In a Phase 3 study, individualized neoantigen therapy intismeran improved recurrence-free survival and distant metastasis-free survival in melanoma patients when combined with Keytruda, relative to Keytruda alone. Moderna shares rose nearly 150% while Merck rose over 10% intraday on Aug. 19.
Why it matters: Declining covid vaccine demand and an uncertain US vaccine policy environment have forced Moderna to budget its cash and invest only in its most promising programs, but intismeran’s success in phase 3 offers validation of the potential of its mRNA technology beyond vaccines.
- While the specific type of cancer studied in Interpath-001 (high-risk melanoma at the adjuvant, or post-surgery, stage) is a relatively small niche (30,000 patients in the United States and European Union), it bodes well for ongoing intismeran studies, including adjuvant lung cancer (more than 100,000 in the US and EU).
- The magnitude of benefit is not yet disclosed, but a positive readout at this first interim analysis is a good sign, as Merck and Moderna likely designed the trial with a high statistical bar for an early readout. Five-year phase 2b data showed a 49% reduction in the risk of recurrence or death.
The bottom line: We’re raising our fair value estimates for wide-moat Merck (to $143 per share from $111) and no-moat Moderna (to $163 from $79) after raising our intismeran sales forecast to $16.8 billion (from $7.2 billion) by 2035, with profits from the program split 50/50 between the partners.
- We’ve increased our assumed probability of approval for intismeran in melanoma (from 60% to 100%) and lung cancer (from 40% to 60%), and we’ve added phase 2 kidney and bladder cancer programs to our model. We expect rapid approval, likely in the first half of 2027, once data is filed.
- We’re watching for Keytruda/intismeran combination data in other areas where Keytruda has benefited patients, including phase 2 kidney cancer data expected this year and phase 2 bladder cancer data expected in 2027.
