How Equinox Group Models Drugs in R&D: The Case of Alecensa in 1L ALK+ NSCLC

We routinely share our view of new drugs coming to the market; for instance, a few months ago, we posted an article detailing top-line results of an analysis of Enhertu in 1L HER2+ metastatic breast cancer.

This article shows in detail how Equinox arrives at a peak share estimate for a new drug treatment, using the example of alectinib (Alecensa, Roche/Genentech) in 1L ALK+ non-small cell lung cancer (NSCLC). Alecensa was approved in this indication 8 years ago; we’ll show how our methodology predicted it would achieve 60% peak share using publicly available data and our Disease Target Assessment framework.

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The Framework

Equinox Group’s Disease Target Assessment (DTA) model quantifies the level of medical need in the target population based on peer-reviewed literature. This framework characterizes the adequacy of the current and possible future standards of care (SOCs) to serve as a benchmark for evaluating client product profiles.

We start by characterizing unmet medical need within each defined patient population, quantifying unmet needs in these product attributes:

• Efficacy

• Safety/tolerability

• Dosing

• Price

as well as key elements of the burden imposed by the disease:

• Mortality

• Morbidity (pain, chronic disability, hospitalization, and HRQOL)

• Non-drug health care costs

For each domain and subdomain, we use consistent utility functions to derive a score on a 0-5 scale (with 0 representing no unmet need and 5 substantial unmet need). Each domain has a fixed weight based upon its importance, as verified through regression analysis of launched agents. The sum of the weighted scores measures the total unmet medical need for patients treated with the profiled therapy.

Through validation against actual market performance, Equinox has demonstrated that the Clinical Innovation of a new drug (or regimen) offers reliable insight into its ability to compete. A few rules of thumb hold up surprisingly well in projecting a new drug’s commercial outlook:

• Drugs with 10%+ Clinical Innovation nearly always dominate their segments – we consider agents with 10%+ Clinical Innovation to be highly innovative

• Drugs with Clinical Innovation between 5% and 10% typically achieve good patient share – they are moderately innovative

• Drugs with Clinical Innovation below 5% are typically seen as poorly differentiated, especially by payers – these drugs have low innovation

Clinical Innovation and competitive intensity are key drivers of share; our DTA models enter these two inputs into an algorithm derived from a regression analysis of actual market performance to estimate peak-year patient share. Comparing our share predictions to observed peak-year shares, Equinox Group’s oncology-specific regression has a strong R-squared value of 83%.

The DTA methodology is rigorous and dynamic. The Excel-based model we deliver allows for instantaneous updates of inputs and outputs. All sources are well-documented in comments throughout the model, with a bibliographic sources sheet included as well.

Key steps in an Equinox DTA Project

1. Define the distinct patient population(s) of interest

2. Characterize disease burden within each patient population

3. Identify and characterize standard(s) of care

4. Model the market entrant/TPP

5. Analyze the developmental pipeline to quantify the expected future level of competition

6. Estimate the number of addressable patients in the US and key European markets

To support the modeling, Equinox Group also conducts a handful of interviews with academic medical experts to explore their views on pipeline agents, treatment paradigms, and key unmet needs.

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The Clinical Sheet

Equinox Group begins by characterizing the key clinical attributes of the SOC(s). We can then use an identical rule set to model client TPPs. For clients who do not yet have any TPPs, we can help model plausible scenarios for profiles.

In 1L ALK+ NSCLC, the SOC prior to alectinib was crizotinib. (Models normally carry two extra slots to model alternative or future SOCs as needed.)

The key clinical domains are shown in the figure below.

Starting in the efficacy domain, we enter peer-reviewed clinical data for the SOCs. Client TPPs are judged along the same lines. In oncology, key efficacy inputs are:

• overall survival,

• progression-free survival, and

• response rates (partial, complete, and overall)

All inputs are explained in accompanying comments within the Excel file. Academic literature is clearly cited, and any necessary assumptions are explained.

Key safety data are gathered from SOC labels and relevant published trials.

Boxed warnings, frequent or inconvenient patient monitoring, and contraindications and pregnancy warnings (when appropriate) are all taken into account.

Grade 3/4 adverse events are modeled and individually weighted based on their severities (e.g., hyponatremia has a lower impact on unmet need than neutropenia). When substantial adverse event data/hypotheses are available for a TPP, we can model the rates of each event. Alternatively, we can model a simple percentage improvement over a comparator profile (e.g., 20% reduction in the rate of each AE seen in the crizotinib side effect profile). In the example below, full side effect data were available.

