Setuptools install fails with PEP508 URLs

setuptools v 45.1.0
pip v 20.0.2

Running python setup.py install for a setup.py which includes PEP508 format URLs in the install_requires field results in failure.
for example if keras @ https://github.com/MarcBS/keras/archive/master.zip is in the install_requires field then setuptools fails to find it, and looks on PyPI instead, installing a matching package (in this case 'keras').
However, running pip install . for the same setup.py succeeds, similarly with pip install keras @ https://github.com/MarcBS/keras/archive/master.zip.

If setuptools always uses pip to install dependencies, then why does it fail for PEP508 URL dependencies when pip is able to do this?

In summary:

• pip install . works ✔️
• pip install 'keras @ https://github.com/MarcBS/keras/archive/master.zip' works ✔️
• python setup.py install fails ❌

(further to this, PyPI throws an error when uploading a package with a setup.py containing PEP 508 dependency links)

Start by reproducing the difference between python setup.py install and the successful pip install . commands using a setup.py with the shown PEP 508 URL in install_requires. Trace the setuptools installation path and compare its dependency handling with pip; done means URL requirements install correctly without falling back to a matching PyPI package, while preserving the existing pip behavior.