"His cancer had spread and he wasn't responding to any other treatment," Associate Professor Hui said.

"Thanks to our new drug he now leads a normal life and today is enjoying a holiday in Alice Springs."

Cancer patient Michael Gordon said looking at his scans before he started taking the medication, it seemed there was little hope.

"Even with ordinary chemo, I was probably too far advanced for it to be effective," Mr Gordon said.

He said Keytruda has changed everything for him.

"It's a miracle, it's a life saver, it's mind changing."

Drug three times more effective than chemotherapy

The global study is running in 16 countries and found the drug prevented cancer from spreading in almost half the patients at 12 months, making it three times more effective than chemotherapy.

Every year 9,000 people die from lung cancer in Australia, making it the country's biggest cancer killer.

"We now have a ground-breaking drug that is offering a lot of hope for the future of lung cancer treatment," Associate Professor Hui said.

"The drug mobilises patients' immune systems to fight against cancer and performs much better than traditional chemotherapy in some patients.

"I've seen widespread tumours shrink to nothing."

Associate Professor Hui also said patients are much less likely to experience the usual nasty side effects of chemotherapy, such as nausea and fatigue.

"This drug has shown stage four lung cancer patients with a specific marker have a 70 per cent chance of living past 12 months without any need for chemotherapy treatment."

Medication gave father a 'longer life'

"It's not invasive, he's lost no hair, he hasn't been physically sick, he hasn't crawled around in the bathroom at night," he said.

"The outcome could have been that we may not have been spending the 70th birthday with Dad, so in that regards [we are] quite happy about it all."

William Ward said he had "a couple of spots of lung cancer on his lungs", but when he started the treatment they started to shrink.

"I don't know about being a miracle drug, but at the moment it's a miracle for me anyway," he said. Health Minister Sussan Ley said the listing of Keytruda on the Pharmaceutical Benefits Scheme was a world first and was one of the great triumphs of the system.

"I am absolutely aware that if you have inoperable cancer, your access to drugs early can be life changing and we don't need bureaucratic processes slowing that up, so it's something I'm personally very committed to," Ms Ley said.