Merck MRK has decided to stop the phase III HYPERION study early. The study evaluates MRK’s pulmonary arterial hypertension (PAH) drug, Winrevair (sotatercept), for a more advanced version of the disease.

This decision is based on strong efficacy data from previously conducted studies on Winrevair. Per Meck, an external steering committee unanimously concluded that the HYPERION study has lost ‘clinical equipoise’.

How Does Losing Clinical Equipoise Benefit Merck?

Clinical equipoise refers to a genuine uncertainty among researchers about which treatment in a clinical study is more effective. However, in Merck’s case, the HYPERION study lost clinical equipoise, which means that study investigators perceive the treatment with Winrevair to be superior to placebo. In such cases, continuing to administer a less effective therapy would be considered unethical, as it may compromise patient welfare and violate ethical research principles.

This is the second late-stage study on Winrevair, which was stopped early. In November, management reported positive results from the phase III ZENITH study, which evaluated the drug in patients with PAH Functional Class (FC) III or IV at high risk of mortality.

Data from this study showed that treatment with Winrevair, when added to background PAH therapy, achieved a statistically significant and clinically meaningful reduction in the risk of morbidity or mortality events compared to placebo. Based on the overwhelming efficacy seen in the study, an independent committee recommended stopping the ZENITH study early and also suggested that all enrolled patients be offered the opportunity to get Winrevair.

The HYPERION study evaluates Winrevair in combination with background PAH therapy in newly diagnosed patients with PAH FC II or III at intermediate or high risk of disease progression. Management expects to report top-line data from this study later this year at a future medical meeting.

PAH is a rare, progressive blood vessel disorder that affects the blood vessel walls in the lungs, resulting in elevated blood pressure. It exerts significant strain on the heart, as it works harder to pump blood through the lungs, eventually leading to heart failure if left untreated.

MRK Stock Performance

In the past year, Merck’s shares have lost 18% compared with the industry’s 1% decline.

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How Does MRK’s Winrevair Treat PAH?

Winrevair is designed to target cellular signaling associated with vascular hyperproliferation and pathological remodeling to treat PAH. Winrevair works by blocking the proteins that contribute to the thickening of blood vessel walls in the lung.

The drug is currently approved in the United States (since March 2024) to treat PAH WHO Group 1. It was approved for a similar use in the EU last August.

Per management, Winrevair has the potential to generate significant revenues over the long term. The drug is already seeing a strong commercial launch, generating sales of $219 million in the first nine months of 2024.

Merck is pinning hopes on Winrevair to boost its top line once its blockbuster drug Keytruda loses patent exclusivity in 2028.

Management added the drug following its $11 billion acquisition of Acceleron Pharma in 2021.

Other Players in the PAH Market

Significant players in the PAH market are United Therapeutics UTHR and J&J JNJ. United Therapeutics markets four drugs to treat PAH in the United States, namely Remodulin, Orenitram, Tyvaso and Adcirca.

Remodulin is an injectable formulation of treprostinil. Orenitram is an oral version of treprostinil, while Tyvaso is an inhaled version of treprostinil. Remodulin, Orenitram and Tyvaso recorded sales of $403.6 million, $326.5 million and $1.2 billion, respectively, in the first nine months of 2024.

As far as J&J is concerned, the PAH franchise was added to its portfolio with the 2017 acquisition of Actelion. J&J’s key PAH drugs are Opsumit and Uptravi. In the first nine months of 2024, J&J recorded revenues of $3.19 billion from its PAH franchise, up 14% year over year.

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MRK’s Zacks Rank

Merck currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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