Merck Will Report Q2 On Tuesday; Some Color From BMS’s Views On Newest Immuno-Oncology Agents

To be sure, we will have to wait and see what the release on Tuesday morning harbors, but I’d not expect a nine per cent downdraft, at the sales line, due to currencies, as was seen last week at Bristol Myers Squibb. I think Merck has more hedging in place than BMS, and a better “natural” mix of geographies; and product-margins (each of which ought to dampen currency headwinds somewhat, at Merck).

What I see as one of the most hopeful moments, likely to be echoed on the Kenilworth call, Tuesday, is the notion that (thus far, at least) Opdivo® (and by implication, Keytruda®) won’t see strong payer-side pressure to agree to long term contracts, with significant price discounts, in any cancer set — anytime in the near (24 month) future. And this is potentially a $35 billion market opportunity, all in. On the BMS call, the question about potential for a Sovaldi® type of pressure/backlash from government- and private insurer- payers was answered thus:

. . . .We’ve really been fortunate with the quality of data that have been generated behind Opdivo and the value that we’ve been able to establish for patients with metastatic melanoma and non-small cell lung cancer. And I think that’s been recognized by payers. We’ve had — we have established very broad and very rapid access in the US.

The breadth of indications that we hope will follow will also further strengthen our ability to weather any attempt that any payers may have to try to restrict these agents, which is very difficult to do in the oncology arena with drugs like Opdivo with overall survival benefits. So we feel very good about our current access and our ability to sustain that going forward. . . .

It would be hard for an insurer to defend being restrictive where the data shows that people will literally die much sooner, without access to the therapy. And that is — in the main — what this data establishes — at both Merck, and BMS. This should mean similar, but smaller, good news ahead for Merck. Keep in mind that in BMS was first to market, and that (at least I predict) Merck will eventually offer to cut price on Keytruda, to win some of the BMS share, in the markets where Merck is likely a year or so behind. Just my $0.02. Onward.

Advertisements

There are no comments on this post.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: