Asian shares edge higher, yen falls on Bank of Japan report

TOKYO (Reuters) - Asian shares edged higher on Monday but prices were capped by uncertainty facing the global economy after a private survey showed Chinese manufacturing activity retreated from two-year highs this month.

China's HSBC flash purchasing managers' index (PMI) for February slipped to a four-month low of 50.4 and down from January's final reading of 52.3, which had been the best performance since January 2011. But the PMI on Monday showed a fourth consecutive month of expansion, confirming that the world's No. 2 economy is recovering, albeit slowly.

Investors remain wary of fragility in the global economic recovery, having pushed markets broadly higher over the past few months on receding pessimism over the euro zone's debt crisis and U.S. budget woes.

Markets are also pondering whether Italy's weekend elections will produce a stable government, and the implications of that for euro zone cohesion, while Moody's credit downgrade on Britain weighed on confidence in the pound.

Investors await testimony on Tuesday from Fed Chairman Ben Bernanke for further clues of when the Fed may slow or stop buying bonds. Financial markets were rattled last week after minutes of the Fed's January meeting suggested some Fed officials were mulling scaling back its strong monetary stimulus earlier than expected.

The MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> was up 0.1 percent, pulled higher by Australian shares <.axjo> which gained 0.6 percent on strong financials.

South Korean shares <.ks11> were nearly flat as the nation's first female president, who has shown willingness to talk down the won, was being inaugurated.

Korean carmakers came under pressure on news that an advocate of aggressive monetary easing was poised to head the Bank of Japan.

The Nikkei newspaper reported the Japanese government is likely to nominate Asian Development Bank President Haruhiko Kuroda and Kikuo Iwata, both vocal advocates of aggressive monetary expansion, as BOJ governor and deputy governor.

The Nikkei <.n225> jumped 2 percent to a 53-month high on Monday as the yen fell to fresh lows since May 2010 against the dollar.

Prime Minister Shinzo Abe on Friday vowed to get the world's third biggest economy growing again as he met with President Barack Obama. The United States and Japan also agreed on language during Abe's visit that could set the stage for Tokyo to soon join negotiations on a U.S.-led regional free trade agreement - the Trans-Pacific Partnership.

"The news of Kuroda (as BOJ nominee) appears to be taken positively by the market, but I think signs of progress towards TPP are vital as it shows Abe is taking leadership in pushing structural reforms, with the TPP being a vital tool to boosting growth," said Tetsuro Ii, the chief executive of Commons Asset Management.

Abe has called on a mix of strong reflationary policies: aggressive monetary easing, huge fiscal spending and pro-growth strategies. Investors have cheered the mix, dubbed "Abenomics," pushing the Nikkei up some 30 percent and the yen down 20 percent against the dollar over the past three months.

Early on Monday, the yen touched a low of 94.77 against the dollar, while the euro rose to a high of 124.83 yen, still off its 34-month peak of 127.71 set early this month.

The dollar fell sharply to below 93 yen last week on media reports that Toshiro Muto, a former financial bureaucrat perceived as less willing to take unconventional steps, was the frontrunner candidate for the top BOJ job.

"The dollar's move this morning is merely a rebound from disappointment on Muto last week. I don't think this topic will be enough to hoist the dollar above 95 yen," said Hiroshi Maeba, head of FX trading Japan at UBS in Tokyo. "No matter who is elected at the BOJ, it will not affect the longer-term trend of a weak yen," he said.

Speculation over the BOJ has been a key factor driving the yen lower recently due to anticipation of strong reflationary measures, but other fundamental factors such as Japan's deteriorating trade balances and signs of firmer U.S. growth also supported a weakening yen trend.

In the U.S., with five days left before $85 billion is slashed from U.S. government budgets, the White House issued more dire warnings about the harm the cuts will do to Americans, breaking down the loss of jobs and services to each of the states.

