Incyte's Strategy Against Competitive Pressures in Oncology

Current Competitive Landscape in Oncology

The current competitive landscape in oncology is characterized by varying levels of intensity among companies. While some, like Bristol-Myers Squibb, acknowledge the need for strategic focus amid competition, others, such as Novartis, see less competitive pressure in oncology compared to other areas. AstraZeneca emphasizes ongoing monitoring of market dynamics to adapt effectively.

"While we saw growth across our immunology business, we recognize there's still more work to do, particularly with Sotyktu in this highly competitive category. There were also some inventory and gross-to-net favorability across several growth brands this quarter, which will be important to take into consideration when phasing sales in the second half of the year. Let's take a closer look at our key brand performance, starting with our oncology franchise on Slide 13." --- (BMY, earning call, 2024/Q2)

"Dear Mr. Kiena, you asked about our competitive position in the field of oncology." --- (MRK, event transcript, 2024/04/26)

"And then the other thing I believe is also an important opportunity for us is that we expect and we see less competitive intensity versus some of the other categories, that we put, tend to work in the oncology setting and even outside of oncology." --- (NVS, earning call, 2023/Q1)

"That in mind, we'll continue to scan the competitive landscape and make the appropriate decisions as we move forward." --- (AZN, earning call, 2024/Q1)

"Maybe any kind of latest thoughts that you guys have in terms of the overall market with a potential competitive landscape over the Yes, it's a great question." --- (BMY, conference, 2024/05/15)

Impact of Competitive Pressures on Incyte's Strategy

Competitive pressures in oncology are significant, as highlighted by Bristol-Myers Squibb's and Gilead's cautious outlooks due to ongoing competition and cost challenges. These dynamics necessitate strategic adjustments for Incyte to maintain its market position and drive growth amidst these headwinds.

"With Abecma, US performance in the quarter was impacted by ongoing competitive pressures." --- (BMY, earning call, 2024/Q1)

"We're remaining cautious for the second half of this year as we continue to see some competitive headwinds both in cost competition." --- (GILD, earning call, 2024/Q2)

"We now have greater than 60% of covered lives with favorable access. As a result, in the near term, we anticipate modest incremental gross-to-net pressure on revenue growth, which will be offset by demand growth over time.Now turning to Slide 17, I will highlight some components of the P&L." --- (BMY, earning call, 2024/Q2)

Strategic Partnerships and Collaborations

Incyte's strategy emphasizes the importance of strategic partnerships to enhance its oncology offerings. Collaborations, such as those with Bristol-Myers Squibb and Merck, focus on co-development and expanding access to therapies, ensuring a competitive edge in delivering innovative treatments to patients.

"Business development and partnerships remain important for us and we continued to strengthen our balance sheet while maintaining our commitment to returning cash to shareholders.Taken together, these actions are ensuring we are focused on the highest-value activities across the organization, tightening our execution where needed and accelerating our ability to deliver important medicines to patients.On that note, turning to Slide 6." --- (BMY, earning call, 2024/Q2)

"About the Merck and Eisai strategic collaboration In March 2018, Eisai and Merck, known as MSD outside of the United States and Canada, through an affiliate, entered into a strategic collaboration for the worldwide co-development and co-commercialization of LENVIMA." --- (MRK, press release, 2024/09/14)

"And I think the biggest highlight I would say with the Arcus collaboration is really the opportunity to play and collaborate with certain assets, but also wait and see some of the data as it evolves so that we can make certain decisions and with the right data sets for us to move forward as well." --- (GILD, conference, 2024/06/12)

""We're excited to collaborate to bring forward new therapeutic options for patients living with cancer, complementing our strategic efforts across a wide range of modalities, including targeted therapies, biologics, radioligand therapies and CAR-Ts."" --- (NVS, press release, 2024/07/24)

"The Company enters strategic collaboration with the Access to Oncology Medicines (ATOM) Coalition to expand access to immuno-oncology therapy Opdivo™ in select countries Bristol Myers Squibb (NYSE:BMY) today announced ASPIRE (Accessibility, Sustainability, Patient-centric, Impact, Responsibility and Equity), a 10-year strategy to advance access to our innovative treatments and help patients in low- and middle-income countries (LMICs) gain access to potentially life-saving medicines." --- (BMY, press release, 2024/05/22)

Market Positioning and Pricing Strategies

Incyte's market positioning and pricing strategies are influenced by ongoing discussions in the industry regarding price-setting processes and the impact of pricing on patient access. Companies like Novartis highlight the importance of adjusting prices to improve patient fulfillment, while others emphasize maximizing product performance and expanding margins to remain competitive.

"So that is what we're expecting to happen. And on the pricing point, I think it's just important to understand the way this market works and how we operate in the market." --- (MRK, earning call, 2024/Q2)

"I think certainly as we move down from a $3,500 cap to a $2,000 cap, I would expect, in general, to see more -- patient's ability to fulfill their medicines to improve as the cost becomes lower at the pharmacy counter." --- (NVS, earning call, 2024/Q1)

"So we believe that there is a place for multiple assets in this market and our objective is to return Abecma to growth over time as we move into a larger patient population." --- (BMY, earning call, 2024/Q1)

"• Maximize performance of our new products • Expand margins by realigning our cost base • Allocate capital to enhance shareholder value One way we believe we will be more efficient, effective and able to execute on these five strategic priorities is through technology, including artificial intelligence." --- (PFE, sec filing, 2024/Q2)

"But what I can say is that these are ongoing discussions, the price setting - we continue not to call it a negotiation, the price-setting process is one that have had multiple rounds." --- (NVS, earning call, 2024/Q2)

Regulatory Challenges and Responses

Incyte is navigating regulatory challenges by actively engaging with authorities and preparing for upcoming decisions, as highlighted by Gilead's anticipation of FDA and European regulatory outcomes. Companies like Pfizer and Bristol-Myers Squibb are also adapting their strategies in response to regulatory pressures, particularly concerning product safety evaluations.

