Mirati Therapeutics is unlikely to carve out a share of the lung cancer market vs. Amgen, analysts said Friday as MRTX stock collapsed on a testing disappointment.
The biotech company tested its drug, adagrasib, in patients with a form of lung cancer that's difficult to treat. Overall, the disease decreased in 43% of patients — a measure called objective response rate. Cancer shrank or remained stable in 80% of patients. At the median, their cancer began progressing after 6.5 months of treatment and patients stopped responding at 8.5 months.
But adagrasib failed to meaningfully differentiate from Amgen's already approved Lumakras, analysts said. In fact, Lumakras had a longer median duration of response in its pivotal study: 10 months.
"We think the drug may have difficulty gaining meaningful market share as a minimally differentiated second-to-market opportunity in (previously treated patients)," SVB Securities analyst Andrew Berens said in a note to clients. He noted competition is coming from companies like Novartis.
On today's stock market, MRTX stock crashed 31.9% to 39.81.
MRTX Stock: Why Amgen Rivalry Remains A Long Shot
Mirati is hoping to go up against Amgen in patients with non-small cell lung cancer tied to mutations in the KRAS gene, a difficult-to-treat cancer. Lumakras has Food and Drug Administration approval for patients who worsened while on at least one prior therapy.
But Mirati tested its treatment in sicker patients. In the midstage study, 98% of patients previously received an immuno-oncology treatment or regimen containing chemotherapy. Just 81% of patients previously received treatment in Lumakras' pivotal study.
Berens noted Mirati's test results were generally in line with Amgen's, excluding the median duration of response at 8.5 months vs. 10 months.
"It could be argued that Mirati showed comparable data in a sicker patient population," he said.
Still, he slashed his price target on MRTX stock to 111 from 164. He kept his outperform rating.
Side Effects Much Higher In Mirati Test
Evercore ISI analyst Umer Raffat added that tolerability also doesn't stack up in Mirati's favor.
Twice as many adagrasib-treated patients experienced diarrhea and three times as many experienced nausea vs. those treated with Lumakras. Patients also experienced a sixfold increase in vomiting among those who received adagrasib compared with Lumakras-treated patients, he said in report to clients.
But he noted switching its formulation to a tablet from a capsule could help Mirati control those poor gastrointestinal side effects.
He maintained his outperform rating on MRTX stock.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
