Merus' Petosemtamab: A Breakthrough in HNSCC with 63% Response Rate – Why MRUS is Poised for Takeoff

The head and neck squamous cell carcinoma (HNSCC) market is on the cusp of a paradigm shift. Merus NV’s (NASDAQ: MRUS) Petosemtamab, a bispecific antibody, has delivered jaw-dropping clinical results in combination with pembrolizumab, positioning it to redefine first-line treatment standards. With a 63% objective response rate (ORR) in PD-L1+ HNSCC patients—far surpassing current therapies—the data is undeniable. For investors, this is a rare opportunity to capitalize on a transformative drug with an accelerated path to approval and a multi-billion-dollar addressable market. Here’s why MRUS is a must-buy ahead of its 2026 phase 3 readout.

Clinical Efficacy: A Landmark Achievement in HNSCC

The phase 2 data for Petosemtamab/pembrolizumab are nothing short of revolutionary. In first-line PD-L1+ HNSCC:
- 63% confirmed ORR, including 6 complete responses (CRs) and 21 partial responses (PRs).
- 12-month overall survival (OS) rate of 79%, with median OS and progression-free survival (PFS) yet to be reached.
- Durable responses: Median duration of response (DOR) was not reached, and 93% of responders saw lasting benefits.

This dwarfs the performance of current standards:
- Pembrolizumab monotherapy (the current gold standard) has an ORR of ~15–20% in PD-L1+ populations.
- Cetuximab-paclitaxel chemotherapy, the traditional backbone of first-line treatment, delivers an ORR of ~45% but with higher toxicity and shorter DOR (median DOR 6.2 months in monotherapy trials).

The combination’s efficacy extends to HPV-associated tumors, a subgroup where prior therapies have struggled. Here, 50% of patients responded, proving its broad utility.

Regulatory Pathway: Acceleration Ahead

Merus is not wasting time. The phase 3 trials (LiGeR-HN1 and HN2) are designed to fast-track Petosemtamab’s approval:
- Primary endpoints: ORR and OS, which are surrogate markers the FDA often accepts for accelerated approval.
- Global enrollment: The trials are enrolling in key HNSCC markets, with data expected in 2026.

The phase 2 data’s superiority over historical controls and favorable safety profile (grade ≥3 treatment-related adverse events in 44% of patients, manageable with updated infusion protocols) bode well for regulatory acceptance. Analysts predict a priority review, cutting approval timelines to 6 months post-submission.

Market Potential: A $2+ Billion Opportunity

The HNSCC market is growing at ~4% annually, driven by rising incidence rates and unmet needs in advanced disease. Key market dynamics:
- Addressable population: ~150,000 new HNSCC cases annually, with ~40–50% testing PD-L1+.
- Current standard limitations: Pembrolizumab’s low ORR and cetuximab’s toxicity create a void for therapies like Petosemtamab.

Petosemtamab’s potential:
- First-line PD-L1+ HNSCC: A $2.5–3 billion annual market if it captures 50–60% of eligible patients.
- Expanded use: The combo could dominate second-line therapy and even earlier lines if data in earlier-stage trials (e.g., perioperative settings) pan out.

Merus’ bispecific platform also opens doors to other cancers, but HNSCC is the first-mover opportunity, with no direct competitors at this efficacy level.

Investment Thesis: MRUS is a Buy with 100%+ Upside Potential

• Catalysts: Phase 3 readout (2026), FDA submission (2027), and potential accelerated approval.
• Valuation: At current levels (~$12/share), MRUS is undervalued. A $30–$40 price target post-approval is achievable.
• Risk mitigation: The phase 2 data’s robustness reduces trial failure risk.

The 63% ORR is a game-changer. For investors, this is a high-conviction call: Buy MRUS now, and ride the wave as Petosemtamab reshapes oncology. The next 18 months will be transformative—don’t miss the boat.

Act now—before the market wakes up to this blockbuster’s potential.