RATIONALE: Bortezomib may stop the growth of cancer cells by blocking some of the enzymes needed for cell growth. Biological therapies, such as thalidomide, may stimulate the immune system in different ways and stop cancer cells from growing. It may also stop the growth of cancer by blocking blood flow to the cancer. Drugs used in chemotherapy, such as dexamethasone, work in different ways to stop the growth of cancer cells, either by killing the cells or by stopping them from dividing. Giving bortezomib together with thalidomide and dexamethasone may kill more cancer cells.

PURPOSE: This phase II trial is studying how well giving bortezomib together with thalidomide and dexamethasone works in treating patients with relapsed or refractory multiple myeloma.

OBJECTIVES:

• Determine the confirmed overall response rate (complete remission, remission, and partial remission) in patients with relapsed or refractory multiple myeloma treated with bortezomib, thalidomide, and dexamethasone.
• Determine overall and progression-free survival of patients treated with this regimen.
• Determine the qualitative and quantitative toxic effects of this regimen in these patients.
• Correlate, preliminarily, treatment with bortezomib with the activation of osteoblasts in these patients.

OUTLINE: This is a multicenter study.

• Patients receive bortezomib IV on days 1, 4, 8, and 11, oral thalidomide once daily on days 1-21, and oral dexamethasone once daily on days 1, 2, 4, 5, 8, 9, 11, and 12. Treatment repeats every 21 days until achievement of confirmed complete remission (CR), remission (R), or partial remission (PR) OR for up to 8 courses in the absence of disease progression or unacceptable toxicity. Patients achieving confirmed CR, R, or PR who reach a plateau prior to receiving the maximum 8 courses of induction therapy OR who achieve confirmed CR, R, or PR after receiving the maximum 8 courses of induction therapy proceed to maintenance therapy. Patients achieving stable disease after receiving the maximum 8 courses of induction therapy either proceed to maintenance therapy or receive further treatment with bortezomib, thalidomide, and dexamethasone off-study.
• Maintenance therapy: Patients receive oral dexamethasone on days 1-4. Courses repeat every 28 days for up to 3 years in the absence of disease progression or unacceptable toxicity. After completion of study treatment, patients are followed within 30 days and then every 6 months for up to 5 years.

PROJECTED ACCRUAL: A total of 90 patients will be accrued for this study within 18 months.

DISEASE CHARACTERISTICS:

• Diagnosis of multiple myeloma (MM)
• Active disease
• Relapsed or refractory disease after ≥ 1 prior therapy for MM, that may have included autologous or allogeneic stem cell transplantation
• Relapse is defined as the occurrence of any of the following during or after prior treatment:
• Myeloma protein level increase by > 100% from the lowest previously recorded level
• Myeloma protein level increase above the defined response criteria for partial remission
• Reappearance of any myeloma peak that had disappeared during the prior treatment
• Increase in the size and number of lytic bone lesions and/or focal lesions by x-ray, MRI, positron emission tomography, and/or CT scan
• Refractory disease is defined as no response (i.e., not achieving complete remission, remission, or partial remission) to prior therapy
• Measurable disease
• No evidence of POEMS (polyneuropathy, organomegaly, endocrinopathy, presence of M-protein, and skin changes) syndrome
• Must be registered on protocol SWOG-S0334

PATIENT CHARACTERISTICS: Age

• 18 and over

Performance status

• Zubrod 0-2 (unless due to bone pain)

Life expectancy

• Not specified

Hematopoietic

• Absolute neutrophil count > 1,000/mm^3
• Platelet count > 50,000/mm^3

Hepatic

• AST or ALT ≤ 3 times upper limit of normal (ULN)
• Bilirubin ≤ 3 times ULN

Renal

• Creatinine clearance > 30 mL/min

Cardiovascular

• No New York Heart Association class III or IV congestive heart failure
• No myocardial infarction within the past 6 months
• No poorly controlled hypertension

Other

• Not pregnant or nursing
• Negative pregnancy test
• Fertile female patients must use effective double method contraception for ≥ 4 weeks before, during, and for ≥ 4 weeks after completion of study treatment (during and for 4 weeks after completion of study treatment for male patients)
• No blood, ova, or sperm donation during study treatment
• No active infection requiring antibiotics
• No neurotoxicity ≥ grade 2
• No diabetes mellitus
• No other serious medical or psychiatric illness that would preclude study treatment
• No other malignancy within the past 3 years except adequately treated basal cell or squamous cell skin cancer or carcinoma in situ of the cervix

PRIOR CONCURRENT THERAPY: Biologic therapy

• See Disease Characteristics

Chemotherapy

• At least 14 days since prior chemotherapy (28 days for nitrosoureas) and recovered

Endocrine therapy

• Not specified

Radiotherapy

• At least 14 days since prior radiotherapy and recovered

Surgery

• Not specified

Other

• No prior bortezomib alone or combined with thalidomide
• Concurrent participation on protocol SWOG-S0309 allowed