Merck's vax sales fail to see same growth reported by peers

Merck & Co. headquarters
Merck & Co. headquarters

Pfizer, GlaxoSmithKline and Sanofi all reported at least decent growth in their vaccines businesses for Q1 2016. Merck & Co., not so much. In fact, the global vaccine player reported sales that were essentially flat as the Kenilworth, NJ-based company struggled overall in Q1.

Merck ($MRK), known as MSD outside of the U.S., reported last week that revenues from its vax unit hit $1.3 billion, up 1% from the same quarter a year ago. Sales of its HPV vaccines, Gardasil and Gardasil 9, were up 5% to $378 million. However, sales of RotaTeq, Pneumovax 23 and Zostavax were all down, 2%, 3% and 28%, respectively.

In the case of Zostavax, Merck's adult shingles vaccine, Adam Schechter, president of global human health, said sales were hurt by a weaker flu season in the U.S.--which he said reduces vaccinations in general--and changes in the Advisory Committee for Immunization Practices recommendations for pneumococcal vaccines.

“We are actively working with customers to help them navigate the reimbursement for Zostavax, and expect this to be less of a hurdle over time,” Schechter said.

But a further shakeup for Zostavax may be in the cards, as GSK's vaccine head, Moncef Slaoui, predicted this January that his company's shingles candidate could bring about a "major" market disruption. The British pharma's candidate has posted a 97.2% efficacy compared with placebo in a Phase III trial.

Merck’s competitors in the vaccine world had better news this quarter. GlaxoSmithKline ($GSK) reported vaccines sales up 23% to £882 million ($1.28 billion). Pfizer ($PFE) reported global vaccine sales that rose 18% to $1.51 billion, driven by the Prevnar family of pneumococcal disease vaccines. Even Sanofi ($SNY) reported that its vaccine sales were up 8.2% to €625 million ($719 million). That came despite supply problems for its Pentacel combo vaccine in the U.S., where overall vaccine sales were down 17.3%.

Merck’s weak vaccine sales were a mirror to its quarter overall, in which it reported a 1% decline in revenue to $9.3 billion.  

- here’s the earnings release 
- read the Seeking Alpha transcript 

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