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2 Important Dates for Big Pharma

- By George Ronan

The last couple weeks of September are set to be big ones for two of the most well-known and largest (from a market capitalization perspective) companies in the biotechnology and health care spaces.

The companies in question are Merck & Co. Inc. (MRK) and Bristol-Myers Squibb Co. (BMY). They both have Prescription Drug User Fee Act (PDUFA) dates for their leading respective portfolio and development stage assets coming up at the end of the month.

Here is a look at both and what is likely to transpire as we close out on the third quarter of the year.

Let's kick things off with Merck.

The drug in focus is Keytruda. Many reading will likely already be familiar with the drug. For those who are not, it is an oncology target asset that first picked up approval back in September 2014 as a treatment for patients with advanced melanoma. Subsequent approvals across a range of additional indications, including advanced nonsmall cell lung cancer, head and neck cancer, Hodgkin lymphoma and more have established the asset as a blockbuster - it generated a little over $1.4 billion in revenues for Merck in 2016 and brought in $584 million during the first quarter of 2017 alone.

It also became a potentially game-changing asset in May when the Food and Drug Administration approved it as a solid tumor cancer treatment that can be administered based on a specific genetic mutation as opposed to for a specific type of cancer - the first drug of its kind to pick up this sort of all-encompassing approval.

The indication that qualifies it for inclusion on this list is gastric or gastroesophageal junction adenocarcinoma and, specifically, as a third-line treatment for this type of cancer. This is an incredibly tough cancer to treat, primarily because surgical resection is hard (due to location) and the only real options outside of this, from a first- and second-line perspective, are chemotherapy and radiotherapy.

In other words, while the third line of this patient population is not a massive market, it is a considerable unmet need in terms of bringing a fresh therapy to market and - if Merck can do that with Keytruda - there is a good chance the company can snap up a large portion of the available population very quickly.

So what are the chances of approval?

This is a PD-1 drug designed to block the interaction of PD-1 and its ligands. In doing this, it promotes programmed cell death - something that does not happen efficiently with cancer cells and causes the unchecked proliferation associated with the disease.

The data that underpins the application with the FDA right now was derived from a phase 2 study called KEYNOTE-059, which was able to demonstrate the drug can have a marked impact on progression-free survival as compared to alternatives or placebo. Given these are third-line patients and there is very little in the way of alternative options (and that this is a very late-stage population), the FDA likely will not take the safety side of things into consideration too harshly, and there were not any major adverse events reported in the study anyway.

This suggests the drug has a pretty solid chance of picking up approval come decision day.

The PDUFA for Keytruda is Sept. 22.

Next up, Bristol-Myers Squibb.

Just as was the case with Merck's Keytruda, there is a good chance most reading will already be familiar with the asset up for review this month. It is called Opdivo. It is one of the company's best-performing and most widely and deeply established oncology assets right now.

Opdivo was first approved back in 2014, when the FDA gave it a regulatory greenlight for commercialization in an advanced melanoma indication. Beyond that, it was also approved as a therapy for lung cancer, wild-type melanoma, renal cell carcinoma, head and neck cancer, Hodgkin lymphoma and - most recently - colorectal cancer. Interestingly, but not surprisingly when you consider the mechanisms of action of both of the assets in discussion here, many of the approved indications for Keytruda overlap with Opdivo. This is because both assets are PD-1 blockers, which work as described in the section discussing Keytruda's mechanism of action.

Also noteworthy is Opdivo dramatically outsells Keytruda right now. The former generates more than $800 million quarterly based on the last four quarters.

Bristol-Meyers Squibb is now trying to expand on this with an approval in a target indication of previously treated hepatocellular carcinoma. This is the most common type of primary liver cancer and - again - once patients have gotten to the stage where they have received first- and second-line treatment for this indication, there is very little in terms of alternative treatment options they can turn to.

So the company is trying to change this with the application that is with the FDA right now.

Again, what are the chances of Opdivo getting a regulatory greenlight come decision day?

And again, this one looks pretty good.

The company reported data from a study called CheckMate 040 back in March this year, which enrolled 262 patients with advanced hepatocellular carcinoma and dosed them with a low and a high dose of the drug.

The drug hit on endpoints associated with a complete and stable response as well as quality of life assessment and the safety program was - and to quote - "manageable and consistent across patient cohorts."

The PDUFA date for Opdivo is Sept. 24. There is also an ongoing phase III study designed to try and show this drug can work as a first-line treatment, as well as in those patients who have already been treated (as is the case in this application).

Disclosure: The author holds no positions in any of the stocks mentioned.

This article first appeared on GuruFocus.