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Merck: Keytruda Label Continues to Expand in 2017

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Multiple indications

Besides lung cancer and melanoma, Merck (MRK) is aggressively expanding Keytruda’s label across multiple cancer indications. Keytruda has enabled Merck to offer tough competition to other oncology players, such as Pfizer (PFE), Eli Lilly (LLY), and Bristol-Myers Squibb (BMY).

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Regulatory approvals in 2017

On March 14, 2017, Merck announced that Keytruda had been approved by the U.S. Food and Drug Administration (or FDA) as a treatment option for patients suffering from relapsed or refractory classical Hodgkin’s lymphoma (or cHL). This approval is based on the KEYNOTE-087 trial, involving 210 patients that reported an overall response rate of 69% and a complete response rate of 22%.

On March 24, 2017, Merck also declared that the Committee for Medicinal Products for Human Use (or CHMP) of the European Medicines Agency (or EMA) had given a positive opinion to approve Keytruda as a treatment option for difficult-to-treat cHL patients.

On May 18, 2017, FDA also approved Keytruda for patients suffering from locally advanced or metastatic urothelial carcinoma who have suffered disease progression after having previous treatment with platinum-containing chemotherapy. This approval is based on data from the trials KEYNOTE-045 and KEYNOTE-052.

Data from the KEYNOTE -045 trial demonstrated statistically significant improvement in overall survival (or OS) and objective response rate (or ORR) in the target urothelial cancer patients when treated with Keytruda as compared to chemotherapy. In the KEYNOTE-052 trial, the drug demonstrated its efficacy in urothelial cancer patients who weren’t considered eligible for cisplatin-containing chemotherapy.

On May 23, 2017, the FDA approved Keytruda as a treatment option for patients with unresectable or metastatic solid tumors that have a specific biomarker called microsatellite instability-high (or MSI-H) or mismatch repair deficient (or dMMR). This is the first instance where a drug has been approved based on a tumor’s biomarker and irrespective of the cancer’s original location. This approval is expected to benefit relapsed and refractory solid tumor patients who don’t have alternative treatment options as well as those suffering from colorectal cancer and witnessing disease progression after previous chemotherapy.

These regulatory approvals are expected to add to Keytruda’s sales, which in turn may boost Merck’s share prices in 2017. This move may also favorably drive share prices of the Vanguard Value ETF (VTV), as Merck makes up about 1.6% of VTV’s total portfolio holdings.

In the next part of this series, we’ll discuss profit margin expectations for Merck in greater detail.

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