Merck Announces Fourth-Quarter and Full-Year 2023 Financial Results
February 1, 2024- Fourth-Quarter and Full-Year Sales Reflect Sustained Growth Across Oncology and Vaccines
- Fourth-Quarter Worldwide Sales Were $14.6 Billion, an Increase of 6% From Fourth Quarter 2022; Excluding LAGEVRIO, Growth Was 11%; Excluding LAGEVRIO and the Impact of Foreign Exchange, Growth Was 13%
- Fourth-Quarter GAAP Loss per Share Was $0.48; Non-GAAP EPS Was $0.03; GAAP Loss per Share and Non-GAAP EPS Include a Charge of $1.69 per Share for a Collaboration With Daiichi Sankyo
-
Full-Year Worldwide Sales Were $60.1 Billion, an Increase of 1% From Full-Year 2022; Excluding LAGEVRIO, Growth Was 9%; Excluding LAGEVRIO and the Impact of Foreign Exchange, Growth Was 12%
- KEYTRUDA Sales Grew 19% to $25.0 Billion; Excluding the Impact of Foreign Exchange, Sales Grew 21%
- GARDASIL/GARDASIL 9 Sales Grew 29% to $8.9 Billion; Excluding the Impact of Foreign Exchange, Sales Grew 33%
- LAGEVRIO Sales Declined 75% to $1.4 Billion; Excluding the Impact of Foreign Exchange, Sales Declined 74%
- Full-Year 2023 GAAP EPS Was $0.14; Non-GAAP EPS Was $1.51; GAAP and Non-GAAP EPS Include Charges of $6.21 per Share for Certain Business Development Transactions
- Obtained FDA Priority Review of Biologics License Applications for V116, an Investigational Pneumococcal Conjugate Vaccine, as Well as Merck and Daiichi Sankyo’s Patritumab Deruxtecan, in the Fourth Quarter
- Received Multiple FDA Approvals Across Oncology Portfolio in 2023
- Initiated More Than 20 Phase 3 Study Starts, Including the Progression of Eight Novel Assets Into Phase 3 in 2023
- Augmented Pipeline Through Acquisitions of Prometheus and Imago, and Collaboration Agreements With Daiichi Sankyo and Kelun-Biotech in 2023
-
Full-Year 2024 Financial Outlook
- Anticipates Worldwide Sales To Be Between $62.7 Billion and $64.2 Billion
- Expects Non-GAAP EPS To Be Between $8.44 and $8.59
RAHWAY, N.J.–(BUSINESS WIRE)–$MRK #MRK–Merck (NYSE: MRK), known as MSD outside the United States and Canada, today announced financial results for the fourth quarter and full year of 2023.
“2023 was another very strong year for Merck. I am extremely pleased by the progress we’ve made to develop and deliver transformative therapies and vaccines that will help save and improve lives around the world. We reached more than 500 million people with our medicines last year alone, over half of which were donations, including through our program to treat river blindness,” said Robert M. Davis, chairman and chief executive officer, Merck. “We also made investments of approximately $30 billion in research and development in our ongoing effort to discover, develop and collaborate to propel the next generation of impactful innovations. As we move forward, I’m confident that our strong momentum will continue, underpinned by the unwavering dedication of our talented global team.”
Financial Summary
|
$ in millions, except EPS amounts |
Fourth Quarter |
Year Ended |
||||||
|
2023 |
2022 |
Change |
Change Ex-Exchange |
Dec. 31, 2023 |
Dec. 31, 2022 |
Change |
Change Ex-Exchange |
|
|
Sales |
$14,630 |
$13,830 |
6% |
7% |
$60,115 |
$59,283 |
1% |
4% |
|
GAAP net (loss) income1 |
(1,226) |
3,017 |
N/M |
N/M |
365 |
14,519 |
-97% |
-95% |
|
Non-GAAP net income that excludes certain items1,2* |
66 |
4,129 |
-98% |
N/M |
3,837 |
19,005 |
-80% |
-75% |
|
GAAP EPS |
(0.48) |
1.18 |
N/M |
N/M |
0.14 |
5.71 |
-98% |
-95% |
|
Non-GAAP EPS that excludes certain items2* |
0.03 |
1.62 |
-98% |
N/M |
1.51 |
7.48 |
-80% |
-75% |
|
*Refer to table on page 9. N/M – Not meaningful |
||||||||
Generally Accepted Accounting Principles (GAAP) loss/earnings per share (EPS) assuming dilution was a loss per share of $0.48 for the fourth quarter and EPS of $0.14 for the full year of 2023. Non-GAAP EPS was $0.03 for the fourth quarter and $1.51 for the full year of 2023. GAAP loss per share and non-GAAP EPS in the fourth quarter of 2023 include a charge of $1.69 per share related to the collaboration with Daiichi Sankyo. GAAP and non-GAAP EPS for the full years of 2023 and 2022 include charges of $6.21 and $0.22 per share, respectively, related to certain collaborations, licensing agreements and asset acquisitions.
Non-GAAP EPS excludes acquisition- and divestiture-related costs, including pretax intangible asset impairment research and development (R&D) charges of $779 million in the fourth quarter and full year of 2023 related to gefapixant, and $780 million and $1.7 billion in the fourth quarter and full year of 2022, respectively, primarily related to nemtabrutinib. Non-GAAP EPS also excludes restructuring costs, including costs for the recently approved 2024 Restructuring Program, as well as income and losses from investments in equity securities.
Fourth-Quarter Sales Performance
The following table reflects sales of the company’s top products and significant performance drivers.
