With 6 rivals in the U.S., why would Lilly shell out up to $1B for Innovent's PD-1 med Tyvyt?

Eli Lilly
Eli Lilly has expanded its PD-1 deal with China's Innovent BIologics to include markets outside of China, and it anticipates an initial launch of Tyvyt in the U.S. in the next two to three years. (Eli Lilly)

Eli Lilly, on the heels of detailing a clinical win in China for PD-1 inhibitor Tyvyt, has decided to take a bigger stake in the drug developed by partner Innovent Biologics in an expanded deal that could vault it into the lucrative—yet ultra-competitive—U.S. lung cancer market.

Lilly’s shelling out $200 million up front and committing up to $825 million in milestones, plus double-digit royalties, to gain exclusive rights to Tyvyt (sintilimab) outside China. The companies already share the med in China itself.

Six PD-1/L1 agents are already on the U.S. market, with Merck & Co.’s megablockbuster Keytruda firmly leading the pack. But Lilly thinks it could carve out a share with Tyvyt.

Tyvyt first earned its China nod in third-line classical Hodgkin lymphoma in late 2018, and the med’s looking at a potential new indication in previously untreated nonsquamous non-small cell lung cancer down the line.

According to data from the China phase 3 Orient-11 trial, Tyvyt used in tandem with Lilly’s Alimta and platinum chemo helped those lung cancer patients live a median 8.9 months without their tumors progressing, significantly longer than the 5.0 months experienced by the chemo group.

RELATED: WCLC: Lilly, Innovent tout Tyvyt front-line lung cancer win. Can it challenge Merck’s Keytruda?

In a statement to FiercePharma, Lilly spokesperson Mark Taylor highlighted Orient-11 as one of the potential targets for future submissions with the FDA, adding that the company anticipates a possible U.S. launch in the next two to three years.

“We look forward to working with the FDA on the most expeditious path to filing in the U.S., leveraging existing data where possible,” he said.

And it’s quite possible. At last year’s American Association for Cancer Research meeting, Richard Pazdur, director of FDA’s Oncology Center of Excellence, said the agency would consider accepting applications based on China-only clinical data.

In fact, Chinese biotech BeiGene snagged an FDA green light for BTK inhibitor Brukinsa last year in mantle cell lymphoma with clinical data primarily generated in China. At that time, SVB Leerink analyst Andrew Berens said the approval validated a U.S. regulatory path for an approval based largely—if not solely—on China results.

Keytruda is currently the rightful king in front-line NSCLC treatment in the U.S. On the progression-free survival front, Tyvyt’s Orient-11 data look very similar to Keytruda’s in the Keynote-189 trial, where a Keytruda-chemo combo demonstrated a median progression-free survival of 8.8 months, versus 4.9 months for chemo alone. But Tyvyt only showed a nominally significant improvement in patients' lifespan, whereas Keytruda showed it could slash the risk of death by 51%.

Tyvyt could compete on pricing, part of the reason Pazdur said he would welcome competition from China-developed PD-1s in the U.S. The Lilly-Innovent drug recently became the first immuno-oncology agent to land on China’s national reimbursement scheme after a steep discount.  

Lilly’s Taylor, though, declined to share the company’s pricing strategies in the U.S. He pointed to Tyvyt’s clinical data, “overwhelmingly positive customer reactions” in China as well as the national coverage as evidence of its potential outside the country.

RELATED: Roche pens $2B biobucks pact with Innovent Biologics for bispecific and cell therapies

However, Big Pharma's six existing PD-1/L1 offerings are likely not Tyvyt’s only competitors in the U.S.

BeiGene recently touted a clinical win for its former Celgene-partnered PD-1, tislelizumab, in its own Alimta-platinum chemo combo for first-line nonsquamous NSCLC. Celgene returned rights to the med after it was bought by Bristol Myers Squibb because of a conflict with Opdivo. Because its initial China go-ahead in classical Hodgkin lymphoma came late in December 209, tislelizumab wasn’t eligible for the China reimbursement talks where Tyvyt won its listing.

SVB Leerink’s Berens, in a November note to clients, said the Brukinsa U.S. approval “suggests BeiGene could also successfully leverage tislelizumab’s China-generated data in nonsquamous/squamous NSCLC as part of the submission for U.S. approval, potentially speeding time to market.”

Lilly first licensed Tyvyt from Innovent in 2015. The original deal included rights outside of China, but in 2017, Lilly licensed back those rights while retaining downstream economics, Taylor said. “Based on the success of Tyvyt in China and the promising data in new indications, Lilly and Innovent agreed Lilly is the best partner to now bring Tyvyt to markets around the globe,” he said.

Besides Tyvyt, the two are working on PD-1-based bispecific antibodies. Through a 2019 deal, Innovent also licensed China rights to Lilly’s dual GLP-1 and GCGR agonist OXM3 as a potential diabetes therapy.