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Merck's Keytruda Wins FDA Nod for First-Line Head/Neck Cancer

Zacks Equity Research

Merck & Co., Inc. MRK announced that the FDA has granted approval to its blockbuster PD-L1 inhibitor, Keytruda for first-line treatment of recurrent or metastatic head and neck squamous cell cancer (HNSCC).

With the latest approval, Keytruda can be prescribed to previously untreated patients with metastatic or with unresectable, recurrent HNSCC as monotherapy in patients whose tumors express PD-L1 [CPS (combined proportion score )≥1)  or in combination with chemotherapy regardless of PD-L1 expression. The sBLA was based on data from the phase III KEYNOTE-048 study, wherein Keytruda, as a monotherapy and in combination with platinum and 5-fluorouracil (5-FU) chemotherapy, demonstrated significant improvement in overall survival compared to the standard of care in the given patient population. 

Keytruda was approved in 2016, on an accelerated basis, for recurrent or metastatic HNSCC with disease progression on or after platinum-containing chemotherapy. With the approval to include data from the KEYNOTE-048 study on Keytruda’s label, the accelerated approval gets converted to a regular approval. The regular approval was contingent upon verification and description of clinical benefit, which has now been demonstrated in the KEYNOTE-048 study.

Merck’s shares have risen 8.6% this year so far compared with the industry’s increase of 1.8%.

Keytruda, Merck’s biggest product, is already approved for use in 15 cancer indications across 10 different tumor types in the United States.

Keytruda generated sales of $2.27 billion in the first quarter of 2019, up around 5.6% sequentially and 55% year over year. Sales were driven by the launch of indications globally. Keytruda sales are gaining particularly from strong momentum in first-line lung cancer indication both as monotherapy and with the rollout of the chemo combo in both non-squamous and squamous non-small cell lung cancer (NSCLC).

This year so far, Keytruda has gained several label expansion approvals. Keytruda was approved by the FDA as an adjuvant therapy for high-risk stage III melanoma and for five new cancer line extensions in Japan in the first quarter. In April, the FDA gave approval to Keytruda in combination with Pfizer’s PFE Inlyta for the first-line treatment of advanced renal cell carcinoma as well as for an expanded first-line lung cancer patient population. All these label expansion approvals should drive sales of Keytruda higher in the future quarters of 2019.

Several regulatory decisions for new indications in the United States as well as in Europe are pending in 2019, which, if approved, can further boost sales of Keytruda. This month an FDA decision is expected on the regulatory application looking for label expansion of Keytruda for previously treated advanced small-cell lung cancer.

In fact, the Keytruda development program is also progressing well and the drug is being studied for more than 30 types of cancer in more than 1000 studies, including more than 600 combination studies. Merck is collaborating with several companies including Amgen AMGN, Incyte INCY, Glaxo and Pfizer separately for the evaluation of Keytruda in combination with other regimens

Merck currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here

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