|
|
Fourth Quarter |
||||
|
$ in millions |
2023 |
2022 |
Change |
Change Ex-Exchange |
Commentary |
|
Total Sales |
$14,630 |
$13,830 |
6% |
7% |
|
|
Pharmaceutical |
13,141 |
12,180 |
8% |
8% |
Increase driven by growth in oncology, vaccines and hospital acute care, partially offset by a decline in virology, due to LAGEVRIO, and diabetes. Excluding LAGEVRIO and impact of foreign exchange, growth of 14%. |
|
KEYTRUDA |
6,608 |
5,450 |
21% |
22% |
Growth driven by increased global uptake in earlier-stage indications, including triple-negative breast cancer and renal cell carcinoma (RCC), and continued strong global demand from metastatic indications. |
|
GARDASIL/GARDASIL 9 |
1,871 |
1,470 |
27% |
27% |
Growth due to strong global demand, particularly in China, and public-sector buying patterns in the U.S. |
|
JANUVIA/JANUMET |
787 |
913 |
-14% |
-13% |
Decline primarily due to generic competition in several international markets, particularly in Europe, and lower demand in the U.S. |
|
PROQUAD, M-M-R II and VARIVAX |
545 |
526 |
4% |
3% |
Growth largely due to higher pricing in the U.S. |
|
BRIDION |
429 |
441 |
-3% |
-3% |
Decline primarily due to generic competition in certain ex-U.S. markets, particularly in Europe, partially offset by higher demand in the U.S. |
|
Lynparza* |
315 |
292 |
8% |
8% |
Growth driven primarily by higher pricing in the U.S. |
|
Lenvima* |
226 |
216 |
5% |
5% |
Growth primarily due to higher demand in the U.S., partially offset by timing of shipments in China. |
|
LAGEVRIO |
193 |
825 |
-77% |
-76% |
Decline due to nonrecurrence of sales in the U.K. and lower demand in Japan and Australia. |
|
ROTATEQ |
185 |
139 |
34% |
33% |
Growth primarily due to public-sector buying patterns in the U.S. and timing of shipments in China. |
|
VAXNEUVANCE |
176 |
138 |
28% |
26% |
Growth largely driven by launches in Europe and continued uptake for the pediatric indication in the U.S. Prior-year quarter benefited from inventory stocking in the U.S. in preparation for pediatric launch. |
|
Animal Health |
1,278 |
1,230 |
4% |
4% |
Growth primarily driven by higher demand for Companion Animal products. |
|
Livestock |
808 |
814 |
-1% |
0% |
Decline primarily due to timing of shipments for ruminant products, largely offset by higher pricing across the product portfolio and higher demand for swine products. |
|
Companion Animal |
470 |
416 |
13% |
12% |
Growth primarily due to higher demand and timing of shipments for BRAVECTO line of products, as well as higher pricing. Sales of BRAVECTO were $197 million and $168 million in the current and prior-year quarters, respectively, which represented growth of 18%, or 19% excluding the impact of foreign exchange. |
|
Other Revenues** |
211 |
420 |
-50% |
-1% |
Decline primarily due to impact of revenue hedging activities. |
|
*Alliance revenue for this product represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs. **Other revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities. |
|||||
Full-Year Revenue Performance
The following table reflects sales of the company’s top pharmaceutical products, as well as sales of Animal Health products.
|
|
Year Ended |
|||
|
$ in millions |
Dec. 31, 2023 |
Dec. 31, 2022 |
Change |
Change Ex-Exchange |
|
Total Sales |
$60,115 |
$59,283 |
1% |
4% |
|
Pharmaceutical |
53,583 |
52,005 |
3% |
5% |
|
KEYTRUDA |
25,011 |
20,937 |
19% |
21% |
|
GARDASIL/GARDASIL 9 |
8,886 |
6,897 |
29% |
33% |
|
JANUVIA/JANUMET |
3,366 |
4,513 |
-25% |
-23% |
|
PROQUAD, M-M-R II and VARIVAX |
2,368 |
2,241 |
6% |
6% |
|
BRIDION |
1,842 |
1,685 |
9% |
11% |
|
LAGEVRIO |
1,428 |
5,684 |
-75% |
-74% |
|
Lynparza* |
1,199 |
1,116 |
7% |
9% |
|
Lenvima* |
960 |
876 |
10% |
11% |
|
ROTATEQ |
769 |
783 |
-2% |
-1% |
|
VAXNEUVANCE |
665 |
170 |
N/M |
N/M |
|
Animal Health |
5,625 |
5,550 |
1% |
3% |
|
Livestock |
3,337 |
3,300 |
1% |
4% |
|
Companion Animal |
2,288 |
2,250 |
2% |
3% |
|
Other Revenues** |
907 |
1,728 |
-48% |
-15% |
|
*Alliance revenue for this product represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs. **Other revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities. N/M – Not meaningful |
||||
Full-year 2023 pharmaceutical sales grew 3% to $53.6 billion. Pharmaceutical sales growth was primarily driven by higher sales in oncology, particularly KEYTRUDA, higher sales of vaccines, reflecting strong growth of combined sales of GARDASIL/GARDASIL 9 and VAXNEUVANCE, as well as growth in hospital acute care products, including PREVYMIS and BRIDION. Pharmaceutical sales growth in 2023 was partially offset by lower sales of the COVID-19 medication LAGEVRIO, as well as lower sales of JANUVIA and JANUMET, primarily reflecting generic competition in many ex-U.S. markets and lower demand in the U.S., and lower sales of PNEUMOVAX 23 as the market continues to shift toward newer adult pneumococcal conjugate vaccines. Pharmaceutical sales growth for the full year of 2023 was 14% excluding LAGEVRIO and the unfavorable impact of foreign exchange.
Full-year 2023 Animal Health sales grew 1% to $5.6 billion. Excluding the unfavorable impact of foreign exchange, Animal Health sales grew 3%, primarily due to higher pricing. Full-year sales growth was also driven by higher demand for livestock products, led by poultry and swine products, partially offset by lower demand for ruminant products. Sales of BRAVECTO were $1.1 billion in 2023, which represented growth of 4%, or 5% excluding the impact of foreign exchange, primarily reflecting higher pricing.
Fourth-Quarter and Full-Year Expense, EPS and Related Information
The table below presents selected expense information.
