Xgeva and a related osteoporosis drug Prolia are seen as among the most important growth drivers for Amgen and may help offset declining sales of anemia drugs, analysts say.

The Food and Drug Administration (FDA) has determined that the risks outweigh the effect of the proposed application and has asked for data from adequate and well-controlled trials, Amgen said.

Xgeva is already approved to prevent fractures in patients with advanced prostate cancer that has migrated to the bone. Amgen is seeking additional approval for use to postpone or prevent the cancer's spread.

The FDA rejected the expanded use of the injectable drug, known chemically as denosumab, after an advisory panel voted against it because of its links to a jawbone-destroying condition.

"We will work with FDA to determine any next steps," said Sean Harper, executive vice president of research and development at Amgen.

The FDA's action does not impact the approved indication of Xgeva in the prevention of fractures in men suffering from advanced prostate cancer, Harper said.

In the first quarter of 2012, sales of Xgeva rose 14 percent from the prior quarter to $153 million, and it is expected to eventually become a $1 billion-a-year drug.

The company said the new use for Xgeva would be targeted at about 50,000 men in the United States in the advanced stage of prostate cancer.

Amgen said it was also testing Xgeva in other cancers, including breast and lung cancer.

Shares of Amgen closed up 0.85 percent at $70.79 on Nasdaq.

(Reporting by Anna Yukhananov and Sakthi Prasad; Editing by Ryan Woo)

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