Almost everyone these days has encountered cancer in one way or another. While the rate of cancer incidence has stabilized to declined since the early 1990s and, with newer and better treatments as well as early detection, cancer death rates have also declined, the war on cancer is still far from won.

It is no surprise, then, that a few days ago, IMS Health (NYSE: RX) -- a provider of market intelligence to the pharmaceutical and healthcare industries -- said that cancer drugs sales will nearly double by the year 2012. Assuming a compound growth rate of 12-15% a year, sales will grow from $48 billion in 2008 to $80 billion by 2012.

The main contributors to growth, according to the study, are an increasing number of patients on chemotherapy, not just in major markets but in emerging markets, too, as well as longer treatment periods for growing numbers of patients. Also fueling growth are the increased use of targeted therapeutic agents, along with first-time innovations coming to the market. Expensive new biotechnology drugs, and the increasing use of combination therapies that contribute to the exploding cost of treatment will also fuel cancer drugs sales growth.

The overall pharmaceutical market grew at a 6.4% pace in 2007, meaning that with its double-digit growth rate, the cancer drug market -- today contributing 17% to global pharmaceutical sales -- will only represent a greater proportion and emphasis. Of course, there will be factors moderating growth, such as drugs losing exclusivity and financial constraints of payers.

Cancer-fighting drugs can reach the market twice as fast as the average medicine, and companies can charge as much as $50,000 for a single course of treatment. It is no surprise then that with more and more drugs coming off patent many pharma companies are turning their attention to cancer. But can it save them?

Earlier this afternoon, Coley Pharmaceutical Group Inc (NASDAQ: COLY) announced that Pfizer Inc (NYSE: PFE) would discontinue the development program of an investigational drug compound - PF-3512676 - in combination with cytotoxic chemotherapy for the treatment of lung cancer. After two Phase 3 clinical trials and two Phase 2 clinical trials, an analysis by an independent Data Safety Monitoring Committee found that there was "no evidence that PF-3513676 produced additional clinical efficacy over that achieved" with cytotoxic chemotherapy alone. The DSMC said that the "risk-benefit profile did not justify continuation" of the compound trial, and Pfizer, apparently, agreed.

This news comes as a huge blow to Coley, whose main thesis drug is PF-3512676, and who is trying to become a force-to-reckon-with in the oncology field. In a statement, president and CEO Robert L. Bratzler, Ph.D., said that the announcement was "surprising, based on the signs of clinical activity observed."

On the announcement, shares of Coley were down approximately 60%. As of March 31, the company had $3.35 per share in cash. Coley will be hosting a conference call and webcast this afternoon at 4:30 p.m. (EST) to discuss this development.