|
$ in millions |
GAAP |
Acquisition- |
Restructuring |
(Income) |
Non- |
|
Fourth Quarter 2023 |
|||||
|
Cost of sales |
$3,911 |
$454 |
$117 |
$- |
$3,340 |
|
Selling, general and administrative |
2,804 |
24 |
29 |
– |
2,751 |
|
Research and development |
9,628 |
790 |
– |
– |
8,838 |
|
Restructuring costs |
255 |
– |
255 |
– |
– |
|
Other (income) expense, net |
78 |
(35) |
– |
(61) |
174 |
|
|
|
|
|
|
|
|
Fourth Quarter 2022 |
|
|
|
|
|
|
Cost of sales |
$3,881 |
$482 |
$38 |
$- |
$3,361 |
|
Selling, general and administrative |
2,687 |
39 |
20 |
– |
2,628 |
|
Research and development |
3,775 |
740 |
– |
– |
3,035 |
|
Restructuring costs |
49 |
– |
49 |
– |
– |
|
Other (income) expense, net |
(75) |
(69) |
– |
80 |
(86) |
|
$ in millions |
GAAP |
Acquisition- |
Restructuring |
(Income) |
Certain Other Items |
Non- |
|
Year Ended Dec. 31, 2023 |
|
|||||
|
Cost of sales |
$16,126 |
$2,018 |
$211 |
$- |
$- |
$13,897 |
|
Selling, general and administrative |
10,504 |
86 |
122 |
– |
– |
10,296 |
|
Research and development |
30,531 |
819 |
1 |
– |
– |
29,711 |
|
Restructuring costs |
599 |
– |
599 |
– |
– |
– |
|
Other (income) expense, net |
466 |
(47) |
– |
(279) |
573 |
219 |
|
|
|
|
|
|
|
|
|
Year Ended Dec. 31, 2022 |
|
|
|
|
|
|
|
Cost of sales |
$17,411 |
$2,059 |
$205 |
$- |
$- |
$15,147 |
|
Selling, general and administrative |
10,042 |
176 |
94 |
– |
– |
9,772 |
|
Research and development |
13,548 |
1,676 |
30 |
– |
– |
11,842 |
|
Restructuring costs |
337 |
– |
337 |
– |
– |
– |
|
Other (income) expense, net |
1,501 |
(207) |
– |
1,348 |
– |
360 |
GAAP Expense, EPS and Related Information
Gross margin was 73.3% for the fourth quarter of 2023 compared with 71.9% for the fourth quarter of 2022. The increase was primarily due to the favorable impacts of lower LAGEVRIO sales, which have a low gross margin, lower manufacturing facilities costs and product mix, partially offset by the unfavorable impacts of foreign exchange and higher restructuring costs. Gross margin was 73.2% for the full year of 2023 compared with 70.6% for the full year of 2022. The increase was primarily due to the favorable impacts of lower LAGEVRIO sales, product mix, lower manufacturing facilities costs, and lower revenue from third-party manufacturing arrangements, partially offset by the unfavorable impact of foreign exchange.
Selling, general and administrative (SG&A) expenses were $2.8 billion in the fourth quarter of 2023, an increase of 4% compared with the fourth quarter of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, partially offset by lower promotional spending. Full-year 2023 SG&A expenses were $10.5 billion, an increase of 5% compared with the full year of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, and higher promotional spending, partially offset by the favorable impact of foreign exchange and lower acquisition- and divestiture-related costs.
R&D expenses were $9.6 billion in the fourth quarter of 2023 compared with $3.8 billion in the fourth quarter of 2022. R&D expenses were $30.5 billion for the full year of 2023 compared with $13.5 billion for the full year of 2022. The increase in the fourth quarter and full year of 2023 reflects a $5.5 billion charge for the collaboration with Daiichi Sankyo, and higher development costs due to spending on clinical programs, including newly acquired programs, as well as higher compensation and benefit costs (reflecting in part increased headcount). The increase in R&D expenses for the full year was also due to charges of $11.4 billion in the aggregate for the acquisitions of Prometheus Biosciences, Inc. (Prometheus) and Imago BioSciences, Inc. (Imago). The increase in R&D expenses for the full year was partially offset by lower intangible asset impairment charges in 2023 and charges of $690 million in the aggregate in 2022 for collaboration and licensing agreements with Moderna, Inc. (Moderna), Orna Therapeutics (Orna) and Orion Corporation (Orion).
Other (income) expense, net, was $78 million of expense in the fourth quarter of 2023 compared with $75 million of income in the fourth quarter of 2022, primarily due to higher exchange losses and higher net interest expense, partially offset by net gains from investments in equity securities for the fourth quarter of 2023 compared with net losses from investments in equity securities for the fourth quarter of 2022, and lower pension settlement costs. Other (income) expense, net, was $466 million of expense in the full year of 2023 compared with $1.5 billion of expense in the full year of 2022, primarily due to net gains from investments in equity securities in 2023 compared with net losses from investments in equity securities in 2022, and lower pension settlement costs, partially offset by a $572.5 million charge in 2023 related to settlements with certain plaintiffs in the Zetia antitrust litigation.
The effective tax rate was 40.1% for the fourth quarter of 2023 compared with 14.1% in the fourth quarter of 2022. The effective tax rate for the fourth quarter of 2023 includes a 29.2 percentage point impact resulting from the charge for the Daiichi Sankyo collaboration. The effective tax rate was 80.0% for the full year of 2023 compared with 11.7% for the full year of 2022. The full-year 2023 effective tax rate reflects an aggregate 65.6 percentage point unfavorable impact, resulting from charges for asset acquisitions (for which no tax benefits were recognized) as well as the charge for the Daiichi Sankyo collaboration.
GAAP loss per share was $0.48 for the fourth quarter of 2023 compared with EPS of $1.18 for the fourth quarter of 2022, primarily driven by the charge in 2023 related to the collaboration with Daiichi Sankyo, the unfavorable impact of foreign exchange and higher restructuring costs, partially offset by a beneficial impact from the tax rate and operational strength in the business. GAAP EPS was $0.14 for the full year of 2023 compared with EPS of $5.71 for the full year of 2022. The EPS decline in 2023 was primarily due to higher charges for certain business development transactions, the unfavorable impact of foreign exchange and the tax rate, as well as a charge related to settlements with certain plaintiffs in the Zetia antitrust litigation, partially offset by the beneficial impacts of operational strength in the business, better performance from equity investments and lower intangible asset impairment charges.
Non-GAAP Expense, EPS and Related Information
Non-GAAP gross margin was 77.2% for the fourth quarter of 2023 compared with 75.7% for the fourth quarter of 2022. Non-GAAP gross margin was 76.9% for the full year of 2023 compared with 74.4% for the full year of 2022. The non-GAAP gross margin improvement in the fourth quarter and full year of 2023 was primarily due to the favorable impacts of lower LAGEVRIO sales, which have a low gross margin, product mix, and lower manufacturing facilities costs. The increase in non-GAAP gross margin for the full year was also due to lower revenue from third-party manufacturing arrangements. The non-GAAP gross margin improvement in the fourth quarter and full year of 2023 was partially offset by the unfavorable impact of foreign exchange.
Non-GAAP SG&A expenses were $2.8 billion for the fourth quarter of 2023 compared with $2.6 billion for the fourth quarter of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, partially offset by lower promotional spending. Full-year 2023 non-GAAP SG&A expenses were $10.3 billion, an increase of 5% compared with the full year of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, and higher promotional spending, partially offset by the favorable impact of foreign exchange.
