Summit Therapeutics' ivonescimab has demonstrated superior performance compared to Merck's Keytruda in a Phase 3 clinical trial for treating first-line advanced non-small cell lung cancer (NSCLC) that expresses the PD-L1 protein. This development poses a potential challenge to Keytruda's market dominance, although further trials and regulatory approvals are necessary.
Keytruda's Market Position and Potential Threats
Keytruda has been Merck's top-selling medicine, accounting for approximately 45% of the company's revenue in the second quarter, with sales reaching $7.3 billion, a 16% increase year-over-year. A significant portion of Keytruda's sales is attributed to NSCLC, which constitutes about 85% of all lung cancer cases and is the leading cause of cancer death worldwide. Keytruda gained its second approved indication in the U.S. for advanced NSCLC expressing the PD-L1 protein in 2015, giving it a head start in this market.
However, Summit Therapeutics' ivonescimab has shown promise in a Phase 3 study conducted in China. Ivonescimab is the first therapy to outperform Keytruda in a Phase 3 study for this specific indication. While this result is significant, ivonescimab still needs to secure approval and further expand its reach to challenge Keytruda across all NSCLC indications.
Regulatory Hurdles and Future Prospects for Ivonescimab
The ivonescimab study conducted in China is unlikely to serve as the basis for approval in the U.S. The FDA will likely require U.S.-based Phase 3 trials, potentially delaying its entry into the U.S. market by a couple of years or more. Therefore, Keytruda's position remains relatively secure in the immediate future, even if ivonescimab gains approval in China for this specific indication.
Patent Expiry and Merck's Mitigation Strategies
Keytruda's patent exclusivity in the U.S., its most important market, will expire in 2028. This will likely lead to a significant decline in sales as generic competition emerges. To counter this, Merck is developing a subcutaneous formulation of Keytruda, which is projected to generate up to $8 billion in revenue by 2030. This new formulation will not cover all previous indications, but it will help offset some of the losses.
Merck is also relying on recent approvals, such as Winrevair for pulmonary arterial hypertension, and a robust pipeline of over 30 programs in Phase 2 and over 80 in Phase 3 to sustain revenue growth. A modest success rate of 20% from these programs could significantly bolster Merck's product lineup in the coming years.
