Reality hits Nuvation

Nuvation Bio’s market cap has climbed to over $2bn since the approval of its ROS1 inhibitor Ibtrozi, but investors got a reality check on Monday. Early Ibtrozi sales figures fell short of some analysts’ expectations, while a licensing deal with Eisai disappointed.

Eisai licensed Ibtrozi outside the US, China and Japan for just $60m upfront, which could rein in both expectations for the drug and Nuvation’s valuation, which has looked increasingly overblown in recent months. The company’s stock closed down 20% on Monday.

Investors might also have been unhappy that Nuvation wasn’t acquired outright. The company will continue to commercialise Ibtrozi in the US, where it got the go-ahead in June for ROS1-positive non-small cell lung cancer, irrespective of therapy line.

The FDA nod gave Nuvation the jump on its ROS1 rival Nuvalent, which is expecting a US approval decision on its contender, zidesamtinib, in September – but only in the second line.

Market size?

The latest developments come amid questions about Ibtrozi’s ultimate sales potential. Only around 2% of patients with NSCLC have ROS1-positive disease – although Nuvation estimates a US “theoretical maximum gross market opportunity” of around $4bn, based on around 3,000 newly diagnosed patients each year.

However, this seems optimistic as it doesn’t take into account existing competition from earlier-generation tyrosine kinase inhibitors like Pfizer’s Xalkori, Roche’s Rozlytrek and Bristol Myers Squibb’s Augtyro and, potentially, looming competition from Nuvalent.

It’s still early days, with Ibtrozi bringing in $15.7m in the fourth quarter, and $24.7m since launch. Jones Research had predicted $19.4m and $28.4m respectively, although the latest figures are in line with consensus. Jones reckons Ibtrozi sales will hit $171.0m in full-year 2026.

At least to start with, Nuvation won’t see all of these revenues: the group owes royalties of 3.0-5.5% to Sagard Healthcare Partners on all annual US sales below $1bn, under a deal signed last March. Nuvation will retain all US sales over $1bn, if Ibtrozi ever surpasses this milestone.

Eisai deal

The Eisai deal will have done nothing to quash any doubts about whether this will actually happen. For only €50m ($60m) up front, the Japanese group will get exclusive rights for Ibtrozi in ROS1-positive NSCLC in Europe, the Middle East, North Africa, Russia, Turkey, Canada, Australia, New Zealand, Singapore, the Philippines, Indonesia, Thailand, Malaysia, Vietnam and India.

This undemanding fee was agreed despite Nuvation estimating around 2,600-5,200 cases of ROS1-positive NSCLC each year in the EU which, on the face of it, would suggest a similar opportunity as in the US.

And the company also highlighted a “robust” process with interest from “multiple” oncology companies – perhaps indicating that no other groups were prepared to outbid Eisai.

Meanwhile, milestones could total €145m, and the first could be a €25m payment upon EU approval (conditional or full); Eisai plans a submission with EMA in the first half of 2026. Eisai is also on the hook for “double-digit tiered royalties up to the high-teens”.

Ibtrozi, which Nuvation gained from AnHeart in a $250m stock deal, is already approved Japan, where it is marketed by Nippon Kayaku, and in China, where it is marketed by Innovent Biologics under the brand name Dovbleron.