Sotatercept

July 29, 2025 6:30 am ET Total Worldwide Sales Were $15.8 Billion, a Decrease of 2% From Second Quarter 2024 Both Nominally and Excluding the Impact of Foreign Exchange KEYTRUDA Sales Were $8.0 Billion, Growth of 9% Both Nominally and Excluding the Impact of Foreign Exchange WINREVAIR Sales Were $336 Million Animal Health Sales Were $1.6 Billion, Growth of 11% Both Nominally and Excluding the Impact of Foreign Exchange GARDASIL/GARDASIL 9 Sales Were $1.1 Billion, a Decline of 55% Both Nominally and Excluding the Impact of Foreign Exchange GAAP EPS Was $1.76; Non-GAAP EPS Was $2.13; GAAP and Non-GAAP EPS Include a Charge of $0.07 per Share for Closing of Hengrui Pharma License Agreement Announced Agreement To Acquire Verona Pharma and Its First-In-Class COPD Maintenance Treatment for Adults, Ohtuvayre®;1 Transaction Expected To Close in Fourth Quarter 2025 Announced Positive Topline Results From First Two Phase 3 CORALreef Trials of Enlicitide Decanoate for Treatment of Adults With Hyperlipidemia Received FDA Approval of ENFLONSIA for Prevention of RSV Lower Respiratory Tract Disease in Infants Born During or Entering Their First RSV Season; CDC’s ACIP Recommended ENFLONSIA for Prevention of RSV in Infants Younger Than 8 Months of Age for Their First RSV Season Announced Multiyear Optimization Initiative Anticipated To Result in Approximately $3.0 Billion of Annual Cost Savings by the End of 2027, To Be Fully Reinvested Into Strategic Growth Areas Full-Year 2025 Financial Outlook Narrows Expected Worldwide Sales Range To Be Between $64.3 Billion and $65.3 Billion Narrows Expected Non-GAAP EPS Range To Be Between $8.87 and $8.97 Outlook Does Not Include Anticipated Impact of the Announced Acquisition of Verona Pharma KEYTRUDA Sales Were $8.0 Billion, Growth of 9% Both Nominally and Excluding the Impact of Foreign Exchange WINREVAIR Sales Were $336 Million Animal Health Sales Were $1.6 Billion, Growth of 11% Both Nominally and Excluding the Impact of Foreign Exchange GARDASIL/GARDASIL 9 Sales Were $1.1 Billion, a Decline of 55% Both Nominally and Excluding the Impact of Foreign Exchange Narrows Expected Worldwide Sales Range To Be Between $64.3 Billion and $65.3 Billion Narrows Expected Non-GAAP EPS Range To Be Between $8.87 and $8.97 Outlook Does Not Include Anticipated Impact of the Announced Acquisition of Verona Pharma RAHWAY, N.J.--(BUSINESS WIRE)-- Merck & Co., Inc., Rahway, N.J., USA (NYSE: MRK), known as MSD outside the United States and Canada, today announced financial results for the second quarter of 2025. "Earlier this month, we were pleased to announce our pending acquisition of Verona Pharma, which augments our portfolio and pipeline and is another example of acting decisively when science and value align,” said Robert M. Davis, chairman and chief executive officer. “Today, we announced a multiyear optimization initiative that will redirect investment and resources from more mature areas of our business to our burgeoning array of new growth drivers, further enable the transformation of our portfolio, and drive our next chapter of productive, innovation-driven growth. With these actions, I am confident that we are well positioned to generate near- and long-term value for our shareholders and, most importantly, deliver for our patients.” Financial Summary $ in millions, except EPS amounts Second Quarter 2025 2024 Change Change Ex- Exchange Sales $15,806 $16,112 -2% -2% GAAP net income2 4,427 5,455 -19% -17% Non-GAAP net income that excludes certain items2,3* 5,366 5,809 -8% -6% GAAP EPS 1.76 2.14 -18% -16% Non-GAAP EPS that excludes certain items3* 2.13 2.28 -7% -5% *Refer to table on page 7. For the second quarter of 2025, Generally Accepted Accounting Principles (GAAP) earnings per share (EPS) assuming dilution was $1.76 and non-GAAP EPS was $2.13. GAAP and non-GAAP EPS in the second quarter of 2025 include a charge of $0.07 per share for an upfront payment to Jiangsu Hengrui Pharmaceuticals Co., Ltd. (Hengrui Pharma) upon closing of a license agreement. Non-GAAP EPS excludes acquisition- and divestiture-related costs, costs related to restructuring programs, and income and losses from investments in equity securities. Non-GAAP EPS in the second quarter of 2025 also excludestax benefits primarily resulting from favorable audit adjustments. Non-GAAP EPS in the second quarter of 2024 also excludes a tax benefit due to a reduction in reserves for unrecognized income tax benefits, resulting from the expiration of the statute of limitations for assessments related to the 2019 federal tax return year. Year-to-date results can be found in the attached tables. Second-Quarter Sales Performance The following table reflects sales of the Company’s top products and significant performance drivers. Second Quarter $ in millions 2025 2024 Change Change Ex- Exchange Commentary Total Sales $15,806 $16,112 -2% -2% Pharmaceutical 14,050 14,408 -2% -3% Decline primarily due to vaccines and immunology, partially offset by growth in oncology and cardiology. KEYTRUDA 7,956 