Feb. 2 (Bloomberg) -- Texas became the first state to mandate use of Merck & Co.'s cervical cancer vaccine as Governor Rick Perry signed an order today requiring school-age girls to get the shot, ensuring higher sales.

Starting in 2008, Texas girls ages 11 and 12 will be required to have the vaccine before entering sixth grade. The shots will cost the state $50 million the first year. Merck's product, Gardasil, won U.S. approval in 2005 as the first vaccine to prevent infection with the human papillomavirus, or HPV, which causes cervical cancer.

Merck started a campaign to raise awareness of the vaccine among state lawmakers even before approval last year and encouraged them to require it for children. The vaccine is Merck's most important new product, capable of generating as much as $3 billion in annual sales, analysts said. Revenue from Gardasil in the fourth quarter reached $155 million.

``Our efforts for Gardasil vary state by state, and all efforts are providing information on Gardasil,'' said a Merck spokesman, Raymond Kerins, in an interview. ``We support any state mechanism, including school requirements, to ensure high immunization rates are achieved through broad access.''

The Texas order allows parents to opt out of the mandatory vaccinations ``for reasons of conscience, including religious beliefs.'' The order directs the state health agency to provide opt-out request forms on line.

Serious Side Effects

A group called the National Vaccine Information Center said yesterday that its analysis of reports to U.S. regulators found cases of serious side effects to Gardasil. One was Guillain-Barre Syndrome, a disorder in which the body's immune system attacks part of the nervous system.

Kerins said that no cases of Guillain-Barre Syndrome were seen in Merck's research program of more than 25,000 individuals.

Shares of Merck, based in Whitehouse Station, New Jersey, fell 40 cents, or less than a percent, to $44.73 at the close of New York Stock Exchange composite trading, after earlier dropping as much as 2.7 percent. The stock has gained 32 percent in the past 12 months, the best return among the 14 members of the Standard & Poor's 500 Pharmaceutical Index.

A spokeswoman at the FDA, Heidi Rebello, said the reports of possible side effects must be analyzed to determine whether they were caused by the vaccine. She said the reports are unconfirmed and can be filed by any doctor, patient or consumer.

Lawmakers are considering similar requirements in at least 20 other states, including Michigan, California, Oklahoma and New Jersey, according to Women in Government, a Washington-based organization that has campaigned for state laws to mandate the vaccine.

In Texas, state health officials will start making the vaccine immediately available to females ages 9 to 18.

To contact the reporter on this story: Angela Zimm in Boston azimm@bloomberg.net; Darrell Preston in Dallas at dpreston@bloomberg.net.

Last Updated: February 2, 2007 20:43 EST