The drug or regimen’s convenience score is calculated via a consistent method. Common dosing methods, frequencies, and locations are pre-populated in drop-down menus. The model allows for multi-drug regimens to be modeled, even when combining IV and oral therapies. In this example, each profiled drug is an oral monotherapy.

Finally, the drug or regimen’s annual cost is calculated using U.S. WAC pricing. We use WAC values because they allow fair, transparent comparisons and because net prices are not widely visible.

When patients are on treatment for less than one year, the cost calculation is restricted to time on treatment. In the example below, median time to progression is 10.9 months, so only that fraction of the year is entered in “intended days of therapy”.

The Unmet Need Sheet

The data from the Clinical sheet flow into the Unmet Need sheet (see below); the core clinical assumptions each have their own sub-domain under product need.

Equinox Group staff gather peer-reviewed data on disease burden (disease seriousness and disease cost), and the consistent utility functions are applied in Excel.

Baseline disease seriousness and costs values come from relevant academic literature, and improvements in efficacy flow through to reduce need in these domains.

In this example, alectinib is more efficacious (thus the lower Efficacy score) and has a cleaner side effect profile than crizotinib. Despite a minor convenience disadvantage, its product need score is significantly lower.

The advantage in overall survival is reflected in a lower mortality score.

Advantages in progression-free survival and response rates reduce morbidity, indirect costs, and non-drug direct costs.

These benefits in indirect and non-drug direct costs partially offset alectinib’s higher price.

The weighted sum of these domain-specific unmet need scores equals a product’s total unmet need score. Overall, total unmet need is lower with alectinib than with crizotinib in 1L ALK+ NSCLC, indicating a better therapeutic option.

Drivers of Innovation

We call the reduction in total unmet medical need is called "Clinical Innovation". We graphically display Clinical Innovation using a Drivers chart.

The gold bars to the left and right of the chart represent the unmet need score under the SOC (crizotinib) and entrant (alectinib), respectively.  Scores range from 0-5 with 0 representing no unmet need. As with any waterfall chart, the intermediate green and red bars represent improvements and detriments, respectively, in domain-specific unmet need.

In the above figure, alectinib is shown to reduce total unmet medical need by 23.2%, with more than two-thirds of its improvement coming from efficacy advantages, and its direct cost impact clawing back <1% of its Clinical Innovation. (The percentages on the chart show the contribution of each domain to that 23.2% overall improvement.)

The Clinical Innovation score of 23.2% is highly impressive. Recall our rules of thumb: products with unmet need improvements of >2% are typically commercially viable, >5% are commercially successful (top 3-4 in market), and >10% are market dominators.

The Competitive Environment

Equinox conducts a thorough review of the developmental pipeline using publicly available sources, such as clinicaltrials.gov and sponsor websites. This pipeline is reviewed by physician experts to ensure nothing is missed, and client competitive intelligence is welcomed.

Each pipeline agent is assigned a probability of launch based upon its phase of development and recent data on success probability by phase and therapeutic area. Competitors are also assigned an angle of impact – how directly (25%-100%) will the entrant and the pipeline agent compete with each other?

We call the sum product of these factors “Competitive Intensity”, a probabilized headcount of competitors the entrant will face at launch. A competitive intensity rating of 319%, as shown below, is roughly comparable to three direct competitors at launch.

The Commercial Sheet

Seeing a profile’s projected peak-year share is as simple as one click. Selecting the SOC at launch in the blue cell will automatically update the profile’s clinical innovation score which, alongside competitive intensity, are entered into the Equinox Share Predictor. The Commercial sheet also displays key figures such as unmet need scores with the SOC and entrant, diagnosed prevalence of the indication in the U.S., and the annual cost of the profile.

Given a Clinical Innovation score of 23.2% and a competitive intensity rating of 319%, Equinox Group’s regression-validated algorithm projects a peak-year patient share of 60% for alectinib in 1L ALK+ NSCLC.

Each entrant’s share call compares its unmet need score to that of a chosen SOC and factors in the estimated number of competitors at launch. In this example, product attributes for potential new competitors are not evaluated in calculating peak share. As a further product offering, Equinox builds forecasts that capture the impact of competing entrants’ clinical attributes and launch timing to produce realistic forecasts of share over time.

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Conclusion

The easy-to-use Excel-based DTA model allows clients to war-game scenarios for input values that aren’t certain yet (such as mature overall survival data) and instantly see how those alternatives affect Clinical Innovation and patient share estimates.

Interested in learning more? Click here to send us a message or to schedule a meeting with one of our practice leaders.

