May 13 (Reuters) - Britain's GSK and drug

developer iTeos Therapeutics ( ITOS ) said on Tuesday they have

stopped developing an experimental lung cancer drug,

belrestotug, after it failed to stop the disease from

progressing in two studies.

The discontinued drug belongs to a class of treatments

focused on the TIGIT receptor that has fallen out of favor in

recent years after a spate of clinical setbacks due to low

efficacy.

Similar drugs developed by Merck ( MRK ), Roche and

BeiGene have failed clinical trials in recent months

as they could not slow disease progression or improve overall

patient survival.

Emily Field, an analyst at Barclays, noted that the TIGIT

class is met with indifference by investors as "no one really

cares" since it was already considered "dead".

Belrestotug, which was being tested in combination with

GSK's dostarlimab for treating advanced non-small cell lung

cancer (NSCLC), did not demonstrate sufficient efficacy, leading

to the termination of the collaboration, the companies said.

"We are truly disappointed by the results," iTeos Chief

Executive Officer Michel Detheux said.

The companies will now cease enrolling new patients in the

ongoing late-stage lung cancer trial.

NSCLC is the most common type of lung cancer in the United

States, accounting for about 87% of all cases, according to the

American Cancer Society.

Current treatment options for advanced NSCLC patients

include Merck's ( MRK ) Keytruda and AstraZeneca's ( AZN )

Tagrisso, which belong to different classes of drugs.

ITeos said it has initiated a targeted review of strategic

alternatives to enhance shareholder value, while GSK said it

would now focus on other cancer programs, including

antibody-drug conjugates.

In afternoon trading, U.S.-listed shares of GSK fell 3%.

However, shares of iTeos climbed 19% after the company said

its cash reserves of $624.3 million as of March 31,

significantly exceeded its market capitalization of $264.9

million as of the last close.

(Reporting by Kamal Choudhury in Bengaluru; Editing by Anil

D'Silva and Shinjini Ganguli)