Pfizer-Merck KGaA Skin Cancer Drug Bavencio Gets EU Approval

Pfizer Inc. (NYSE:PFE) and German partner Merck KGaA announced that their anti-PD-L1 monoclonal antibody, Bavencio (avelumab), has been granted marketing authorization in the EU as a monotherapy for treating adult patients with metastatic Merkel cell carcinoma (mMCC), a rare and aggressive skin cancer. The company expects to make the drug commercially available in the EU along with Germany and the U.K. within the next month.

Notably, with this approval, the drug will now be marketed in the 28 countries of the EU including Norway, Liechtenstein and Iceland. It is the first approved immunotherapy in the EU for the given indication.

Bavencio received the FDA approval for mMCC in March. With the approval, the drug became the first immunotherapy option for the said cancer treatment. In May, Bavencio received the FDA approval for a second indication. The drug was approved for urothelial carcinoma, an aggressive disease with a high rate of recurrence. Also, earlier this month, the drug was granted with an approval in Switzerland for treatment of mMCC.

Pfizer’s shares are up 10.7% so far this year, comparing unfavorably with the 16.6% rally of the industry during the period.

The approval was supported by positive data from the phase II study, JAVELIN Merkel 200.

We remind investors that the approval follows a positive opinion adopted by the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA), recommending approval of Bavencio for mMCC in July.

Pfizer will focus on Bavencio, continuously growing and expanding into new indications and markets globally.

Also, Bavencio is being evaluated in collaboration with Merck KGaA for different types of cancers including late stage-studies for renal cell carcinoma, lung cancer, ovarian cancer, plus head and neck cancer.

Although Pfizer is a major player in immunotherapy, there are several other big and small companies, looking to develop and introduce immunotherapy treatments to the market.

As a matter of fact, Merck & Co., Inc. (NYSE:MRK) is conducting numerous studies to evaluate its anti-PD-1 therapy, Keytruda, for more than 30 types of cancer in more than 550 studies, including more than 300 combination studies. AstraZeneca plc’s (NYSE:AZN) recently approved immuno-oncology drug Imfinzi (durvalumab) is being assessed for multiple cancers (either alone or in combination with other regimens) and has bright long-term prospects.

Smaller biotechs are also working to bring innovative immuno-oncology treatments to the market. Kite Pharma's (NASDAQ:KITE) lead drug axicabtagene ciloleucel is currently under priority review in the United States for treating aggressive non-Hodgkin lymphoma (NHL) with an FDA decision expected on Nov 29.

However, we believe, Bavencio can give these drugs a tough run for their money as there is ample scope for growth in the immuno-oncology space.

Zacks Rank

Pfizer currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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