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Bristol-Myers Squibb (BMY) - Get Bristol-Myers Squibb Company Report suffered another cancer immunotherapy setback Thursday night when the pharma giant said it would not seek accelerated approval for a combination of two drugs -- Opdivo and Yervoy -- as a treatment for newly diagnosed lung cancer.

Shares of Bristol-Myers are down 8% to $51.15 in Friday premarket trading, erasing almost $7 billion in market cap.

Bristol's bad news is a boost for Merck (MRK) - Get Merck & Co., Inc. Report , which announced earlier this month that U.S. regulators has accepted and are reviewing a marketing application for its competing first-line lung cancer combination immunotherapy. An approval decision is expected on or before May 10.

Merck shares are up 4% to $62.50 in Friday premarket trading.

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Bristol offered no details or explanations Thursday about its decision other than to cite "a review of the data at this time."

Bristol is conducting larger phase III studies of the Opdivo-Yervoy combination in first-line lung cancer, but it now looks like an approval filing won't occur until early 2018, assuming the study results are positive.

The delay gives Merck a significant head start in the commercially lucrative front-line lung cancer market. It also opens the door for AstraZeneca (AZN) - Get Astrazeneca PLC Sponsored ADR Report and Roche (RHHBY) to potentially reach the market before Bristol, depending on the outcomes of clinical trials still underway.

One year ago, Bristol was widely considered be leading the market in cancer immunotherapy, but that all changed last summer with the failure of a phase III study of Opdivo in front-line lung cancer. Merck was able to demonstrate a benefit for first-line lung cancer patients treated with its rival drug Keytruda, so in an instant, the company raced ahead of Bristol and hasn't looked back since.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.