Eli Lilly and Co. shares rose nearly 5 percent Monday morning after it said a study found that its experimental stomach-cancer drug helped patients with advanced disease live longer.

The most common side effect for the medicine, called ramucirumab, was high blood pressure, diarrhea and headache, the Indianapolis-based company said in a prepared statement. The drug was tested in patients with gastric cancer that had spread to other parts of the body.

Leerink Swann upgraded its rating on the stock to buy from hold on the data, saying the drug has an 80-percent chance of approval as a second-line treatment. The medicine is in the final stage of testing for U.S regulatory approval. If approved, it may generate $600 million in annual sales, said Mark Schoenebaum, a New York-based analyst with ISI Group.

“Overall, the Street will view this positively, we think, as it adds credence to the pipeline thesis,” Schoenebaum said, in a note to clients. He said it will also make Lilly less dependent in the future on its experimental Alzheimer’s drug.

Lilly shares rose 4.8 percent, to $52.86 each, late in the morning and were up 32 percent in the 12 months through Sunday. Shares in Dyax Corp, which has a partnership on the treatment, rose 28 cents, or 12 percent, to $2.66.

Leerink analyst Seamus Fernandez said in a report Monday that the stock could hit $59 to $60 a share based on his positive outlook for the drug.

Lilly didn’t disclose the increase in the survival benefit. Full results from the research will be presented at a future medical meeting, the drugmaker said.

Ramucirumab is among the products obtained by Lilly from its $6.5 billion acquisition of ImClone Systems Inc. in 2008. Lilly has five other late-stage studies of ramucirumab ongoing in four tumor types, including breast and lung cancer. If approved for all indications in testing, the drug could have $1.6 billion in sales by 2020, Fernandez said.

More than 21,000 people will be diagnosed with stomach cancer in the U.S. in 2012 and 10,540 people will die of the disease, according to the National Cancer Institute.