Unlike most MS drugs, which are taken by injection or IV infusion, FTY720 is an oral drug. It reduced relapse rates in 54 percent to 60 percent of subjects, compared to a placebo, and disability progression in 30 percent to 32 percent. Detailed results are slated for presentation at a leading scientific congress next year, Novartis said. Merck KGaA and Biogen are also racing for first approval of an oral MS therapy. Merck already beat Novartis when it filed Wednesday for approval of its MS pill cladribine in the U.S.

Novartis's result builds on previous data showing superior efficacy to Avonex (interferon beta-1a), the current treatment standard, the company announced, and there was no significant difference in efficacy between high and low doses (1.25 mg and 0.5 mg doses), which could help with safety concerns. Novartis says it plans to file for approval of the lower dose.

FTY720 has been associated with such safety concerns as potentially fatal infections and skin cancer, which Novartis did not address. But Trevor Mundel, Novartis Pharma's global head of development, said in the release, "FTY720 0.5 mg therapy offers compelling efficacy on all relevant endpoints compared to both placebo and a standard of care, complemented by extensive safety data."

Novartis says it's on track to submit the drug for approval in the U.S. and Europe in December. The FDA may be willing to review the drug within six months, Mundel says, meaning an approval could come as early as next year. Novartis's drug is expected to reach blockbuster status -- over $1 billion in annual sales -- within a few years of its launch.

NVS shares closed up nearly 2 percent at $50.38.