Equinox Group’s proven method to measure clinical innovation and peak-year patient share for new products is accurate, less expensive, more flexible, and quicker to execute than conventional market research-based techniques. We use this approach to inform decisions about individual programs (pipeline and business development), to help therapeutic area teams set aspirations, and to inform R&D portfolio assessments.

A project of this nature typically delivers results in around 6 weeks. We support our models for 24 months from kickoff and can help socialize the methodology and results within your organization.

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About Equinox Group

Since 1995, Equinox Group has provided analytics to support R&D decisions at biopharmaceutical firms, assessing the potential of drugs from discovery to launch. Our validated techniques save time and money—and they overcome several deficiencies of traditional demand studies.

We have evaluated thousands of drug profiles across hundreds of indications in oncology, immunology, rare diseases, cardio-metabolic disorders, infectious disease, neurology, pulmonology, urology, ophthalmology, and endocrine disorders. We also have tailored methods to solve the unique analytical challenges that arise in oncology and rare diseases.

Using this methodology, we have developed a suite of tools to inform whatever R&D decisions you’re facing in any stage of development, including: setting indication priorities, supporting go/no-go decisions, assessing market access and pricing potential, share forecasting, and patient flow modeling.

What indications should we focus on?

Drugs with utility across multiple patient populations have the potential to become major cash cows for biopharmaceutical companies. To tap this potential, companies must carefully select which indications to prioritize. This decision can be the difference between establishing a new brand that becomes a pillar of a company’s success and having consistently underperforming sales. The ideal choice is one where high medical need exists in a sizeable population, the asset promises to offer significant improvement, and there is relatively low competition. (Probably no indication checks all of these boxes perfectly.)

Equinox Group provides analytical decision support to development teams making indication prioritization decisions by quantifying these characteristics for each opportunity.

Figure 1 shows how key commercial factors compare across candidate indications for a new oncology therapy, which we call Product X.  Perhaps the most important of these—and the hardest to characterize consistently—is the level of improvement the drug would offer over the standard of care (SOC), a chief driver of patient share (more on share below).

We use a rigorous technique to quantify that improvement, which we call “Clinical Innovation”. Using real world market performance, we have observed that the following general rules hold up remarkably well:

• Drugs with 10% or greater Clinical Innovation typically dominate their segments

• Drugs with 5 to 10% Clinical Innovation achieve good patient share

• Drugs with less than 5% Clinical Innovation typically struggle; they impose high risk on the developer

Figure 1: Clinical Innovation, Population Size, and Medical Need: A New Drug in 8 Indications

Product X is highly innovative in 2L CRC (a large population), as well as in 2L TNBC and 1L ALK+ NSCLC.  It is also moderately innovative in 1L and 2L melanoma, and 2L pancreatic cancer.  In 2L prostate cancer, however, the drug’s Clinical Innovation is well below the 5% threshold, suggesting Product X will be approvable but not be highly competitive in this population.  In 3L melanoma, Product X’s Clinical Innovation is slightly below the desired 5% mark, but approval here may be helpful in pursuing 1L and 2L, larger patient segments where Product X is more innovative. These indications have moderate-to-high need at baseline, forming two tight groups on the high end of our unmet need scale.

With all of this in mind, we can transform our view to consider the competitive intensity in each population rather than the level of unmet medical need under the SOC. Below in Figure 2, indications are located by the competitive intensity faced by Product X as well as clinical innovation, with bubble size still indicating patient population size. Note that a lower score on the y-axis implies less competition, meaning that in indications located in the upper right, Product X offers high clinical innovation and has low competition.

Figure 2: Clinical Innovation, Population Size, and Competitive Intensity: A New Drug in 8 Indications

As we can see, the indications are once again separated into two groups: those with moderate competitive intensity (3 to 4 expected direct competitors at launch) and those with higher competitive intensity (5 to 6 competitors).

Additionally, Equinox has developed a regression equation that predicts peak-year patient-share as a function of two of the factors described here; the level of Clinical Innovation and the number of competitors.

Table 1 gathers the key commercial factors presented above into one view, including the corresponding peak-year patient share estimates in the indications.

Table 1: The Complete View

*Undifferentiated from SOC

From our assessment of the clinical innovation in each indication, it is already clear that 1L ALK+ NSCLC, 2L CRC, and 2L TNBC offer good commercial opportunities. But which of them is the best? And what about all the others? Taking into account the other commercial factors, we notice that while 1L ALK+ NSCLC faces moderate competition and has the highest clinical innovation, it ranks as the smallest population with the lowest unmet medical need. Therefore, it’s not going to provide the best revenue potential. Likewise, in 2L TNBC, there is a relatively low barrier to entry and a high unmet need, but the population size also restricts potential gains.

