ADCs at a Crossroads: Learning from Patritumab's Setback in Lung Cancer

The withdrawal of Daiichi Sankyo and Merck's Biologics License Application (BLA) for patritumab deruxtecan (HER3-DXd)—the first HER3-targeted antibody-drug conjugate (ADC) for third-line EGFR-mutated non-small cell lung cancer (NSCLC)—has sent ripples through the oncology pipeline. While the FDA's decision stemmed from manufacturing issues rather than efficacy concerns, the broader implications for ADC development are profound. The failed HERTHENA-Lung02 trial, which narrowly met its progression-free survival (PFS) endpoint but left overall survival (OS) data immature, underscores a critical challenge in late-stage oncology trials: translating PFS gains into meaningful OS benefits in heavily pretreated populations. For investors, this case serves as a wake-up call to prioritize ADC programs with biomarker-stratified populations or dual-mechanism combinations to mitigate the growing risks of late-stage failure.

The PFS-OS Disconnect: A Red Flag for ADC Investors

Patritumab deruxtecan's HERTHENA-Lung02 trial exemplifies the widening gap between statistical success in PFS and the ultimate goal of improving survival. While the drug demonstrated a 23% reduction in disease progression (median PFS of 5.8 vs. 5.4 months vs. chemotherapy), OS data remained immature at the time of analysis. This is a recurring theme in third-line NSCLC, where patients are often resistant to prior therapies and have limited life expectancy. The trial's two treatment-related deaths from interstitial lung disease (ILD)—a known risk of topoisomerase I inhibitor-based ADCs—adds another layer of complexity, reminding investors that safety liabilities can compound in late-stage studies.

The market's reaction to the BLA setback was swift: Daiichi Sankyo's shares fell 12% in the days following the FDA's Complete Response Letter (CRL), underscoring how manufacturing hiccups can amplify existing concerns about clinical risk. But the deeper issue is strategic: in a crowded NSCLC market where EGFR-mutated patients have over a dozen approved or late-stage therapies, ADC developers must prove not just activity but durable survival benefits.

Why PFS Alone Isn't Enough Anymore

The HERTHENA-Lung02 trial's narrow PFS margin (HR=0.77) highlights the diminishing returns of single-agent ADCs in later-line NSCLC. Competing therapies—such as Roche's osimertinib (Tagrisso) plus lorlatinib or AstraZeneca's durvalumab (Imfinzi)—are combining targeted therapies with immunotherapy to tackle resistance mechanisms. Meanwhile, patients progressing beyond second-line treatment often have heterogeneous molecular drivers, making a “one-size-fits-all” ADC approach risky.

The HERTHENA-Lung01 phase II trial, which reported a median OS of 11.9 months, hinted at potential, but phase III reality has exposed the limits of HER3 targeting alone. HER3 overexpression, while common in EGFR-mutated tumors, may not be the sole determinant of response. Biomarker-stratified populations—such as those with specific EGFR TKI resistance mutations (e.g., MET amplification)—could refine patient selection and boost OS. Yet, few ADC programs have integrated such biomarkers into their trial designs.

Investment Strategy: Prioritize Precision and Synergy

The lesson for investors is clear: ADCs lacking biomarker-driven patient selection or dual-mechanism combinations face heightened late-stage risk in crowded markets. Companies with the following traits should command premium valuations:

1. Biomarker-Driven Pipelines:
2. Example: Immunomedics' sacituzumab govitecan (Trop-2 ADC) uses biomarker screening to identify responsive breast and bladder cancer patients, reducing trial attrition.

3. Opportunity: ADCs targeting HER2, Trop-2, or other validated biomarkers in NSCLC subpopulations could replicate this success.

4. Combination Therapy Partnerships:

5. Example: Seattle Genetics' enfortumab vedotin (Nectin-4 ADC) in urothelial cancer pairs well with checkpoint inhibitors, improving OS. Similar strategies in NSCLC could enhance ADC efficacy.

6. Next-Gen ADC Platforms:

7. Example: Genentech's HER3-targeted RG6199, which employs a non-crosslinking payload to reduce ILD risks, addresses safety concerns while maintaining potency.

Conclusion: ADCs Must Evolve to Survive

Patritumab's stumble is not the end of HER3-targeted ADCs, but it marks the beginning of a new era where precision and partnership are non-negotiable. Investors should favor pipelines that pair ADCs with biomarker stratification, immunotherapies, or next-gen payloads to bridge the PFS-OS gap. In a space where manufacturing hiccups can magnify clinical risks, only those with rigorous trial design and strategic differentiation will thrive. The next wave of ADC approvals will belong to the companies that learn from HERTHENA-Lung02's cautionary tale—and act decisively before the next setback hits.

Act now: Reallocate capital toward ADC developers with biomarker-centric trial designs or combination therapy partnerships in NSCLC. The window to secure positions in this high-risk, high-reward space is narrowing.