Dive Insight:

Regeneron is counting on expanding Libtayo’s market after buying out full rights to the drug from its former partner, Sanofi. As part of the deal, Regeneron agreed to pay the French drugmaker $900 million plus royalties and as much as $200 million in additional fees.

Libtayo has a lot ground to make up, however. Its initial approval came in 2018, well after top-selling competitors such as Merck & Co.’s Keytruda and its sales have remained comparatively low. Total sales reached $143 million in the third quarter, compared with $5.4 billion for Keytruda and almost $2.1 billion for Bristol Myers Squibb’s Opdivo.

Still, Regeneron executives say they expect the biotech to become a “global leader” in oncology based in part on expanded usage of Libtayo. In a recent call with investors, CEO Leonard Schleifer highlighted research on the drug’s use in ovarian cancer, melanoma and prostate cancer.

Company executives are also focusing on Libtayo’s potential in combination with other drugs. Initial data from a study of Libtayo and a Regeneron antibody therapy known as fianlimab in melanoma suggest the combination “has the potentially best-in-class profile” for those patients, said George Yancopoulos, Regeneron’s president and chief scientific officer. Fianlimab homes in on the same immunotherapy target, LAG-3, as Bristol Myers’ newly approved melanoma treatment Opdualag.

In addition to non-small cell lung cancer, Libtayo is already cleared for use for certain patients with two types of skin cancer, cutaneous squamous cell carcinoma and basal cell carcinoma.

Shares in Regeneron rose by about 1% in Wednesday morning trading.