Company Reports

In a Phase 3 study, individualized neoantigen therapy intismeran improved recurrence-free survival and distant metastasis-free survival in melanoma patients when combined with Keytruda, relative to Keytruda alone. Moderna shares rose nearly 150% and Merck rose over 10% intraday on Aug. 19.

Merck's combination of a wide lineup of high-margin drugs and a pipeline of new drugs should ensure strong returns on invested capital over the long term. While we expect the firm could see sales declines in the late 2020s as patents on core oncology drug Keytruda expire in the US, it is likely that pipeline launches will limit these declines to a roughly two-year period during 2029-30. On the pipeline front, after several years of only moderate research and development productivity, Merck's drug development strategy is yielding important new drugs.

Merck reported 5% second-quarter revenue growth, and management narrowed and slightly raised its 2026 revenue guidance to $66.3 billion-$67.3 billion from $65.8 billion-$67 billion. Shares were up 1% in intraday trading on Aug. 4.

Merck's combination of a wide lineup of high-margin drugs and a pipeline of new drugs should ensure strong returns on invested capital over the long term. While we expect the firm could see sales declines in the late 2020s as patents on core oncology drug Keytruda expire in the US, it is likely that pipeline launches will limit these declines to a roughly two-year period during 2029-30. On the pipeline front, after several years of only moderate research and development productivity, Merck's drug development strategy is yielding important new drugs.

Merck's first-quarter revenue grew 5% to reach $16.3 billion, with a non-GAAP loss of $1.28 per share after incorporating the cost of the Cidara acquisition. Shares fell roughly 2% on April 30.

Merck reported 2025 results, including 1% revenue growth and 17% non-GAAP EPS growth. For 2026, management has guided to a revenue range of roughly 1-3% growth and non-GAAP EPS of $5.00-$5.15 (lower due to charges related to the Cidara acquisition).

On Jan. 20, Moderna and partner Merck announced five-year data showing a 49% reduction in the risk of recurrence or death for the combination of intismeran and Keytruda, over Keytruda alone, in high-risk adjuvant melanoma patients. Moderna and Merck shares were relatively flat in early trading.

The Trump administration and several biopharma firms announced new drug pricing agreements on Dec. 19. While previous deals included US drug firms Pfizer (Sept. 30) and Eli Lilly (Nov. 6), the nine new deals included additional US firms Amgen, Bristol Myers Squibb, Gilead, and Merck.

On Nov. 14, Merck announced an agreement to acquire Cidara and its phase 3 influenza prevention antiviral, CD388, for $9.2 billion.

Merck reported third-quarter earnings on Oct. 30 that were relatively in line with consensus, and management slightly narrowed its expectations for full-year revenue and EPS growth. Shares were flat.

Merck's combination of a wide lineup of high-margin drugs and a pipeline of new drugs should ensure strong returns on invested capital over the long term. While we expect the firm could see sales declines in the late 2020s as patents in core oncology drug Keytruda expire in the US, it is likely that pipeline launches will limit these declines to a roughly two-year period during 2029-30. On the pipeline front, after several years of only moderate research and development productivity, Merck's drug development strategy is yielding important new drugs.

Merck reported $15.8 billion in sales in the second quarter (a 2% decline from the same quarter last year) and $2.13 in non-GAAP EPS (a 7% decline). Management narrowed guidance for the full year to $64.3 billion-$65.3 billion on the top line and $8.87-$8.97 on the bottom line.

Merck announced plans to acquire Verona Pharma and its chronic obstructive pulmonary disease drug Ohtuvayre for $10 billion.

President Trump released an executive order on May 12 calling for a 30-day negotiation period between the Department of Health and Human Services and the biopharma industry, with the threat of a rule from the Centers for Medicare and Medicaid Services to lower US drug prices if no deal is reached.

Merck's revenue fell 2% year over year (and grew at 1% in constant currencies) to $15.5 billion, and management held its guidance for revenue and EPS except for business development charges. An estimated $200 million tariff headwind for 2025 is being balanced by tailwinds from a weaker US dollar.

President Donald Trump issued an executive order on April 15 listing several potential policy changes aimed at lowering US drug prices.

President Trump has announced that "major" pharmaceutical product tariffs are likely to be revealed soon, but at the same time, paused broader tariffs for most trade partners for 90 days to allow time for negotiations.

On April 2, President Donald Trump announced a 10% tariff on imports from all countries, effective on April 5. However, pharmaceuticals appear to be among the exemptions listed in the full executive order, as part of Annex II.

On Feb. 13, the Senate voted 52-48 to confirm Robert F. Kennedy Jr. as secretary of Health and Human Services. This follows a 14-13 party-line vote on Feb. 4 in the Senate Finance Committee, where Republican Sen. Bill Cassidy cast the deciding yes vote despite concerns about Kennedy's vaccine views.

Fourth-quarter revenue grew 7% to $15.6 billion (including Keytruda growth of 21% to $7.8 billion), in line with overall 7% growth for the year. Shares fell more than 10% as Merck paused Gardasil shipments to China, and 2025 sales guidance of $64.1 billion-$65.6 billion implies flat to 2% growth.