We have updated our renal cell cancer (RCC) models. For more details on the reasoning behind these model changes, please see our 2006 Post-ASCO Report, in which we document multiple data presentations and our conversations with Genitourinary (GU) specialists at ASCO.

Our original RCC Indication Report from August 2005, which contains in depth information on the pathology of RCC and our prognosis for many other drugs in development, can be found here. To see the full market share breakdown for the RCC market, please click here.

Nexavar and Sutent

Previously we had anticipated Sutent to be used more widely than Nexavar due to the remarkable progression-free survival data in two uncontrolled phase II studies presented at ASCO 2005. While Nexavar was, at the time, the only drug to have shown a PFS benefit in a controlled study, we felt that the better PFS data obtained in Sutent’s phase II trials would have led to Sutent being preferred.

At ASCO 2006, Sutent once again demonstrated impressive efficacy, showing that it significantly prolonged PFS, this time in previously untreated metastatic RCC patients. Data from a Nexavar phase II study in a similar patient population were expected at this meeting but were not yet mature. With Sutent’s impressive data in cytokine-refractory patients (in phase II studies) and in treatment-naïve patients (in phase III studies), we would have expected Sutent to be preferred over Nexavar in either the front- or second-line setting. However, we spoke to several GU specialists who indicated that while they felt that these two tyrosine kinase inhibitors probably had similar efficacy, patients taking Sutent are often plagued with a disabling severe fatigue. These doctors indicated that this has caused many patients to switch from Sutent to Nexavar.

Because of this fatigue, along with other considerations detailed in our post-ASCO report, we now expect Nexavar to be slightly preferred to Sutent in the first-line setting. Since Nexavar is now expected to do better than Sutent in the first-line setting, we expect Sutent to do slightly better than Nexavar in the second-line setting (since patients who fail Nexavar are likely to try Sutent next and vice versa). We have adjusted our Nexavar and Sutent revenue models accordingly. We are now projecting peak U.S. revenue for Nexavar of $209.6 million, up from $173.4 million. For Sutent, we are now projecting peak U.S. revenue of $128.3 million, down from $164.7 million.

Temsirolimus

We had previously projected Temsirolimus to only be used in poor performance patients in the second-line (and salvage) setting. However, outstanding data presented at ASCO 2006 showed that Temsirolimus significantly prolonged survival in previously untreated patients with poor performance. Given this new data, we now believe that Temsirolimus will be used in poor performance patients in both the first-line and second-line setting. We are now projecting peak U.S. revenue of $100.4 million, up from $48.2 million.

Onyx Pharmaceuticals (ONXX)

Based on the changes to Nexavar’s revenue, ONXX’s 5 and 10-year pipeline values have been adjusted since Nexavar for RCC accounts for approximately 40% of ONXX’s value in our models. The remaining 60% consists of Nexavar’s potential in other indications, including non-small cell lung cancer, melanoma and liver cancer. We now value ONXX at $48.38/share and $39.48/share, up from $38.17/share and $35.26/share.