The signs were definitely there for a disappointment from Bristol-Myers Squibb (NYSE: BMY). Several weeks ago, AstraZeneca (NYSE: AZN) reported its checkpoint inhibitor Imfinzi failed to improve progression-free survival in a late-stage study targeting lung cancer. There were concerns that Bristol-Myers Squibb (BMS) could experience a similar letdown when the company announced results from a late-stage study of its own checkpoint inhibitor, Opdivo, combined with chemotherapy in treating lung cancer.
A disappointment came, but it was in a totally different indication. Last week, BMS announced mixed results from its late-stage CheckMate-214 clinical trial evaluating a combination of Opdivo and Yervoy as a first-line treatment for renal cell carcinoma, the most common type of kidney cancer. Improvement in progression-free survival for the combo wasn't statistically better than that of Pfizer's (NYSE: PFE) Sutent chemotherapy. What's next for Bristol-Myers Squibb after this setback for Opdivo?
About the latest results
It wasn't a total flop for Opdivo and Yervoy. After all, one of the primary endpoints of the CheckMate-214 trial was easily achieved. More patients taking Bristol-Myers Squibb's immuno-oncology combo (41.6% objective response rate) achieved tumor shrinkage than patients taking Pfizer's Sutent (26.5% objective response rate). Also, median duration of response wasn't reached for the Opdivo/Yervoy combination, while the median duration of response for Sutent was 18.17 months.
And the BMS combo did result in better progression-free survival than Sutent did -- 11.56 months versus 8.38 months. The problem, though, was that the improvement wasn't statistically significant.
BMS researcher Vicki Goodman couldn't be blamed for taking an overall optimistic perspective on the results. She said, "We are encouraged by the totality of the CheckMate-214 data." The totality of that data wasn't all that bad, but it wasn't as good as BMS and shareholders would have preferred.
Still, BMS stock felt the sting from the news. Shares fell 3% on the next day of trading. Investors had hoped the drugmaker would have a clear path to approval in the first-line indication. Opdivo is already approved as a second-line treatment for kidney cancer. Goodman said the next steps were to share the first-line data from CheckMate-214 with regulatory authorities and report overall survival rates when the data is available.
The past performance disclaimer
Remember the disclaimers mutual funds are required to include? Those disclaimers usually state something like, "past performance is no guarantee of future results." Investors might want to take those words to heart when contemplating what future studies of Opdivo might hold.
BMS chief scientific officer Thomas Lynch spoke at the Goldman Sachs Healthcare Conference in June. In his comments, Lynch cautioned against relying too much on AstraZeneca's failure with Imfinzi to predict how Opdivo (in combination with chemotherapy) would fare in the CheckMate-227 study in treating non-small cell lung cancer.
Lynch's warning wasn't just spin. The two clinical studies aren't exactly alike. And Opdivo and Imfinzi aren't exactly alike.
A similar caution should be heeded when thinking about how the latest results from CheckMate-214 could affect the CheckMate-227 results. Non-small cell lung cancer is different from kidney cancer. The combo of Opdivo and chemotherapy will have different effects than the combination of Opdivo and Yervoy.
Having said that, I'm not predicting that BMS will succeed with the CheckMate-227 study. The company might have a miserable failure. But don't think that will necessarily be the case just because of the latest mixed results from CheckMate-214.
Importance of Opdivo
What is easy to predict, though, is how important the remaining studies for Opdivo will be for Bristol-Myers Squibb's future. In the first half of 2017, the company's revenue grew by $811 million over the prior-year period. Opdivo accounted for $778 million -- nearly 96% -- of total sales growth.
Blood thinner Eliquis is running a close second right now to Opdivo. However, BMS splits revenue with partner Pfizer for the drug. Also, peak sales estimates for Eliquis are far below what Opdivo could eventually generate.
Bristol-Myers Squibb doesn't have a huge late-stage pipeline beyond its studies featuring Opdivo. As Opdivo goes, so goes BMS.
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