Wall Street ended up on Friday on strong earnings from Dow component Hewlett-Packard , but the benchmark Standard & Poor's Index <.spx> posted its first weekly decline of the year.

The euro steadied around $1.3190, off Friday's six-week low of $1.31445.

Sterling fell to a 31-month low of $1.5073 early on Monday and a record low against the New Zealand dollar at NZ$1.8025 following Friday's one-notch downgrade of Britain's prized triple-A sovereign rating by Moody's.

Hedge funds and other big speculators cut their bullish bets on U.S. commodities by the most in about 10 months in the week to February 19, just before oil and metals prices tumbled on rumors a commodities fund was dumping positions, data showed on Friday.

U.S. crude was down 0.1 percent to $93.07 a barrel and Brent fell 0.2 percent to $113.92.

(Editing by Eric Meijer)

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South Korea’s Park Geun-hye Warns North Against Nuclear Pursuits

SEOUL, South Korea — Park Geun-hye, the daughter of a late military strongman, was sworn in Monday as South Korea’s first female president, warning North Korea that the primary victim of its pursuit of nuclear weapons and long-range missiles will be the isolated country itself.

“North Korea’s recent nuclear test is a challenge to the survival and future of the Korean people, and there should be no mistake that the biggest victim will be none other than North Korea itself,” Ms. Park said in her inaugural address in front of the National Assembly building in Seoul.

She urged North Korea to abandon its nuclear ambitions without delay, “instead of wasting its resources on nuclear and missile development and continuing to turn its back to the world in self-imposed isolation.”

Her motorcade’s arrival Monday at the presidential Blue House marked a triumphant moment not just for Ms. Park but for her family. Ms. Park, 61, was returning to her childhood home, 34 years after the assassination of her father, Park Chung-hee, a divisive figure even now. Mr. Park’s 18-year rule was credited with rapidly raising South Korea’s economy from postwar devastation, but his iron-fisted governance was increasingly maligned as the country evolved toward democracy.

Ms. Park was elected in December thanks largely to the support of South Koreans in their 50s and older. Many younger voters were vehemently opposed to her candidacy, saying she represented a return to the past.

North Korea, meanwhile, has again become a prime national security concern. A week before Ms. Park’s election, the North launched a satellite into orbit in defiance of United Nations resolutions. On Feb. 12, it conducted a third nuclear test. The two events have heightened fears that years of efforts by Washington and its allies to rein in the North’s nuclear ambitions have failed, even as Pyongyang appears to have made progress toward achieving the capability to make long-range nuclear missiles.

Speaking Monday before a large crowd — which earlier had been entertained by the rapper Psy, famous for the song “Gangnam Style” — Ms. Park also addressed economic concerns, a major issue in the election. She said her tasks as president would include “achieving economic rejuvenation, the happiness of the people and the flourishing of our culture.”

In a comment reminiscent of her father, she called for a “second miracle on the Han River.” Seoul, which straddles the Han, began transforming itself into an industrialized metropolis under her father, who sought economic growth at all costs and nurtured a handful of family-controlled companies, such as Samsung and Hyundai, as the engines of an export-driven economy.

Now, as his daughter takes office, one of the biggest complaints among ordinary South Koreans is of widening economic inequality, particularly those conglomerates’ overpowering influence on smaller businesses — a grievance Mr. Park addressed in her speech, saying that a second Han River “miracle” should be based on “economic democratization.”

She promised policies designed to strengthen small and medium-sized enterprises so that “such businesses can prosper alongside large companies.” She said, “By rooting out various unfair practices and rectifying the misguided habits of the past which have frustrated small business owners and small and medium-sized enterprises, we will provide active support to ensure that everyone can live up to their fullest potential, regardless of where they work or what they do for a living.”

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Firefox takes on smartphone powers Apple, Google

SAN FRANCISCO (Reuters) – Mozilla, makers of the popular Firefox Internet browser, is preparing to challenge Google and Apple‘s grip on smartphone software.

