The emergence of novel, biologically targeted anticancer agents such as gefitinib ('Iressa', ZD1839) has raised the question of how the dose for later-stage clinical development and clinical use is best determined. For cytotoxic drugs, because toxic effects and antitumor activity often fall within the same dose range and are dose dependent, the clinically used dose will depend on the therapeutic window. Therefore, the maximum tolerated dose identified in Phase I trials is typically used to determine the dose level for Phase II and III trials. However, because biologically targeted agents are expected to provide clinical benefits that are not predicted by surrogate end points of toxicity to normal replicating tissue, new Phase I trials have been designed to determine the optimum biological dose for use in further studies. A large, multifaceted Phase I program was designed to evaluate the pharmacokinetics, safety, efficacy, and targeted biological activity of a once-daily oral dose of gefitinib. The maximum tolerated dose was >or=700 mg/day, although doses as low as 150 mg/day provided (a). plasma concentrations sufficient for pharmacological activity, (b). evidence of targeted biological effect, and (c). antitumor activity. From these observations, two large Phase II trials ('Iressa' Dose Evaluation in Advanced Lung Cancer 1 and 2) evaluated 250- and 500-mg/day doses of gefitinib in patients with advanced non-small cell lung cancer (NSCLC). As predicted from the Phase I trials, doses >250 mg/day provided no additional efficacy benefit, whereas adverse effects increased in a dose-dependent manner. Consequently, the recommended dose of gefitinib in NSCLC is 250 mg/day. The early clinical trial development of gefitinib provides a model for the development of novel, noncytotoxic anticancer agents.