Merck's Keytruda puts heat on Pfizer, Merck KGaA's Bavencio with new Merkel cell OK

Merck’s latest Keytruda approval isn’t necessarily a huge one for the New Jersey drugmaker when it comes to sales. But it’s a big deal for Pfizer and Merck KGaA, maker of rival drug Bavencio.

Wednesday, the FDA green-lighted Merck’s immuno-oncology blockbuster in rare skin cancer Merkel cell carcinoma, an area where Bavencio had previously held immuno-oncology’s only approval.

The green light comes ahead of a Dec. 28 decision deadline set by the FDA and follows a priority review designation from the agency, which sped up Keytruda’s trip down the regulatory pathway back in September. Regulators based their decision on data from a phase 2 study that showed Keytruda could provoke a response in 56% of patients, with 24% of trial patients seeing their cancer disappear completely.

The approval is a conditional one, meaning Merck may need to produce more positive trial results to back it up. But for now, Keytruda will take on Bavencio in the disease, which affects about 2,500 new patients each year in the U.S.

Keytruda will make for unwelcome company, as long as Pfizer and German Merck are concerned. Bavencio has borne a Merkel cell approval—its first-ever FDA go-ahead—since last March, but the drug has been slow to get off the ground. In the second quarter, its sales amounted to just $17 million.

Keytruda, on the other hand, has been tearing it up thanks to a slew of indications and its leading position in the previously untreated lung cancer market, the largest for the PD-1/PD-L1 class of cancer-fighters. That same quarter, it racked up $1.67 billion in sales to overtake archrival Opdivo from Bristol-Myers Squibb for the first time, and through the first nine months of the year, it’s generated $5.02 billion around the world, Merck said in October.