June 27 (Reuters) - The U.S. Food and Drug

Administration declined to approve Merck ( MRK ) and Japan-based

Daiichi Sankyo's ( DSKYF ) lung cancer treatment, which belongs

to a lucrative class of cancer therapies that work like "guided

missiles".

The FDA cited findings from an inspection of a third-party

manufacturing facility in its so-called complete response

letter, the companies said late on Wednesday.

The letter, which indicates the agency has reviewed the

companies' application and has outstanding questions, did not

identify any issues with the efficacy or safety data submitted.

The companies said they will work with the FDA and the

third-party manufacturer to address the feedback.

The treatment, called patritumab deruxtecan, is one of three

antibody-drug conjugates (ADCs) that were part of Merck's ( MRK ) up to

$22-billion joint development and commercialization deal with

Daiichi Sankyo ( DSKYF ) signed last year.

ADCs are targeted cancer therapies that involve two key

components - a monoclonal antibody that binds to specific tumor

cells and a toxin that kills those cells while leaving healthy

ones unharmed - in a way working like a "guided missile".

The companies sought approval for the treatment to treat

non-small cell lung cancer in patients who have failed two prior

lines of therapy and whose tumor expresses a certain type of

mutation that leads to uncontrolled growth of an EGFR protein.

Johnson & Johnson's ( JNJ ) Rybrevant and AstraZeneca's ( AZN )

Tagrisso and Iressa are currently approved in the U.S.

for EGFR-mutated non-small cell lung cancer.