Non-GAAP R&D expenses were $8.8 billion in the fourth quarter of 2023 compared with $3.0 billion in the fourth quarter of 2022. Non-GAAP R&D expenses were $29.7 billion for the full year of 2023 compared with $11.8 billion for the full year of 2022. The increase in the fourth quarter and full year of 2023 reflects a $5.5 billion charge for the collaboration with Daiichi Sankyo, and higher development costs due to spending on clinical programs, including newly acquired programs, as well as higher compensation and benefit costs (reflecting in part increased headcount). The increase in non-GAAP R&D expenses for the full year was also due to charges of $11.4 billion in the aggregate for the acquisitions of Prometheus and Imago. The increase in R&D expenses for the full year was partially offset by charges of $690 million in the aggregate in 2022 for collaboration and licensing agreements with Moderna, Orna and Orion.
Non-GAAP other (income) expense, net, was $174 million of expense in the fourth quarter of 2023 compared with $86 million of income in the fourth quarter of 2022, primarily due to higher exchange losses and higher net interest expense, partially offset by lower pension settlement costs. Non-GAAP other (income) expense, net, was $219 million of expense in the full year of 2023 compared with $360 million of expense in the full year of 2022, primarily due to lower pension settlement costs.
The non-GAAP effective tax rate was 114.2% for the fourth quarter of 2023 compared with 15.6% in the fourth quarter of 2022. The non-GAAP effective tax rate for the fourth quarter of 2023 includes a 101.1 percentage point unfavorable impact resulting from the charge for the Daiichi Sankyo collaboration. The non-GAAP effective tax rate was 35.8% for the full year of 2023 compared with 14.2% for the full year of 2022. The full-year 2023 non-GAAP effective tax rate reflects an aggregate 21.2 percentage point unfavorable impact, resulting from charges for asset acquisitions (for which no benefits were recognized) as well as the charge for the Daiichi Sankyo collaboration.
Non-GAAP EPS was $0.03 for the fourth quarter of 2023 compared with $1.62 for the fourth quarter of 2022. The non-GAAP EPS decline in the fourth quarter was primarily due to the charge in 2023 related to the collaboration with Daiichi Sankyo and the unfavorable impact of foreign exchange, partially offset by a beneficial impact from the tax rate and operational strength in the business. Non-GAAP EPS was $1.51 for the full year of 2023 compared with $7.48 for the full year of 2022. The non-GAAP EPS decline for the full year was primarily due to higher charges for certain business development transactions, the unfavorable impact of foreign exchange and the tax rate, partially offset by operational strength in the business.
A reconciliation of GAAP to non-GAAP net (loss) income and (loss) earnings per share is provided in the table that follows.
|
Fourth Quarter |
Year Ended |
|||
|
$ in millions, except EPS amounts |
2023 |
2022 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
EPS |
|
|
|
|
|
GAAP EPS |
$(0.48) |
$1.18 |
$0.14 |
$5.71 |
|
Difference |
0.51 |
0.44 |
1.37 |
1.77 |
|
Non-GAAP EPS that excludes items listed below2 |
$0.03 |
$1.62 |
$1.51 |
$7.48 |
|
|
|
|
|
|
|
Net (Loss) Income |
|
|
|
|
|
GAAP net (loss) income1 |
$(1,226) |
$3,017 |
$365 |
$14,519 |
|
Difference |
1,292 |
1,112 |
3,472 |
4,486 |
|
Non-GAAP net income that excludes items listed below1,2 |
$66 |
$4,129 |
$3,837 |
$19,005 |
|
|
|
|
|
|
|
Excluded Items: |
|
|
|
|
|
Acquisition- and divestiture-related costs3 |
$1,233 |
$1,192 |
$2,876 |
$3,704 |
|
Restructuring costs |
401 |
107 |
933 |
666 |
|
(Income) loss from investments in equity securities |
(61) |
80 |
(279) |
1,348 |
|
Charge for Zetia antitrust litigation settlements |
– |
– |
573 |
– |
|
Increase to net loss/decrease to net income before taxes |
1,573 |
1,379 |
4,103 |
5,718 |
|
Estimated income tax (benefit) expense |
(281) |
(267) |
(631) |
(1,232) |
|
Increase to net loss/decrease to net income |
$1,292 |
$1,112 |
$3,472 |
$4,486 |
2024 Restructuring Program
Merck recently approved a new restructuring program (2024 Restructuring Program) intended to continue the optimization of the company’s Human Health global manufacturing network as the future pipeline shifts to new modalities, and also to optimize the Animal Health global manufacturing network to improve supply reliability and increase efficiency. The company recorded charges in its GAAP results of $190 million related to the 2024 Restructuring Program for the fourth quarter and full year of 2023.
Pipeline and Portfolio Highlights
In the fourth quarter, Merck continued to make significant progress advancing its broad portfolio and pipeline across key therapeutic areas, representing continued momentum toward addressing patient needs.
In oncology, Merck received multiple U.S. Food and Drug Administration (FDA) approvals, including KEYTRUDA plus Padcev for the first-line treatment of adult patients with locally advanced or metastatic urothelial cancer and WELIREG for the treatment of certain patients with previously treated advanced RCC, among other approvals. The FDA also accepted and granted Priority Review to Merck and Daiichi Sankyo’s Biologics License Application (BLA) for patritumab deruxtecan for the treatment of certain patients with previously treated locally advanced or metastatic EGFR-mutated non-small cell lung cancer (NSCLC). The FDA set a Prescription Drug User Fee Act (PDUFA), or target action, date of June 26, 2024. In addition, Merck showed meaningful progress in its robust oncology pipeline, initiating Phase 3 trials for four investigational medicines, including bomedemstat (LSD1 inhibitor), nemtabrutinib (BTK inhibitor), MK-2870 (anti-TROP2 antibody-drug conjugate) and MK-5684 (CYP11A1 inhibitor).
In vaccines, Merck received Priority Review from the FDA for a BLA for V116, the company’s investigational, 21-valent pneumococcal conjugate vaccine specifically designed to protect adults, based on results from multiple Phase 3 trials.
