the process that the HIV virus uses to insert its genetic material into human DNA, allowing replication. The drug targets an enzyme called integrase that HIV uses to accomplish the task. Studies have shown the medicine helps patients with resistant strains of HIV when used in combination with other drugs.

Merck's studies found that Isentress reduced the virus to less than the point of detection after four months in 61 to 62 percent of patients getting the medicine in combination with other anti-HIV drugs. That compares with 33 to 36 percent of those who got a placebo along with their most effective therapies.

Successful treatment reduces levels of the virus to less than 50 copies per milliliter of blood, which is considered undetectable. The patients came into the studies with at least 1,000 copies per milliliter.

An AIDS Activist

Matt Sharp, an activist who has had AIDS for almost 20 years, said he developed resistance to his anti-HIV regimen and was helped by Isentress, also known as raltegravir, after joining a study.

``I tried everything available and paid the price with a multi-drug-resistant virus,'' Sharp, of the AIDS Treatment Activist Coalition, told the advisory panel. ``My case shows that raltegravir, especially used with at least one other retroviral drug, will save lives.''

In a safety analysis, FDA reviewers found patients taking Isentress had more rashes than did those on a placebo. Side effects also included diarrhea, nausea and headache. Rates of elevated liver enzymes, generally a sign of liver damage, were similar in Isentress and placebo patients. Although more patients taking Isentress developed cancers, the drug didn't appear to pose an increased risk, according to the reviewers.

Merck has proposed a plan to manage the drug's risks, which would include a program to monitor for drug resistance and cancers, a pregnancy registry and additional clinical trials.

AIDS Cocktails

Thirty AIDS treatments are approved in the U.S., according to the FDA. AIDS patients take so-called cocktails of anti-HIV drugs each day, typically three or more medicines. The drugs can't cure HIV, and people with the infections still have the virus in their bodies. Eventually, HIV develops resistance to drugs. Once a drug fails, the combination loses effectiveness.

All HIV drugs are designed to interfere with a part of the HIV life cycle of infection and replication. HIV attacks and destroys white blood cells, which the immune system uses to fend off invasions from viruses and bacteria.

Glaxo, Pfizer, Gilead, Roche

Besides integrase, HIV employs two other enzymes in replicating and infecting healthy cells. GlaxoSmithKline's Lexiva and Pfizer Inc.'s Viracept interfere with the action of the protease enzyme, while drugs such as Gilead's Viread inactivate another viral enzyme, reverse transcriptase.

A third class of medications, called entry inhibitors, works by blocking HIV from entering target white cells. These drugs include Roche Holding AG and Trimeris Inc.'s Fuzeon, which reached the market in 2003

Last month, Pfizer, the world's biggest drugmaker, won FDA approval for Selzentry, the first HIV drug to block the CCR5 receptor, a chemical portal on immune system cells used by the virus.

Merck sold the U.S. rights to its previous AIDS drug, Strocrin, to Bristol-Myers Squibb Co., which markets it under the name Sustiva. Merck continues to market Stocrin outside the U.S. and sells another older AIDS drug, Crixivan. The company is testing a vaccine against HIV that is in the second of three stages of human tests generally required for regulatory approval.

To contact the reporters on this story: Angela Zimm in Silver Spring, Maryland azimm@bloomberg.net; Elizabeth Lopatto in Silver Spring, Maryland at elopatto@bloomberg.net

Last Updated: September 5, 2007 16:32 EDT