A new Firefox operating system for mobile devices is set for a July release after winning the backing of 13 wireless service providers around the globe, including Spain’s Telefonica, China Unicom and America Movil.

Mozilla is betting there’s room for a software developer-friendly mobile platform alongside Apple’s and Google’s Android, which together power the majority of mobile devices on the planet.

The new software is based on open Web standards and is capable of operating on devices with much lower hardware requirements than today’s existing crop of smarpthones, according to Mozilla.

Because the Firefox OS is open-source and Web-based, third-party developers will be free to sell mobile applications without needing to share revenue with Apple or Google.

“There’s a strategic imperative for the industry to have another OS that really is open and supports choice and competition,” said Mozilla’s Senior Vice President of Products, Jay Sullivan.

Mozilla will showcase some of the first hardware devices based on that software at the Mobile World Congress, taking place in Barcelona this week. Among the brands that have signed on to make devices based on Firefox OS are South Korea’s LG, China’s ZTE and Huawei.

Unlike Google and Apple’s operating systems, which are built from proprietary technology, Firefox OS uses the HTML5 standard that Web services are built with. That means anyone familiar with Web programming can create Firefox OS apps.

Whether a smartphone built on Web standards can deliver the kind of performance that consumers expect remains to be seen. Facebook famously stopped using HTML5 to develop its iPhone app last year, with Chief Executive Mark Zuckerberg saying the technology couldn’t deliver acceptable quality and calling a decision to use HTML5 for its app one of Facebook’s “biggest mistakes.”

SIZE MATTERS

Mozilla, a non-profit organization, also faces stiff competition. Google’s Android software, which the company distributes free to phone vendors from Samsung to HTC, had roughly 70 percent share of the worldwide smartphone market in the fourth quarter, according to industry research firm Gartner. Apple, which created the smartphone market with the 2007 launch of the now-iconic iPhone, had a roughly 21 percent share of the market.

“The real barrier here is not necessarily a technical one, it’s scale,” said John Jackson, an analyst with research firm IDC. Mozilla will need to attract large numbers of consumers and app developers if it hopes to avoid the fate of previous mobile operating system hopefuls, such as Palm’s WebOS, now owned by Hewllet-Packard.

But “the world’s computing experiences are going mobile and when they get to the mobile environment, they’re happening on a platform that’s controlled by either Apple or Google,” said Jackson. “There’s a universe of content and service providers that have an interest in seeing a more neutral platform materialize.”

Mozilla will initially look to compete in so-called “emerging economies” in Latin America, Eastern Europe and Asia, where many people still use older phone models and have yet to upgrade to more expensive smartphones that feature touchscreens and high-speed Internet connections.

The first phones will be available this summer in Brazil, Columbia, Poland, Venezuela, Serbia and Spain.

The first Firefox OS phones that Telefonica will offer this summer come with a wholesale price of $ 100. The price that consumers pay for the phone will vary in different markets and depend on whether the phone is offered on a pre-paid basis or comes with a service contract, a Telefonica spokesman said.

Telefonica will eventually offer higher-end Firefox OS phones, and plans to offer Firefox devices in all 25 countries that it operates in by the end of 2014.

(Reporting By Alexei Oreskovic; Editing by Bernard Orr)

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Breaking Dawn - Part 2 Sweeps the Razzies

By Stephen M. Silverman

02/23/2013 at 10:00 PM EST

Taylor Lautner and Mackenzie Foy, in Breaking Dawn – Part 2

Andrew Cooper, SMPSP/Summit

Who's misérable now?

The Twilight Saga: Breaking Dawn – Part 2, Adam Sandler and Rihanna are among the "winners" of the 33rd annual Golden Raspberry Awards – the Razzies – which are not so much handed out as they are thrown at those who are voted as perpetrating Hollywood's worst achievements of the year.

Breaking Dawn – Part 2, the fifth and final installment in Stephenie Meyer's vampire saga, was recognized in seven categories, including worst picture.

