Melanoma Outlook 2024: Promising Treatments Face Competition, US Price Reductions
Melanoma, the deadliest form of skin cancer, is one of the pharmaceutical industry’s biggest success stories, as novel medicines have dramatically improved survival. We believe rising patient numbers and uptake for early-stage treatment can expand the market for melanoma drugs to $10.8 billion by 2027 from $8 billion in 2023, with potential upside from a new generation of medicines. But there’s a high bar for clinical and commercial success, and growth is likely to stagnate later in the decade.
Merck’s Keytruda and Bristol Myers’ Opdivo and Yervoy have been on the market for over a decade and still lead melanoma sales as treatment extends to patients in the early stages of the disease. Opdivo and Keytruda are likely to face US government price cuts starting in 2028 and competition from less expensive biosimilars soon after, slowing sales and forcing any new medicine to make a strong case for cost effectiveness compared with the discounted drugs. We expect that Bristol Myers’ Opdualag, Regeneron’s competing fianlimab and new drugs for patients who don’t respond to immunotherapy can generate $3 billion in annual sales by 2030.
Key Research Topics
- Price Cuts Threaten: The dominant market share of Keytruda and Opdivo immunotherapy makes mandatory Medicare price cuts an outsize threat to US market growth starting in 2028.
- New Drug Widens Market: Opdualag, a combination of Opdivo and a new antibody that doesn’t have near-term pricing concerns, will add significant share for newly diagnosed patients. Strong data in the adjuvant setting — that is, preventing post-surgical recurrence in earlier-stage patients — is needed to sustain growth.
- Competition Is Coming: Biosimilars are expected by 2030 for Keytruda, Opdivo and Yervoy, bringing less-expensive copies that will further pressure prices and threaten sales.
- More Breakthroughs: We expect adjuvant sales to exceed $4 billion by 2027 in an increasingly competitive market. Emerging data on presurgery treatment with Keytruda improves on already impressive readouts and may prove more cost effective than conventional adjuvant combinations currently in late-stage trials.
- Later Entrants Hold Promise: Iovance’s Amtagvi was approved by FDA in February for patients who don’t benefit from standard therapy. But the FDA’s move was essentially due to unmet need rather than stellar data. Later entrants including Immunocore’s Kimmtrak may do more to establish the new setting.
Disclaimer: This is a synopsis of the full report. This is not an investment recommendation. All investors are advised to conduct their own independent research and consult a licensed investment professional before making a purchase decision. In addition, investors are advised that past investment performance is no guarantee of future price appreciation or performance.