=Incyte (INCY) and Merck (MRK) : failed key Phase 3 melanoma study

• Biotech stocks (XBI) lower after important immune-oncology combo data (Incyte's IDO inhibitor plus Merck's Keytruda) fails in key Phase 3 melanoma study:  NLNK (IDO inhibitor peer) -37.57%,  INCY -18.23%,  NKTR -9.84%,  JNCE -10.20%,  LABU -5.14%,  FPRX -3.84%,  ONCS -3.72%,  SAGE -2.21%,  SGEN -1.81%,  BLUE -4.85%,  PBYI-1.85%,  SPPI -2.46%,  CRVS -9.17%,  TSRO +0.37%,  BMRN -2.01%, GLYC-2.03%, MRK-1.19% 
• IBB -1.99%,  XBI -1.78%

Incyte announces that the External Data Monitoring Committee determined that the Phase 3 ECHO-301/KEYNOTE-252 study did not meet the primary endpoint 

The co and Merck (MRK) announced that an external Data Monitoring Committee review of the pivotal Phase 3 ECHO-301/KEYNOTE-252 study results evaluating Incyte's epacadostat in combination with Merck's KEYTRUDA in patients with unresectable or metastatic melanoma determined that the study did not meet the primary endpoint of improving progression-free survival in the overall population compared to KEYTRUDA monotherapy.

• The study's second primary endpoint of overall survival also is not expected to reach statistical significance. Based on these results, and at the recommendation of the eDMC, the study will be stopped. The safety profile observed in ECHO-301/KEYNOTE-252 was consistent with that observed in previously reported studies of epacadostat in combination with KEYTRUDA.

Incyte and Merck will inform investigators of the results and work with investigators to appropriately conclude the study in a manner consistent with the best interests of each patient. Data from this study will be analyzed and submitted for presentation at an upcoming scientific congress.

=Eli Lilly (LLY) reported earnings on Tue 25 July 2017 (b/o)

• Incyte (INCY) -- Lilly's partner on the arthritis drug

A delay in getting its rheumatoid arthritis drug to market by at least 18 months sent Eli Lilly (LLY) shares lower Tuesday as the drug giant reported second-quarter earnings.

The Food and Drug Administration is requiring Lilly and Incyte to run another trial to determine the benefits and risks across doses of the drug, now known as baricitinib, before resubmitting their application for approval.

Lilly estimates at least 18 months to resubmit the application, putting the approval of baricitinib beyond 2017. Baricitinib is approved in Europe to treat moderate-to-severe rheumatoid arthritis.

Also early Tuesday, Lilly reported $5.82 billion in second-quarter sales, just lagging the consensus for $5.89 billion. Adjusted profits of $1.11 per share topped by 7 cents. Revenue grew 8% with profits per share up 29%.

Diabetes drug Trulicity and plaque psoriasis drug Taltz led growth in the quarter, up 139% and 618%, respectively, vs. the year-earlier quarter. Sales of Basaglar, an insulin to treat adults and children with Type 1 diabetes, grew 432%.

Lilly also raised its 2017 sales guidance to $22 billion to $22.5 billion, up from earlier views for $21.8 billion to $22.3 billion. Adjusted income was raised to $4.10-$4.20 a share for the year, which would be up 16%-19% from 2016.