The flick's Kristen Stewart was also cited as worst actress; Taylor Lautner, worst supporting actor; Lautner and 12-year-old Mackenzie Foy, worst screen couple; the entire cast, including Robert Pattinson, worst screen ensemble, and Bill Condon, worst director.

In addition, the film, which since opening last November has taken in more than $828 million at the box office, was named worst sequel.

Sandler, who last year monopolized the Razzies – and set a record by winning in 10 categories with the "comedy" Jack & Jill – this year got only two awards: for worst actor of the year and worst screenplay, both for That's My Boy.

Unlike the Oscars, which keep voting tallies a secret and will be handed out Sunday night during a very glamorous event, founder and Head RAZZberry John Wilson announced Razzie recipients Saturday night in the utilitarian Continental Breakfast Room of the Holiday Inn Express Hollywood Walk of Fame hotel, near (and yet so far from) the Dolby Theatre, home of the Academy Awards.

Wilson revealed to the press that although Rihanna, as worst supporting actress in the movie Battleship, won her Razzie by a landslide, worst screenwriter Sandler only beat the authors of Breaking Dawn by a single vote.

It's close shaves like that that really make or break the Razzies.

Adam Sandler, in That's My Boy, and Rihanna, in Battleship

Columbia; Universal

The 85th annual Academy Awards will air live on ABC starting at 7 p.m. ET/4 p.m. PT on Sunday, Feb. 24, from the Dolby Theatre in Hollywood.

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FDA approves new targeted breast cancer drug

WASHINGTON (AP) — The Food and Drug Administration has approved a first-of-a-kind breast cancer medication that targets tumor cells while sparing healthy ones.

The drug Kadcyla from Roche combines the established drug Herceptin with a powerful chemotherapy drug and a third chemical linking the medicines together. The chemical keeps the cocktail intact until it binds to a cancer cell, delivering a potent dose of anti-tumor poison.

Cancer researchers say the drug is an important step forward because it delivers more medication while reducing the unpleasant side effects of chemotherapy.

"This antibody goes seeking out the tumor cells, gets internalized and then explodes them from within. So it's very kind and gentle on the patients — there's no hair loss, no nausea, no vomiting," said Dr. Melody Cobleigh of Rush University Medical Center. "It's a revolutionary way of treating cancer."

Cobleigh helped conduct the key studies of the drug at the Chicago facility.

The FDA approved the new treatment for about 20 percent of breast cancer patients with a form of the disease that is typically more aggressive and less responsive to hormone therapy. These patients have tumors that overproduce a protein known as HER-2. Breast cancer is the second most deadly form of cancer in U.S. women, and is expected to kill more than 39,000 Americans this year, according to the National Cancer Institute.

The approval will help Roche's Genentech unit build on the blockbuster success of Herceptin, which has long dominated the breast cancer marketplace. The drug had sales of roughly $6 billion last year.

Genentech said Friday that Kadcyla will cost $9,800 per month, compared to $4,500 per month for regular Herceptin. The company estimates a full course of Kadcyla, about nine months of medicine, will cost $94,000.

FDA scientists said they approved the drug based on company studies showing Kadcyla delayed the progression of breast cancer by several months. Researchers reported last year that patients treated with the drug lived 9.6 months before death or the spread of their disease, compared with a little more than six months for patients treated with two other standard drugs, Tykerb and Xeloda.

Overall, patients taking Kadcyla lived about 2.6 years, compared with 2 years for patients taking the other drugs.

FDA specifically approved the drug for patients with advanced breast cancer who have already been treated with Herceptin and taxane, a widely used chemotherapy drug. Doctors are not required to follow FDA prescribing guidelines, and cancer researchers say the drug could have great potential in patients with earlier forms of breast cancer

Kadcyla will carry a boxed warning, the most severe type, alerting doctors and patients that the drug can cause liver toxicity, heart problems and potentially death. The drug can also cause severe birth defects and should not be used by pregnant women.

