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3 Promising Cancer Immunotherapies to Watch in 2018

By Keith Speights - Dec 22, 2017 at 5:04AM

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Bristol-Myers Squibb, Incyte, and Nektar Therapeutics could provide the biggest fireworks next year on the immunotherapy scene.

Any way you look at it, immunotherapies -- also known as immuno-oncology (I-O) drugs -- are hot commodities. Two of the top three cancer drugs projected to be the biggest winners in the next five years are immunotherapies: Bristol-Myers Squibb's (BMY -0.55%) Opdivo and Merck's (MRK 0.40%) Keytruda. Together, those two combined are on track to generate revenue topping $8 billion this year. 

Immunotherapies work by spurring the body's immune system to fight cancer. The approach has gained such incredible traction in the research community that there are now over 2,000 immunotherapies in clinical-stage development or on the market. Out of that vast number, I think there are three especially promising cancer immunotherapies to watch in 2018.

Pill opened up with boxing glove on end of mechanical arm punching cancer cell

Image source: Getty Images.


Incyte (INCY -0.33%) could have the most eagerly anticipated immunotherapy on its hands with epacadostat. Some types of cancer cells produce a protein called IDO (indoleamine 2,3-dioxygenase). This protein shuts down immune system T cells, which would normally attack the tumor. Epacadostat works by inhibiting production of IDO, therefore allowing the body's immune system to fight back against cancer.

Epacadostat's potential is so great that several major drugmakers have teamed up with Incyte to test the drug in combination with their own immunotherapies. Bristol-Myers Squibb and Incyte are evaluating a combination of Opdivo and epacadostat in late-stage studies targeting non-small cell lung cancer (NSCLC) and head and neck cancer. AstraZeneca and Incyte are also working together in testing a combination of Imfinzi and epacadostat in treating NSCLC.

But the most important study to watch next year is the late-stage Echo-301 study that Merck and Incyte are conducting to evaluate the potential of a Keytruda-epacadostat combo in treating melanoma. The two companies expect to announce results from this study in the first half of 2018. Echo-301 will be the first late-stage study to wrap up for epacadostat. If the results are positive, it could bode well for the many other combination studies that are in progress. 


Bristol-Myers Squibb isn't just pairing Opdivo up with epacadostat. The big pharma company is researching plenty of other drugs in combination with its blockbuster immunotherapy. One with significant potential is Bristol's own relatlimab.

Relatlimab is a LAG-3 (lymphocyte-activation gene 3) inhibitor. LAG-3 proteins are found on the surfaces of some types of T cells. The protein controls T cells' response, activation, and growth. By inhibiting production of the LAG-3 protein, relatlimab helps the immune system fight cancer. This approach is similar to that of PD-1 inhibitors like Opdivo. However, many cancer patients don't respond well over time to PD-1 inhibitors alone, so Bristol thinks that a combination of immunotherapies could be more effective. 

The company will find out if its thinking is on track pretty soon. Bristol's Checkmate-142 study evaluating Opdivo in combination with several other drugs, including relatlimab, is scheduled to complete collection of primary outcome data in the first quarter of 2018. 


Nektar Therapeutics (NKTR -0.85%) is yet another partner with Bristol-Myers Squibb. The biotech's NKTR-214 is a CD122 agonist. The drug activates the immune system's T cells and natural killer cells to attack tumors. 

Bristol and Nektar announced highly encouraging interim data in November from a phase 1/2 study of a combination of Opdivo and NKTR-214 in treating melanoma, renal cell carcinoma, and NSCLC. Those results included a 91% disease control rate among melanoma patients participating in the study and an 85% rate for patients with renal cell carcinoma.  

As you might expect, Bristol and Nektar are moving full steam ahead in studying the Opdivo-NKTR-214 combo. The partners are actively enrolling patients in the phase 2 expansion portion of the study of the two immunotherapies. This study is scheduled to wrap up in October 2018. Nektar is also conducting an early stage study on its own evaluating NKTR-214 in combination with Keytruda and with Roche's Tecentriq that should conclude by the end of next year. 

Investor takeaway

Investors pretty much know what they're getting with Bristol-Myers Squibb. The big drug stock won't generate thrilling returns, but with tremendous momentum for Opdivo and blood thinner Eliquis, along with a solid dividend, Bristol should be a pretty good long-term pick. 

Nektar ranks among the best-performing biotech stocks of 2017, with a year-to-date gain of more than 370%. The company could get good news next year from NKTR-214 and plans to file for regulatory approval of experimental pain drug NKTR-181. Nektar's approved drugs, though, aren't making the biotech a lot of money. And the biotech's market cap of over $9 billion means that high expectations are baked into the stock price.

That leaves Incyte. It's been a disappointing year for the biotech, but Incyte's market cap is now below $20 billion for the first time in a while. The company continues to enjoy success with JAK inhibitor Jakafi. However, Incyte's fortunes hinge on epacadostat. If the late-stage study with Merck goes well, Incyte could regain its tremendous momentum from 2016. On the other hand, disappointing results would probably cause the stock to plunge. I suspect that Incyte will have good news, with a rebound on the way in 2018.

Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Incyte Corporation Stock Quote
Incyte Corporation
$73.62 (-0.33%) $0.24
Merck & Co., Inc. Stock Quote
Merck & Co., Inc.
$91.40 (0.40%) $0.36
Bristol Myers Squibb Company Stock Quote
Bristol Myers Squibb Company
$74.15 (-0.55%) $0.41
Nektar Therapeutics Stock Quote
Nektar Therapeutics
$4.68 (-0.85%) $0.04
AstraZeneca PLC Stock Quote
AstraZeneca PLC
$66.50 (0.12%) $0.08
Roche Holding AG Stock Quote
Roche Holding AG
$41.96 (0.77%) $0.32

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