Eli Lilly's presence at the Morgan Stanley 22nd Annual Global Healthcare Conference provided valuable insights into the company's oncology strategy, pipeline developments, and market positioning. Jake Van Naarden, President of Lilly Oncology, offered a comprehensive overview of the company's progress and future direction. This analysis delves into key takeaways from the conference, highlighting Lilly's strategic moves in oncology and beyond.
Revamping Lilly Oncology: A Strategic Overhaul
Lilly Oncology has undergone a significant transformation in recent years, aimed at aligning the company with future trends in cancer treatment. Van Naarden described a bold approach to restructuring the oncology pipeline:
"A couple of years ago, we took a look at the pipeline of programs that we had in oncology and the technologies that we had announced to make new medicines. And it was sort of increasingly clear to me and others on our team that we just really weren't sort of set up for where the future was headed with making new medicines to treat cancer."
This realization led to a dramatic shift in strategy:
"We took a pretty ambitious step of terminating most things in the pipeline at the time, with the exception of a few, and making a bet that between internal discovery efforts and business development, we could sort of put our heads down, hunker down for a few years and build back to a pipeline that -- of similar size, but with more relevance and sort of an overall higher likelihood of delivering medicines really based on the back of biology conviction."
This strategic pivot demonstrates Lilly's commitment to staying at the forefront of oncology research and development. By focusing on programs with strong biological rationales, the company aims to increase the probability of success in clinical trials and ultimately bring more effective treatments to patients.
Expanding the Oncology Toolkit
A crucial aspect of Lilly's oncology revamp has been the expansion of its technological capabilities. Van Naarden highlighted the importance of diversifying beyond traditional small molecules and naked antibodies:
"We really needed to modernize just the tool kit of technologies that we actually had at our disposal. We, at the time, really could only make a small molecule and a naked antibody. And I think we all know just from seeing the kinds of innovations that, frankly, many others have advanced that like that's not enough to be a relevant player going forward."
To address this, Lilly has invested in several cutting-edge technologies:
"We've invested in antibody drug conjugate technologies. We've invested in T cell engagers. We've -- we're in the process of building a radioligand platform."
This expansion of capabilities positions Lilly to compete more effectively in the evolving oncology landscape, enabling the company to pursue a wider range of therapeutic approaches.
Pipeline Progress and Future Outlook
The conference provided insights into Lilly's oncology pipeline, with Van Naarden expressing optimism about the company's progress:
"This year is a particularly productive year for new clinical starts. I think we're going to put somewhere between 5 and 8 new medicines into the clinic this year in oncology. Next year will be pretty productive too, I imagine."
This productivity is a direct result of the strategic reset implemented a few years ago. While acknowledging that not all programs will succeed, Van Naarden emphasized the increased probability of success and diversity within the portfolio:
"These are not all going to work. They're not all going to end up being approved medicines. That's just not the way it works. But I think that as a portfolio, the probability of success there is higher than what it was in the past and more diverse."
The diversity of Lilly's oncology pipeline is evident in the range of modalities and targets being pursued:
"We now have, just to give some examples, a portfolio of ADCs in the clinic 2 Nectin-4 ADCs, 1 folate receptor ADC. We have one radioligand in the clinic, more to come. We have 3 oral small molecules in a RAS portfolio. We have a G12C inhibitor, G12D inhibitor, a pan-KRAS inhibitor."
This broad approach increases Lilly's chances of success across multiple oncology indications and treatment modalities.
Verzenio: Continued Growth and Market Positioning
Lilly's CDK4/6 inhibitor, Verzenio, remains a cornerstone of the company's oncology portfolio. Van Naarden provided updates on its market penetration in the high-risk, early-stage breast cancer setting:
"We're actually probably closer to 70% now. So we're -- this launch has gone pretty well. And we're not that -- we're only a couple of years into the label expansion for Verzenio in high-risk adjuvant breast cancer, and we're like 70% of eligible patients are receiving the medicine."
While this represents significant success, Van Naarden acknowledged the potential for further growth:
"And of course, the flip side is that 30% aren't, and we're talking about a curative setting of cancer. So that is like forget about the business impact, that's just bad for humanity. So we continue to work to change that."
The potential entry of Novartis' Kisqali into the adjuvant setting was addressed, with Van Naarden expressing confidence in Verzenio's position:
"I remain completely convinced that in a data side by side and a regimen side-by-side, Verzenio will remain the standard of care. I think ASCO guidelines have already spoken. There was an OpEx just yesterday in the Annals of Oncology that talked about this even further."
This confidence suggests that Lilly expects Verzenio to maintain its strong market position despite potential new competition.
