Merck, Bristol heat up immunotherapy race in lung cancer

By Bill Berkrot

Jan 12 (Reuters) - Bristol-Myers Squibb and Merck & Co broke further away from rival drugmakers in the race to treat lung cancer with a new generation of immune system therapies, adding pressure on the likes of Roche and AstraZeneca (Swiss: AZN.SW - news) to play catch-up.

Merck (Other OTC: MKGAF - news) said it would file an application with U.S. regulators in the middle of this year seeking expanded use of its new Keytruda treatment for non-small cell lung cancer, the most common form of the deadly disease.

That followed a late Sunday announcement by Bristol-Myers that independent monitors halted a trial of its Opdivo treatment for lung cancer when it became clear the drug extended survival compared with standard chemotherapy.

While the magnitude of the benefit was not yet known, it marked the first time the new class of immunotherapy demonstrated an overall survival benefit in lung cancer.

Some industry analysts expect this class, known as PD-1 or PD-L1 inhibitors, to generate more than $30 billion in worldwide annual sales by 2025, with lung cancer seen as the most lucrative use.

Keytruda and Opdivo are already approved to treat advanced melanoma, the most deadly form of skin cancer. They work by blocking a mechanism used by tumors to hide from disease fighting immune system cells.

Sanford Bernstein analyst Tim Anderson sees Merck closing a perceived gap with Bristol-Myers in using their drugs for lung cancer.

"The review time for Merck's application could be on the order of a few months," implying approval in the second half of 2015, nearly a year earlier than Wall Street had expected, Anderson said in a note. As a result, "Merck may only be about six months behind Bristol-Myers in bringing its product to market."

Bristol has not said when it expects an approval decision for Opdivo as a treatment for lung cancer.

Leerink Partners analyst Seamus Fernandez said in a research note that Merck's rapid advancement may pose a setback to similar programs from Roche and AstraZeneca (NYSE: AZN - news) .

Roche's timeline for seeking regulatory approval remains unclear, Fernandez noted. AstraZeneca, meanwhile, may not be able to secure an accelerated review in lung cancer if the Bristol-Myers or Merck drug is already on the market, potentially adding several months to a decision on its contender.

Roche said it expects pivotal data for its PD-L1 drug in lung and bladder cancer in the first half of this year, with potential filings seeking approval in the second half if the trials are successful.

Bahija Jallal of AstraZeneca's MedImmune oncology unit, speaking at the JP Morgan healthcare conference in San Francisco, said the company's focus was on testing combinations of its immunotherapy with its own traditional drugs.

"I think we're in a great position because we have biologics on one side and small molecules on the other side," Jallal said.

Lung cancer is the leading cause of cancer deaths globally, killing more than 1.5 million people each year, according the World Health Organization.

Bristol-Myers shares were up 3 percent at $62.17, while Merck shares were off 0.4 percent at $62.27. (Reporting by Bill Berkrot in New York; Additional reporting by Caroline Humer in San Francisco; Editing by Leslie Adler)