Did Gilead overpay for Immunomedics? Trodelvy answered that $21B-dollar question at ESMO: analyst

Immunomedics' Trodelvy, soon to be bought by Gilead, has increasing potential to reach $4.7 billion in sales in breast cancer alone, RBC Capital Markets analyst Brian Abrahams said. (Olivier Le Moal/Getty Images)

Since Gilead Sciences unveiled a $21 billion buyout of Immunomedics centered on Trodelvy, industry watchers have been busy crunching the numbers. Now, after seeing new data, one analyst sees broad opportunity for the antibody-drug conjugate that justifies the purchase price.

RBC Capital Markets analyst Brian Abrahams predicts Trodelvy could capture $4.7 billion in peak sales in breast cancer alone. He sees “increasing potential” for that scenario after talking to “a renowned oncologist with 21+ years of experience who directs the breast cancer division at a major research hospital and institute in the U.S.”

The reason for the “fresh excitement?” Life extension data presented last weekend at the European Society of Medical Oncology virtual congress.

Data from the phase 3 Ascent trial showed that Trodelvy cut the risk of death by 52% among metastatic triple-negative breast cancer patients who had previously failed on at least two chemo regimens. The anti-TROP-2 drug helped patients live a median 12.1 months, versus 6.7 months for the chemo group.

The expert, describing the effect as “striking,” noted that the benefit is unusually positive and has therefore set Trodelvy as the new standard in later-line mTNBC.

RELATED: ESMO: New Trodelvy breast, bladder cancer data show why Gilead's going big for Immunomedics

But the drug is also linked to some high rates of side effects; more than 50% of patients experienced diarrhea and nausea, Abrahams noted, and Trodelvy also produced a higher rate of neutropenia than chemo did.

These problems made the expert wonder whether Trodelvy’s payload is as specific to cancer cells as it could be, Abrahams said in a Thursday note. In fact, an academic breast cancer expert SVB Leerink analyst Geoffrey Porges previously interviewed called Trodelvy a “fancy chemotherapy”—as opposed to a true targeted therapy—that carries some tolerability issues as traditional systemic chemo drugs do.

Abrahams’ expert, while acknowledging some patient dropouts from the trial, argued that many oncologists prioritize efficacy over safety. Based on Trodelvy’s showing in Ascent, the expert, as well as Abrahams, believes Trodelvy’s use in later-line mTNBC could be “close to universal.”

Still, the question of whether Gilead overpaid for Immunomedics never revolved around late-line mTNBC, but rather on Trodelvy’s ability to expand into earlier lines of treatment across multiple tumor types, including HR-positive, HER2-negative breast cancer.

The expert expressed comfort that the drug would once again beat standard of care in earlier lines of mTNBC. He even forecast rapid off-label uptake in those who immediately fail after surgery and radiation. Overall, Abrahams predicts Trodelvy could penetrate 51% of the mTNBC market.

RELATED: Gilead needs 'heroic' Immunomedics revenues to get a return on $21B deal: analyst

As for the much larger HR-positive indication, the expert expects Trodelvy will succeed there as well, based on his view that HR-positive patients who are refractory to hormone therapies tend to behave similarly to TNBC patients.

The HR-positive disease rate is about seven times that of TNBC—but of course, there are also more treatment options available in HR-positive disease. Patients in that population tend to be older, too, meaning they may be less able to tolerate Trodelvy because of their other conditions.

With those factors in mind, Abrahams has assigned about 30% to 40% penetration for Trodelvy in second- and third-line HR-positive breast cancer. 

For now, the expert noted that few, if any, of his colleagues were talking about Trodelvy’s strong overall survival data. “This low awareness could indicate that initial off-label use coming out of ESMO data may be slow, but it also suggests that with active marketing Gilead should be able to unlock the full market opportunity for Trodelvy as it begins to leverage its sales force,” Abrahams said.