A new drug, which has proven more effective than chemotherapy in treating the most common type of lung cancer, has been approved for use as a first-line treatment.

Immunotherapy drug Keytruda, which is used for treating advanced Melanoma and was being used on lung cancer patients after chemotherapy failed, has now been given Medsafe registration to be used to treat PD-L1 positive patients with advanced non-small cell lung cancer.

PD-L1 is a protein expressed by cancer cells to evade the immune system.

Merck Sharp & Dohme New Zealand director Paul Smith said clinical trial results were so compelling that trial investigators believed Keytruda should replace platinum-based chemotherapy to become the new standard of care for untreated advanced non-small cell lung cancer (NSCLC) that expresses high levels of PD-L1.

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"Chemotherapy has long been the standard of care for advanced NSCLC; however the latest data from the KEYNOTE-024 trial demonstrates superior overall survival with Keytruda, compared to chemotherapy in patients with high PD-L1 expression.

"In light of that trial data, the external data and safety monitoring committee recommended that the study be stopped early to give the patients who were receiving chemotherapy the opportunity to receive Keytruda."

Lung Foundation New Zealand chief executive Philip Hope said the trial showed a 40 per cent increase in the survival rates of patients on Keytruda.

"This Keytruda lung cancer registration is a hugely welcome step forward in ensuring New Zealanders can benefit from this new generation of treatments," Hope said.

He said lung cancer was the biggest killer among all cancers in New Zealand and about 70 per cent of all lung cancer was non-small cell. Of that about a third of those had a PD-L1 expression greater than 50 per cent - about 470 patients.

There were about another 950 people who had more than 1 per cent PD-L1 expression.

"It will increase life expectancy," he said.

Hope said lung cancer patients in New Zealand needed access to more funded treatment options and hoped Pharmac would agree to fund Keytruda.

New Zealand Cancer Society medical director Chris Jackson said having a new treatment option for lung cancer was great news but agreed it needed to be funded.

Most patients would not be able to afford it if it was not funded, he said.

A funding application has been lodged with Pharmac and Smith said he was hopeful it could be funded by July 1.

Pharmac director of operations Sarah Fitt said an application for Keytruda to be used as a first-line treatment was received in February and the assessment process was underway.

Pharmac would consider the clinical evidence using advice from expert clinical committees, undertake an economic analysis and rank the application relative to other medicines, she said.

Any funding proposal would involve public consultation.