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The Food and Drug Administration approval of Bristol-Myers Squibb's (NYSE: BMY  ) Yervoy on Friday wasn't that big of surprise. I figured canceling the advisory panel was a good sign, as did a vast majority of Fool readers.

Even the midday announcement didn't surprise me. While I'd just as soon the FDA make the announcement after the market closes -- no reason to give those that notice the news first the upper hand -- I'm getting used to the new mode of operation.

What was a little surprising was the label that the FDA gave Yervoy. The label tells doctors about the drug and what the FDA has -- and by omission, hasn't -- signed off on. While doctors are free to prescribe a drug for anything they want, companies are only allowed to market the drug for the indications on the label.

Typically, labels are determined by the clinical trials that are used to support the marketing application; the population the drug was tested in is what the FDA will approve the drug for.

Yervoy was tested in patients that had failed other treatments, but the FDA approved the drug for patients earlier in their disease progression. Bristol-Myers recently announced that a trial testing Yervoy in the earlier population succeeded, so it would likely have been approved for the earlier indication eventually. But the approval allows Bristol-Myers to promote it to a broader population earlier than expected.

Bristol-Myers plans to charge $120,000 for the four-course regimen. That's even more than Dendreon (Nasdaq: DNDN  ) charges for a full course of Provenge. This is certainly good news for up-and-coming oncology drugs such as Johnson & Johnson's (NYSE: JNJ  ) abiraterone, Seattle Genetics' (Nasdaq: SGEN  ) brentuximab vedotin, and Medivation's (Nasdaq: MDVN  ) MDV3100, which could see high price tags turn into higher peak sales.

Of course, it's only good news if the companies can get payers to reimburse for the drug. While most of Yervoy's surprises have been revealed, there's still one more $0.12 million question.

Interested in keeping track of Bristol-Myers as it launches Yervoy? Click here to add it to My Watchlist, which will help you keep track of all our Foolish analysis on Bristol-Myers.

Johnson & Johnson is recommendation of the Motley Fool Inside Value and Motley Fool Income Investor newsletters. Motley Fool Options has recommended a diagonal call position on Johnson & Johnson. The Fool owns shares of Johnson & Johnson. Motley Fool Alpha LLC owns shares of Johnson & Johnson. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. The Fool has a disclosure policy.

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