We knew going into American Society of Clinical Oncology annual meeting that immuno-oncology would be a big focus. And Bristol-Myers Squibb (NYSE:BMY) and Merck (NYSE:MRK) didn't disappoint.

Rather than attacking the tumor directly, immuno-oncology drugs encourage the patient's immune system to attack the cancer. Bristol-Myers Squibb already has Yervoy on the market, a drug that activates the immune system. And both Bristol-Myers Squibb and Merck are developing a second class of immuno-oncology drug, called PD1 inhibitors, that inhibit a signal that tumor cells use to tell the immune system to not attack them. Inhibiting the inhibitor results in activation of the immune system.

The PD1 drugs have already put up remarkable data in patients with melanoma, but at ASCO, Bristol-Myers Squibb and Merck showed the class's true potential, expanding their use into other types of cancer. Merck's MK-3475 worked well in head and neck cancer, producing a 45% response rate in patients that over-express the target protein. And Bristol-Myers Squibb showed that nivolumab worked well in kidney cancer in combination with Yervoy, with the response rate about double what the monotherapy produced.

Watch the following video for more insight into the oncology confab from senior biotech specialist Brian Orelli and health-care analyst David Williamson.

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Brian Orelli and The Motley Fool have no position in any stocks mentioned. David Williamson owns shares of Merck. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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