Kadcyla was developed by South San Francisco-based Genentech using drug-binding technology licensed from Waltham, Mass.-based ImmunoGen. The company developed the chemical that keeps the drug cocktail together and is scheduled to receive a $10.5 million payment from Genentech on the FDA decision. The company will also receive additional royalties on the drug's sales.

Shares of ImmunoGen Inc. rose 2 cents to $14.32 in afternoon trading. The stock has ttraded in a 52-wek range of $10.85 to $18.10.

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Investors face another Washington deadline

NEW YORK (Reuters) - Investors face another Washington-imposed deadline on government spending cuts next week, but it's not generating the same level of fear as two months ago when the "fiscal cliff" loomed large.

Investors in sectors most likely to be affected by the cuts, like defense, seem untroubled that the budget talks could send stocks tumbling.

Talks on the U.S. budget crisis began again this week leading up to the March 1 deadline for the so-called sequestration when $85 billion in automatic federal spending cuts are scheduled to take effect.

"It's at this point a political hot button in Washington but a very low level investor concern," said Fred Dickson, chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon. The fight pits President Barack Obama and fellow Democrats against congressional Republicans.

Stocks rallied in early January after a compromise temporarily avoided the fiscal cliff, and the Standard & Poor's 500 index <.spx> has risen 6.3 percent since the start of the year.

But the benchmark index lost steam this week, posting its first week of losses since the start of the year. Minutes on Wednesday from the last Federal Reserve meeting, which suggested the central bank may slow or stop its stimulus policy sooner than expected, provided the catalyst.

National elections in Italy on Sunday and Monday could also add to investor concern. Most investors expect a government headed by Pier Luigi Bersani to win and continue with reforms to tackle Italy's debt problems. However, a resurgence by former leader Silvio Berlusconi has raised doubts.

"Europe has been in the last six months less of a topic for the stock market, but the problems haven't gone away. This may bring back investor attention to that," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

OPTIONS BULLS TARGET GAINS

The spending cuts, if they go ahead, could hit the defense industry particularly hard.

Yet in the options market, bulls were targeting gains in Lockheed Martin Corp , the Pentagon's biggest supplier.

Calls on the stock far outpaced puts, suggesting that many investors anticipate the stock to move higher. Overall options volume on the stock was 2.8 times the daily average with 17,000 calls and 3,360 puts traded, according to options analytics firm Trade Alert.

"The upside call buying in Lockheed solidifies the idea that option investors are not pricing in a lot of downside risk in most defense stocks from the likely impact of sequestration," said Jared Woodard, a founder of research and advisory firm condoroptions.com in Forest, Virginia.

The stock ended up 0.6 percent at $88.12 on Friday.

If lawmakers fail to reach an agreement on reducing the U.S. budget deficit in the next few days, a sequester would include significant cuts in defense spending. Companies such as General Dynamics Corp and Smith & Wesson Holding Corp could be affected.

General Dynamics Corp shares rose 1.2 percent to $67.32 and Smith & Wesson added 4.6 percent to $9.18 on Friday.

EYES ON GDP DATA, APPLE

The latest data on fourth-quarter U.S. gross domestic product is expected on Thursday, and some analysts predict an upward revision following trade data that showed America's deficit shrank in December to its narrowest in nearly three years.

U.S. GDP unexpectedly contracted in the fourth quarter, according to an earlier government estimate, but analysts said there was no reason for panic, given that consumer spending and business investment picked up.

Investors will be looking for any hints of changes in the Fed's policy of monetary easing when Fed Chairman Ben Bernake speaks before congressional committees on Tuesday and Wednesday.

Shares of Apple will be watched closely next week when the company's annual stockholders' meeting is held.

On Friday, a U.S. judge handed outspoken hedge fund manager David Einhorn a victory in his battle with the iPhone maker, blocking the company from moving forward with a shareholder vote on a controversial proposal to limit the company's ability to issue preferred stock.