Imlunestrant: A New Chapter in Breast Cancer Treatment
One of the most significant announcements during the conference was the positive results from the EMBER-3 trial of imlunestrant, Lilly's oral SERD (Selective Estrogen Receptor Degrader):
"I'm actually excited to announce today, is a positive study. So disclosing that today for the first time. We'll present those data later this year. Excited to be able to share that, and you guys can react to that when you see it."
While detailed results are yet to be presented, this positive outcome marks a significant milestone for Lilly's breast cancer program. The EMBER-3 trial design, which includes arms for imlunestrant monotherapy, fulvestrant, and imlunestrant plus Verzenio, could provide valuable insights into optimal treatment strategies.
Van Naarden also highlighted the potential of imlunestrant in the adjuvant setting through the EMBER-4 trial:
"EMBER-4 is taking patients who've already received a few years of initial adjuvant therapy with or without a CDK4/6 inhibitor, hopefully with, because that's what we think the right medical practice ought to be, and then physicians have the option of taking patients that they're worried about, and there's a set of eligibility criteria that delineate that. And either keeping them on the AI backbone that they were on or switching them to imlunestrant."
The scale of this trial underscores Lilly's commitment to exploring the full potential of imlunestrant:
"And so that study is a 6,000-patient study, largest trial we've ever run oncology at Lilly. Accrual is going reasonably well. It will take a while to read out."
If successful, EMBER-4 could position imlunestrant as a long-term treatment option in the adjuvant setting, potentially providing a significant revenue stream for Lilly.
KRAS Inhibitor Program: Olomorasib
Lilly's KRAS G12C inhibitor, olomorasib, represents another important component of the company's oncology strategy. Van Naarden outlined the differentiation strategy for olomorasib, focusing on its potential for combination therapy in first-line lung cancer:
"Our main idea out of the gate was, can we develop a medicine that's combinable? And I think the answer to that is yes. So we are in the throes of standing up a pretty big Phase III program, starting with first line in both the PD-L1 high population, where it's pembro plus or minus our agent as well as in the PD-L1 all-comer population, which is the KEYNOTE-189 regimen, which is pembro and chemo plus/minus olomorasib, all being done under one big master protocol design that we're rolling out across the world right now."
This approach aims to address limitations seen with existing KRAS inhibitors and could potentially expand the use of these agents into earlier lines of therapy.
Adapting to the IRA: Strategic Implications
The conference also touched on the impact of the Inflation Reduction Act (IRA) on Lilly's oncology strategy. Van Naarden highlighted two key adaptations:
Accelerated development timelines:
"It means, frankly, just putting the gas accelerator on our development programs in more aggressive ways than we would have historically."
Diversification of modalities:
"The diversification away in part from small molecules and towards biologics was in part a reaction to wanting to diversify our pipeline modalities, as I mentioned earlier, but in part a reaction to the IRA dynamics and an incentive structure that exists today."
These adaptations reflect Lilly's proactive approach to navigating the changing regulatory landscape while maintaining its commitment to innovation.
Tirzepatide: Expanding Access and Combating Counterfeits
While not directly related to oncology, the discussion of Lilly's obesity treatment, tirzepatide (Zepbound), provided insights into the company's broader strategy. The introduction of vial formats and the launch through Lilly Direct were presented as solutions to supply challenges and counterfeit concerns:
"We've deployed this strategy as a way of increasing supply of a medicine that there is a lot of demand for, that we're on a ramp to meeting that demand with what I think are the more patient-friendly devices. But in the meantime, this is a way of getting more patients access to the medicine."
This approach demonstrates Lilly's flexibility in addressing market demands and patient needs across its portfolio.
Conclusion
Eli Lilly's presentation at the Morgan Stanley 22nd Annual Global Healthcare Conference provided a comprehensive overview of the company's oncology strategy and broader pharmaceutical initiatives. The strategic overhaul of Lilly Oncology, expansion of technological capabilities, and progress across multiple pipeline programs position the company for potential growth in the coming years.
Key takeaways include:
- A successful reset of the oncology pipeline with a focus on biology-driven programs
- Expansion into new modalities, including ADCs, T cell engagers, and radioligands
- Continued strong performance of Verzenio in the adjuvant breast cancer setting
- Positive results from the EMBER-3 trial of imlunestrant, with potential for significant impact in breast cancer treatment
- Strategic positioning of olomorasib in the competitive KRAS inhibitor landscape
- Proactive adaptation to the IRA through diversification and accelerated development
- Innovative approaches to expanding access to high-demand treatments like tirzepatide
As Lilly continues to execute on its oncology strategy and broader pharmaceutical initiatives, the company appears well-positioned to navigate the evolving healthcare landscape and potentially deliver value through innovative treatments across multiple therapeutic areas.
