From Morgan Stanley (no rating since MS is a financial advisor on
the Celgene merger)....
Pt 2 failure negative for Opdivo perception
CM-227 Part 2 (Opdivo + chemo) surprisingly failed with OS
HR and median OS worse compared to MRK's Keytruda KN-
189 cross-trial. We see risk that debate ensues about relative
efficacies of the two PD-1 agents.
In 1L non-squamous lung cancer Opdivo + chemo showed non-significant OS HR
of 0.86, median OS of 18.88 months (vs. 15.6 for chemo), and one-year
landmark OS of 67% (vs. 59% for chemo). These results are numerically worse
cross-trial against Keytruda + chemo (KN-189), which showed OS HR of 0.56,
median OS of 22.0 months (vs. 10.7 for chemo), and one-year OS of 70% (vs. 48%
for chemo). See Exhibit 1.
As we indicated in our report "Imminent lung readouts," we see this outcome as
a negative for BMY shares and Opdivo perception. We believe these data could
cause investors and key opinion leaders to debate whether Opdivo may be
inferior to Keytruda. We await future oncology expert assessments.
A small glimmer of hope for Opdivo + Yervoy, but we have low expectations
and need to compare figures cross-trial with Keytruda KN-042 results.
In 1L PDL1+ lung cancer Opdivo + Yervoy showed OS benefit vs. chemotherapy. We await
details at a future medical meeting. Opdivo + Yervoy would have to show
considerably better results cross-trial than Keytruda monotherapy, which showed
OS HR of 0.81, median OS of 17 months (vs. 12 for chemo), and one year OS of
60% (vs. 50% for chemo), in order to justify the addition of Yervoy. See Exhibit 1.
If Opdivo + Yervoy does show better results than Keytruda monotherapy, it
would also need to show compelling efficacy relative to the PD-L1+ group of 189,
which showed 0.55 HR in PD-L1+ 1–49% and 0.42 HR in PD-L1+ ≥ 50%, plus an
acceptable relative toxicity profile.