Germany’s Merck KGaA has scored another thumbs up in Europe for its cancer drug Erbitux (cetuximab), which has just been cleared by the European Commission for use in treating head and neck cancer.

Specifically, the drug will be made available in all 25 member states of the European Union, as well as in Iceland and Norway, for treating patients with locally advanced squamous cell carcinoma of the head and neck, in combination with radiotherapy, as a first line therapy. This latest decision follows recent approvals by the US Food and Drug Administration last month and in Switzerland in December 2005.

And the news looks set to create a nice boost to Merck’s coffers, with Erbitux already proving to be one of the company’s star offerings, reeling in almost $250 million dollars last year for its first indication of colorectal cancer. And this focus on Erbitux as a driver of success will likely intensify after Merck’s failed bid to acquire fellow German company Schering AG recently; it is also under investigation as part of a combination therapy for first-line recurrent and advanced head and neck cancer, which has recruited 440 patients, non-small cell lung cancer, and advanced colorectal cancer and is believed to have peak sales expectations of around $1 billion.

The approval was based on a late-stage study in which median survival improved by nearly 20 months, whereas time to disease progression beyond the head and neck improved by 9.5 months. Every year in Europe, around 100,800 people are diagnosed with head and neck cancer and almost 40,000 die from the disease. Head and neck cancer is the sixth-most frequently occurring cancer worldwide and includes cancers of the tongue, mouth, and salivary glands.

Merck licensed the right to sell Erbitux outside North America in 1998 from the once-embattled biotechnology ImClone Systems, which partners Erbitux in these markets with Bristol-Myers Squibb. ImClone too had some good news yesterday in the shape of a $250 million milestone payment from B-MS in relation to the US approval of Erbitux in head and neck cancer. Total milestone payments to date amount to some $900 million.