Salt Lake-based NPS Pharmaceuticals Inc. said Tuesday that its main experimental drug, the Preos osteoporosis treatment, was effective in a study that may help the company win U.S. approval.

The drug, a genetically engineered parathyroid hormone injected to promote bone growth, prevented initial fractures and worsening disease in women with mild to moderate osteoporosis, the company said. NPS plans to file for Food and Drug Administration approval of Preos this year.

Shares of NPS rose $1.95, or 7.2 percent, to close at $28.89 on the Nasdaq Stock Market. They have risen 87 percent in the past 12 months.

Preos is the first drug the company has developed alone. It would compete with injected medicine such as Eli Lilly & Co.'s Forteo and pills including Merck & Co.'s Fosamax and Procter & Gamble Co.'s Actonel in the more than $4 billion-a-year global market for treatments for the bone-thinning disease.

"This clinical trial built a big product for marketing," showing the drug helps women even before they have fractures, said Samuel D. Isaly, managing partner at OrbiMed Advisors, one of NPS's largest holders with 3.7 million shares. "It's clearly a billion-dollar-plus product."

Ten million Americans, mainly women, have osteoporosis, which may lead to fractures, disability and death. Another 18 million have low bone mass, a risk factor for the disease, according to the U.S. National Institutes of Health.

People who experience a fracture are four to seven times more likely to have another, and 20 percent have a second fracture within a year, he said.

"The name of the game is prevention of fracture," said Robert Lindsay, chief of medicine at Helen Hayes Hospital and professor of medicine at Columbia University. "The problem is that once you have a fracture, that excess risk doesn't go away, not even with medication," he said in a telephone interview.

NPS is in a "sweet spot" for emerging medical companies, with a market capitalization of about $1 billion and a potential winning product, Isaly said. Market capitalization tends to run at 10 times product sales, and if Preos generates $1 billion in sales, its stock price will jump, he said.

NPS still needs marketing partners for Preos and must distinguish it from a handful of proven osteoporosis drugs. The company's cinacalcet drug for treating a kidney-disease complication was licensed by Amgen Inc., which now sells it under the brand name Sensipar.

"Fosamax and Actonel are good drugs and reduce fracture risk, but they don't build bone," Lindsay said. "These medicines don't work for everybody," said Lindsay, a parathyroid hormone expert who monitored patient safety in the study. While Preos is similar to Lilly's Forteo, having more drugs on the market will give patients options, he said.

The worldwide study involved 2,600 women with low bone-mineral density, 81 percent of whom hadn't yet had any fractures. All received calcium and vitamin D, plus Preos or a placebo.

About 3.4 percent of women on the placebo had a spinal fracture during the 18-month study, compared with 1.4 percent of those taking the drug. Women particularly benefited if they started the study before they had any fractures.

It took at least a year to show that Preos conferred a significant benefit compared with a placebo, the company said. Also, the drug's ability to prevent fractures in areas other than the spine wasn't statistically significant in the study.

The most common side effect of Preos was elevated levels of calcium in the blood and urine, the company said. Other side effects of the drug included headaches, nausea, dizziness and vomiting, leading 16 percent of women taking the drug to drop out of the study. Ten percent of women taking the placebo withdrew from the study citing side effects.