Immune system cancer drugs tipped to be a $35 bln market

* Potential sales of $35 bln a year over next 10 years -Citigroup

* Immunotherapy may be used in up to 60 percent of cancers

* Bristol-Myers Squibb and Roche both upgraded to "buy"

By Ben Hirschler

LONDON, May 22 (Reuters) - A new wave of medicines that tapthe power of the immune system to fight cancer could become thebiggest drug class in history, with potential sales of $35billion a year.

That bullish sales forecast by analysts at U.S. bankCitigroup highlights the growing excitement surroundingso-called immunotherapy after positive results from clinicaltrials conducted by companies such as Bristol-Myers Squibb and Roche Holding.

"We believe this market will generate sales of up to $35billion (a year) over the next 10 years and be used in some wayin the management of up to 60 percent of all cancers," Citianalyst Andrew Baum said on Wednesday.

Citi's forecast is considerably higher than current marketconsensus, but if it proves correct, then cancer immunotherapywould exceed the peak market value of top blockbuster drugclasses such as statins for high cholesterol.

After years of puzzling over how to get the body's immunesystem to respond more effectively against tumour cells,scientists are now finding a number of promising avenues.

The new drugs are designed to target areas that act asbrakes on the immune system. By interfering with these brakes,the drugs free the immune system to attack and kill cancercells.

Bristol-Myers Squibb's nivolumab and Roche's MPDL3280A aretwo leading contenders in the field. Both had an impressiveeffect against a variety of cancers, according to preliminarytrial results released last week.

Further details of the studies will be presented at ameeting of the American Society of Clinical Oncology in Chicagoearly next month.

MANAGEABLE CANCER

Conventional chemotherapy and other cancer drugs often havea powerful effect in shrinking tumours, but the effect istypically short-lived. The effect of immunotherapy can last muchlonger because the immune system has effectively been reset toremember how to keep fighting cancer cells.

Citigroup said that immunotherapy has the potential totransform a significant percentage of cancers into somethingakin to a chronic disease, in a similar way to how HIV drugshave made the viral disease a manageable condition.

On the back of its upbeat prediction for the immunotherapymarket, Citigroup has upgraded shares in Bristol-Myers Squibband Roche to "buy" from "neutral".

Roche stock was trading 1.7 percent higher by 0914 GMT,outperforming a flat European drugs sector.

Other leading players with a range of drugs, vaccines andcell therapy treatments in the cancer immunotherapy fieldinclude GlaxoSmithKline, AstraZeneca, Novartis, Merck & Co and Amgen.

In addition to the progress being made in research, analystsbelieve that the immunotherapy field could also benefit from anew U.S. Food and Drug Administration initiative to speedapproval of important and innovative drugs.

The U.S. watchdog recently started a scheme to allow quickerstudies of life-saving therapies designated as a "breakthrough",provided that clinical data is compelling. (Editing by David Goodman)