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Bristol-Myers' new cancer data opens door to bigger market, execs say

In a crowded immuno-oncology field, Bristol-Myers Squibb Co.'s latest lung cancer data shows it is looking to get ahead of the competition with a broader patient reach.

The New York City-based drugmaker's earnings rose 8% in the fourth-quarter of 2017 and largely beat revenue expectations for the full year. Notably, cancer drug Opdivo made $4.9 billion over the year, leading the class of therapies known as checkpoint inhibitors, or those that target the interaction between PD-1 proteins on healthy cells and PD-L1 proteins on the surface of tumor cells that have been shown to suppress the immune system.

Its closest competitor, Merck & Co. Inc.'s Keytruda, made $3.8 billion in 2017.

Bristol-Myers' earnings call centered on data from its ongoing, key late-stage lung cancer trial, called Checkmate-227, that showed early indications that a combination of Opdivo and another Bristol-Myers' therapy, Yervoy, could treat in patients that do not necessarily have high levels of PD-L1 — the usual marker for using these types of therapies — but still show a high tumor mutation burden, or TMB, a broader indicator of cancers' makeup.

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The company had previously restructured the trial to include this arm after the Opdivo/Yervoy combination missed the mark in an earlier study.

How much a TMB focus would broaden the potential patient population is a source of debate. Bristol-Myers said about 45% of the Checkmate-227 patients fit into their targeted TMB range. That largely squares with data released at the American Society of Clinical Oncology conference in 2016 that estimated about 40% of lung cancer patients fell in this range, Evercore ISI analyst Umer Raffat said in a note. However, if the bar is slightly raised to target patients with the highest mutation, the population falls to 13%, Raffat added.

Importantly, the TMB arm could make the case for Yervoy, which has shown specific effectiveness in patients with low levels of PD-L1, yet stumbled in earlier trials for the lung cancer population, stoking concerns that it could be a takeover target.

However, the TMB data is still early and restricted for the time to progression-free survival, or living without the disease worsening. Bristol-Myers would eventually like to add the key endpoint of overall survival — which includes goals such as minimizing the tumor or achieving remission — but the data shared today is still very fresh, Thomas Lynch, executive vice president of R&D and chief science officer, said.

It is also challenging to pin down the number of cancer patients with high PD-L1 levels. This class of drugs has mostly been tested in lung cancer, as well as forms of skin, kidney and gastrointestinal cancer that have shown high levels. Merck has previously reported that about 30% of patients screened for lung cancer studies showed high levels, while about 66% showed PD-L1 expression of any type.

Checkmate-227 includes an arm comparing the Opdivo/Yervoy combination to chemotherapy in the PD-L1 population, but in this case targeting overall survival. That arm will likely be closely compared to Merck's ongoing trial studying a Keytruda and chemotherapy combination head-to-head with more complex pairings — a trial that the rival recently said will "set the bar" for this drug class in the future.

Checkmate-227 helps define which patients will actually benefit from different treatment strategies, Bristol-Myers Chairman and CEO Giovanni Caforio said on the call. "It is clear that for patients with low TMB, going for a combination of immuno-oncology agents may not be the right strategy. So I think there is clearly room in this market for multiple treatment strategies," he said.

Bristol-Myers is measuring the TMB population's response to the combination in 100 clinical trials, Caforio added.