In 2L CRC, the moderate unmet need and large population size make it the best opportunity among the eight indications. While the competitive intensity is high, a clinical innovation of 11.3% should adequately insulate Product X from the competition and results in significant patient share in a sizable population. Due to its size, an initial approval in this indication will potentially help the asset owner manage development costs in the other indications.

These three indications (ALK+ NSCLC, 2L TNBC, and 2L CRC) also have the potential to create a “halo effect” where payers and prescribers view Product X more favorably in other indications due to its previous success. This may prove helpful when pursuing 1L & 2L Melanoma and 2L Pancreatic, all of which are valuable opportunities in this assessment. All things considered, Product X offers substantial revenue and growth potential, if managed properly.

Finally, the analytics described here also include a basis for comparing pricing potential across the candidate indications. To keep this introduction to the techniques brief, we have not included that analysis here, but for those interested in how a pricing potential assessment can be added to the outputs, see this example.

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We have fine-tuned these methodologies and others over the past 30 years to help biopharmaceutical companies handle challenges in R&D. Our specialties range from market access and go/no-go decisions to patient share forecasting and patient flow modeling. To learn more about our process, click here to schedule a meeting with one of our practice leaders.

Enhertu is poised to dominate first-line HER2+ breast cancer

Equinox Group’s analysis of the Enhertu + Perjeta combination in first-line HER2+ breast cancer predicts a peak-year patient share of 46% in that setting. Our finding is based on initial results from the Destiny-Breast09[1] trial and the expected competitive environment. FDA approval in first-line is likely by the end of 2025[2].

The core of our analysis compares the net clinical improvement of the Enhertu regimen vs. the current standard of care, Perjeta + Herceptin + paclitaxel. Using our rigorous, data-driven methodology, we find that the Enhertu regimen reduces medical need by 14.6%.

History shows that drugs with a 10% or greater reduction in need typically go on to dominate their segment. Enhertu’s improvement in this population is similar to Tagrisso’s advantage in first-line EGFR+ NSCLC.

The graphic quantifies that net clinical improvement, and shows the contribution of each clinical attribute. The biggest driver is efficacy, primarily progression-free survival (40.7 months for the Enhertu regimen vs. 26.9 months for the SOC). Because the median overall survival data is not yet mature, we have made a conservative assumption about that value for Enhertu. Moreover, the Enhertu regimen spares patients paclitaxel, greatly reducing the frequency of neutropenia and offering a cleaner side effect profile. While the Enhertu regimen costs more, that modest disadvantage is overwhelmed by the clinical benefits.  

[1] Tolaney et al. 2025

[2] Daiichi Sankyo Press Release, July 2025

CAR-T Outlook

Chimeric antigen receptor T-cell (CAR-T) therapies promise to transform treatment of many cancers but have been slow to gain wide use. We argue that the CAR-Ts’ high costs ought to be thought of in light of the many years of life they can add over standard therapy. Even amortizing CAR-T costs over two years puts them in a similar cost-benefit zone as many other highly innovative cancer therapies. Pay-for-performance schemes, such as some being used for CAR-Ts in Europe to reduce payer risk, offer another path to more acceptable costs.

Marketed CAR-Ts are indicated only for hematological malignancies, but there are many developmental programs targeting solid tumors. Moreover, efforts are under way to extend the technology beyond the current autologous approach to include allogeneic solutions, which could ease the cost and complexity of treating with CAR-T therapies. 

In this post we analyze the commercial outlook for CAR-Ts, given their unique characteristics, especially:

• dramatic clinical improvement (near-cures in approximately 40% of treated patients) and

• very high prices (typically north of $400,000 to treat a single patient)

We have analyzed several CAR-T therapies through the lens of our Disease Target Assessment (DTA) framework, which provides (1) an objective and comparable basis for quantifying the magnitude of clinical improvement offered by a therapy, and (2) a measure of clinical benefit compared to price – is the benefit/cost ratio similar to other new oncology drugs that have achieved good market access?

Yescarta

Yescarta (axicabtagene ciloleucel) won its first FDA approval in 2017 and can be considered a moderate commercial success. Its clinical innovation, notably its efficacy, puts it in what has historically been breakthrough territory by our measures. In third-line-plus diffuse large B cell lymphoma (3L+ DLBCL), Yescarta boosted median overall survival to 25.8 months from 6.3 months for Rituxan regimens, with similar improvements in progression-free survival and response rates. Importantly, five-year survival with Yescarta was 42.6%--reflecting a fat tail to the survival curve.

