Another sellside call for PD-(L)1 price competition

With 10 anti-PD-(L)1 drugs on the US market the lack of discernible price competition among them continues to vex, and this week the sellside again pitched the merits of price cutting. Jefferies analysts argued that BeiGene, whose Tevimbra got its first US approval at last in March, “could obtain an edge by setting a competitive price”; as the drug has yet to be launched its pricing hasn’t yet been revealed. Jefferies’ view echoes an April 2021 letter sent to Regeneron management by the then Bernstein analyst Ronny Gal (now chief strategy and growth officer at Novartis), claiming that failure to discount Libtayo versus established PD-(L)1 competitors “could result in irrelevance for [the Regeneron drug] over the next few years". Notably this was a call Regeneron declined to heed, as demonstrated by Jefferies’ note to clients showing that the US prices of four anti-PD-1 drugs, including Libtayo, have actually risen 2.5% year on year. However, so far Tevimbra is US-approved for the niche use of second-line oesophageal squamous cell carcinoma, so how BeiGene might undercut the likes of Keytruda, which is fuelled by big-ticket indications like front-line lung cancer, isn’t clear.

Selected anti-PD-1 drug prices in the US

Note: *WAC=wholesale acquisition cost. Source: Jefferies.