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Keytruda Sales Climb 16 Percent in Q2 as Merck Pursues New Oncology Candidates

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NEW YORK – Sales of Merck's bestselling immune checkpoint inhibitor Keytruda (pembrolizumab) continued to climb during the second quarter of 2024, as the drugmaker focused further on diversifying its pipeline ahead of future generic competition. 

Keytruda sales were $7.27 billion in Q2 2024, a 16 percent increase from $6.27 billion in Q2 2023. Merck attributed the growth to increased uptake across earlier-stage cancer indications, which has become ever more important for the drugmaker to boost adoption of its bestselling drug. 

"Keytruda has now achieved market leadership in the neoadjuvant and adjuvant settings, building on its existing leadership position as [an] adjuvant therapy," Merck CFO Caroline Litchfield said during a conference call on Tuesday morning to discuss Merck's Q2 financial results. Outside the US, Litchfield noted that Keytruda's growth was driven by increased use in high-risk, early-stage triple-negative breast cancer patients, as well as by greater demand among metastatic cancer patients. 

Keytruda currently has nine approvals in early-stage cancer settings, four of which have shown overall survival benefits. The firm pointed out that several of these approvals are perioperative, meaning they involve neoadjuvant immunotherapy, then surgery and adjuvant immunotherapy. The US Food and Drug Administration has taken a recent interest in elucidating the benefit of immunotherapies in these settings and discussed whether all early non-small cell lung cancer patients needed both pre- and post-surgery treatment with AstraZeneca's PD-L1 immunotherapy Imfinzi (durvalumab) at a recent Oncologic Drugs Advisory Committee advisory meeting. 

"We are in discussions with the FDA regarding our clinical trials," said Dean Li, the president of Merck Research Laboratories. "Future studies need to consider what the FDA has said, but the FDA has also been very clear that overall survival is the gold standard, especially in early stage." 

For the three months ended June 30, the Rahway, New Jersey-based drugmaker's overall revenue was $16.11 billion, up 7 percent from $15.04 billion in Q2 2023, and exceeded analysts' consensus Q2 revenue estimate of $15.84 billion. Excluding impacts from foreign exchange, Merck's overall revenue increased 11 percent during this period. 

Merck recorded $14.41 billion in pharmaceutical sales during Q2 2024, up 7 percent from $13.46 billion in the year-ago quarter. 

The PARP inhibitor Lynparza (olaparib), which Merck comarkets with AstraZeneca, brought in $317 million in Q2 2024, an uptick of 2 percent from $310 million in the year-ago quarter. Much of Lynparza's international growth took place in European and Chinese markets, according to Merck. 

During the earnings call, Merck executives updated investors on where the firm stands in broadening its oncology portfolio as the 2027 expiry dates for several key patents for the blockbuster immunotherapy inches closer, opening the door to generic competition. Merck has been pursuing new combination approaches with Keytruda and adding other types of cancer therapies to its portfolio through licensing deals and mergers and acquisitions. 

"We have leveraged our foundational position with Keytruda to create a diverse pipeline by executing on our three-pillar strategy comprised of immuno-oncology, precision molecular targeting, and tissue-targeting candidates," Li said. 

In Merck's portfolio are several antibody-drug conjugates that Merck has been codeveloping with Daiichi Sankyo, including patritumab deruxtecan, a HER3-directed therapy for patients with previously treated advanced EGFR-mutated NSCLC. In June, Merck and Daiichi Sankyo announced they had received a complete response letter from the US Food and Drug Administration related to their patritumab deruxtecan biologics license application in this setting. 

Li reiterated that the complete response letter was related to an inspection of a third-party manufacturing site, and that Merck and Daiichi Sankyo are working to address the agency's concerns in a timely manner. He also said that the issues the FDA detailed in the complete response letter have no bearing on ifinatamab deruxtecan or raludotatug deruxtecan, the other ADCs that Merck is codeveloping with Daiichi Sankyo within their October 2023 collaboration deal

In the second quarter, Merck recorded net income of $5.46 billion, or $2.14 per share, in Q2 2024, compared to a loss of $5.98 billion, or $2.35 per share, in Q2 2023. On a non-GAAP basis, Merck's earnings per share were $2.28 in Q2 2024, which exceeded the Wall Street consensus EPS estimate of $2.15. 

For the full year, Merck expects revenues in the range of $63.4 billion to $64.4 billion and non-GAAP EPS between $7.94 and $8.04. Previously, the drugmaker had estimated 2024 revenues in the range of $63.1 billion and $64.3 billion and non-GAAP EPS between $8.53 and $8.65.