* FDA advisers vote 7-0 in favor of Bepreve * Agency usually approves drugs with panel backing * Ista shares jump as much as 30 percent * Panel rejects River Plate, Alcon dry eye drug (Adds analyst comment) By Lisa Richwine SILVER SPRING, Md., June 26 (Reuters) - Ophthalmic drug maker Ista Pharmaceuticals Inc <ISTA.O> won unanimous support from a U.S. advisory panel on Friday for new drops to treat itchiness in the eye caused by allergies. The committee rejected a second drug developed by privately held River Plate Biotechnology for treating dry eye. Alcon Inc <ACL.N> holds U.S. marketing rights to that medicine. Ista shares jumped as much as 30 percent after the positive recommendation for its Bepreve eye drops, hitting a 17-month high of $5.53 before giving back most of the gains. The panel of Food and Drug Administration advisers voted 7-0 that Ista had adequately demonstrated the safety and effectiveness of Bepreve, which would be sold by prescription if the agency granted final approval. Studies by Ista "all deliver the same message and that's in support of safety and effectiveness," said panel member Philip Lavin, executive chairman of Averion International Corp, a clinical research organization. The FDA usually approves drugs recommended by advisory panels, which are groups of outside doctors and other scientific experts. A final decision on Bepreve is due by Sept. 12, although the FDA has missed several target dates over the past year. SunTrust Robinson Humphrey analyst Frank Pinkerton has forecast Bepreve sales of $12 million in 2010 if the drug won approval for U.S. sales. Ista's net revenue for 2008 was $83 million with a net loss of nearly $31 million. The company sells the eye drugs Xibrom, Vitrase and Istalol and predicts its operating income will roughly break even in 2009. Several medicines are approved for treating allergies, but Ista said there was a need for new options with fewer side effects. Approved drugs may cause sleepiness, dry mouth and other problems. The most frequent side effect seen in studies of Bepreve was changes in taste, such as a bitter taste or aftertaste reported by 25 percent of patients treated with the drug in one study. Ista officials said cases were mild and transient and the drug was safe in people as young as 3. Ista said in a statement: "We believe people who suffer from itchy eyes due to allergies will be pleased to have access to a new therapeutic option" should the drug be cleared for sale. On River Plate's drug, the FDA panel voted 6-1 that the company did not adequately demonstrate the safety and effectiveness of Rejena, a proposed treatment for dry eye. FDA reviewers said River Plate's application contained major statistical issues surrounding the data on effectiveness, and panel members said findings from two separate studies were not convincing. "I found the first study to be invalid and in the second the design was flawed," said panel member Susan MacDonald, an assistant professor at Tufts University School of Medicine. River Plate officials had told the panel the overall data showed Rejena was effective at treating the symptoms of dry eye, which afflicts about 5 million patients in the United States. The drug is widely sold in other countries, the company said. Collins Stewart analyst Louise Chen, in a research note, said expectations for Rejena were "modest" and the panel decision "does not change our view that (Alcon) is a global leader in ophthalmology, and a high quality company with good long-term growth prospects." She has a "buy" rating on the stock. Ista shares were halted during the panel meeting. When trading resumed after the decision, the stock rose as high as $5.53 before ending up 43 cents, or 10.14 percent, at $4.67 on Nasdaq. Alcon rose 0.62 percent to $116.44 on the New York Stock Exchange. (Reporting by Lisa Richwine; editing by Gerald E. McCormick, Lisa Von Ahn and Richard Chang)