Entering these results and other clinical information in our framework puts Yescarta’s clinical innovation over the Rituxan regimen as 21.5%.  This figure is well above the 10% threshold that we observe for new drugs that achieve dominant patient share. Yescarta clearly delivers substantial clinical improvement, on par with other commercially successful new drugs. Yescarta shows nearly identical clinical innovation in the newer 2L+ DLBCL population, suggesting strong share potential in that patient group. 

Benefit vs. Cost

To address the question of how a drug’s price affects its outlook, our techniques measure the ratio of “Clinical Benefit” vs. cost; through empirical observation we have shown there is a clear benefit/cost relationship among oncology drugs that have achieved favorable market access (see figure below). Priced upwards of $400K, Yescarta is much more expensive than Rituxan regimens in DLBCL, which average ~$20K annually. CAR-Ts incur substantial ancillary costs for apheresis, bridging therapy, conditioning therapy, infusion and post-infusion, along with hospitalization, ICU stays, and ER visits. Patients with life-threatening adverse events such as high-grade cytokine release syndrome (CRS) incur higher than average costs. All told, the total direct costs of CAR-T therapy can reach ~$650K in DLBCL. In contrast to more conventional drug therapies, all of that cost is incurred up-front. 

Because costs are front-loaded while the benefits are durable, we believe these costs should be amortized. We consider a two-year horizon reasonable (i.e., cutting first-year costs in half). Using that assumption, Yescarta’s benefit to cost ratio in 3L+ DLBCL is in line with other novel oncology therapies that have achieved good market access. This is also true for Yescarta in the 2L+ DLBCL population).

Other Approved CAR-Ts

BMS’s Breyanzi has similar clinical characteristics to Yescarta’s in both 3L+ and 2L+ DLBCL, and although launched several years after Yescarta, it is seeing reasonably good uptake. Still more recent is Janssen’s Carvykti in 5L+ multiple myeloma; this agent has even more impressive clinical innovation (40%), and also offers a good clinical benefit to price ratio. Given those results, we think Carvykti will be successful as it gains approvals in earlier lines of therapy.

Barriers to Use

Factors aside from clinical benefit and price also affect CAR-T share. CAR-Ts are only available at authorized treatment centers (ATCs). While there are over 110 ATCs in the United States, their uneven geographical distribution poses challenges. The elapsed time between sampling a patient’s T-cells and reinfusing treated cells limits CAR-T use to patients who have enough time to benefit from it. Ancillary costs are high and may face uncertain reimbursement.

Key Questions Affecting the Outlook for a New CAR-T Program

Equinox conducted this analysis to investigate the extent to which our analytical tools can help development teams anticipate the commercial potential for CAR-T (and other regenerative medicine therapies) programs. Our preliminary conclusion is that the same metrics we have applied for years to more traditional oncology therapies seem to provide similar insight even in the special case of cell therapies. Evidence so far confirms that the level of clinical improvement and its relationship to price remain important factors.

Enhertu shows high clinical innovation in second-line metastatic breast cancer

Conclusion: Enhertu achieves impressive clinical innovation versus Kadcyla, the current SOC, in second-line HER2+ metastatic breast cancer, and in the newly defined HER2-low metastatic breast cancer population at second or later lines of therapy versus chemo.

Enhertu (trastuzumab deruxtecan, AstraZeneca) was approved[1] in December 2019 for HER2+ unresectable or metastatic breast cancer patients who have received multiple prior anti-HER2 treatments. In May 2022 the FDA approved Enhertu in second line HER2+ breast cancer, based on results from the DESTINY-Breast03[2] trial, which show impressive efficacy in the second-line setting in HER2+ unresectable or metastatic breast cancer.

In these patients, Enhertu boasts a significant increase in progression-free survival compared to the current standard of care (SOC), trastuzumab emtansine (Kadcyla) (25.1 vs. 9.6 months), and a notable improvement in overall response rate (79.7% vs. 43.6%). Coupled with a hazard ratio for death of 0.55, Enhertu appears poised to take over from Kadcyla in second-line HER2+ metastatic breast cancer.

The waterfall chart above shows that Enhertu’s improvements in efficacy far outweigh its slightly worse side effect profile when compared to Kadcyla. The jump in efficacy, as well as its trickle-down effect on mortality and morbidity, deliver a strong clinical innovation score of 25.9%.  Drugs with clinical innovation above 10% usually dominate their segments; Enhertu’s improvement in this population is similar to Tagrisso’s advantage in second-line EGFR+ NSCLC.

