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Merck's Keytruda Gets Priority Review for Rare Skin Cancer

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Merck & Co., Inc. (MRK - Free Report) announced that a supplemental Biologics License Application (sBLA) for its anti-PD-1 therapy, Keytruda, has been accepted under priority review by the FDA.

With the latest application, Merck is looking to expand the label of Keytruda for the treatment of adult and pediatric patients with recurrent locally advanced or metastatic Merkel cell carcinoma (MCC). It is a rare form of skin cancer and the death rate is higher than other skin cancers including melanoma. Per Merck’s press release, about 2,500 cases of MCC are diagnosed annually in the United States, which creates significant unmet need for this disease.

With the FDA granting priority review, a decision is expected on Dec 28. The sBLA was based on data from phase II KEYNOTE-017 study.

So far this year, Merck’s shares have outperformed the industry, rising 20.7% compared with a 4.6% increase for the industry.



Keytruda is a key contributor to Merck’s sales growth.In a very short span of time, Keytruda has become Merck’s largest product. It is already approved for use in 12 indications across eight different tumor types in the United States.

The treatment generated sales of $1.67 billion in second-quarter 2018, up 13.8% sequentially and 89% year over year. Sales were driven by the launch of new indications globally. Keytruda sales are gaining particularly from strong momentum in the first-line lung cancer indication as it is the only anti-PD-1 approved in first-line setting.

Keytruda development program is also progressing well and is being studied for more than 30 types of cancer in more than 800 studies, including more than 400 combination studies. Merck is collaborating with several companies including Amgen (AMGN - Free Report) , Incyte (INCY - Free Report) , Glaxo (GSK - Free Report) and Pfizer separately for the evaluation of Keytruda in combination with other regimens.

Several regulatory decisions for new indications in the United States as well as in Europe are due in the second half of 2018 and 2019, which if approved can further boost sales. A key decision on the label expansion of Keytruda as a first-line treatment for metastatic squamous non-small cell lung cancer (NSCLC), a difficult-to-treat lung cancer patient population, based on data from the phase 3 KEYNOTE-407 study is expected in October.

Merck 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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