4. Merck & Co.

Merck faces a year in transition as CFO Robert Davis gets a promotion, replacing 10-year CEO Kenneth Frazier this June.

2020 revenue:
$48.00 billion
2019 revenue: $46.84 billion
Headquarters: Kenilworth, New Jersey

The coronavirus pandemic has delivered a one-two punch to pharma giant Merck & Co. 

First, it stunted sales for several of the company’s tried-and-true drugs. Second, the virus proved elusive to Merck’s top R&D minds. Despite some pricey efforts, the company failed to successfully develop a COVID-19 vaccine or a treatment for those already infected. 

But knocking down one of the heavyweights of the industry takes more than a formidable left and right. At the end of pandemic-riddled 2020, the New Jersey-based drugmaker stood strong with $48 billion in revenue.

It was a 2.5% increase in sales, but nothing to approach the upward trend of 2019 when receipts swelled by 11%. But considering how the virus tilted the pharma landscape, and decidedly not in Merck’s favor, it was good to get out of 2020 in the black.

The blow Merck absorbed was even more pronounced than anticipated. By late October, Merck had adjusted its predicted pandemic hit of $1.9 billion to $2.5 billion. Add this amount of lost revenue to the 2020 sales figure and it provides a healthy 8% increase.

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Merck can thank immuno-oncology superstar Keytruda for carrying a heavy load. Generating $14.4 billion in 2020, Keytruda’s sales jumped 30%, keeping it on track to be the world’s best-selling drug in the middle of this decade.

Januvia pulled in $5.3 billion, but that was a 4% decrease from 2019 as the aging diabetes treatment faced increased competition and pricing pressure. Sales also took a mild dip for Januvia’s diabetes combo drug, Janumet ($2.0 billion).  

HPV vaccine Gardasil rang up $3.9 billion, a 5% improvement from 2019 after a 19% increase the previous year. The stagnation can mostly be blamed on limited doctors' visits during the pandemic outbreak. 

Other big earners for Merck were chickenpox vaccine Varivax ($1.9 billion), whose sales nonetheless were down from last year in all four quarters, Bridion ($1.2 billion) and Pneumovax ($1.1 billion). 

“Despite extraordinary challenges brought on by the COVID-19 pandemic, Merck achieved solid growth and made meaningful progress in our pipeline in 2020,” CEO Ken Frazier said in January. “We remain focused on our science-led strategy and are confident that this approach will continue to deliver value to patients and shareholders.”

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After a 10-year run, Frazier will depart his post in June, to be replaced by Merck CFO Robert Davis, who will plot Merck’s long-term course for growth post-Keytruda.

Merck’s market capitalization suffered a significant drop (10.5%) in 2020 but part of that can be attributed to the rare air of its figure to begin the year ($230 billion). And while market cap figures for many pharma companies didn’t necessarily correspond to their response to the pandemic, Merck’s COVID performance certainly didn’t help.  

Merck continues to wheel and deal in its efforts to diversify away from its dependence on Keytruda. In November, the company picked up VelosBio, which was working on therapies against ROR1. Merck hopes it pans out better than its acquisition of Themis, an ill-fated attempt to join the COVID-19 vaccine race.    

4. Merck & Co.