(Additional reporting by Doris Frankel; Editing by Kenneth Barry)

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Car Bomb Hits Intelligence Agency in Afghanistan

KABUL, Afghanistan (AP) — A series of early morning attacks hit eastern Afghanistan Sunday, with three separate suicide bombings in outlying provinces and a shootout between security forces and a would-be attacker in the capital city of Kabul.

The deadliest attack was a suicide car bombing at a state intelligence site just after sunrise in the eastern city of Jalalabad. In that attack, a car approached the gate of a compound used by the National Directorate of Security and exploded, killing two guards and wounding three others, said regional government spokesman Ahmad Zia Abdulzai. The building was damaged in the attack, he added.

Taliban spokesman Zabiullah Mujahid claimed responsibility for the bombing.

Shortly before the Jalalabad attack, an assailant detonated a van packed with explosives at a highway police checkpoint in Logar province, also in the east. That explosion wounded three police officers but no one was killed, said Deputy Police Chief Rais Khan Abdul Rahimzai.

In Kabul, meanwhile, police shot and killed a would-be suicide bomber who was trying to attack an intelligence agency office downtown, according to the city's deputy police chief, Gen. Mohammad Daud Amin. Intelligence agents spotted the bomber before he could detonate the explosives in his vehicle and shot him, Amin said.

The explosives in the vehicle were later defused, he added.

Later in the morning, a man wearing a suicide vest blew himself up outside the police headquarters for Baraki Barak district in Logar province. The man was stopped by police as he tried to force his way into the building, but still managed to detonate his vest, said Din Mohammad Darwesh, the provincial government spokesman.

One policeman was wounded in the Baraki Barak attack, Darwesh said.

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Samsung takes on iPad Mini with Galaxy Note 8.0

BARCELONA, Spain (AP) — Samsung Electronics is beefing up its tablet range with a competitor to Apple‘s iPad Mini that sports a pen for writing on the screen.

The Korean company announced on Sunday in B’arcelona that the Galaxy Note 8.0 will have an 8-inch screen, putting it very close in size to the Apple‘s tablet, which launched in November with a 7.9-inch screen. It’s not the first time Samsung has made a tablet that’s in the Mini’s size range: it’s very first iPad competitor had a 7-inch screen, and it still makes a tablet of that size, but without a pen.

Samsung will start selling the new tablet in the April to June period, at an as yet undetermined price. It made the announcement ahead of Mobile World Congress, the wireless industry’s annual trade show, which starts Monday in Barcelona, Spain.

The Note 8.0 fills a gap in Samsung’s line-up of pen-equipped devices between the Galaxy Note II smartphone, with its 5.5-inch screen, and the Galaxy Note 10.1, a full-size tablet. Samsung has made the pen, or more properly the stylus, one of the tools it uses to chip away at Apple’s dominance in both tablets and high-end smartphones. Apple doesn’t make any devices that work with styluses, preferring to optimize its interfaces for fingers, mice and touchpads.

On Samsung’s Note line, the pens can be used to write, highlight and draw. The screens also sense when the mouse hovers over the screen, providing an equivalent to the hovering mouse cursor on the PC. However, few third-party applications have been modified to take full advantage of the pens.

Gadgets News Headlines – Yahoo! News

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Courtney Lopez: Gia Thinks Our Dog Is Having a Baby

Mom & Babies
Celebrity Baby Blog

02/22/2013 at 01:00 PM ET

Denise Truscello/Wireimage

Mario Lopez is a man of his word.

Following a December wedding, the EXTRA host declared he and wife Courtney would get to work expanding their family immediately — and he wasn’t kidding.

In January, the couple discovered they were indeed expecting.

“Mario and I are so excited to add to our family! I found out a month ago and surprised Mario with the good news at breakfast,” Courtney tells PEOPLE.

But the proud parents aren’t the only ones gearing up for a new addition. Big sister Gia Francesca, 2, already has babies on the brain.

