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- 01/16/2017

Merck gets a major leg up on the competition for the largest cancer market.

Pharma Horizon

Surprisingly  the U.S. Food and Drug Administration (FDA) would decide by May 10 on Merck’s application to combine its immune system-boosting drug Keytruda with chemotherapy as an initial therapy for advanced lung cancer.

The annoucmente came less than an hour after Bristol-Myers Squibb CEO Giovanni Caforio had left the stage in San Francisco at JP Morgan 2017.

Less surpisingly the annoucement sent the company’s stock 5 percent higher in early U.S. trading Wednesday 11th, while shares in companies working on competing immunotherapy-based combinations for lung cancer fell back, with Bristol-Myers Squibb down 2 percent, while Roche and AstraZeneca lost around 0.5 percent.
Although Merck presented good results from a mid-stage Phase II trial for its Keytruda-chemotherapy combination  many analysts had thought it would need to wait for data from a larger Phase III study before filing and they thought that Merck would make the move for the combination therapy towards the end of 2017.
“This comes as an important surprise because if FDA approves the application, Merck would suddenly be catapulted ahead of all other (immunotherapy) competitors who are also pursuing competing combination regimens of their own,” said Bernstein analyst Tim Anderson.

Evercore ISI estimated the market for first-line lung cancer for all patients could be as high as $14 billion.“While Merck is unlikely to durably penetrate this entire population, especially with multiple competing regimens on the horizon, an approval in May would give them a significant first-mover advantage,” Evercore analyst John Scotti wrote.

Keytruda is already also approved to treat advanced melanoma, the deadliest of skin cancers, and head and neck cancers.

Also CNBC reports that according to Morgan Stanley investors should buy Merck shares because profits from its cancer treatments will top expectations in the coming years, which upgraded the pharmaceutical company to overweight from equal weight.

“We expect Merck to return to accelerating earnings growth in 2018 after six years of flat earnings driven by Keytruda growth as Merck builds on its leadership position in immuno-oncology,” analyst David Risinger wrote in a note to clients Thursday. “Our long term estimates are well above consensus.”



Suorce: Reuters, Daily Mail, CNBC