Merck profit tops Wall Street view on strong Keytruda sales

By Michael Erman and Leroy Leo

(Reuters) -Merck & Co on Thursday reported higher-than-expected second-quarter earnings and income on sturdy gross sales of its blockbuster most cancers immunotherapy drug.

A lot of that beat got here from better-than-expected gross sales of Merck’s top-selling drug Keytruda and elevated demand for its Gardasil vaccine, which protects in opposition to cancers brought on by the human papillomavirus (HPV).

The outcomes have been reported a day after U.S. Democratic Senator Joe Manchin and Senate Democratic chief Chuck Schumer agreed on a invoice to assist curb drug costs.

The proposed invoice goals to cap out-of-pocket drug prices for recipients of Medicare – the U.S. medical health insurance for these 65 and older – at $2,000 a yr, and likewise present free vaccines for seniors.

Merck Chief Government Rob Davis mentioned the proposed invoice may have a “extremely chilling” impact on innovation, however he doesn’t see it hurting gross sales of Keytruda and Gardasil within the near-term, whether it is handed.

With Merck anticipated to lose patent safety for Keytruda in 2028, the corporate may additionally think about a subcutaneous or different variations of the drug, which is at present given by intravenous infusion type.

“I believe there’s a path to consider that innovation,” mentioned Merck analysis chief Dean Li.

Keytruda has come to the eye of U.S. lawmakers over tax points.

On Wednesday, U.S. Senator Ron Wyden, a Democrat, despatched a letter to Merck suggesting the corporate had averted billions of {dollars} of U.S. taxes owed from Keytruda gross sales lately by reserving all of the income from the remedy exterior of the USA.

Merck in an emailed assertion on Wednesday mentioned they’ve responded with data they imagine appropriately addressed inquiries made in two letters acquired from the Senate Finance Committee.

Excluding one-off objects, the corporate mentioned it earned $1.87 a share, 17 cents increased than analysts on common anticipated, in keeping with Refinitiv knowledge.

The corporate reported $5.3 billion in gross sales of Keytruda, in contrast with analyst estimates of $4.9 billion.

Merck additionally narrowed its full-year earnings forecast to $7.25 to $7.35 per share, beneath Wall Avenue estimates of $7.37 per share.

Merck shares have been down about 2% on an off day for a lot of drugmakers following Wednesday’s proposed drug pricing invoice announcement.

(Reporting by Michael Erman in New Jersey and Leroy Leo in Bengaluru; Enhancing by Invoice Berkrot)