Merck (MRK) earnings Q3 2024

Merck on Thursday reported third-quarter revenue and adjusted earnings that topped expectations as the corporate saw strong sales from its top-selling cancer drug Keytruda, recently launched treatments and its animal health business. 

But Merck’s vaccine that stops cancer from HPV, essentially the most common sexually transmitted infection within the U.S., posted one other quarter of lighter-than-expected sales. Revenue from the shot, Gardasil, fell 11% in comparison with the year-earlier period, mainly resulting from lower demand in China. 

The pharmaceutical giant narrowed its full-year sales forecast to a variety of $63.6 billion to $64.1 billion, from a previous guidance of $63.4 billion to $64.4 billion. 

Merck also lowered its adjusted profit guidance from a variety of $7.72 to $7.77 per share, from a previous forecast of $7.94 to $8.04 per share. That updated outlook reflects a one-time charge of 24 cents per share related to business development deals with Curon Biopharmaceutical and Daiichi Sankyo. 

Here’s what Merck reported for the third quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG: 

• Earnings per share: $1.57 adjusted vs. $1.50 expected
• Revenue: $16.66 billion vs. $16.46 billion expected

Merck posted net income of $3.16 billion, or $1.24 per share, for the third quarter. That compares with net income of $4.75 billion, or $1.86 per share, throughout the year-earlier period. 

Excluding acquisition and restructuring costs, Merck earned $1.57 per share for the three-month period. 

The corporate booked $16.66 billion in revenue for the third quarter, up 4% from the identical period a yr ago.

The outcomes come as Merck shows substantial progress in preparing for Keytruda’s patent expiration in 2028. The lack of exclusive rights to the medication will likely cause sales to fall, forcing the corporate to attract revenue from elsewhere.

But Merck has a handful of latest deals under its belt and key drug launches that can help it offset those losses. That features Winrevair, a medicine approved within the U.S. in March to treat a progressive and life-threatening lung condition. 

And Capvaxive, a vaccine designed to guard adults from a bacteria often called pneumococcus that may cause serious illnesses and lung infection, was approved within the U.S. in June. 

Merck’s pharmaceutical division, which develops a wide selection of medicine, booked $14.94 billion in revenue throughout the third quarter, up 5% from the identical period a yr ago.

The corporate’s immunotherapy drug Keytruda recorded $7.43 billion in revenue throughout the quarter, up 17% from the year-earlier period. Analysts had been expecting $7.33 billion in Keytruda sales, in response to estimates from StreetAccount. 

That increase was driven by higher uptake of Keytruda for earlier-stage cancers and robust demand for the drug for metastatic cancers, which spread to other parts of the body. 

Gardasil brought in $2.31 billion in sales, down 11% from the third quarter of 2023. Merck said the decline was primarily resulting from lower demand in China compared with the year-earlier period. It was partially offset by higher sales within the U.S. 

That’s below the $2.51 billion that analysts expected, in response to StreetAccount. 

Winrevair posted $149 million in revenue for the third quarter following its approval in March. Analysts had expected the treatment to book $127 million in sales. 

The corporate’s Type 2 diabetes treatment, Januvia, saw $482 million in sales, down 42% from the identical period a yr ago. Merck said the decline was primarily resulting from lower prices of the drug within the U.S., together with generic competition in several countries. 

Analysts had expected the drug to rake in $610 million in sales, StreetAccount said. 

Januvia is one among 10 drugs targeted in ongoing Medicare drug price negotiations, a policy that goals to make costly medications cheaper for seniors. Those price talks, a key provision of President Joe Biden’s Inflation Reduction Act, will end in the beginning of August.