Appeals court sides with Bristol Myers Squibb in years-long battle with investors over Opdivo fail
Bristol Myers Squibb’s years-long court battle with investors over a failed Opdivo study is coming to a close. Second Circuit judges sided with the pharma giant on Friday, affirming a federal court’s decision to dismiss a case surrounding a lung cancer trial for the blockbuster PD-1 checkpoint inhibitor.
Opdivo, also known as nivolumab, won its first approval back in 2014 for advanced melanoma, and has since tacked on a lengthy list of cancer indications. But this particular case traces back to a disappointing 2016 readout in non-small cell lung cancer, which shed roughly $20 billion off the company’s market cap in pre-market trading.
The drug works by preventing the PD-L1/PD-1 interaction in cancer cells, rendering them vulnerable to the body’s immune system. But not all cancer cells have the PD-1 protein — so the higher a patient’s PD-L1 expression, the more effective the drug. BMS revealed back in August 2016 that Opdivo did not meet the primary endpoint in the Phase III CheckMate-026 study, just months after Merck touted a win in that same setting with its PD-1 rival Keytruda.
However, there was a key difference among the trials. While both claimed to enroll patients with “strong” PD-L1 expression, BMS set the threshold at 5%, while Merck defined “strong” expression as higher than 50%.
BMS’ failure in NSCLC left investors shaking their heads — and in 2018, several filed suit against the pharma giant alleging that it “misrepresented the study” by declining to disclose the 5% PD-L1 expression threshold in advance.
“The claim in this suit is that 5% is not a ‘strong’ expression, and that the class was thereby misled to overestimate the prospect of the trial’s success,” court documents state.
A federal judge in New York dismissed an amended complaint in 2020 for failure to state a claim, maintaining that the investors failed to “allege (i) material misrepresentations or omissions or (ii) facts giving rise to a strong inference of scienter.”
Second Circuit judge Dennis Jacobs affirmed that decision in an opinion on Friday, concluding that there was no generally understood meaning of “strong” expression at the time, and also that no evidence indicates BMS had an obligation to disclose the precise threshold.
In fact, BMS “cautioned the public” that it would not do so, Jacobs wrote.
Despite Merck’s definition of up to 49% expression as “weak,” Jacobs said “there was little consensus among industry participants and researchers as to the expression levels constituting ‘strong’ PD-L1 expression and PD-L1 ‘positivity.'”
With respect to PD-L1 positivity, the July 2015 Journal of Thoracic Oncology surveyed the threshold used for “positive” expression in various studies, noting that many used 5%, while some used 1% or 10%. The publication showed that in several studies, Merck considered any expression up to 49% “weak.” Similarly, a May 26, 2016 medical publication stated that “[t]he best cut-off percentage of scored cells to determine PD-L1 positivity … remains an unresolved question” but “the threshold most often chosen is >5% expression.”
“Bristol Myers Squibb is pleased with the unanimous decision of the appellate court to affirm the district court’s dismissal of this lawsuit,” a spokesperson told Endpoints News.
Opdivo raked in more than $7.5 billion last year, and snagged an approval earlier this month in combination with chemotherapy for adults with NSCLC in the neoadjuvant setting.
Mark Awad, clinical director of the Lowe Center for Thoracic Oncology at the Dana-Farber Cancer Institute and a study investigator, said in a statement that the approval “marks a turning point in how we treat resectable NSCLC.”