NEW YORK (CNN/Money) - Imclone Systems Inc., whose former CEO is languishing in prison for insider trading, got a boost this week as a top financier ramped up his stake and the biotech unveiled new positive test results for Erbitux.

"We think [Imclone] will resume some growth," said Brian Rye, analyst for Janney Montgomery Scott, as Imclone (up $4.49 to $34.65, Research) stock prices shot up 16 percent in morning trading.

But Imclone should enjoy its freedom from competition while it lasts, because a rival is developing a drug that is similar to Erbitux and could eventually siphon away sales, said Rye.

Rye projects that sales for Erbitux, an anti-tumor drug for colorectal cancer that was put on the market in February, 2004, will total $483 million in 2005. Erbitux sales totaled $350 million from the drug's inception through the first quarter of 2005, said Imclone spokesman David Pitts.

Erbitux sales could get a boost if the Food and Drug Administration approves the drug for an additional use. Imclone said Wednesday that an independent review of results from a late-stage clinical trial showed that Erbitux, used in combination with radiation, is more effective in combating the spread of certain head and neck cancers than radiation alone. About 40,000 Americans are diagnosed with this form of cancer every year, the company said.

But Rye said he is "cautious" about Imclone's stock, because of the "looming" presence of a competing drug. Amgen Inc., the world's largest biotech with $10.5 billion in 2004 sales, said in May that its cancer treatment, Panitumumab, had demonstrated anti-tumor activity in clinical testing.

"[Panitumumab] is a very similar drug [to Erbitux] in terms of its efficacy, but it has a safer profile," said Rye.

Amgen (down $0.13 to $60.07, Research) spokeswoman Trish Hawkins said that Panitumumab, which is being co-developed with Abgenix Inc. (up $0.17 to $7.09, Research), is now in late-stage testing and the company intends to file with the FDA at the end of the year. Hawkins said that Panitumumab is 100 percent human protein and might be safer than Erbitux, which is a "chimeric" human-mouse protein mix.

"By virtue of being fully human, Panitumumab may potentially have less infusion reaction and allergic response," said Hawkins.

If Panitumumab is approved, it will take sales away from Erbitux but will probably remain the underdog, at least in the beginning, said Rye.

"It won't have that first mover advantage," said Rye. "We think its initial sales numbers will be lower than Imclone because it will be the second drug on the market."

Pitts would not provide an estimate on the potential rival's threat to Erbitux sales. "It's impossible to speculate at this point because Panitumumab is not an approved product," said Pitts.

On Tuesday, the day before Imclone announced its new results for Erbitux, the company said that financier Carl Icahn filed with U.S. regulators to acquire up to an 18 percent stake in the drugmaker. This would triple the 6 percent stake, valued at $151 million, that Icahn held in March, according to a new report.

"Mr. Icahn has been a long-time shareholder in Imclone and we appreciate his confidence in the company," said Pitts.

Imclone, based in New York City, hit the headlines with a 2001 insider stock trade that resulted in the convictions of founder and former CEO Sam Waksal and celebrity homemaker Martha Stewart.

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Rye does not own Imclone or Amgen stock and Janney Montgomery Scott has no relation with them.