We expect Enhertu to dominate treatment in this setting within two years.

Moreover, the FDA recently granted Enhertu Breakthrough Therapy Designation in patients with unresectable or metastatic HER2-low (IHC 1+ or IHC 2+/ISH-negative) breast cancer who received a prior systemic therapy in the metastatic setting or developed disease recurrence within six months of completing adjuvant chemotherapy. HR+ patients should additionally have received or be ineligible for endocrine therapy.

The DESTINY-Breast04[3] trial studied Enhertu versus investigator’s choice chemotherapy (e.g., eribulin) in 2L+ HER2-low metastatic breast cancer. Enhertu offers a significant increase in progression-free survival (9.9 vs. 5.1 months) and median overall survival (23.4 vs. 16.8 months) compared to chemo, and a dramatic improvement in overall response rate (52.3% vs. 16.3%). This trial could portend a paradigm shift in breast cancer classification, targeting the entirety of HER2 expression.

The waterfall chart below shows that Enhertu’s improvements in efficacy in HER2-low patients, and resultant impact on mortality and morbidity, offer strong clinical innovation of 14% compared to chemotherapy.

Enhertu is a transformative advance for HER2-low metastatic breast cancer patients, and should dominate the space in the near future.

[1] https://www.daiichisankyo.com/media/press_release/detail/index_3159.html

[2] Cortes et al. 2022

[3] Modi et al. 2022

Weighing Efficacy vs. Tolerability: Lenvima + Keytruda in Advanced ccRCC

Conclusion: Despite its toxicity, the overwhelming efficacy advantage of the Keytruda + Lenvima regimen in first-line (1L) treatment of advanced clear cell renal cell carcinoma (ccRCC) puts it in a position to lead the market in this indication. Tolerability concerns will limit its share.

Winning an FDA approval in August 2021, the combination of Lenvima (lenvatinib, Merck + Eisai) and Keytruda (pembrolizumab, Merck) is the most recently approved TKI/IO therapy with an NCCN category 1 recommendation for 1L treatment of advanced ccRCC. This is the third TKI/IO combination to secure an FDA approval and category 1 recommendation, with Inlyta (axitinib, Pfizer) + Keytruda being approved in April 2019, and Cabometyx (cabozantinib, Exelixis) + Opdivo (nivolumab, BMS) approved in January 2021. The approvals and category 1 recommendations of these regimens span all risk groups. These regimens have since bumped sunitinib (Sutent by Pfizer, which went generic in August 2021) from a category 1 recommendation to a category 2A recommendation. Our comparison of the category 1 TKI/IO regimens in this indication shows that although the Lenvima + Keytruda regimen may be more toxic than the others, this disadvantage is modest relative to its major improvement in efficacy. Our analysis is based on phase 3 clinical trial data (CLEAR, CheckMate 9ER, and KEYNOTE-426).

Historically, new regimens with clinical innovation over 10% achieve strong patient share. Lenvima + Keytruda shows 13.4% clinical innovation over Inlyta + Keytruda, driven by improved efficacy.

Lenvima + Keytruda should excel commercially in patients who are able to tolerate it. Dose reductions and interruptions will help manage the toxicity of this regimen and expand its usage to patients who may not able to tolerate it otherwise.

For the clinical benefit that Lenvima + Keytruda provides relative to Inlyta + Keytruda, its higher price is reasonable. Because of this, it falls within the “cloud” of drugs that have historically achieved good market access, and we predict that Lenvima + Keytruda will perform well commercially.

As a side note, Cabometyx + Opdivo is likely to capture share in this indication as a more tolerable alternative to Lenvima + Keytruda, with its efficacy improvement driving its 7.1% clinical innovation over Inlyta + Keytruda.

Rybrevant and Exkivity: two highly innovative new therapies to treat EGFR Exon 20 Insertion positive mNSCLC

Conclusion: Two highly innovative new therapies, Rybrevant and Exkivity, were approved by the FDA within four months of each other. We think that Janssen’s Rybrevant is likely to come out on top in this competition.

EGFR- positive NSCLC has several targeted options for treatment such as Tagrisso (osimertinib) and Tarceva (erlotinib). However, EGFR exon 20 insertion positive mNSCLC, for which existing EGFR TKIs are ineffective, is still treated with chemotherapy.  These patients have a poor prognosis and this mutation affects approximately 2% of those diagnosed with NSCLC.