“Gia kind of understands that there is a baby in my belly,” Courtney notes. “She also told me our dog Julio has a baby in his belly — so who knows!”

Despite a bumpy start — “I had a rough couple of weeks when I first found out,” she shares — the mom-to-be is feeling better and already sporting quite the blossoming belly. “I am showing so much faster this time around,” she says.

And with warmer weather on the way, Courtney will be swathing her bump in floor-length frocks — but plans on forgoing a few fashion ensembles from her past.

“I love being pregnant in the summer! I live in maxi dresses,” she says. “Looking back at my first pregnancy, there are certain things that I wore and I have no idea why. I looked horrible and I won’t do that again!”

Originally from Pittsburgh, the expectant mama is thrilled to have settled down with her growing family on the West Coast. Her only wish? That her children will one day enjoy a winter wonderland.

“I don’t miss the East Coast at all — especially the humidity,” she explains. “The one thing I do want my children to experience from an early age is snow. There is nothing like being a kid playing in the snow.”

– Anya Leon

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FDA approves new targeted breast cancer drug

WASHINGTON (AP) — The Food and Drug Administration has approved a first-of-a-kind breast cancer medication that targets tumor cells while sparing healthy ones.

The drug Kadcyla from Roche combines the established drug Herceptin with a powerful chemotherapy drug and a third chemical linking the medicines together. The chemical keeps the cocktail intact until it binds to a cancer cell, delivering a potent dose of anti-tumor poison.

Cancer researchers say the drug is an important step forward because it delivers more medication while reducing the unpleasant side effects of chemotherapy.

"This antibody goes seeking out the tumor cells, gets internalized and then explodes them from within. So it's very kind and gentle on the patients — there's no hair loss, no nausea, no vomiting," said Dr. Melody Cobleigh of Rush University Medical Center. "It's a revolutionary way of treating cancer."

Cobleigh helped conduct the key studies of the drug at the Chicago facility.

The FDA approved the new treatment for about 20 percent of breast cancer patients with a form of the disease that is typically more aggressive and less responsive to hormone therapy. These patients have tumors that overproduce a protein known as HER-2. Breast cancer is the second most deadly form of cancer in U.S. women, and is expected to kill more than 39,000 Americans this year, according to the National Cancer Institute.

The approval will help Roche's Genentech unit build on the blockbuster success of Herceptin, which has long dominated the breast cancer marketplace. The drug had sales of roughly $6 billion last year.

Genentech said Friday that Kadcyla will cost $9,800 per month, compared to $4,500 per month for regular Herceptin. The company estimates a full course of Kadcyla, about nine months of medicine, will cost $94,000.

FDA scientists said they approved the drug based on company studies showing Kadcyla delayed the progression of breast cancer by several months. Researchers reported last year that patients treated with the drug lived 9.6 months before death or the spread of their disease, compared with a little more than six months for patients treated with two other standard drugs, Tykerb and Xeloda.

Overall, patients taking Kadcyla lived about 2.6 years, compared with 2 years for patients taking the other drugs.

FDA specifically approved the drug for patients with advanced breast cancer who have already been treated with Herceptin and taxane, a widely used chemotherapy drug. Doctors are not required to follow FDA prescribing guidelines, and cancer researchers say the drug could have great potential in patients with earlier forms of breast cancer

Kadcyla will carry a boxed warning, the most severe type, alerting doctors and patients that the drug can cause liver toxicity, heart problems and potentially death. The drug can also cause severe birth defects and should not be used by pregnant women.

Kadcyla was developed by South San Francisco-based Genentech using drug-binding technology licensed from Waltham, Mass.-based ImmunoGen. The company developed the chemical that keeps the drug cocktail together and is scheduled to receive a $10.5 million payment from Genentech on the FDA decision. The company will also receive additional royalties on the drug's sales.

Shares of ImmunoGen Inc. rose 2 cents to $14.32 in afternoon trading. The stock has ttraded in a 52-wek range of $10.85 to $18.10.

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