Get ready for a deluge of important approval decisions. This year, before April showers get a chance to bring any May flowers, the FDA is expected to make a slew of important approval decisions.
Cancer patients in the U.S. could get some important new treatment options. Shares of the companies involved could put up big gains if the agency delivers the approval decisions investors are hoping for.
Big FDA decisions coming up in the first quarter for Bristol Myers Squibb (BMY 1.30%), Eli Lilly (LLY -2.63%) AstraZeneca (AZN 0.28%), and Merck (MRK 0.44%) could send their share prices soaring. Here's what to look for.
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Bristol Myers Squibb: Relatlimab
Shares of Bristol Myers Squibb have gained around 17% since hitting a 52-week low in November. An FDA approval for a new type of cancer immunotherapy could push this pharma stock even higher.
In September, the FDA began a priority review of Bristol Myers Squibb's application for an all-new type of cancer immunotherapy called relatlimab. This is an antibody that prevents tumor cells from exploiting LAG-3, one of many checkpoints that normally prevent the immune system from accidentally destroying healthy tissue. The FDA expects to issue an approval decision from this all-new checkpoint inhibitor on or before March 19.
Opdivo is another checkpoint inhibitor from Bristol Myers Squibb that acts on the PD-1 checkpoint. Opdivo is extremely effective for patients who respond to it, but far too many don't respond at all.
In the study underpinning its application, adding relatlimab to Opdivo reduced melanoma patients' risk of disease worsening or death by 25% compared with treatment with Opdivio on its own. Unfortunately, side effects severe enough to warrant hospitalization were reported among 18.9% of patients who received the combination compared to 9.7% of those who received Opdivo on its own.
The questionable safety-to-benefit ratio of the relatlimab plus Opdivo combo isn't necessarily bad. That said, it could persuade the FDA to wait and see if adding relatlimab to Opdivo improves these patients' overall chances of long-term survival.
Eli Lilly and Innovent: Sintilimab
Smart partnering decisions helped make Eli Lilly the best-performing pharmaceutical stock of the past five years. A licensing agreement with Innovent, one of the most successful biotechnology companies in China, could help Lilly stay on top for the next five years.
This March, the FDA is expected to make an approval decision regarding sintilimab, a PD-1 inhibitor that is already successful in China under the brand name Tyvyt. Pivotal studies run in China provided strong evidence of safety and efficacy, but Eli Lilly might have to run a large and expensive pivotal trial in the U.S. to satisfy the FDA.
The agency doesn't have a policy that says U.S. trials are necessary before it will approve a new cancer drug. Instead, agency officials have been vocal about the need for results that are generalizable to the U.S. population.
On Feb. 10, 2021, the FDA will hold an advisory meeting to see what independent experts have to say about the available data. It doesn't seem likely, but it will have huge implications for the entire industry if Tyvyt can earn U.S. approval without more time and domestic investment.
AstraZeneca and Merck: Lynparza
Since earning first approval in 2014 to treat ovarian cancer, Lynparza sales have grown to an annualized $2.4 billion for AstraZeneca and around $980 million for its oncology collaboration partner Merck. An expansion to treat HER2-negative breast cancer patients after they've had chemotherapy has been pushing Lynparza sales higher since 2018.
Before the end of the first quarter, the FDA could approve Lynparza to treat the much larger population of HER2-negative breast cancer patients following their first surgery to prevent the risk of recurrence. Recurrence prevention treatments, called adjuvants are extremely valuable because these patients tend to keep taking them for a very long time.
During the phase 3 trial supporting Lynparza's potential label expansion to the adjuvant setting for HER2-negative breast cancer, it reduced patients' risk of disease recurrence by 42% compared to a placebo.
At less than $2.2 billion in the first nine months of 2021, sales of AstraZeneca's COVID-19 vaccine have been a little dissapointing. An expansion to the adjuvant setting for Lynparza, though, could go a long way to help investors feel better about the years ahead.
