Merck KGaA’s Oncology Sales And Pipeline Updates Dominate Q3 Earnings
Bavencio Sees Double-Digit Growth
Executive Summary
The German firm’s oncology franchise grew to more than €400m in the third quarter as sales of Bavencio doubled, while anticancer partnerships and pipeline updates drew interest.
Merck KGaA’s cancer portfolio helped drive overall healthcare sales growth in the third quarter as the major highlighted new collaboration agreements and clinical trial results that bode well for its oncology outlook.
The company’s total healthcare sales rose organically by 8.7% to €2.09bn in the third quarter. The sales beat analyst consensus estimates of approximately €2.02m and were pushed by oncology franchise sales, which increased by 24.5% to €453m in the third quarter. In particular, sales of the carcinoma product Bavencio (avelumab) accounted for €166m, representing growth of 51%.
The programmed death ligand-1 (PD-L1) blocking antibody was first approved by the US Food and Drug Administration in 2017 for the Merkel cell carcinoma and later won green lights in renal cell carcinoma and urothelial carcinoma. So far, Bavencio is the only immunotherapy to demonstrate overall survival benefit in the first-line urothelial carcinoma setting.
While its third quarter performance in major markets such as the US, EU and Japan was “homogenous”, the drug benefitted from the confirmation of pricing and reimbursement in “late-launch” markets including Spain and Italy earlier this year, Merck’s healthcare CEO Peter Guenter told analysts on a 10 November earnings call.
The German major hopes to unlock Bavencio’s potential in other diseases and, since the last quarter, has completed enrolment of 60 participants in a Phase II trial of Bavencio and Pfizer Inc.’s tyrosine kinase inhibitor Inlyta (axitinib) in advanced or metastatic non-small cell lung cancer and treatment-naive cisplatin-ineligible urothelial cancer.
Elsewhere in oncology, sales of Merck’s older epidermal growth factor receptor (EGFR) inhibitor product Erbitux (cetuximab) for colon cancer rose by 13.5% to €274m in the third quarter. The drug was initially developed by Eli Lilly and Company but the German firm licensed the rights to market it outside the US and Canada and has helped push the boat on label expansions.
Just last month, Merck inked a clinical trial collaboration agreement with Jacobio Pharmaceuticals Co. Ltd. to investigate the anticancer potential of Erbitux plus the latter’s KRAS G12C inhibitor asset JAB-21822. Jacobio CEO Wang Yinxiang said at the time that preclinical studies had shown Erbitux enhanced the anti-tumor activity of JAB-21822 inhibitors in colorectal cancer tumor models.
Other strategic cancer milestones in the third quarter include Merck’s collaboration agreement with Nerviano Medical Sciences with a licensing option for the latter’s next-generation PARP1 inhibitor, NMS-293, which is early in the clinic as a monotherapy for BRCA-mutated tumors and in combination with temozolomide (Merck & Co., Inc.’s Temodar) in recurrent glioblastoma.
Under the deal terms, Nerviano is eligible for upfront and option exercise fee payments of up to $65m as well as unspecified milestones. If the German firm exercises its option, both companies will collaborate on clinical development activities for NMS-293 with Nerviano responsible for funding these activities.
Merck’s oncology head Victoria Paulina has said at the time the move was an attempt to build on the therapeutic impact PARP inhibitors have had over the last several years, adding the collaboration would combine Nerviano’s experience with this drug class with Merck’s “expertise in developing therapies which modify DNA damage response mechanisms.”
On the R&D side, the firm released positive Phase II data of its apoptosis protein inhibitor candidate, xevinapant, in patients with squamous cell carcinoma of the head and neck in September. In the trial, the addition of xevinapant to standard-of-care chemoradiotherapy more than halved the risk of death over five years when compared with placebo.
Mavenclad Going Strong In MS
Elsewhere, Merck’s neurology franchise also fared well with third quarter sales of multiple sclerosis (MS) drug Mavenclad (cladribine) increasing by 9.8% to €234m. Meanwhile, its Bruton’s tyrosine kinase inhibitor candidate for MS, evobrutinib, produced promising data in the open-label extension portion of a Phase II trial.
The firm also announced it would invest €130m to expand manufacturing capacities for single-use assemblies in Molsheim, France and confirmed it had opened a €29m Biologics Testing Center in Shanghai, China to meet growing local demand for viral clearance testing services.