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A landmark FDA approval last week in breast cancer defined a new cancer target, expanding the number of patients that can be treated. Mersana Therapeutics is going after that same new target with a drug from the same class of therapies and the biotech is readying for a clinical trial that could show whether its twist on the approach works in other cancers. GSK wants a piece of that potential and it is paying the biotech $100 million to begin a partnership. The sum announced after the market close Monday is an upfront payment that gives GSK an exclusive option to license and co-develop the Mersana drug, XMT-2056. Exercising that option would give the pharmaceutical giant the opportunity to add another drug to its portfolio from the class of therapies called antibody drug conjugates (ADCs), but one that works in a slightly different way. ADCs are traditionally comprised of a tumor-target targeting antibody that’s linked to a tumor-killing drug payload. The goal is to provide a targeted effect that spares healthy tissue. More than a dozen such therapies have passed FDA muster, most recently last Friday’s expanded approval of AstraZeneca and Daiichi Sankyo drug Enhertu to including treatment of breast cancers that express low levels of the protein HER2. Cambridge, Massachusetts-based Mersana aims to take ADCs beyond the delivery of toxic drug payloads. XMT-2056 still offers targeted delivery to tumors, but its cargo instead activates stimulator of interferon genes (STING), a pathway of the innate immune system. Other biotechs are developing STING-activating drugs for cancer, some of them given as injections into the tumor. Mersana said in an investor presentation that its approach leverages the targeting ability of an ADC to elicit an immune response in both tumor cells as well as immune cells found inside the tumors. This “one-two punch” to both is intended to provide a more potent therapeutic effect while at the same time reducing toxic effects elsewhere in the body. In preclinical research, Mersana has reported that its drug showed robust anti-tumor activity in animal models expressing high HER2 levels as well as those with low HER2. The company said the efficacy of the therapy was enhanced when the drug was used in combination with other cancer drugs, including Roche’ drugs transtuzumab and pertuzumab, checkpoint-blocking drugs that target the protein PD-1, and the AstraZeneca and Daiichi drug Enhertu. In a prepared statement, John Lepore, GSK’s senior vice president of research, said that XMT-2056’s “preclinical data demonstrate how it might work to harness the immune system by activating the STING pathway, and its differentiated mechanism of action offers the potential for additional clinical benefit in patients with HER2-expressing tumors.” Though Enhertu and XMT-2056 both target HER2, Mersana’s drug is designed to target a novel part of that protein. A Phase 1 test of the drug is expected to begin “imminently,” Mersana said in the investor presentation. That study will span a range of HER2-expressing tumors. In addition to breast cancer, the study will include gastric cancer and non-small cell lung cancer. GSK’s oncology portfolio already includes Blenrep, an ADC that won its FDA approval two years ago for treating multiple myeloma. According to a Mersana regulatory filing, the pharma giant may exercise its option on the Mersana-partnered ADC after it delivers dose-escalation data from the Phase 1 study that includes investigation into the subgroups of breast cancer patients most likely to benefit from the therapy. If GSK elects to exercise its option on the Mersana drug, it’s on the hook for a $90 million option exercise payment. Achieving clinical, regulatory, and commercial milestones could bring Mersana up to $1.27 billion more. GSK is the second Mersana partner that the biotech has signed on this year. In February, the company unveiled a partnership with Johnson & Johnson’s Janssen Biotech subsidiary. According to terms of that deal, Mersana will work with antibodies provided by Janssen for three unspecified targets. Janssen paid Mersana $40 million up front. Mersana could receive up to $1 billion in milestone payments.

