Merck tops Q3 earnings forecasts despite slower Gardasil demand

Adjusted earnings per share came in at $1.57, surpassing analysts’ expectations of $1.48, though that still marked a decline from the prior year due to charges related to acquisitions, including Eyebiotech and Curon Biopharmaceutical.

Non-GAAP earnings per share also met expectations, despite a 26% drop attributed to restructuring and acquisition costs.

Merck said Keytruda continued its pivotal role in its portfolio, with sales reaching $7.4bn - a 17% increase from the prior year.

Growth was particularly strong in early-stage lung cancer in the US and breast cancer in international markets.

However, the company remained cautious as Keytruda faced potential pricing pressures in the coming years.

Merck’s newer products also showed promise, with its recently-launched pulmonary arterial hypertension drug Winrevair, acquired through the Acceleron acquisition, generating $149m in third-quarter sales, while Capvaxive, a pneumonia vaccine, showed positive early momentum in the US and Europe.

However, Gardasil, Merck’s human papillomavirus (HPV) vaccine, saw an 11% sales decline, mainly due to muted demand in China.

Despite that, Merck said it was optimistic about Gardasil’s long-term potential, projecting demand to recover and expand with potential future approvals for male patients in China.

Additionally, Merck slightly adjusted its full-year sales forecast to a range of $63.6bn to $64.1bn, reflecting challenges from foreign exchange impacts, notably the devaluation of the Argentine peso.

The company said it expected full-year non-GAAP earnings per share of $7.72 to $7.77, narrowing its prior outlook.

“Our third-quarter results were strong, as we continue to make progress heading into 2025 and beyond,” said chairman and chief executive officer Robert Davis.

“Our pipeline is advancing and expanding, demonstrating our success in creating a sustainable innovation engine, and positioning Merck with a more diversified portfolio to drive growth.

“I continue to remain confident in the strength of our business and our ability to execute, and I want to thank our colleagues across the globe for their focus and commitment as we work to create lasting value for patients, shareholders and all our stakeholders.”

At 1331 EDT (1731 GMT), shares in Merck & Co were down 2.09% in New York at $102.64.

Reporting by Josh White for Sharecast.com.