Contacts
Media Contacts:
Robert Josephson
(203) 914-2372
[email protected]
Michael Levey
(215) 872-1462
[email protected]
Investor Contacts:
Peter Dannenbaum
(732) 594-1579
[email protected]
Steven Graziano
(732) 594-1583
[email protected]
Merck Announces Fourth-Quarter and Full-Year 2023 Financial Results
February 1, 2024- Fourth-Quarter and Full-Year Sales Reflect Sustained Growth Across Oncology and Vaccines
- Fourth-Quarter Worldwide Sales Were $14.6 Billion, an Increase of 6% From Fourth Quarter 2022; Excluding LAGEVRIO, Growth Was 11%; Excluding LAGEVRIO and the Impact of Foreign Exchange, Growth Was 13%
- Fourth-Quarter GAAP Loss per Share Was $0.48; Non-GAAP EPS Was $0.03; GAAP Loss per Share and Non-GAAP EPS Include a Charge of $1.69 per Share for a Collaboration With Daiichi Sankyo
-
Full-Year Worldwide Sales Were $60.1 Billion, an Increase of 1% From Full-Year 2022; Excluding LAGEVRIO, Growth Was 9%; Excluding LAGEVRIO and the Impact of Foreign Exchange, Growth Was 12%
- KEYTRUDA Sales Grew 19% to $25.0 Billion; Excluding the Impact of Foreign Exchange, Sales Grew 21%
- GARDASIL/GARDASIL 9 Sales Grew 29% to $8.9 Billion; Excluding the Impact of Foreign Exchange, Sales Grew 33%
- LAGEVRIO Sales Declined 75% to $1.4 Billion; Excluding the Impact of Foreign Exchange, Sales Declined 74%
- Full-Year 2023 GAAP EPS Was $0.14; Non-GAAP EPS Was $1.51; GAAP and Non-GAAP EPS Include Charges of $6.21 per Share for Certain Business Development Transactions
- Obtained FDA Priority Review of Biologics License Applications for V116, an Investigational Pneumococcal Conjugate Vaccine, as Well as Merck and Daiichi Sankyo’s Patritumab Deruxtecan, in the Fourth Quarter
- Received Multiple FDA Approvals Across Oncology Portfolio in 2023
- Initiated More Than 20 Phase 3 Study Starts, Including the Progression of Eight Novel Assets Into Phase 3 in 2023
- Augmented Pipeline Through Acquisitions of Prometheus and Imago, and Collaboration Agreements With Daiichi Sankyo and Kelun-Biotech in 2023
-
Full-Year 2024 Financial Outlook
- Anticipates Worldwide Sales To Be Between $62.7 Billion and $64.2 Billion
- Expects Non-GAAP EPS To Be Between $8.44 and $8.59
RAHWAY, N.J.–(BUSINESS WIRE)–$MRK #MRK–Merck (NYSE: MRK), known as MSD outside the United States and Canada, today announced financial results for the fourth quarter and full year of 2023.
“2023 was another very strong year for Merck. I am extremely pleased by the progress we’ve made to develop and deliver transformative therapies and vaccines that will help save and improve lives around the world. We reached more than 500 million people with our medicines last year alone, over half of which were donations, including through our program to treat river blindness,” said Robert M. Davis, chairman and chief executive officer, Merck. “We also made investments of approximately $30 billion in research and development in our ongoing effort to discover, develop and collaborate to propel the next generation of impactful innovations. As we move forward, I’m confident that our strong momentum will continue, underpinned by the unwavering dedication of our talented global team.”
Financial Summary
|
$ in millions, except EPS amounts |
Fourth Quarter |
Year Ended |
||||||
|
2023 |
2022 |
Change |
Change Ex-Exchange |
Dec. 31, 2023 |
Dec. 31, 2022 |
Change |
Change Ex-Exchange |
|
|
Sales |
$14,630 |
$13,830 |
6% |
7% |
$60,115 |
$59,283 |
1% |
4% |
|
GAAP net (loss) income1 |
(1,226) |
3,017 |
N/M |
N/M |
365 |
14,519 |
-97% |
-95% |
|
Non-GAAP net income that excludes certain items1,2* |
66 |
4,129 |
-98% |
N/M |
3,837 |
19,005 |
-80% |
-75% |
|
GAAP EPS |
(0.48) |
1.18 |
N/M |
N/M |
0.14 |
5.71 |
-98% |
-95% |
|
Non-GAAP EPS that excludes certain items2* |
0.03 |
1.62 |
-98% |
N/M |
1.51 |
7.48 |
-80% |
-75% |
|
*Refer to table on page 9. N/M – Not meaningful |
||||||||
Generally Accepted Accounting Principles (GAAP) loss/earnings per share (EPS) assuming dilution was a loss per share of $0.48 for the fourth quarter and EPS of $0.14 for the full year of 2023. Non-GAAP EPS was $0.03 for the fourth quarter and $1.51 for the full year of 2023. GAAP loss per share and non-GAAP EPS in the fourth quarter of 2023 include a charge of $1.69 per share related to the collaboration with Daiichi Sankyo. GAAP and non-GAAP EPS for the full years of 2023 and 2022 include charges of $6.21 and $0.22 per share, respectively, related to certain collaborations, licensing agreements and asset acquisitions.
Non-GAAP EPS excludes acquisition- and divestiture-related costs, including pretax intangible asset impairment research and development (R&D) charges of $779 million in the fourth quarter and full year of 2023 related to gefapixant, and $780 million and $1.7 billion in the fourth quarter and full year of 2022, respectively, primarily related to nemtabrutinib. Non-GAAP EPS also excludes restructuring costs, including costs for the recently approved 2024 Restructuring Program, as well as income and losses from investments in equity securities.
