FRANKFURT, Nov 4 (Reuters) - Pfizer Inc and Germany's Merck KGaA started the second late-stage drug trial of its avelumab drug against lung cancer, targeting a slice of the growing but crowded cancer immunotherapy field.

Avelumab, designed to help the immune system detect and fight tumours, will be tested on newly diagnosed lung-cancer cases in the third and last phase of testing on humans required for regulatory approval, Merck said in a statement on Wednesday.

Merck and Pfizer had in April started another phase-three trial with lung-cancer patients whose disease had progressed despite chemotherapy.

Avelumab is also in the second phase of testing in Merkel cell carcinoma, a type of skin cancer, for which U.S. regulators awarded it a speedy approval process for so-called orphan drugs to treat rare, severe conditions.

Rivals making progress in cancer immunotherapy include Bristol-Myers Squibb, Merck & Co Inc and Roche .

(Reporting by Ludwig Burger; Editing by Georgina Prodhan)