Janssen’s bispecific antibody therapy, Rybrevant (amivantamab- vmjw), was launched May 2021 and Takeda’s oral tyrosine-kinase inhibitor, Exkivity (mobocertinib), was launched September 2021. Both agents are approved for EGFR Exon 20 insertion patients who have progressed on or after platinum-based chemotherapy. We reviewed data from the phase I/II approval trials for these two agents, CHRYSALIS (Rybrevant) and EXCLAIM (Exkivity). These drugs were granted accelerated approval by the FDA based on ORR and response duration.

Both Rybrevant and Exkivity show significant Clinical Innovation over the previous standard of care, docetaxel, with 19.0% and 17.4% improvement respectively. New agents with Clinical Innovation over 10% historically achieve strong patient shares. These drugs have similar efficacy (mOS, mPFS and response rates) and WAC prices. However, they differ notably in safety/tolerability, with Rybrevant having a significant advantage over Exkivity.   Rates of serious diarrhea are high in patients who took Exkivity, and it has two black box warnings for cardiovascular safety - QTc prolongation and torsades de pointes (an abnormal heart rhythm that can lead to sudden cardiac death). Rybrevant is administered as an IV infusion every two weeks, while Exkivity is taken orally once a day.

Rybrevant was approved four months ahead of Exkivity, and is vying for more approvals in all-comers (i.e., beyond the Exon 20 mutation) in 1L EGFR+ mNSCLC vs. Tagrisso with a phase III trial in progress, in addition to phase III trials in 2L EGFR+ mNSCLC. It also has phase II trials in other cancers, including esophageal and gastric.

Exkivity appears to be further behind in earlier phase trials, including a phase I/II trial in solid tumors harboring EGFR or HER2 mutations and phase I studies in renal and hepatic impairment. The Janssen strategy is to compete in the broader EGFR+ NSCLC population, whereas Takeda pursues opportunities in other malignancies and therapeutic areas. 

Prioritizing Indications: An Analytical Framework

Developing drugs with potential across multiple populations requires setting priorities. Equinox helps development teams quantify opportunity and risk by indication, to better inform prioritization decisions.

Clinical Improvement, Population Size, and Medical Need: A New Drug in 8 Indications

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This graph shows how important commercial factors compare across candidate indications for a new drug: the sizes of the target populations, the level of unmet medical need in each population, and the improvement the drug would offer over the standard of care (SOC), which drives patient share.

This improvement will vary by indication. We use a rigorous technique to quantify that improvement, which we call “Clinical Innovation”. Validating using real world market performance, we have observed that these general rules hold up remarkably well:

• Drugs with 10% or greater Clinical Innovation typically dominate their segments

• Drugs with 5 to 10% Clinical Innovation achieve good patient shares

• But new drugs with less than 5% Clinical Innovation typically struggle; they impose high risk on the developer

Moreover, we have quantified how Clinical Innovation correlates with a new drug’s market access, pricing potential, and patient share.  We use those correlations to predict commercial outcomes for a drug in each of its target patient segments, providing development teams with a strategic perspective to compare opportunity and risk by indication.

In this example, the agent is highly innovative in 2L CRC (a large population), as well as in 2L TNBC and 1L ALK+ NSCLC.  It also is moderately innovative in 1L and 2L melanoma, and 2L pancreatic cancer.  In 2L prostate cancer, however, the agent’s Clinical Innovation is well below the 5% threshold, suggesting the agent will not be competitive in this population.  In 3L melanoma, it offers modest improvement, but this indication will be required to get to the more lucrative 1L and 2L melanoma populations.

Calculating patient share as a function of Clinical Innovation, we can estimate the revenue outlook for the asset in each target population. Development teams use this output (and others from our process) to inform decisions about development strategy.

Trodelvy: A New Option for Later Lines TNBC

Conclusion: Trodelvy offers moderate clinical innovation in relapsed/refractory triple-negative breast cancer (R/R TNBC), suggesting it will be prescribed to a large share of patients in this population.  We compare the results with other recent launches in breast cancers.   

In April 2020, the FDA granted accelerated approval to Trodelvy (sacituzumab govitecan-hziy, Gilead) in patients with metastatic TNBC who have failed two prior lines of therapy. Now, a year later, the FDA has granted full approval to Trodelvy for women with TNBC who have had received two or more systemic therapies, at least one for metastatic disease. Our analysis is based on phase III clinical data (NCT02574455).

TNBC makes up 15-20% of metastatic breast cancer incidence and remains an area of high unmet need. Patients at later lines have historically had few options—all of which offered short time to progression and poor survival rates.