Fourth-Quarter Sales Performance
The following table reflects sales of the company’s top products and significant performance drivers.
|
|
Fourth Quarter |
||||
|
$ in millions |
2023 |
2022 |
Change |
Change Ex-Exchange |
Commentary |
|
Total Sales |
$14,630 |
$13,830 |
6% |
7% |
|
|
Pharmaceutical |
13,141 |
12,180 |
8% |
8% |
Increase driven by growth in oncology, vaccines and hospital acute care, partially offset by a decline in virology, due to LAGEVRIO, and diabetes. Excluding LAGEVRIO and impact of foreign exchange, growth of 14%. |
|
KEYTRUDA |
6,608 |
5,450 |
21% |
22% |
Growth driven by increased global uptake in earlier-stage indications, including triple-negative breast cancer and renal cell carcinoma (RCC), and continued strong global demand from metastatic indications. |
|
GARDASIL/GARDASIL 9 |
1,871 |
1,470 |
27% |
27% |
Growth due to strong global demand, particularly in China, and public-sector buying patterns in the U.S. |
|
JANUVIA/JANUMET |
787 |
913 |
-14% |
-13% |
Decline primarily due to generic competition in several international markets, particularly in Europe, and lower demand in the U.S. |
|
PROQUAD, M-M-R II and VARIVAX |
545 |
526 |
4% |
3% |
Growth largely due to higher pricing in the U.S. |
|
BRIDION |
429 |
441 |
-3% |
-3% |
Decline primarily due to generic competition in certain ex-U.S. markets, particularly in Europe, partially offset by higher demand in the U.S. |
|
Lynparza* |
315 |
292 |
8% |
8% |
Growth driven primarily by higher pricing in the U.S. |
|
Lenvima* |
226 |
216 |
5% |
5% |
Growth primarily due to higher demand in the U.S., partially offset by timing of shipments in China. |
|
LAGEVRIO |
193 |
825 |
-77% |
-76% |
Decline due to nonrecurrence of sales in the U.K. and lower demand in Japan and Australia. |
|
ROTATEQ |
185 |
139 |
34% |
33% |
Growth primarily due to public-sector buying patterns in the U.S. and timing of shipments in China. |
|
VAXNEUVANCE |
176 |
138 |
28% |
26% |
Growth largely driven by launches in Europe and continued uptake for the pediatric indication in the U.S. Prior-year quarter benefited from inventory stocking in the U.S. in preparation for pediatric launch. |
|
Animal Health |
1,278 |
1,230 |
4% |
4% |
Growth primarily driven by higher demand for Companion Animal products. |
|
Livestock |
808 |
814 |
-1% |
0% |
Decline primarily due to timing of shipments for ruminant products, largely offset by higher pricing across the product portfolio and higher demand for swine products. |
|
Companion Animal |
470 |
416 |
13% |
12% |
Growth primarily due to higher demand and timing of shipments for BRAVECTO line of products, as well as higher pricing. Sales of BRAVECTO were $197 million and $168 million in the current and prior-year quarters, respectively, which represented growth of 18%, or 19% excluding the impact of foreign exchange. |
|
Other Revenues** |
211 |
420 |
-50% |
-1% |
Decline primarily due to impact of revenue hedging activities. |
|
*Alliance revenue for this product represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs. **Other revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities. |
|||||
Full-Year Revenue Performance
The following table reflects sales of the company’s top pharmaceutical products, as well as sales of Animal Health products.
|
|
Year Ended |
|||
|
$ in millions |
Dec. 31, 2023 |
Dec. 31, 2022 |
Change |
Change Ex-Exchange |
|
Total Sales |
$60,115 |
$59,283 |
1% |
4% |
|
Pharmaceutical |
53,583 |
52,005 |
3% |
5% |
|
KEYTRUDA |
25,011 |
20,937 |
19% |
21% |
|
GARDASIL/GARDASIL 9 |
8,886 |
6,897 |
29% |
33% |
|
JANUVIA/JANUMET |
3,366 |
4,513 |
-25% |
-23% |
|
PROQUAD, M-M-R II and VARIVAX |
2,368 |
2,241 |
6% |
6% |
|
BRIDION |
1,842 |
1,685 |
9% |
11% |
|
LAGEVRIO |
1,428 |
5,684 |
-75% |
-74% |
|
Lynparza* |
1,199 |
1,116 |
7% |
9% |
|
Lenvima* |
960 |
876 |
10% |
11% |
|
ROTATEQ |
769 |
783 |
-2% |
-1% |
|
VAXNEUVANCE |
665 |
170 |
N/M |
N/M |
|
Animal Health |
5,625 |
5,550 |
1% |
3% |
|
Livestock |
3,337 |
3,300 |
1% |
4% |
|
Companion Animal |
2,288 |
2,250 |
2% |
3% |
|
Other Revenues** |
907 |
1,728 |
-48% |
-15% |
|
*Alliance revenue for this product represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs. **Other revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities. N/M – Not meaningful |
||||
Full-year 2023 pharmaceutical sales grew 3% to $53.6 billion. Pharmaceutical sales growth was primarily driven by higher sales in oncology, particularly KEYTRUDA, higher sales of vaccines, reflecting strong growth of combined sales of GARDASIL/GARDASIL 9 and VAXNEUVANCE, as well as growth in hospital acute care products, including PREVYMIS and BRIDION. Pharmaceutical sales growth in 2023 was partially offset by lower sales of the COVID-19 medication LAGEVRIO, as well as lower sales of JANUVIA and JANUMET, primarily reflecting generic competition in many ex-U.S. markets and lower demand in the U.S., and lower sales of PNEUMOVAX 23 as the market continues to shift toward newer adult pneumococcal conjugate vaccines. Pharmaceutical sales growth for the full year of 2023 was 14% excluding LAGEVRIO and the unfavorable impact of foreign exchange.
Full-year 2023 Animal Health sales grew 1% to $5.6 billion. Excluding the unfavorable impact of foreign exchange, Animal Health sales grew 3%, primarily due to higher pricing. Full-year sales growth was also driven by higher demand for livestock products, led by poultry and swine products, partially offset by lower demand for ruminant products. Sales of BRAVECTO were $1.1 billion in 2023, which represented growth of 4%, or 5% excluding the impact of foreign exchange, primarily reflecting higher pricing.
Fourth-Quarter and Full-Year Expense, EPS and Related Information
The table below presents selected expense information.
