On January 20, 2021 GlaxoSmithKline reported that jump on for $4.2 billion has come up as a dud in a key trial pitting it against U.S. Merck’s blockbuster Keytruda (Press release, GlaxoSmithKline, JAN 20, 2021, View Source [SID1234574227]).

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That drug, originally known as M7824, now bintrafusp alfa, works as a bifunctional fusion protein immunotherapy.

It is designed to combine a TGF-β trap with the anti-PD-L1 mechanism in one fusion protein and to combine co-localized blocking of the two immuno-suppressive pathways: Targeting both pathways aims to control tumor growth by potentially restoring and enhancing anti-tumor responses.

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Early data showing a strong objective response rate (ORR) appeared to be enough for GSK to pen a deal with Germany’s Merck. (Though Pfizer, already partnered with Merck KGaA for their also-ran checkpoint inhibitor Bavencio, appeared to have passed on the med.)

The original deal with London’s GlaxoSmithKline saw Merck gain €300 million upfront, with milestone payments of up to €500 million and potential sales of €2.9 billion, which brought the total to an eye-watering figure of €3.7 billion ($4.16 billion).

RELATED: Merck KGaA, GSK pen $4.2B biobucks pact for next-gen Bavencio

That deal came after a mini deal spree for GSK, coat-tailing its $5.1 billion buyout of cancer biotech Tesaro, all amid a period of major restructuring, new personnel and R&D shifts at the company that has seen it once again refocus on oncology research.

But today, GSK’s decision looks poor: In a late-stage test of the drug in PD-L1-expressing non-small cell lung cancer patients, an independent monitoring committee has told the pair the drug will likely not hit its primary endpoint, which was progression-free survival, in the trial known as INTR@PID Lung 037.

The drug was going head-to-head with Merck’s rival U.S. pharma, also called Merck, and its winner-takes-all checkpoint inhibitor Keytruda, in newly diagnosed late-stage lung cancer patients. Beating out Keytruda, which has a strong track record in lung cancer, was always going to be a tough ask.

Other trials for the drug appear to be ongoing. "The recommendation by the Independent Data Monitoring Committee and the Company’s decision is related only to this Clinical Trial," the pair said in a statement.

Germany’s Merck was down more than 3% on the news, with GSK down 1.5% premarket.

"We have pioneered the science behind bintrafusp alfa, and now through a strategic alliance, multiple non-correlated parallel hypotheses are being evaluated across numerous indications in our extensive INTR@PID clinical program," said Danny Bar-Zohar, M.D., global head of development for the healthcare business of Merck KGaA.

"We remain committed to further evaluation of bintrafusp alfa, and these data from INTR@PID Lung 037 will provide important insights that may be applied to future studies."

Analyst at Jefferies said that Merck remains confident the drug is "active" but are unclear why it was hit by a failure, although they said it is not due to any safety issues.

In a call with analysts, the pharma said it remains optimistic about the franchise and other indications ongoing including biliary tract cancer, cervical, urothelial, and first-line and second-line lung combinations with radiation, TIGIT, and so on, there is a second-line biliary tract cancer topline result also coming in the coming weeks, with an ORR analysis "and the bar is low to beat," according to analysts.

Michael Yee from Jefferies added in his note to clients: "Bottom line: We are perplexed why Merck KGaA failed early at an interim despite very positive phase 2 data. This goes to why single-agent, uncontrolled studies must be taken with a grain of salt."