* EU panel does not back anti-inflammatory drug naproxcinod
* NicOx to examine potential with advisors, Grupo Ferrer
* Shares fall as much as 34 percent, hitting 8-yr low
(Adds detail, analysts, updates shares)
PARIS, April 20 (Reuters) - French biotech NicOx has withdrawn its application for European marketing approval for anti-inflammatory drug naproxcinod, dashing hopes for what was once seen as a potential blockbuster.
NicOx shares, which were already dealt a blow last year when naproxcinod failed to win marketing approval in the United States, sank to an eight-year low in early morning trade, losing as much as 34 percent.
NicOx said on Wednesday it was evaluating options for the drug's "potential further development" in Europe after an EU health expert panel said it would not adopt a formal positive opinion for its approval based on the clinical data provided.
But analysts doubted naproxcinod had any future after its double flop.
"It (naproxcinod) is dead," says a Paris-based analyst who declined to be identified. "Now it will be wait and see what steps management will take next, how they could approach potential merger partners."
Spain's Grupo Ferrer Internacional has an option for rights to the drug in certain European countries. NicOx's other partnerships are with U.S. eye health company Bausch & Lomb to develop a glaucoma treatment in mid-stage trials and with Merck on an early-stage product.
One possible attraction of NicOx could be the 107.3 million euros ($154.5 million) in cash it had at the end of last year.
When hopes were still high for naproxcinod, NicOx at the end of 2009 managed to raise about 100 million euros, partly backed by the French government's strategic fund FSI, to speed up the drug's launch.
Last year, the U.S. Food and Drug Administration (FDA) turned down naproxcinod for marketing, a decision NicOx has appealed.
NicOx shares were down 22 percent at 1.78 euros at 0855 GMT. Last year the stock lost 62.25 percent. (Reporting by Caroline Jacobs, additional reporting by Lionel Laurent; Editing by Will Waterman) ($1=.6945 Euro)