Courtship in the clinic: Seagen unveils positive bladder cancer data for Padcev-Keytruda combo amid merger talks with Merck

Over the last several weeks as Merck and Seagen have reportedly considered a merger, one of the key factors at play in determining the value of the Seattle biotech was impending data from a trial of its bladder cancer drug, Padcev.

On Tuesday, Seagen and Astellas revealed some positive data from one of the cohorts in the phase 1b/2 urothelial cancer trial. Specifically, in the group testing Padcev as a first-line treatment in combination with Merck’s Keytruda for unresectable locally advanced or metastatic UC (la/mUC) patients who are ineligible to receive cisplatin-based chemotherapy, 64.5% had a confirmed objective response rate (ORR).

While lauding the efficacy win, analysts at SVB Securities pointed out that the statement lacked key details such as "duration of Padcev usage (number of cycles), durability metrics (median duration of response not reached) and the efficacy of the Padcev monotherapy arm.

"We think that the absence of inclusion of the monotherapy data in the press release suggests the activity/duration is likely meaningfully less than combination, important to some investors speculating on the likelihood of optionality, which would be largely driven by synergies with checkpoint agents," wrote Andrew Berens senior biotech analyst at SVB, in a note to clients

Seagen and Astellas will discuss the results with regulators, Ahsan Arozullah, M.D., Astellas’ SVP and head of development therapeutic areas, said in the release. 

Berens said: "We think it is widely anticipated that the results could form the basis for an accelerated approval," and Berens pegs overall peak sales for Padcev at $7.7 billion. Padcev is in development for various forms and settings of bladder cancer as well as in a solid tumor trial.

The results announced today are lower than the 73% ORR previously reported from a separate cohort from the same trial that included a similar patient population as cohort K. This drop was “not unexpected,” according to Evercore ISI analyst Josh Schimmer stated in a note.

Padcev originally won its U.S. go-ahead under accelerated approval but has since converted that nod to a full green light. It is available for la/mUC patients who previously received a PD-1 or PD-L1 inhibitor like Keytruda and a platinum-containing chemotherapy in the neoadjuvant/adjuvant metastatic setting as well as for such patients who are ineligible for cisplatin-containing chemotherapy and have previously received one or more prior lines of therapy.

Besides adding billions to its sales potential if Padcev gets first-line la/mUC approval, a regulator nod would also extend Keytruda’s patent protection in the indication beyond 2027.

The FDA granted the combo a breakthrough designation in February 2020. 

And regarding the still-to-come trial results on Padcev as a solo agent, Berens said he expects those to be presented at the ESMO medical conference this September.

The recent results continue to show that Keytruda and Padcev in combination are “still differentiating,” between either as a monotherapy in the indication, Schimmer said. He pointed to previous data showing that in patients ineligible for cisplatin chemotherapy, Keytruda alone showed a 24% ORR, while Padcev’s rate as a monotherapy, following checkpoint inhibitor treatment, was approximately 50%.

The results should help Merck and Seagen get to a resolution in their ongoing merger talks. Eleven days ago, The Wall Street Journal reported that the deal was unlikely to be completed until after each company reports their quarterly earnings, citing people familiar with the matter. Both companies' earnings releases are scheduled for Thursday.

Another factor cited by the WSJ’s sources as a reason for the delay is ongoing patent litigation between Seagen and Daiichi Sankyo of Japan.

In April, a Texas court granted a $41.8 million award to Seagen, ruling that its patents were infringed in Daiichi’s development of breast cancer drug Enhertu. If Daiichi’s appeal is unsuccessful, Seagen will seek future royalties and milestone payments for the increasingly successful drug.