Merck & Co.
Estimated 2026 sales: $51.96 billion
2019 sales: $40.90 billion
2019-26 CAGR: 3.48%
Any pharma company that has one dominant blockbuster inevitably finds itself facing pressure from investors with a burning question—what’s next? Merck is no different. Its immuno-oncology blockbuster Keytruda continues to fuel the company’s revenue trajectory, as CEO Ken Frazier works behind the scenes to ensure there’s life for Merck beyond the fast-growing cancer drug.
Merck is expected to pull in nearly $52 billion in 2026, up from $46.8 billion last year, thanks largely to the I-O superstar, Evaluate estimates. In fact, Merck’s drug, a PD-1 checkpoint inhibitor, will overtake AbbVie’s blockbuster anti-inflammatory Humira as the world’s best-selling drug that year, the firm predicts. Expected to haul in $14.4 billion in sales this year, Keytruda should see 2026 proceeds of $24.3 billion, Evaluate says.
Those numbers are possible because of the masterful way Merck has expanded Keytruda’s market since the drug was first approved by the FDA to treat melanoma in 2014. That approval has since grown to 17 cancer types. What’s more, the drug has the distinction of two FDA green lights based not on where the cancer is in the body, but rather which biomarkers the tumors have. The most recent location-agnostic approval came in June, when the FDA cleared Keytruda to treat cancers with high levels of tumor mutational burden (TMB).
Merck’s aggressive development strategy for Keytruda has kept the drug in front of the growing PD-1/PD-L1 pack. For example, in June, Merck nabbed a new approval for Keytruda to treat recurrent or metastatic cutaneous squamous cell carcinoma that’s not amenable to radiation or surgery. That category was previously owned by Sanofi and Regeneron’s recently approved PD-1 drug Libtayo.
Still, Frazier and his executive team are well aware of the pressure they’re under to diversify Merck’s product lineup and pipeline. During the company’s fourth-quarter earnings announcement, Frazier said the company would spin off its women’s health and biosimilars units to focus more intently on building its pipeline of prescription medicines. The oncology pipeline alone has more than 20 contenders in it, as the company often reminds investors.
And now Merck is entering the race to combat the COVID-19 pandemic. In May, it partnered with Ridgeback Bio to develop an antiviral against the disease.
With the nonprofit IAVI, Merck is also working on a COVID-19 vaccine that comes from the platform that yielded its Ebola vaccine Ervebo. The project, backed by $38 million from the U.S. government’s BARDA, is one of the five vaccine candidates selected by the government’s Operation Warp Speed, an effort to get COVID-19 vaccines on the market by the end of the year. Merck also bought Themis, which is working on another COVID vaccine.
Meanwhile, the COVID pandemic has produced a short-term blip in Merck’s fast growth curve. Merck said in April it expected a $2.1 billion hit to sales this year, because stay-at-home orders have dampened prescriptions for physician-administered products, including Keytruda. The company expected to see a full return of demand for those products starting in the fourth quarter.
Editor's note: Evaluate's 2019 figures cover pharmaceuticals and over the counter sales, so Merck's animal health franchise wasn't included.