• The FDA approved a drug from Merck designed to treat a rare, progressive and life-threatening lung condition called pulmonary arterial hypertension.
• The decision is a big step for the roughly 40,000 people in the U.S. living with that disease because Winrevair is the first drug to target the root cause of the condition. 
• The approval is also a win for Merck, which is working to diversify its revenue stream as its blockbuster cancer drug Keytruda approaches a loss of market exclusivity in 2028. 

The Food and Drug Administration on Tuesday approved a drug from Merck designed to treat a progressive and life-threatening lung condition in a win for both the drugmaker and for patients suffering from the rare disease.

The agency greenlighted the therapy, which will be marketed as Winrevair, for adults with pulmonary arterial hypertension. The decision is a big step for the roughly 40,000 people in the U.S. living with that disease because Winrevair is the first drug to target the root cause of the condition. Other available medicines only help manage symptoms. 

The condition refers to when the small blood vessels in the lungs narrow. That leads to high blood pressure in the arteries that carry blood from the heart to the lungs, which can damage the heart and result in limited physical activity. Starting from diagnosis, the mortality rate of patients is 43% by five years, according to Merck.

Merck estimates that Winrevair will be available in select specialty pharmacies in the U.S. by the end of April, according to a company release. The drug is an injection administered every three weeks and is distributed in single-vial or double-vial kits.

It will priced at $14,000 per vial before insurance, a Merck spokesperson said in a statement. But the company has a program that offers eligible patients help with out-of-pocket costs and copays.

Winrevair is meant to be used along with existing therapies for the condition to increase exercise capacity, lessen the severity of PAH and reduce the risk of the disease worsening.

The approval is critical for Merck, which is working to diversify its revenue stream as its top-selling cancer immunotherapy Keytruda approaches a loss of market exclusivity in 2028. 

In a note this month, JPMorgan analyst Chris Schott estimated that Winrevair would reach worldwide annual sales of around $5 billion by 2030 and emerge as one of Merck's "largest growth drivers." 

Merck Chief Medical Officer Eliav Barr told CNBC that "this is a really great opportunity for the company, but really, more importantly, a great important opportunity for patients." He noted that the drug will be a "paradigm shift" for patients living with PAH.

The company gained the rights to Winrevair through its $11.5 billion acquisition of Acceleron Pharma in 2021. At the time, Merck estimated that PAH would be a roughly $7.5 billion market by 2026. 

The FDA's approval is based on data from a late-stage trial, which followed more than 300 patients at a moderate stage of PAH who were already taking another medication for the blood vessel condition. 

The study found that Winrevair combined with an existing therapy helped patients with the condition walk about 40.8 meters more in six minutes than those who received a placebo, 24 weeks into the trial. 

"There is tremendous improvement in people's ability to exercise and move around," Barr said. "Because this disease causes people to be very, very homebound. They have shortness of breath, they can't move." 

Winrevair on top of an existing medication also significantly improved eight of nine secondary goals in the study. That includes reducing the risk of death or worsening of the condition by 84% compared to an existing drug alone.

Severe and serious adverse events were less common in the group of patients who took Winrevair compared to those who received a placebo, according to the trial. Side effects that occurred more frequently included nose bleeds, headaches and rashes, among others.

One notable advantage of Winrevair is that patients or caregivers can inject it under the skin with appropriate training from a healthcare provider. Meanwhile, some existing treatments for PAH must be administered by medical professionals at an infusion center. 

"One of the things we heard very loud and very clear, from both patients and physicians, is that they wanted something that you could get at home," Barr said. 

Merck is continuing to study Winrevair in other phase two and phase three trials.

Those trials include late-stage studies on patients with more advanced PAH disease, and those who are within the first year after diagnosis. Merck has said it expects those trials to finish around 2025 and 2026.