In Merck’s quarterly conference call on Thursday, it took CEO Rob Davis less than a minute to tout newly approved pulmonary arterial hypertension (PAH) treatment Winrevair (sotatercept) and what the emergence of the potential blockbuster means for the company.
“We’ve demonstrated that we can leverage our deep discovery prowess to identify important acquisition targets and then add significant value through our powerful clinical research engine, our regulatory expertise and our commercial scale,” Davis said.
Four months into Davis’ tenure as CEO in 2021, the company acquired sotatercept in an $11.5 billion buyout of Acceleron. Data analytics group FactSet has projected sales of Winrevair to reach $3.9 billion by 2029.
“Strategic business development focused on the best external science remains an important priority,” the CEO said.
With cancer powerhouse Keytruda losing patent protection in 2028 in the United States and in 2031 in Europe, Davis is anxious to show that Merck can find replacements for the juggernaut that accounted for 44% of the company’s revenue in the first quarter.
“If our clinical success continues, I think you’re gonna see us with a more diversified set of growth drivers over time than frankly we’ve had in many years, if ever,” Davis said. “I see it as more of a hill than a cliff.”
When asked to estimate Winrevair’s sales this year, Davis reiterated that the company does not provide guidance for its individual products. He did declare that the launch is off to a strong start, with prescriptions increasing along with repeat prescriptions. Shipments to patients’ homes is underway. And the company is seeing excellent access with “no real limits,” Davis said, which is a good sign considering the drug was approved less than a month ago, he added.
R&D chief Dean Li, M.D., Ph.D., said that there will be continued “data flows that will continue to inform and strengthen,” Winrevair’s profile. The company also is working on an auto-injector that should improve uptake for the drug, which is currently provided in a vial.
“We believe that the vast majority with time will use it as self-administration,” Li said. “This is a patient population that’s quite used to doing injections.”
Merck’s revenue for the quarter came in at $15.8 billion, which topped the analyst consensus of $15.2 billion. It was a 9% increase from the $14.5 billion figure from the first quarter of 2023 and an 8% increase sequentially.
With the performance, Merck made a slight adjustment to its annual revenue projection to a range of $63.1 billion to $64.3 billion, up from $62.7 billion to $64.2 billion. The midpoint of the new estimate would provide a 6% revenue increase over 2023 sales of $60.1 billion.
Keytruda did much of the heavy lifting in the first quarter, generating sales of $6.9 billion, which was up 20% from the first quarter of 2023 and 5% sequentially. Of the $1.29 billion increase in Merck’s revenue year over year, Keytruda accounted for $1.15 billion of the uptick.
Helping fuel recent Keytruda sales have been five approvals over the last seven months, moving the PD-1 immunotherapy into earlier use for patients with kidney, breast and non-small cell lung cancers, Merck said.
HPV vaccine Gardasil had a 14% year-over-year increase and a 20% sequential bump in sales to $2.2 billion in the quarter, helping compensate for a 24% drop in sales from diabetes drug Januvia to $670 million.