Merck has halted its large clinical study of Keytruda after an independent monitoring committee found that the drug met targets as a first treatment for advanced melanoma, helping to prolong survival in previously untreated patients who were fighting advanced stages of the cancer.
The survival rates surpassed those of Bristol-Myers Squibb's Yervoy, the current standard of care for advanced melanoma. Not only that, Keytruda also showed statistically significant improvements in preventing progression of the cancer. The late-stage study involved 834 patients and will be presented by Merck (mrk) at a medical conference in Philadelphia next month.
The medicine is a type of PD-1 inhibitor, which triggers the body's immune system to attack tumors. It's already approved for use as a second line of defense in melanoma patients who failed to benefit from standard treatments, such as Yervoy. That could benefit the nearly 76,000 Americans who are diagnosed with melanoma each year, 9,700 of whom die from the disease, according to the National Cancer Institute.
If approved as a first line of treatment for melanoma, the drug could bring huge financial gains for Merck. Keytruda was approved in September for second-line use and costs about $150,000 a year per patient. The drug brought in $50 million over the fourth quarter in 2014, and sales are expected to reach $3.64 billion by 2020, according to Bloomberg data.
But, that's only scratching the surface of Keytruda's potential. The drug is also being tested as a treatment for non-small cell lung cancer, an even bigger market. Non-small cell lung cancer is the most common form of the disease. Over 224,000 new cases were diagnosed last year and more than 159,000 people died of the disease, according to the NCI.
J.P. Morgan analyst Chris Schott even called it a "paradigm-shifting" asset, especially given its potential to treat non-small cell lung cancer better than other existing options. Sales of PD-1 inhibitors could reach more than $10 billion a year just for non-small cell lung cancer, and Keytruda's peak global sales could equal about half that sum, Schott estimated.
Merck's PD-1 inhibitor drug is also being tested as treatment for other tumor types, including gastric, head and neck, bladder cancer, triple negative breast cancer, and Hodgkin's Lymphoma.
Other drugmakers are also getting into the PD-1 market, including AstraZeneca (azn) and Pfizer (pfe), and Bristol-Myers' already has an approved version, Opdivo, on the market as a second-line treatment for melanoma. Bristol-Myers (bmy) halted a trial for Opdivo in January after independent reviewers found that it improved survival of lung cancer patients compared to standard chemotherapy.