Merck, Pfizer get first OK for checkpoint inhibitor avelumab

There's now a fourth player in the PD-1/PD-L1 inhibitor market, after Merck KGaA and Pfizer won FDA approval for avelumab in a rare form of skin cancer.

Avelumab - which will be sold under the Bavencio trade name - has been given the nod by the US regulator for Merkel cell carcinoma (MCC), and is the first drug to be approved for this particularly aggressive form of skin cancer which is diagnosed in around 1,600 people in the US per year.

Although most MCC patients present with localised tumours that can be treated with surgical resection, approximately half of all patients will experience recurrence, and around a third will eventually develop metastatic disease. Fewer than half of patients survive more than one year and less than 20% are still alive five years after diagnosis.

The drug has been given accelerated approval in the US based on response rates from the single-arm JAVELIN Merkel 200 trial involving just 88 patients who had failed to respond to prior chemotherapy for MCC. According to the FDA, 33% of patients experienced tumour shrinkage while on avelumab therapy, with around 9% of patients seeing a complete response to the treatment.

That data - as well as the results of trials from other checkpoint inhibitors in MCC - prompted the trial investigators to suggest these drugs could emerge as a new standard for treatment of the cancer. It is also under review in the EU for MCC, and in both the US and EU for bladder cancer, with the FDA scheduled to deliver its verdict on the second indication by 27 August.

Bavencio will be launched with a wholesale acquisition cost (WAC) of around $13,000 per month, which is roughly in line with the price of the three other marketed checkpoint inhibitors - Bristol-Myers Squibb's Opdivo (nivolumab), Merck & Co's Keytruda (pembrolizumab) and Roche's Tecentriq (atezolizumab).

Merck and Pfizer have claimed the fourth position in the PD-1/PD-L1 inhibitor category ahead of AstraZeneca, whose durvalumab has been hit by some delays in its late-stage testing and a decision to focus on combination therapy.

Analysts have predicted avelumab sales of around $600m in 2020 - rising to $4bn-plus at peak - despite eventually jostling with rival checkpoint inhibitors for market share in some indications. For its part, Merck said recently that it expects to see €2bn in revenue from new launches between 2017 and 2022, with a new product or indication launch every year, and avelumab's roll-out features prominently in that plan.

Pfizer paid Merck a record $850m upfront to jointly develop and market avelumab for multiple cancer indications in 2014, and the deal could be worth up to $2.85bn to the German drugmaker if avelumab's roll-out proceeds as planned.