Merck’s Multi-Billion-Dollar KEYTRUDA Levels Up with Novel Subcutaneous Delivery, Matching IV Efficacy

Recently, Merck & Co. (NYSE:MRK) announced results from its Phase 3 trial of subcutaneous pembrolizumab with berahyaluronidase alfa. The study tested its effectiveness alongside chemotherapy against the intravenous KEYTRUDA formulation in metastatic lung cancer patients. APembrolizumab, marketed as KEYTRUDA, is currently available as an IV treatment. Berahyaluronidase alfa, developed by Alteogen Inc., enhances subcutaneous delivery. 

Phase III MK-3475A-D77 Trial Confirms Subcutaneous KEYTRUDA Matches IV Formulation in Metastatic NSCLC Treatment

Merck is aiming to extend KEYTRUDA’s dominance with promising Phase III results for a new subcutaneous formulation. The randomized, open-label Phase 3 trial, named MK-3475A-D77 (NCT05722015), combined subcutaneous KEYTRUDA with Alteogen’s berahyaluronidase alfa to facilitate under-the-skin delivery alongside chemotherapy. This was compared to the intravenous (IV) version of KEYTRUDA with chemotherapy in first-line metastatic non-small cell lung cancer (NSCLC) patients. The study met its primary endpoint, demonstrating that subcutaneous KEYTRUDA matches the IV formulation when administered every six weeks. Additionally, safety and efficacy goals were achieved, showcasing the potential of this new delivery method.

Subcutaneous KEYTRUDA: A Strategic Move Amidst Loss of Exclusivity

For years, Merck has relied on KEYTRUDA to drive its growth. Approved in 2014, KEYTRUDA works by harnessing the body’s immune system to combat cancer, achieving remarkable outcomes. In the case of advanced lung cancer, the treatment has contributed to a five-year survival rate of approximately 25%, a significant improvement compared to the historical survival rate of just 5%.

Merck faces KEYTRUDA’s loss of exclusivity in 2028, and analysts suggest that these Phase III results could delay a significant shift to biosimilar, noting that expanding indications for the subcutaneous version may strengthen KEYTRUDA’s market position. The convenience of subcutaneous administration could appeal to both patients and physicians, particularly in regions with limited infusion center availability.

The trial results were called “a key step for extending KEYTRUDA’s franchise longevity.” Merck estimates that up to 50% of patients could eventually benefit from the subcutaneous formulation, potentially expanding KEYTRUDA’s accessibility. The company is evaluating the subcutaneous version in additional trials, including a Phase III study for first-line NSCLC patients and Phase II studies for relapsed or refractory Hodgkin’s lymphoma and primary mediastinal large B-cell lymphoma.

Strategic Moves and Merck’s Efforts to Mitigate Exclusivity Loss

Merck is also looking at other strategies to sustain KEYTRUDA’s revenue amidst the upcoming loss of exclusivity. Recently, Merck signed a licensing agreement with Shanghai-based LaNova Medicines to develop a next-generation therapy targeting PD-1 and VEGF pathways. Although the PD-1/VEGF data remains in early stages, this partnership could help mitigate exclusivity concerns.

Analysts suggest the FDA could approve the subcutaneous version for all current IV indications, similar to Roche’s Tecentriq. While these developments may not completely offset KEYTRUDA’s revenue decline after its exclusivity ends, they could slow the process. This would allow Merck more time to grow revenue from other assets, such as Winrevair and Capvaxive.

Facing Biosimilars: KEYTRUDA’s Expiry and Competing Treatments

Merck is also dealing with the looming threat of biosimilars. Companies like Sandoz, Samsung Bioepis, Amgen, and Celltrion are advancing biosimilar versions of KEYTRUDA (pembrolizumab), and Merck needs to secure approval for the subcutaneous version to transition before the 2028 patent expiration. The subcutaneous version could offer more convenience than the current 30-minute infusion and would be protected by new patents. This formulation combines KEYTRUDA’s active ingredient with an enzyme developed by South Korea’s Alteogen, which aids in absorption and dispersion.

With KEYTRUDA’s exclusivity ending soon, Merck is seeking ways to sustain revenue from its top-selling drug. KEYTRUDA generated nearly $22 billion in sales in the first nine months of 2024. While Roche and Bristol Myers moved faster with their subcutaneous cancer therapies, Merck is catching up. Subcutaneous Tecentriq gained FDA approval in September, and a decision on Opdivo’s version is expected by Dec. 29. Both therapies enzymes developed by Halozyme, a frequent pharma collaborator.

Subcutaneous Delivery: A Potential Advantage Providing Pricing Power

Merck’s subcutaneous KEYTRUDA could also offer a pricing advantage once the original formulation loses exclusivity. The new version may be exempt from the Medicare price negotiation program due to the inclusion of a new ingredient, berahyaluronidase alfa, which helps the drug disperse through the body. According to new guidance from the Centers for Medicare and Medicaid Services (CMS), the subcutaneous version could be treated as a separate drug, allowing Merck to continue setting its own prices for this formulation. This strategic move could help Merck retain some pricing power for subcutaneous KEYTRUDA, even as the original KEYTRUDA’s price drops for Medicare patients after 2028.

Merck needed this positive development after a challenging few months. In July, the company’s shares fell nearly 10% following concerns about weakened demand for its GARDASIL vaccine in China. Merck’s third-quarter results in October did little to ease investor concerns, with GARDASIL sales falling 11% year-over-year. GARDASIL is Merck’s second-highest-selling drug after KEYTRUDA, aimed at preventing human papillomavirus (HPV) infections. In the second quarter, sales of the GARDASIL franchise totaled $2.48 billion, remaining relatively stable compared to the previous year. However, analysts from Leerink Partners had anticipated revenue of approximately $2.7 billion for the product during this period. Despite these challenges, Merck’s development of the subcutaneous KEYTRUDA formulation provides a promising path forward, potentially mitigating the financial impact of the eventual patent expiry.

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Author

Bernice Lottering