Increasingly complex cancer medicines are launching with six-figure price tags, and a larger, longer-living population means that global cancer drug spending is soaring. Many clinical-stage biotech stocks are working on new drugs that could capitalize on this growth, butArray BioPharma (NASDAQ: ARRY)is among the most intriguing. Why? Because it has two new melanoma approaches fast approaching commercialization.
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Tackling a big unmet need
The National Cancer Institute reports that 76,000 new cases of melanoma are diagnosed every year, and, sadly, many of these patients will succumb to their disease within five years of their diagnosis.
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While Array BioPharma’s drug pipeline might not help all melanoma patients live longer, the company may be able to offer new hope to patients with amenable genetic makeups.
Specifically, the company has filed for Food and Drug Administration approval of binimetinib, a MEK inhibitor that can be used to treat advanced melanoma patients withNRAS-mutation. It also plans to file for approval of a combination therapy for BRAF mutation patients that includes binimetinib and another drug, encorafenib, a BRAF inhibitor.If approved, binimetinib could be used in about 20% of melanoma patients, and binimetinib and encorafenib could be used in about half of all melanoma patients.
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In trials, these drugs were able to delay melanoma progression better than other treatment options.
In phase 3 studies, patients who were givenbinimetinib every three weeks had progression-free survival of 2.8 months, while patients given the chemotherapy dacarbazine saw progression-free survival of 1.5 months. The study also showed that binimetinib patients who had been previously treated with immunotherapy had progression-free survival of 5.5 months versus 1.6 months for dacabarzine.
In BRAF-mutation patients, patients receiving encorafenib and binimetinib had progression-free survival of 14.9 months, while patients receivingRoche Holdings‘Zelboraf had progression-free survival of 7.3 months.
How significant is the opportunity?
If the FDA approves both drugs, then they’ll become part of a toolbox used by oncologists that includes the checkpoint inhibitors Opdivo and Keytruda and drugs that are marketed by Roche Holdings and Novartis (NYSE: NVS).
Checkpoint inhibitors are often used to treat NRAS-mutation patients. However, those drugs aren’t specifically approved for these patients. Therefore, if binimetinib’s approval specifically includes its use in NRAS-mutation patients, it could win favor with doctors.
Patients with BRAF-mutation can be treated with checkpoint inhibitors, too, but doctors can also prescribecombination therapies that include both a MEK inhibitor and a BRAF inhibitor. These options includeRoche’s Zelboraf plus Cotellic and Novartis’ Mekinist plus Tafinlar. While these two-drug solutions can be effective, overallsurvival rates remain poor for BRAF-mutation patients, and that suggests there’s room for binimetinib plus encorafenib.
It’s anyone’s guesshow much revenue these drugs could generate for Array BioPharma annually, but there’s a good chance it will be in the nine figures. Existing therapies cost $10,000 per month or more, and as a result, Roche and Novartis’ are reporting hundreds of millions in sales for their two-drug combinations.In 2016,Roche reported Zelboraf sales of $215 million and Cotellic sales of about $45 million, at current exchange rates.Meanwhile, Novartis reported a combined $178 million in Mekinist and Tafinlar sales in the fourth quarter.
Overall, Array BioPharma estimates that the MEK/BRAF inhibitor drug market is worth about $1 billion per year currently.
Looking ahead
Advanced melanoma patients could benefit from new treatment options like binimetinib and encorafenib, but the future of melanoma treatment may be three-drug combination therapies that include a MEK inhibitor, a BRAF inhibitor, and a checkpoint inhibitor.
Roche is conducting a clinical trial that combines Zelboraf and Cotellic with its checkpoint inhibitor, Tecentriq. And Array BioPharma is studying binimetinib and encorafenib alongside Keytruda.
If one — or both — of these three-drug combinations delivers better efficacy than existing two-drug approaches, then they could become the go-to patient treatment in advanced melanoma.
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Todd Campbell has no position in any stocks mentioned.His clients may have positions in the companies mentioned.The Motley Fool has a disclosure policy.
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