Merck heaps early pressure on Bristol-Myers' Opdivo with Keytruda's kidney cancer debut

Analysts expect a Keytruda-Inlyta pairing to steal share from Bristol-Myers' Opdivo-Yervoy regimen. (Merck)

Bristol-Myers Squibb investors knew trouble would come for Opdivo when Merck’s Keytruda entered the kidney cancer arena, but that trouble just arrived two months early.

Monday morning, the FDA green-lighted a combination of the PD-1 med and Pfizer’s Inlyta for patients with previously untreated kidney cancer—and it did so well ahead of its decision deadline. Now, the regimen will go up against an Opdivo-Yervoy pairing in one of the Bristol-Myers drug’s key indications, and analysts give Merck the advantage.

“Based on our conversations with experts, we expect the combo to quickly be adopted in the majority of new patients,” Credit Suisse analyst Vamil Divan, M.D., wrote to clients Monday.

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RELATED: Big Keytruda survival win sets Merck up to steal Bristol-Myers Squibb's kidney cancer share

One major reason? Consistency. Back in February, Merck rolled out data showing the Keytruda combo could slash the risk of death by 46% among patients with tumors bearing biomarker PD-L1. But that figure was almost as high—41%—in the PD-L1 negative group.

That’s not what BMS saw in its Opdivo-Yervoy trials, and it’s not what wannabe competitor Pfizer, which is racing down the regulatory pathway with a combination of Inlyta and Keytruda classmate Bavencio, saw either. Those trials “showed a major effect of PD-L1 expression on efficacy,” Evercore ISI analyst Umer Raffat noted after Merck unveiled its data.

The Keytruda duo also worked consistently across risk groups, something Bristol-Myers can’t say about Opdivo-Yervoy.

“The fact that you have a combination with a really remarkable outcome as well as consistency of results across the spectrum of risk categories I think will be a game-changer for the field,” Scot Ebbinghaus, M.D., Merck VP of clinical research, said in February.

And Credit Suisse’s Divan has predicted that price could give Keytruda another lift, with Inlyta generics—which he forecasts for 2025—providing “a cost advantage” over Bristol-Myers’ regimen.

All told, Divan expects first-line kidney cancer to become “another indication where Merck will likely start taking share from Bristol,” which is exactly what BMS investors have been dreading since Merck’s early top-line results surprised the market in October.

RELATED: The skeptics were right: Bristol-Myers has pulled a crucial Opdivo lung filing as it awaits more data

And unfortunately for Bristol, it hasn’t been able to encroach on Merck’s territory in the same way; earlier this year, it withdrew its Opdivo-Yervoy application in first-line lung cancer, postponing a chance to take on its archrival in immuno-oncology’s most lucrative indication.

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