USA —Merck & Co has posted better-than-expected sales and profit in the third quarter due to strong performance by its blockbuster cancer immunotherapy drug Keytruda and human papillomavirus (HPV) vaccine Gardasil.
Merck’s revenue of US$15 billion for the quarter surprised analysts. Earnings per share were US$1.85, compared to the US$1.67 consensus.
In addition, the company raised its annual guidance from US$57.5 billion to US$58.5 billion to between US$58.5 and US$59 billion.
Merck has been looking to pursue deals to protect itself from an eventual revenue loss as Keytruda patents begin to expire toward the end of the decade.
The company was reportedly in talks to buy cancer-focused biotech Seagen Inc. over the summer, but a deal did not materialize.
Keytruda sales jumped 20% to US$5.4 billion for the quarter, in line with analysts’ estimates. Gardasil sales rose 15% to US$2.3 billion, topping expectations by more than US$200 million.
Gardasil, the vaccine juggernaut, also maintained its upward trajectory, with sales of US$2.29 billion, a 15% year-over-year increase.
Chief Financial Officer, Caroline Litchfield stated that the company expects Gardasil revenue to double by 2030, up from US$5.7 billion last year.
The company also posted slightly better-than-expected sales of its COVID-19 antiviral drug Lagevrio (molnupiravir), which it developed and shares with Ridgeback Biotherapeutics.
Sales of COVID-19 antiviral Lagevrio dropped from the US$1.2 billion it generated in the second quarter to US$436 million in the third quarter.
Merck benefited from its foreign exchange hedging program, which added roughly US$300 million to quarterly revenue, partially offsetting pressure on overseas sales, CFO Litchfield said.
“Foreign exchange will continue to be a headwind,” she said, adding that the impact of Merck’s hedging program is likely to be more subtle in 2023 as the pace of the dollar’s strengthening slows.
Januvia, another Merck bestseller, performed below par, with sales of US$1.13 billion in the quarter, a 15% decrease year on year.
During the quarter, the company cited fading demand and loss of exclusivity in China and Europe, which resulted in competition from generics in these markets.
Merck now expects to earn US$7.32 to US$7.37 per share for 2022, up from its prior view of US$7.25 to US$7.35. It beat analysts’ estimates for adjusted profit in the quarter by 14 cents.
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