|
$ in millions |
GAAP |
Acquisition- |
Restructuring |
(Income) |
Non- |
|
Fourth Quarter 2023 |
|||||
|
Cost of sales |
$3,911 |
$454 |
$117 |
$- |
$3,340 |
|
Selling, general and administrative |
2,804 |
24 |
29 |
– |
2,751 |
|
Research and development |
9,628 |
790 |
– |
– |
8,838 |
|
Restructuring costs |
255 |
– |
255 |
– |
– |
|
Other (income) expense, net |
78 |
(35) |
– |
(61) |
174 |
|
|
|
|
|
|
|
|
Fourth Quarter 2022 |
|
|
|
|
|
|
Cost of sales |
$3,881 |
$482 |
$38 |
$- |
$3,361 |
|
Selling, general and administrative |
2,687 |
39 |
20 |
– |
2,628 |
|
Research and development |
3,775 |
740 |
– |
– |
3,035 |
|
Restructuring costs |
49 |
– |
49 |
– |
– |
|
Other (income) expense, net |
(75) |
(69) |
– |
80 |
(86) |
|
$ in millions |
GAAP |
Acquisition- |
Restructuring |
(Income) |
Certain Other Items |
Non- |
|
Year Ended Dec. 31, 2023 |
|
|||||
|
Cost of sales |
$16,126 |
$2,018 |
$211 |
$- |
$- |
$13,897 |
|
Selling, general and administrative |
10,504 |
86 |
122 |
– |
– |
10,296 |
|
Research and development |
30,531 |
819 |
1 |
– |
– |
29,711 |
|
Restructuring costs |
599 |
– |
599 |
– |
– |
– |
|
Other (income) expense, net |
466 |
(47) |
– |
(279) |
573 |
219 |
|
|
|
|
|
|
|
|
|
Year Ended Dec. 31, 2022 |
|
|
|
|
|
|
|
Cost of sales |
$17,411 |
$2,059 |
$205 |
$- |
$- |
$15,147 |
|
Selling, general and administrative |
10,042 |
176 |
94 |
– |
– |
9,772 |
|
Research and development |
13,548 |
1,676 |
30 |
– |
– |
11,842 |
|
Restructuring costs |
337 |
– |
337 |
– |
– |
– |
|
Other (income) expense, net |
1,501 |
(207) |
– |
1,348 |
– |
360 |
GAAP Expense, EPS and Related Information
Gross margin was 73.3% for the fourth quarter of 2023 compared with 71.9% for the fourth quarter of 2022. The increase was primarily due to the favorable impacts of lower LAGEVRIO sales, which have a low gross margin, lower manufacturing facilities costs and product mix, partially offset by the unfavorable impacts of foreign exchange and higher restructuring costs. Gross margin was 73.2% for the full year of 2023 compared with 70.6% for the full year of 2022. The increase was primarily due to the favorable impacts of lower LAGEVRIO sales, product mix, lower manufacturing facilities costs, and lower revenue from third-party manufacturing arrangements, partially offset by the unfavorable impact of foreign exchange.
Selling, general and administrative (SG&A) expenses were $2.8 billion in the fourth quarter of 2023, an increase of 4% compared with the fourth quarter of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, partially offset by lower promotional spending. Full-year 2023 SG&A expenses were $10.5 billion, an increase of 5% compared with the full year of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, and higher promotional spending, partially offset by the favorable impact of foreign exchange and lower acquisition- and divestiture-related costs.
R&D expenses were $9.6 billion in the fourth quarter of 2023 compared with $3.8 billion in the fourth quarter of 2022. R&D expenses were $30.5 billion for the full year of 2023 compared with $13.5 billion for the full year of 2022. The increase in the fourth quarter and full year of 2023 reflects a $5.5 billion charge for the collaboration with Daiichi Sankyo, and higher development costs due to spending on clinical programs, including newly acquired programs, as well as higher compensation and benefit costs (reflecting in part increased headcount). The increase in R&D expenses for the full year was also due to charges of $11.4 billion in the aggregate for the acquisitions of Prometheus Biosciences, Inc. (Prometheus) and Imago BioSciences, Inc. (Imago). The increase in R&D expenses for the full year was partially offset by lower intangible asset impairment charges in 2023 and charges of $690 million in the aggregate in 2022 for collaboration and licensing agreements with Moderna, Inc. (Moderna), Orna Therapeutics (Orna) and Orion Corporation (Orion).
Other (income) expense, net, was $78 million of expense in the fourth quarter of 2023 compared with $75 million of income in the fourth quarter of 2022, primarily due to higher exchange losses and higher net interest expense, partially offset by net gains from investments in equity securities for the fourth quarter of 2023 compared with net losses from investments in equity securities for the fourth quarter of 2022, and lower pension settlement costs. Other (income) expense, net, was $466 million of expense in the full year of 2023 compared with $1.5 billion of expense in the full year of 2022, primarily due to net gains from investments in equity securities in 2023 compared with net losses from investments in equity securities in 2022, and lower pension settlement costs, partially offset by a $572.5 million charge in 2023 related to settlements with certain plaintiffs in the Zetia antitrust litigation.
The effective tax rate was 40.1% for the fourth quarter of 2023 compared with 14.1% in the fourth quarter of 2022. The effective tax rate for the fourth quarter of 2023 includes a 29.2 percentage point impact resulting from the charge for the Daiichi Sankyo collaboration. The effective tax rate was 80.0% for the full year of 2023 compared with 11.7% for the full year of 2022. The full-year 2023 effective tax rate reflects an aggregate 65.6 percentage point unfavorable impact, resulting from charges for asset acquisitions (for which no tax benefits were recognized) as well as the charge for the Daiichi Sankyo collaboration.
GAAP loss per share was $0.48 for the fourth quarter of 2023 compared with EPS of $1.18 for the fourth quarter of 2022, primarily driven by the charge in 2023 related to the collaboration with Daiichi Sankyo, the unfavorable impact of foreign exchange and higher restructuring costs, partially offset by a beneficial impact from the tax rate and operational strength in the business. GAAP EPS was $0.14 for the full year of 2023 compared with EPS of $5.71 for the full year of 2022. The EPS decline in 2023 was primarily due to higher charges for certain business development transactions, the unfavorable impact of foreign exchange and the tax rate, as well as a charge related to settlements with certain plaintiffs in the Zetia antitrust litigation, partially offset by the beneficial impacts of operational strength in the business, better performance from equity investments and lower intangible asset impairment charges.
Non-GAAP Expense, EPS and Related Information
Non-GAAP gross margin was 77.2% for the fourth quarter of 2023 compared with 75.7% for the fourth quarter of 2022. Non-GAAP gross margin was 76.9% for the full year of 2023 compared with 74.4% for the full year of 2022. The non-GAAP gross margin improvement in the fourth quarter and full year of 2023 was primarily due to the favorable impacts of lower LAGEVRIO sales, which have a low gross margin, product mix, and lower manufacturing facilities costs. The increase in non-GAAP gross margin for the full year was also due to lower revenue from third-party manufacturing arrangements. The non-GAAP gross margin improvement in the fourth quarter and full year of 2023 was partially offset by the unfavorable impact of foreign exchange.
