Opdivo tops Yervoy in melanoma win analyst says could pad Bristol-Myers' I-O sales by $1B

Leerink Partners analyst Seamus Fernandez expects Opdivo to become the standard of care for high-risk, post-surgery melanoma patients.

Bristol-Myers Squibb’s battered Opdivo registered a positive surprise Wednesday, topping fellow BMS checkpoint med Yervoy in an adjuvant melanoma trial. And while the news may not have wowed investors, some analysts say it could give the company’s top line a serious lift.

In a phase 3 study evaluating Opdivo against Yervoy in certain postsurgery patients at high risk of recurrence, Opdivo nailed its primary endpoint at an interim analysis, posting superior recurrence-free survival data. And that’s important, considering the majority of patients in that pool see their disease return after surgery, Vicki Goodman, Bristol’s melanoma development lead, said in a statement.

The news “comes as a surprise,” Leerink Partners analyst Seamus Fernandez wrote in a note to clients, noting that top-line data weren’t expected until the study’s final readout in the second half of 2018. But investors weren’t all that impressed, with shares through the morning staying mostly put.

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Fernandez, though, sees reason for optimism, despite the fact that just how large Opdivo’s benefit was remains under wraps for now. “We would expect it to become the standard of care in high-risk patients following surgical resection given its superior safety and tolerability profile relative to Yervoy,” he wrote.

Overall, Fernandez expects the entrance of PD-1 players into the adjuvant melanoma market to expand worldwide sales of the meds by $3 billion, with Merck’s Keytruda likely following Opdivo onto the scene. So while Opdivo’s win will cannibalize Yervoy’s adjuvant saleswhich Fernandez pegs at between $300 million and $400 millionthe overall expansion should still hand Bristol an extra $1 billion in immuno-oncology sales, he predicts.

RELATED: With ASCO data tallied, Bristol-Myers loses ground to Merck in I-O field

That’s an important boost for Bristol, which industry watchers see as having fallen behind Merck on the PD-1 front. The drugmaker has come up short and faced delays in the key non-small cell lung cancer field, considered the most lucrative market for I-O meds.

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