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Novartis Collaborates with Bristol-Myers Squibb

Novartis (NVS) announced that it entered into a collaboration agreement with Bristol-Myers Squibb Co. (BMY).

As per the collaboration, Novartis will conduct two studies to evaluate the safety, tolerability and preliminary efficacy of three molecularly targeted compounds in combination with Bristol-Myers’ investigational PD-1 immune checkpoint inhibitor, Opdivo (nivolumab), in phase I/II trials for the treatment of non-small cell lung cancer (:NSCLC).

Novartis will evaluate the combination of Opdivo with Zykadia (ceritinib). Novartis’ Zykadia is already approved for the treatment of patients with anaplastic lymphoma kinase-positive (ALK+) metastatic NSCLC who have progressed on or are intolerant to Xalkori.

The second study will evaluate Opdivo with candidates INC280 and EGF816. Both these candidates are being evaluated for the treatment of NSCLC in phase I/II trials.

Immunotherapy has received a lot of attention in recent times as pharmaceuticals majors began to focus their research and development efforts. Novartis’ collaboration with Bristol-Myers is a step in that direction.

Earlier in 2014, Novartis acquired privately-held biotechnology company CoStim Pharmaceuticals Inc., which focuses on developing the immune system to eliminate immune-blocking signals from cancer.

The acquisition added late discovery stage immunotherapy programs directed to several targets, including PD-1, to Novartis' pipeline.

We note that Novartis had collaborated with the University of Pennsylvania in Aug 2012 to develop and commercialize targeted chimeric antigen receptor (CAR) immunotherapies for the treatment of various kinds of cancers. The collaboration agreement focuses on accelerating the discovery and development of additional therapies using CAR immunotherapy.

We remind investors that Novartis boasts a strong oncology portfolio with drugs like Gleevec, Sandostatin SC/Sandostatin LAR, Afinitor, Exjade, Zometa, Femara and Jakavi, among others.

We expect the development of cancer immunotherapy agents to further complement the company’s extensive portfolio of drugs.

Novartis currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks include Shire (SHPG) and Sucampo Pharmaceuticals (SCMP). Both carry a Zacks Rank #1 (Strong Buy).

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