Bristol-Myers Squibb Shares Drop on Positive Lung Cancer Trial

Bristol-Myers Squibb announced initial positive data from its Phase III CheckMate 227 clinical trial of Opdivo (nivolumab) plus low-dose Yervoy (ipilimumb) combination in first-line advanced non-small cell lung cancer (NSCLC) with high tumor mutational burden. Yet company shares dropped more than six percent. Why?

Because Bristol-Myers Squibb is in a battle for domination with Merck & Co. for the checkpoint inhibitor market. And Merck, for the most part, is winning with its Keytruda. So while Opdivo and Yervoy, both Bristol-Myers drugs, reduced the risk of death by 42 percent compared to chemotherapy alone, Merck’s Keytruda decreased the risk of death by 51 percent when combined with chemotherapies, as opposed to chemotherapy alone, in its own study, which is presented today.

Of the Bristol-Myers Squibb results, Matthew Hellmann, assistant attending at Memorial Sloan Kettering Cancer Center, told CNBC, "These practice-changing data establish the combination of nivolumab (Opdivo) plus ipilimumab (Yervoy) as a first-line treatment option for patients with high-TMB NSCLC."

CNBC points out, "That alphabet soup hints at the characterization of patients in Bristol’s trial: it focused on those with more than 10 mutations observed in their cancer, a status referred to as high tumor mutational burden, or TMB. NSCLC is short for non-small cell lung cancer, which is the most common form of the disease—accounting for 85 percent of cases. Patients with high TMB account for about 45 percent of patients with non-small cell lung cancer, Hellmann said."

Lung cancer is the second most-common form of cancer in both men and women. But it causes the most cancer-related deaths. Of the 234,000 people in the U.S. expected to be diagnosed with lung cancer this year, more than 154,000 deaths are expected out of that number.

Evercore ISI analyst Umer Raffat projects the size of the lung cancer market as $10 to $15 billion at its peak.

"Lung cancer is a highly complex disease, defined by multiple subtypes, making it increasingly important to define a more precise treatment approach for this disease," sid Sabine Maier, development lead, thoracic cancers, Bristol-Myers Squibb, in a statement. "We are excited to have advanced the science by establishing in this study that TMB was an important biomarker that predicted which first-line lung patients experienced a clinically meaningful progression-free survival benefit with a chemotherapy-sparing option, Opdivo plus low-dose Yervoy combination. These results are an example of our goal to understand each patient type through our leading translational research capabilities."

There are differences between Merck’s Keytruda and Bristol-Myers Squibb’s Opdivo and Yervoy trials, as well as in the drugs’ safety profiles. Keytruda has a consistent safety profile of nausea, anemia and fatigue, but has shown higher levels of acute kidney injury. The Opdivo and Yervoy combination had fewer side effects than chemotherapy, about 31 percent compared to 36 percent. They were not head-to-head trials, comparing Keytruda to Opdivo and Yervoy, so there are limits to the comparisons.

CNBC writes, "Merck may have the advantage when it comes to cost, according to Cowen, which noted chemotherapy as the combination drug costs less than a second immunotherapy medicine. Keytruda and Opdivo alone are both priced at about $150,000 a year; Yervoy can add about $100,000 to the Bristol combination’s price tag."

While Bristol-Myers shares dropped about six percent, Merck shares rose about three percent

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