Swiss pharmaceutical company Nycomed SCA on Tuesday said the European health regulator approved lung drug Daxas in patients suffering from smoker's lung, a move that could spur the private equity-backed company's plans for an initial public offering.

A spokeswoman for Zurich-based Nycomed said plans for an IPO are on track, but declined to provide a timeline or other details.

Nycomed is joining up with U.S.-based Merck Co & Inc. (MRK) to sell Daxas, which treats COPD, or chronic obstructive pulmonary disease, in some of Europe's largest markets including the U.K., Germany, France, Spain and Italy.

In the U.S., Daxas and Forest Laboratories Inc. (FRX), to which Nycomed has ceded the drug's rights, is expected to face stiffer headwinds getting approval after a U.S. drug regulatory panel decided in April not to recommend Daxas due to safety concerns. Nycomed's spokeswoman said Forest is currently evaluating the Food & Drug Administration's full-response letter.

Nycomed, whose main shareholders include Nordic Capital, which has a 42.7% stake; DLJ Merchant Banking, which owns 25.9%; Collier International Partners, which owns 9.7%; and Avista Capital Partners, with 6.6%, has more than EUR4 billion in senior debt. This compares with total assets of around EUR8 billion.

Pharma companies usually have a low debt exposure unless they need to finance large acquisitions.

-By Katharina Bart, Dow Jones Newswires; +41 43 443 8043; katharina.bart@dowjones.com
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