Germany's Merck sees long-term growth in cancer drug Erbitux

Reuters

DARMSTADT, Germany, Oct 4 (Reuters) - German healthcarecompany Merck KGaA expects to get a long-term boostfrom study results in June that showed its main cancer drugErbitux has an edge over rival product Avastin.

Erbitux, which accounted for roughly 8 percent of Merck's10.7 billion euros ($14.6 billion) in sales last year, in Junewas shown to be more effective at prolonging the lives ofcolorectal cancer patients than Roche's Avastin.

Only patients whose tumours contain the non-mutated versionof a gene called KRAS took part in the trial. Erbitux is onlyapproved in this patient subgroup, which accounts for about 60percent of colorectal cancer cases.

"We still have room to grow in colorectal cancer due to ourpersonalised KRAS-approach," Belen Garijo, the head of Merck'sprescription drugs division, told Reuters.

She said the study results would help her marketing teams argue the case for Erbitux, which unlike Avastin, requiresdoctors to perform a genetic test on the cancer tissue beforestarting therapy.

Depending on the country, the testing can delay treatment byanything from a few days to one and a half weeks, making it apriority for Merck to provide support for faster testing and labprocedures, Garijo said.

Merck has the marketing and development rights to Erbituxoutside North America, while Bristol-Myers Squibb sellsthe product in North America with Eli Lilly receivingroyalties.

Garijo's projections for long-term growth are at odds withanalysts polled by Thomson Reuters Pharma, who on average expectMerck's Erbitux sales to peak at $1.25 billion in 2014, slippingto $1.1 billion by 2018.

One concern is that rivals will be free to launch their ownversions of the biotech drug, so-called biosimilars, in Europefrom 2015.

Amgen Inc, for instance, said in February itexpects biosimilars to be a multibillion-dollar opportunity andthat it would develop generic versions of six establishedbiotech drugs including Erbitux.

Garijo, however, said that biosimilars were not a concern,saying that years of data on safety and efficacy on Erbituxwould provide an edge over newcomers.

"We do not expect to see a biosimilar for Erbitux for quitea few years," she said.

Both Erbitux and Avastin are approved and are in use asinitial treatments of metastatic bowel cancer in combinationwith chemotherapy.

Merck had 887 million euros ($1.21 billion) in Erbitux saleslast year, from head and neck as well as bowel cancer, whileBristol-Myers Squibb generated $702 million in sales from thedrug.

Roche had 5.76 billion Swiss francs ($6.00 billion) inAvastin sales last year.

Merck, based in Darmstadt near Frankfurt, is in chemicals aswell as pharmaceuticals and is the world's largest maker ofliquid crystals for flat screen displays.

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