Merck (MRK) released phase III data for an injection form of its blockbuster cancer treatment drug Keytruda and announced the FDA is reviewing the application for approval.
The data showed that when given to patients with a type of lung cancer in tandem with chemotherapy, a two-minute injection was as effective as receiving it intravenously (IV) plus chemotherapy.
The company said this could open the door for other cancers treated by Keytruda and potentially give Merck a new product at a time when the drug, which brought in nearly $30 billion in revenue in 2024, will face competition after its patent expires in 2028.
Analysts have mixed opinions about the benefit to Merck’s bottom line for the injectable, or subcutaneous, product — since not all IV patients will move to injections, and the price of the injection will be much lower, meaning lower revenue potential.
“Debatable whether or not the sub-cu formulation will be sufficient to stem/offset declining sales when the drug faces patent loss in a couple years,” wrote Mizuho’s healthcare expert Jared Holz in a note to clients in February.
As of 3:42:03 PM EDT. Market Open.
When topline phase III data was released in November, hinting at the potential of success, Jefferies analyst Akash Tiwari wrote in a note that it could benefit Keytruda patients with other types of cancers.
“We think this is an [important] win for MRK, as they should be able to bridge approval for all IV solid tumor indications in the US [with] this data. For switch dynamics, keep in mind that MRK expects ~50% of Keytruda IV [population] would be addressable for the [subcutaneous] route,” Tiwari wrote.
Analysts see the Keytruda injection as key to buoying Merck’s stock, as the company has hit a few headwinds — including slower demand of the HPV vaccine, Gardasil, in China, a key market — in the past year.
There have been questions about how this impacts the future of Medicare drug pricing negotiations for these drugs, as drugmakers who have pursued similar routes have claimed the drugs are different products if they are administered through an injection rather than intravenously. And Medicare has not yet addressed that point.
The shift to an injection results in lower treatment time for patients — from nearly two hours to one hour, which is why it is a new popular target for drugmakers. The pivot to an injection isn’t new. Other companies, like Roche (RHHBY) and Bristol Myers Squibb (BMY), are already in the space with injectable cancer therapies, and Merck is playing catch-up.
The FDA has set a decision date of September 23, by which it will either approve or reject the injectable drug.