Non-GAAP SG&A expenses were $2.8 billion for the fourth quarter of 2023 compared with $2.6 billion for the fourth quarter of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, partially offset by lower promotional spending. Full-year 2023 non-GAAP SG&A expenses were $10.3 billion, an increase of 5% compared with the full year of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, and higher promotional spending, partially offset by the favorable impact of foreign exchange.
Non-GAAP R&D expenses were $8.8 billion in the fourth quarter of 2023 compared with $3.0 billion in the fourth quarter of 2022. Non-GAAP R&D expenses were $29.7 billion for the full year of 2023 compared with $11.8 billion for the full year of 2022. The increase in the fourth quarter and full year of 2023 reflects a $5.5 billion charge for the collaboration with Daiichi Sankyo, and higher development costs due to spending on clinical programs, including newly acquired programs, as well as higher compensation and benefit costs (reflecting in part increased headcount). The increase in non-GAAP R&D expenses for the full year was also due to charges of $11.4 billion in the aggregate for the acquisitions of Prometheus and Imago. The increase in R&D expenses for the full year was partially offset by charges of $690 million in the aggregate in 2022 for collaboration and licensing agreements with Moderna, Orna and Orion.
Non-GAAP other (income) expense, net, was $174 million of expense in the fourth quarter of 2023 compared with $86 million of income in the fourth quarter of 2022, primarily due to higher exchange losses and higher net interest expense, partially offset by lower pension settlement costs. Non-GAAP other (income) expense, net, was $219 million of expense in the full year of 2023 compared with $360 million of expense in the full year of 2022, primarily due to lower pension settlement costs.
The non-GAAP effective tax rate was 114.2% for the fourth quarter of 2023 compared with 15.6% in the fourth quarter of 2022. The non-GAAP effective tax rate for the fourth quarter of 2023 includes a 101.1 percentage point unfavorable impact resulting from the charge for the Daiichi Sankyo collaboration. The non-GAAP effective tax rate was 35.8% for the full year of 2023 compared with 14.2% for the full year of 2022. The full-year 2023 non-GAAP effective tax rate reflects an aggregate 21.2 percentage point unfavorable impact, resulting from charges for asset acquisitions (for which no benefits were recognized) as well as the charge for the Daiichi Sankyo collaboration.
Non-GAAP EPS was $0.03 for the fourth quarter of 2023 compared with $1.62 for the fourth quarter of 2022. The non-GAAP EPS decline in the fourth quarter was primarily due to the charge in 2023 related to the collaboration with Daiichi Sankyo and the unfavorable impact of foreign exchange, partially offset by a beneficial impact from the tax rate and operational strength in the business. Non-GAAP EPS was $1.51 for the full year of 2023 compared with $7.48 for the full year of 2022. The non-GAAP EPS decline for the full year was primarily due to higher charges for certain business development transactions, the unfavorable impact of foreign exchange and the tax rate, partially offset by operational strength in the business.
A reconciliation of GAAP to non-GAAP net (loss) income and (loss) earnings per share is provided in the table that follows.
|
Fourth Quarter |
Year Ended |
|||
|
$ in millions, except EPS amounts |
2023 |
2022 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
EPS |
|
|
|
|
|
GAAP EPS |
$(0.48) |
$1.18 |
$0.14 |
$5.71 |
|
Difference |
0.51 |
0.44 |
1.37 |
1.77 |
|
Non-GAAP EPS that excludes items listed below2 |
$0.03 |
$1.62 |
$1.51 |
$7.48 |
|
|
|
|
|
|
|
Net (Loss) Income |
|
|
|
|
|
GAAP net (loss) income1 |
$(1,226) |
$3,017 |
$365 |
$14,519 |
|
Difference |
1,292 |
1,112 |
3,472 |
4,486 |
|
Non-GAAP net income that excludes items listed below1,2 |
$66 |
$4,129 |
$3,837 |
$19,005 |
|
|
|
|
|
|
|
Excluded Items: |
|
|
|
|
|
Acquisition- and divestiture-related costs3 |
$1,233 |
$1,192 |
$2,876 |
$3,704 |
|
Restructuring costs |
401 |
107 |
933 |
666 |
|
(Income) loss from investments in equity securities |
(61) |
80 |
(279) |
1,348 |
|
Charge for Zetia antitrust litigation settlements |
– |
– |
573 |
– |
|
Increase to net loss/decrease to net income before taxes |
1,573 |
1,379 |
4,103 |
5,718 |
|
Estimated income tax (benefit) expense |
(281) |
(267) |
(631) |
(1,232) |
|
Increase to net loss/decrease to net income |
$1,292 |
$1,112 |
$3,472 |
$4,486 |
2024 Restructuring Program
Merck recently approved a new restructuring program (2024 Restructuring Program) intended to continue the optimization of the company’s Human Health global manufacturing network as the future pipeline shifts to new modalities, and also to optimize the Animal Health global manufacturing network to improve supply reliability and increase efficiency. The company recorded charges in its GAAP results of $190 million related to the 2024 Restructuring Program for the fourth quarter and full year of 2023.
Pipeline and Portfolio Highlights
In the fourth quarter, Merck continued to make significant progress advancing its broad portfolio and pipeline across key therapeutic areas, representing continued momentum toward addressing patient needs.
In oncology, Merck received multiple U.S. Food and Drug Administration (FDA) approvals, including KEYTRUDA plus Padcev for the first-line treatment of adult patients with locally advanced or metastatic urothelial cancer and WELIREG for the treatment of certain patients with previously treated advanced RCC, among other approvals. The FDA also accepted and granted Priority Review to Merck and Daiichi Sankyo’s Biologics License Application (BLA) for patritumab deruxtecan for the treatment of certain patients with previously treated locally advanced or metastatic EGFR-mutated non-small cell lung cancer (NSCLC). The FDA set a Prescription Drug User Fee Act (PDUFA), or target action, date of June 26, 2024. In addition, Merck showed meaningful progress in its robust oncology pipeline, initiating Phase 3 trials for four investigational medicines, including bomedemstat (LSD1 inhibitor), nemtabrutinib (BTK inhibitor), MK-2870 (anti-TROP2 antibody-drug conjugate) and MK-5684 (CYP11A1 inhibitor).
In vaccines, Merck received Priority Review from the FDA for a BLA for V116, the company’s investigational, 21-valent pneumococcal conjugate vaccine specifically designed to protect adults, based on results from multiple Phase 3 trials.
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(732) 594-1579
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(732) 594-1583
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