Despite a recent hiccup, new treatments for cancer are among the brightest spots on the drug development landscape. Drugs that attempt to leverage the body’s immune system to fight tumors have been approved for some forms of cancer. Clinical trials for many other possible treatment areas are ongoing.
For a small group of patients, they have generated significant survival benefits. Given the dire nature of illnesses these drugs treat, clinical results have generally been quite impressive. Since these drugs carry an annual sticker price in excess of $100,000, their economic potential has rightly generated significant excitement among investors. Bristol-Myers Squibb announced a surprise failure of its immunotherapy drug Opdivo in a clinical trial among patients with previously untreated lung cancer-a large market with a significant unmet medical need.
Merck pursued a less ambitious design of its clinical trial and targeted a smaller subset of patients, and now appears set to reach the first line lung cancer market first, thanks to strong data earlier this summer.
The drugs are still too novel for comprehensive long-term survival data in cancers with large patient populations. That data will go a long way toward determining which drugs work best-and the pricing power manufacturers enjoy. What’s more, there is no shortage of competition among drug companies. Roche Holding has an immunotherapy drug, Tecentriq, approved to treat bladder cancer.
Handicapping the marketplace is also more complex beyond considering just the number of drugs in development, thanks to the role of combination therapy in cancer treatment. Studies of Opdivo in combination with another Bristol-Myers drug, Yervoy, are ongoing. Analysts’ consensus calls for nearly $20 billion in annual sales for Opdivo and Keytruda alone by 2021, but those forecasts are bound to change as more data sees the light of day.