This week, the FDA granted approval for Merck & Co., Inc. MRK’s Keyruda for chemotherapy combination treatment of frontline lung cancer. While the approval was far from a surprise, it may be enough to move the needle for both Merck and rival Bristol-Myers Squibb Co BMY.
BMO Capital raised its price target for Merck following the Keytruda approval from $71 to $74 and says Keytruda’s label is “solid.”
“Based on our oncologist surveys, we expect strong uptake in IL-NSCLC given Keytruda’s broad label and significant market lead,” analyst Alex Arfaei explained. BMO is predicting roughly $4 billion in Keytruda sales in 2017, ahead of Wall Street consensus expectations of $3.5 billion. BMO forecasts sales will hit $10 billion in 2020 compared to consensus expectations of only $7 billion.
For Bristol-Myers, a rival getting to market is never good news. JPMorgan analyst Chris Schott said Bristol-Myers shares could be under pressure in coming days, but the company has some promising candidates in its pipeline as well.
“We continue to see positive CM-227 data as a key catalyst for shares and see a high probability of success for at least some portions of the pivotal Ph. III CM-227 study given solid phase I data and enhancements made to the design of the trial over time,” Schott explained.
JPMorgan predicts “fairly rapid adoption within the labeled indication” for Keytruda. The firm forecasts…
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