Friday Five – The week in review

Quarterly earnings season in full swing

Following release of Johnson & Johnson's Q1 results last week, pharma's first-quarter earnings season has hit its stride over the past four days with AbbVie, Amgen, AstraZeneca, Bayer, Biogen, Bristol-Myers Squibb, Celgene, Eli Lilly, GlaxoSmithKline, Novartis and Roche all reporting results. Sanofi will report its first-quarter earnings on Friday (April 28).

New GlaxoSmithKline CEO Emma Walmsley delivered her maiden quarterly presentation and promised to provide more detail on long-term strategic priorities and an updated view of the company's earlier-stage R&D pipeline in the summer.

At Amgen, Enbrel sales fell short of expectations putting even greater emphasis on the company's ability to drive an inflection in sales of its PCSK9 inhibitor Repatha.

Eli Lilly's diabetes franchise remains integral to the company's growth aspirations, but management warned it will take some time for Jardiance's demonstrated cardiovascular benefit to be reflected by commercial performance.

Novartis hopes to support recent new launches (such as Cosentyx [psoriasis], Kisqali [breast cancer] and Entresto [heart failure]) with continued momentum from its late-stage pipeline. Filing dates for new therapies in progressive multiple sclerosis and sickle cell disease have been firmed up, while management reiterated the long-term blockbuster potential of its CAR-T therapy CTL019.

For analysis of key discussion points beyond first-quarter press releases…

Roche Q1 Results – Earnings presentation/analyst call highlights

AstraZeneca Q1 Results – Earnings presentation/analyst call highlights

GlaxoSmithKline Q1 Results – Earnings presentation/analyst call highlights

Eli Lilly Q1 Results – Earnings presentation/analyst call highlights

Biogen Q1 Results – Earnings presentation/analyst call highlights

Novartis Q1 Results – Earnings presentation/analyst call highlights

Johnson & Johnson Q1 Results – Earnings presentation/analyst call highlights

Immuno-oncology remains a key focus

With AstraZeneca, Bristol-Myers Squibb and Roche all reporting first-quarter results on Thursday, there was an opportunity for investors and analysts to size up managements' respective thoughts on the immuno-oncology landscape; critical to the outlook for each of these companies and Merck & Co., which reports its earnings next week.

Most crucially, perhaps, we are potentially less than a month away from Merck securing US approval of Keytruda as a first-line treatment for non-small-cell lung cancer in combination with chemotherapy; a label which if granted is expected to play a key role in positioning the drug as the best-selling PD-(L)1 inhibitor in the medium to long term.

Roche is awaiting data from the first of seven large trials looking at immuno-oncology plus chemotherapy combinations in the third quarter and AstraZeneca confirmed on Thursday it too has invested in a similar strategy. This year's upcoming ASCO annual meeting may lack the immuno-oncology excitement of recent years, but trial readouts over the next 12 months will play a critical role in shaping the market – AstraZeneca and Bristol-Myers Squibb, in particular, have a lot riding on these results.

Bristol-Myers Squibb, while noting that sales of its PD-1 inhibitor Opdivo in the second and third-line lung cancer markets have stabilised in recent weeks, was at pains on Thursday to suggest "it is more than a lung cancer" company. Indeed, calling out the unpredictability of lung cancer drug development – Bristol-Myers Squibb having been on the receiving end here – management also made an effort to highlight key mid-stage pipeline assets in fibrosis, cardiovascular and immunology as it looks to add some diversification. However, while analyst expectations for the core oncology portfolio have been lowered slightly, they are nevertheless expected to account for a high percentage of the company's sales a decade from now, meaning that Bristol-Myers Squibb still has much riding on the immuno-oncology race.

More changes at Teva

Teva's transitional status was enhanced this week by confirmation that CFO Eyal Desheh is to depart in the next few months and reports the company is exploring the sale of its oncology portfolio. Teva is in the process of recruiting a new CEO following Erez Vigodman's resignation in February. Bernstein analyst Ronny Gal suggested Dehesh's departure is unlikely related to upcoming quarterly results, but is part of a broader process to "clear the deck" for new management.

Concurrently, Teva has confirmed launch of AirDuo in the US market and announced the COPD treatment will be available in both branded and authorised generic form; the former priced comparatively to GlaxoSmithKline's Advair (AirDuo is a not substitutable generic version of Advair, with a lower dose delivered via a different inhaler) and the latter available at approximately a third of the cost.

See Physician Views Poll Results: Teva's authorised generic AirDuo strategy looks set to deliver a material impact in asthma market and KOL Views: Leading pulmonologist sees Teva’s AirDuo as a legitimate threat to GlaxoSmithKline’s Advair and other ICS/LABA combos

Merck KGaA exits biosimilars as Jimenez predicts survival of the largest

With Fresenius Kabi acquiring the business for $185 million upfront, Merck KGaA has completed its long-plotted exit from the biosimilars market, in order to focus resources on its revitalised R&D pipeline.

Spotlight On Interview: Merck KGaA's R&D renaissance – FirstWord discusses immuno-oncology aspirations with global head of R&D Luciano Rossetti

Analysts at Morgan Stanley welcomed Merck's strategic decision by suggesting that although "the biosimilar market offers material sales opportunities overall, fierce competition suggests limited profits in most cases."

Speaking on Novartis' Q1 earnings call this week, CEO Joseph Jimenez argued that the Sandoz division was poised to deliver long term profitability from its biosimilars business, but echoed a frequently-made suggestion that a handful of larger players are likely to dominate this market, squeezing out smaller companies in the process.

Approval last week of a second biosimilar Remicade product in the US market (to be marketed by Merck & Co.) ups the ante further, and Biogen hinted this week on its first-quarter earnings call that it will likely double down on its investment in biosimilars joint venture it runs with Samsung Bioepis. Those on the receiving end of biosimilar erosion are not standing still, however, and Roche remains the leading proponent of innovation as a means to defend market share. Accepting the realities of biosimilar competition, the company reiterated this week that its focus remains on "improving the standard of care," where these products compete.

Drugmakers call for June decision on new location of EMA

A number of drugmakers including AstraZeneca, Novartis, Sanofi and Roche on Monday called for a decision on the new location of the European Medicines Agency to be made by the EU's heads of state at their next scheduled meeting in June. "The Council's deliberations on the [EMA's] future location need to be conducted on the basis of very essential criteria and put for decision as early on as possible," the European Federation of Pharmaceutical Industries and Associations (EFPIA) said in a statement signed by 19 senior executives at member companies. 

"Were a rapid resolution on the future location of the EMA not to materialise, or if the future seat of the [agency] were to fail in terms of establishing its minimum prerequisites, the quality of its work and the future of the European Medicines Regulatory Network would be placed in jeopardy," the EFPIA warned. The statement follows EMA executive director Guido Rasi's recent suggestion that a new headquarters could be selected at the European Council's June meeting.

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