AstraZeneca (AZN) recently reported a highly positive outcome in treating patients with front-line extensive-stage small cell lung cancer (SCLC) using a combination of its drug Imfinzi (PD-L1 inhibitor) and standard chemotherapy regimen. This is good news for the company to carve out a space for itself in this particular indication. The flip side to note is that it will not be in the market space alone. That's because Roche (OTCQX:RHHBY) has already received FDA approval for its drug Tecentriq along with carboplatin and etoposide for front-line SCLC. Considering that a lower amount of lines of therapy allowed AstraZeneca's treatment arm to improve clinical outcomes, compared to standard of care, I believe that Imfinzi has a good shot at penetrating this specific lung cancer space.
Another Option For Specific Group Of Lung Cancer Patients
The latest positive finding in the phase 3 CASPIAN study for front-line extensive stage SCLC using Imfinzi along SOC chemotherapy will allow AstraZeneca to talk to regulatory authorities around the globe to seek marketing approval. There are two aspects to consider here. The first is that front-line treatment of this patient population opens up a larger market opportunity, compared to later lines of therapy. The second aspect to consider is that these patients with SCLC were extensive stage. Extensive stage means that the cancer has metastasized and in the case of SCLC spreads to other nearby organs like the brain, bone marrow and the other lung.
What does this mean? This means it is a hard to treat population with minimal treatment options available. How exactly did treatment with Imfinzi along with etoposide (either with cisplatin or carboplatin) help? That's because there was a finding that was unexpected in this hard to treat patient population. That is, about 33.9% of patients treated with the Imfinzi combination were alive at 18 months. This was shown to be higher than those that took SOC. As for the clinical data, that too was also shown to be remarkably good. The phase 3 study was able to show that patients treated with the Imfinzi arm saw a reduction of the risk of death by 27%. They had a median overall survival (OS) of 13 months, compared to only 10.3 months in the SOC arm. Besides just focusing on the data alone, which ended up being superior, it's important to highlight a key difference in each treatment arm. In the Imfinzi arm, patients only needed to be treated with 4 cycles of chemotherapy. On the other hand, the SOC arm had required 6 cycles of chemotherapy. This may seem like a small difference, but typically treatment with chemotherapy involves more systemic side effects. The ability for Imfinzi to be used along with fewer cycles of chemotherapy means less side effects for the patients. In turn, this will reduce the burden on their quality of life.
As with anything in biotech, most treatments don't exist in a bubble. While AstraZeneca just had a positive clinical finding for this phase 3 CASPIAN study, Roche had already secured FDA approval for this patient population back in March of 2019. That is, Tecentriq in combination with carboplatin and etoposide had been approved by the FDA to treat front-line extensive-stage SCLC. As you see above, I highlighted that the Imfinzi arm generated a median OS of 13 months. In comparison, Tecentriq was able to achieve 12.3 months for median OS in its late-stage study known as IMpower133. I never like direct trial comparisons, but this kind of information gives a minor comparison in how well the Imfinzi combination may do in terms of sales should it ultimately be approved by the FDA. Competition will always remain in certain sectors in the pharmaceutical industry, however, I believe management will account for this. Plus, you have to consider that pipelines are always evolving. By this I mean that Imfinzi is just one part of AstraZeneca's strategy to go after the lung cancer space. I recently wrote a Seeking Alpha article titled "AstraZeneca's Latest Lung Cancer Data Sets It Apart Because Of Its Targeted Approach To Treatment". The bottom-line for this article is that I highlighted the massive potential AstraZeneca has in the lung cancer space with Tagrisso. That is, it has achieved regulatory approvals for 2nd line treatment for EGFR T790M-mutated NSCLC and 1st line EGFR mutated NSCLC as a new SOC agent for these settings. Tagrisso produced $1.86 billion in sales in 2018 and some analysts expect that it could earn $5.8 billion by 2023.
As these two indications suggest, these are types of lung cancer indications that occur due to a specific genetic mutation EGFR. As more biotechs are able to recognize oncogenic driver mutations of a particular type of cancer, then the more targeted treatment approaches can start to evolve. That's because while broad approaches to treating cancer do well in terms of clinical outcomes, there exists an opportunity to drive superior survival rates with targeted treatment. Consider that a targeted approach is more tailored to handling the specific genetic mutations of the tumor in question, whereas another treatment that covers a broad label may not perform as well.
The positive findings in the phase 3 CASPIAN study, using Imfinzi along with standard of care chemotherapy, will allow AstraZeneca to begin talks with multiple regulatory authorities. Being that the drug has to be reviewed still, this remains a significant risk. However, I believe that Imfinzi has a good chance at approval. That's because of what treatments are actually available right now. The current 5-year survival rate for small cell lung cancer is low at 6%. On top of that, this type of cancer is an aggressive form. That's because even if patients respond to platinum based chemotherapy, the cancer continues to progress rapidly regardless. With limited treatment options for this patient population, I believe that AstraZeneca's Imfinzi should be approved.
The good thing is that while the company is going to push approval for Imfinzi in this patient population, any type of setback won't be a big deal. As I highlighted above, Tagrisso already looks to be a solid drug. It has already received regulatory approval for several indications and has already generated $1.86 billion in sales in 2018. Analysts believe that revenues could grow past $5 billion by 2023 for it. One thing to note is that the lung cancer space is starting to get very crowded. AstraZeneca's Tagrisso could possibly be challenged by Pfizer (PFE) with its lung cancer drug Vizimpro. Vizimpro has already been approved by the FDA for first-line treatment of patients with EGFR-mutated metastatic NSCLC. Then, Vizimpro had even been approved several months ago for the European Union as well. Other treatments that specifically target the EGFR mutation for NSCLC are: Roche and its partner Astellas with Tarceva and Boehringer Ingelheim with Giotrif (afatinib). I believe that AstraZeneca has good drugs both in the SCLC space and for the treatment of NSCLC patients with EGFR mutation. Therefore, it should have no problem carving out a good chunk of the market share as evidenced by last year's sales of Tagrisso. I believe that AstraZeneca is a good long-term name to own.
This article is published by Terry Chrisomalis, who runs the Biotech Analysis Central pharmaceutical service on Seeking Alpha Marketplace. If you like what you read here and would like to subscribe to, I'm currently offering a two-week free trial period for subscribers to take advantage of. My service offers a deep-dive analysis of many pharmaceutical companies. The Biotech Analysis Central SA marketplace is $49 per month, but for those who sign up for the yearly plan will be able to take advantage of a 33.50% discount price of $399 per year.
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