The drug, larotrectinib, will be sold under the brand name Vitrakvi in partnership with Bayer AG.
The mutation, known as TRK fusion, occurs in no more than 3,000 Americans each year, or less than 1 percent of patients with solid tumor cancers, according to Bayer.
Vitrakvi, which will be Loxo's first commercial medicine, was approved for adults and pediatric patients with the gene mutation who have advanced solid tumor cancers that has progressed after other treatments, according to the drug's label on the FDA website.
In a 122-patient clinical trial, larotrectinib was shown to significantly reduce tumors in 81 percent of those with 24 different types of cancer, including lung, pancreatic, breast, thyroid, colon and soft tissue sarcomas. Researchers also reported an extremely mild side effect profile for the medicine.
Currently, most cancer patients are not routinely tested for tumor mutations, making it difficult to find those who will benefit from the drug, although Bayer is talking with payers about expanding testing, said Kevin O'Leary, vice president of pricing and contracting at Bayer.
Oppenheimer has forecast annual larotrectinib sales of more than $1 billion by 2024.
The FDA approval marks the latest success in efforts to treat tumors based on their molecular signature rather than their origin in the body.
Merck & Co's Keytruda last year became the first cancer drug to win approval for a tumor-agnostic use, although that remains a small market for the big-selling drug.
Loxo is also developing a drug, LOXO-292, that targets another rare gene fusion mutation known as RET, seen in thyroid, lung and other cancers. And Loxo and Bayer have a follow-up TRK drug in development known as LOXO-195.
Similar drugs being developed by Roche and others are expected to fuel increased demand for advanced genetic testing of tumors in order to identify the patients likely to benefit from the treatments.
The U.S. government earlier this year said the Medicare program for Americans aged 65 and older will cover so-called next generation sequencing, which looks for hundreds of mutations across all solid tumors, for advanced cancer patients.
(Reporting By Deena Beasley Editing by Bill Berkrot)
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)