The forecasts for Roche Holding AG saw quite a spike on Monday following the announcement that the U.S. regulators had approved their drug, Avastin, for use in treating advanced breast cancer. Genentech Inc., Roche’s partner also saw a huge gain last Friday.

Most observers had expected the Food and Drug Administration to either delay a decision or reject the medicine for this use, but the company said Friday that the FDA reversed its December ruling (through which the drug was forbidden) and approved it for treatment for advanced breast cancer. However, the regulator approved Avastin under a mechanism known as accelerated approval, which means that Genentech must submit additional data to gain full approval.

The approval news pushed Roche stock up nearly 4 percent in early trade, following 9 percent gains for its U.S. partner Genentech Inc. late on Friday.

“The market had hardly reckoned on this decision. The potential sales of 1 billion Swiss francs in 2008 had been taken out of our model. Now we are adding 5 percent to Avastin sales in 2008 and 2009,” Zuercher Kantonalbank analyst Michael Nawrath said quoted by Reuters.

Avastin is based on bevacizumab, an active ingredient developed by Genentech. Bevacizumab, approved by the Food and Drug Administration (FDA) in February 2004 for use in colorectal cancer, was the first commercially available angiogenesis inhibitor. This class of drugs stops tumor growth by preventing the formation of new blood vessels. The main side effects of the drug are hypertension and heightened risk of bleeding.

The cancer drug had sales of $2.3 billion in 2007, with part of that coming from off-label use of Avastin for advanced breast cancer, the Wall Street Journal reports.

Breast cancer affects more than 1.2 million people yearly around the globe and kills 500,000, according to the World Health Organization.