"We understand from a regulatory standpoint, the challenges that presents. But specifically on second line non small cell lung cancer, we think it's interesting for patients, and this is coming off of ASCO, you've all now seen the data in a bit more detail, and we'll continue to follow that trial, by the way, in those patients in those trials." --- (GILD, conference, 2024/06/12)

"In response to requests from various regulatory authorities, manufacturers across the pharmaceutical industry, including Pfizer, are evaluating their product portfolios for the potential presence or formation of nitrosamines." --- (PFE, sec filing, 2024/Q2)

"We are obviously preparing and planning to have conversations with regulatory authorities as well to plan for later stages of development of this molecule." --- (BMY, earning call, 2024/Q2)

"And we are hoping to see what we call competitive response rate or meaningful response rate for different respective populations." --- (MRK, event transcript, 2024/06/03)

"We anticipate an FDA regulatory decision by August 14th, and a decision from European regulators early next year." --- (GILD, earning call, 2024/Q1)

Key Trends Shaping the Oncology Market

Key trends shaping the oncology market include the anticipated launch of 20 new medicines by AstraZeneca by 2030, significant sales growth for Merck's Keytruda across various cancer indications, and Bristol-Myers Squibb's robust oncology pipeline, highlighting increasing demand and competitive dynamics in the sector.

"Launch of 20 new medicines expected by 2030 Significant growth from existing oncology, biopharmaceuticals and rare disease portfolios Investing in disruptive innovation that will shape the future of medicine and drive long-term growth Decoupling carbon emissions from revenue growth Today AstraZeneca revealed its bold ambition to deliver $80 billion in Total Revenue by 2030, up from $45.8 billion in 2023." --- (AZN, press release, 2024/05/21)

"Keytruda sales growth in international markets reflects higher demand predominately for the TNBC, melanoma and RCC earlier-stage indications, as well as uptake in cervical, renal and gastric cancer metastatic indications, particularly in Europe and Latin America." --- (MRK, sec filing, 2024/Q1)

"We approach #ASCO24 and #EHA2024 supported by the wide breadth of data we’ll be presenting across our diverse oncology pipeline and portfolio." --- (BMY, Twitter post, 2024/05/23)

"Keytruda sales growth in international markets reflects higher demand predominately for the TNBC and RCC earlier-stage indications, as well as uptake in head and neck squamous cell carcinoma and RCC metastatic indications, particularly in Europe and Latin America." --- (MRK, sec filing, 2024/Q1)

"Pharmaceutical Segment Oncology Three Months Ended March 31, % Change Excluding Foreign Exchange ($ in millions) 2024 2023 % Change Keytruda $ 6,947 $ 5,795 20 % 24 % Alliance Revenue - Lynparza (1) 292 275 6 % 7 % Alliance Revenue - Lenvima (1) 255 232 10 % 10 % Welireg 85 42 * * Alliance Revenue - Reblozyl (2) 71 43 66 % 66 % * > 100% (1) Alliance revenue for Lynparza and Lenvima represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs (see Note 3 to the condensed consolidated financial statements)." --- (MRK, sec filing, 2024/Q1)

Future Growth Opportunities in Oncology

Future growth opportunities in oncology are highlighted by companies expanding their portfolios and advancing clinical trials. Incyte, along with partners, is involved in multiple oncology programs, while firms like Bristol Myers Squibb and Amgen are sharing pivotal data and progressing innovative treatments, indicating a robust competitive landscape.

"So, it's a wonderful opportunity to extend our oncology franchise in a new disease area." --- (REGN, earning call, 2024/Q1)

"At this year's ASCO and EHA meetings, we have the opportunity to share data across our robust and differentiated oncology portfolio including new data from pivotal studies, data that reinforce the longer-term impact our medicines are having for patients, and emerging science in the oncology space, said Samit Hirawat, M.D., executive vice president, chief medical officer, Drug Development, Bristol Myers Squibb." --- (BMY, press release, 2024/05/23)

"Under the terms of the agreement, in exchange for an initial $75 million payment, Ligand will receive 18.75% of the royalties and 31.875% of the future milestones on six Agenus-partnered oncology programs including BMS-986442 (Bristol Myers Squibb), AGEN2373 (Gilead Sciences), INCAGN2385 and INCAGN2390 (Incyte), MK-4830 (Merck), and UGN-301 (UroGen Pharma)." --- (MRK, press release, 2024/05/07)

"To round out oncology, we have completed enrollment of FORTITUDE-101, a Phase III study of bemarituzumab, a first-in-class fibroblast growth factor receptor IIb directed monoclonal antibody administered in combination with chemotherapy in frontline gastric cancer. We are also rapidly advancing AMG 193, our oral PRMT5 inhibitor developed for MTAP-null solid tumors as both a monotherapy and in combination with other therapies." --- (AMGN, earning call, 2024/Q2)

"Having said that, we remain convinced that our target of 1 third of sales goals from oncology is achievable without the need for additional BD and including potential growth of our HIV business." --- (GILD, conference, 2024/06/12)