JP Morgan 2017: With a little help from Incyte, Merck & Co. progresses novel immuno-oncology combination into four Phase III studies

Merck & Co. announced on Monday that it will advance the combination of Keytruda and Incyte's IDO inhibitor epacadostat into Phase III studies for non-small cell lung, renal, head and neck and bladder cancer. This follows a decision to initiate late-stage studies in malignant melanoma in mid-2016 (ViewPoints: ESMO preview – Melanoma success for epacadostat/Keytruda combination could set Incyte on path to broader opportunity, say experts). As a result, Merck will become the first company to assess PD-1/IDO inhibitor combinations in Phase III studies in these tumour types.

Analysts are Barclays suggest that NSCLC will assume initial priority. Earlier this year, Keytruda was approved by the FDA as a first-line monotherapy in NSCLC patients with high levels of PD-L1 biomarker expression. In pivotal-stage studies, the company is also assessing the combination of Keytruda and chemotherapy in first-line NSCLC and will likely take out the insurance policy of studying Keytruda with Bristol-Myers Squibb's CTLA-4 inhibitor Yervoy, suggests Bernstein analyst Tim Anderson (Bristol-Myers Squibb recently 'mirrored' this strategy by initiating a Phase III study for its PD-1 inhibitor Opdivo in combination with chemotherapy).

Based on currently available data (but subject to change once PD-1/chemotherapy results read out later this year) the Keytruda/epacadostat combination will likely be benchmarked against efficacy shown to date for Opdivo plus Yervoy; however, use of an IDO inhibitor should provide "a more manageable adverse event profile," suggest analysts at Barclays. This also reflects the potential advantage that Keytruda/epacadostat could show versus Opdivo/Yervoy when Phase III data read out in melanoma.    

Speaking in San Francisco on Monday, Incyte CEO Hervé Hoppenot said that sufficient Phase II data from 600 patients became available in late December and Merck quickly agreed to push the combination into additional Phase III studies. Discussions regarding both design of the trials and financial considerations are ongoing, noted Hoppenot; for NSCLC the majority of patients treated in Phase II had received chemotherapy prior to the combination, he told FirstWord on the sidelines.

Echoing Incyte's agreement with Merck in melanoma – where the two companies have contributed 50 percent of the R&D costs and own equal share of the data – Hoppenot was quick to remind investors that it retains full ownership of epacadostat.

This consideration alone will keep Incyte in the spotlight as a potential acquisition target, as will management's emphasis that the company remains ahead of the competition when it comes to IDO inhibition; Roche – through its Genentech division – and Bristol-Myers Squibb both have access to drugs in this class, both of which are currently in Phase I/II testing.


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