GSK CEO Emma Walmsley said none of the short-term pressure in China “takes away from our longer-term ambition” for its shingles vaccines Shingrix. Even as GSK’s RSV vaccine launch hits a serious slowdown, the British pharma has dialed up its long-term sales guidance once again.GSK now expects to generate more than 40 billion pound sterling ($50 billion) in 2031 sales, the company said Wednesday alongside its fourth-quarter earnings report. For 2024, the pharma giant reported 31.4 billion pound sterling in total revenue, a 7% increase at constant exchange rates.The new target is an increase from the company’s 38 billion pound sterling projection, announced last year, and its 33 billion pound sterling forecast in 2021 when GSK transformed into a pure-play drugmaker by spinning off its consumer health franchise into Haleon.The latest increase reflects the revival of the once-withdrawn antibody-drug conjugate Blenrep, as well as “multiple launch opportunities in the ’26-to-’31 period,” GSK CEO Emma Walmsley said on a Wednesday call with investors.After two back-to-back phase 3 wins in second-line multiple myeloma, GSK has re-adopted a projection that Blenrep’s peak sales could exceed 3 billion pound sterling. The number does not account for any risk factors, according to GSK. Conversely, the groupwide sales target is risk-adjusted, with 90% of the total coming from products that are already approved or planned for launch in the next three years.GSK pulled Blenrep as a late-line myeloma therapy in late 2022. Now, the company expects an FDA decision for the BCMA-directed ADC's second-line use by July 23 of this year. GSK has recently launched a phase 3 trial, Dreamm-10, in the first-line setting, with headline results expected toward the end of 2027, chief commercial officer Luke Miels said on the call. The addition of Blenrep, plus over 4 billion pound sterling in combined peak sales from Nucala and the near-market long-acting IL-5 drug depemokimab, will help boost the contribution of GSK's specialty medicines portfolio to more than 50% of the company’s overall top line, according to Walmsley.Meanwhile, the rise of therapeutics comes in stark contrast to the struggles that GSK’s vaccines business is navigating.After a blockbuster burst onto the market last year, sales of the RSV vaccine Arexvy nosedived this season. In a similar pattern already seen in the third quarter, Arexvy sales in the fourth quarter plummeted by 70% year over year to 158 million pound sterling ($198 million), landing 32% below analysts’ expectations.RSV vaccine demand was lower this year because of a restricted recommendation from the CDC, plus a late season and an unfavorable comparison to launch stocking in 2023, Miels explained. On Tuesday, Pfizer also reported $198 million in fourth-quarter sales for its RSV shot Abrysvo.For 2025, GSK doesn’t expect the age restrictions in the CDC’s RSV immunization recommendation will change.Also in vaccines, GSK’s star Shingles vaccine Shingrix saw sales drop 4% at constant exchange rates to 848 million pound sterling ($1.06 billion) in the last three months of 2024.An overall vaccines market slowdown in China has recently struck a nerve with investors. On Tuesday, Merck & Co. said it’s temporarily suspending shipments of its HPV vaccine Gardasil to China so that it and its partner Chongqing Zhifei Biological Products can work through an inventory backlog. Disappointing prospects of the shot sent Merck’s stock price down by about 10% Tuesday morning.GSK is also partnered with Zhifei on Shingrix. On Wednesday’s GSK call, Miels acknowledged the short-term headwinds in China as well as a low expectation for Shingrix in the country in 2025. But he stressed that the company is there for a “mid- to longer-term play." Walmsley stressed that none of the short-term pressure “takes away from our longer-term ambition” for the shot.GSK has adjusted expectations for both Arexvy and Shingrix in its 2031 sales target, although Walmsley said she expects vaccines to “remain a key source of future growth” for the firm. Elsewhere, another pillar of GSK’s business, HIV drugs, delivered nearly 2 billion pound sterling ($2.5 billion) in fourth-quarter sales, good for 11% growth year over year. The company's long-acting injectable treatment Cabenuva and PrEP drug Apretude played a role in the growth.With the new sales target set and pipeline progressing, GSK on Wednesday also announced a 2 billion-pound sterling share buyback program to be implemented over the next 18 months.“We believe this offers a very attractive return for shareholders at current share price levels,” Walmsley said. “Very importantly, and to reconfirm, we will maintain planned increased levels of investment in R&D, new launches and targeted business development alongside these share buybacks.”