Trodelvy boasts a significant increase in both median progression-free survival (mPFS) and median overall survival (mOS) when compared to physician’s choice chemotherapy. In the phase III ASCENT trial, Trodelvy patients without brain metastasis had an average PFS of 5.6 months, compared to 1.7 months for chemotherapy; mOS almost doubled, going from 6.7 months to 12.1. Trodelvy’s efficacy in patients with brain metastasis was only marginally less impressive. When modeled in Equinox’s framework, these results yield a Clinical Innovation score for Trodelvy of 9.3%, which is moderately differentiated (defined as 5-10% improvement), based on a large set of historical examples.

To put into context Trodelvy’s commercial outlook in R/R TNBC, we can compare it with other breast cancer therapies launched in recent years, regarding:

• Sizes of the populations (bubble size)

• Level of medical need (Y-axis)

• Clinical improvement over the previous standard of care (Equinox Group’s “Clinical Innovation” metric, on the X-axis)

Green bubbles represent drugs with a clinical innovation score greater than 10% (highly innovative drugs)

Yellow bubbles represent drugs with a clinical innovation score of 5-10% (moderately innovative drugs)

Orange bubbles represent drugs with a clinical innovation score of less than 5% (low innovation drugs)

The level of unmet medical need in R/R TNBC treated with chemotherapy is extraordinarily high at 4.22 on Equinox Group’s 0-5 unmet need scoring system.  Need is driven by the excess risk of mortality: 50 times higher than in an age-matched population. 

Our analysis suggests Trodelvy will achieve good patient share in this small population.  Its Clinical Innovation is only slightly lower than that achieved by Perjeta (in combination with trastuzumab + docetaxel) in 1st line HER2+ metastatic breast cancer – a regimen that dominates treatment in its population.

Enhertu in 3rd line HER2+ mBC addresses the second highest level of medical need among the indications here; it offers strong clinical innovation of 26%, suggesting it has strong patient share potential.

Trodelvy’s modest revenue of $72 million in Q1 2021 reflects its initial launches in small patient populations.  In contrast, Ibrance is targeted to a much larger, lower-need population, offers high clinical innovation (15.7%) and has achieved a substantial patient share and sales ($5.4 billion in 2020).  Kisqali’s more modest sales of $687 million in 2020 are explained by its lack of meaningful improvement vs. Ibrance and a launch that was two years later.

Trodelvy is in development in larger populations, including early lines of TNBC, HR+/HER 2- metastatic breast cancer and metastatic non-small-cell lung cancer. Its commercial outlook in those indications, including patient share and pricing potential, will depend on the level of Clinical Innovation it delivers.

Monjuvi: Newest Blockbuster in Relapsed/Refractory DLBCL

Conclusion: Monjuvi achieves an impressive clinical benefit for its substantial efficacy improvements over Polivy (polatuzumab vedotin) + bendamustine + rituximab for adults with R/R DLBCL who have failed one or more prior lines of treatment, but favorable market access may be linked to the availability of generic lenalidomide, which remains a question

Monjuvi (tafasitamab-cxix, MorphoSys and Incyte) was approved in August 2020 in combination with Revlimid (lenalidomide) for relapsed or refractory diffuse large B-cell lymphoma (DLBCL) patients. Though the populations enrolled in the Monjuvi and Polivy trials were similar, having received between one to three or more prior lines of therapy, Monjuvi was approved with a differentiated second-line label for R/R DLBCL, while Polivy was approved for third-line.

Monjuvi + lenalidomide boasts a significant increase in progression-free survival compared to Polivy + bendamustine + rituximab (12.1 vs.7.5 months), as well as a notable improvement in overall response rate (55% vs. 42%). While survival data is not yet mature, even the most conservative modeled estimate (22.8 vs. 12.4 months) sees Monjuvi offering significant clinical benefit for R/R DLBCL patients eligible for a second or later line of treatment.

The waterfall chart below shows that Monjuvi offers a significant improvement in efficacy, which produces further benefits in mortality and morbidity, delivering a strong clinical benefit score of 19%.

While offering substantial clinical benefit, this regimen is expensive, exceeding $360,000 annually, assuming Revlimid’s branded price (WAC).  

Analysts expect Monjuvi to be a blockbuster, projecting $1 billion sales at peak. We believe Monjuvi’s commercial success hinges on the availability of cost-effective generic lenalidomide (expected to be rolled out in 2022 on a limited volume basis), in the absence of which payer pushback is a near certainty.