7,270 9% 9% Growth driven by continued strong global demand from metastatic indications, including bladder, endometrial and gastric cancers, and increased global uptake in earlier-stage indications, including triple-negative breast cancer, renal cell carcinoma (RCC) and cervical cancer, as well as non-small cell lung cancer in the U.S. GARDASIL/GARDASIL 9 1,126 2,478 -55% -55% Decline primarily due to lower demand in China. Excluding China, sales declined 3%, or 4% excluding impact of foreign exchange, reflecting lower demand in Japan following a national catch-up immunization program, as well as timing of public-sector purchases in certain international markets. U.S. sales increased 2% in the quarter. JANUVIA/JANUMET 623 629 -1% - Decrease primarily attributable to lower demand in China, impacts of generic competition in most international markets, and lower demand in the U.S. due to competitive pressure, which were largely offset by higher net pricing in the U.S. PROQUAD, M-M-R II and VARIVAX 609 617 -1% -2% Decrease primarily reflects lower U.S. sales due to unfavorable VARIVAX public-sector activity and M-M-R II private-sector buy-out, partially offset by partial replenishment of PROQUAD doses borrowed from the U.S. Centers for Disease Control and Prevention (CDC) Pediatric Vaccine Stockpile, and higher pricing. BRIDION 461 455 1% 1% Increase primarily due to higher demand in the U.S., partially offset by lower demand in most international markets due to ongoing generic competition. Lynparza* 370 317 17% 15% Growth primarily due to higher demand in the U.S. and certain international markets. WINREVAIR 336 70 N/M N/M Growth reflects continued uptake since second-quarter 2024 launch in the U.S. Lenvima* 265 249 6% 5% Increase primarily due to higher sales in the U.S. reflecting higher demand, partially offset by lower pricing. VAXNEUVANCE 229 189 21% 20% Growth primarily due to favorable public-sector activity in the U.S. and increased demand in certain international markets, partially offset by lower demand in the U.S. and Japan due to competitive pressure. PREVYMIS 228 188 21% 20% Growth primarily due to higher demand in the U.S. and Europe, partially offset by lower demand in China due to generic competition. WELIREG 162 126 29% 29% Growth primarily driven by higher demand in the U.S. and early launch uptake in certain EU markets, partially offset by lower pricing in the U.S. CAPVAXIVE 129 - - - Represents continued uptake since third-quarter 2024 launch in the U.S. SIMPONI - 172 -100% -100% Marketing rights in former territories of the Company reverted to Johnson & Johnson on Oct. 1, 2024. Animal Health 1,646 1,482 11% 11% Growth primarily due to higher demand for Livestock products, as well as inclusion of sales from Elanco aqua business acquired in July 2024, higher pricing and improved supply. Livestock 961 837 15% 16% Growth primarily driven by higher demand across all species, as well as inclusion of sales from Elanco aqua business acquired in July 2024. Companion Animal 685 645 6% 6% Increase primarily driven by higher pricing. Sales of BRAVECTO were $335 million and $331 million in current and prior year quarters, respectively, which represents an increase of 1%, both nominally and excluding impact of foreign exchange. Other Revenues** 110 222 -50% -3% Primarily due to unfavorable impact of revenue-hedging activities. *Alliance revenue for this product represents the Company’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. Second-Quarter Expense, EPS and Related Information The table below presents selected expense information. $ in millions GAAP Acquisition- and Divestiture- Related Costs4 Restructuring Costs (Income) Loss From Investments in Equity Securities Non- GAAP3 Second Quarter 2025 Cost of sales $3,557 $576 $165 $- $2,816 Selling, general and administrative 2,649 15 1 - 2,633 Research and development 4,048 3 53 - 3,992 Restructuring costs 560 - 560 - - Other (income) expense, net (7) - - (61) 54 Second Quarter 2024 Cost of sales $3,745 $606 $66 $- $3,073 Selling, general and administrative 2,739 24 31 - 2,684 Research and development 3,500 20 - - 3,480 Restructuring costs 80 - 80 - - Other (income) expense, net 42 (17) - (49) 108 GAAP Expense, EPS and Related Information Gross margin was 77.5% for the second quarter of 2025 compared with 76.8% for the second quarter of 2024. The increase was primarily due to the favorable impact of product mix, partially offset by higher restructuring costs and inventory write-offs. Selling, general and administrative (SG&A) expenses were $2.6 billion in the second quarter of 2025, a decrease of 3% compared with the second quarter of 2024. The decrease was primarily due to lower administrative, restructuring and promotional costs. Research and development (R&D) expenses were $4.0 billion in the second quarter of 2025, an increase of 16% compared with the second quarter of 2024. The increase was primarily due to a $200 million charge for an upfront payment made in the second quarter of 2025 for a license agreement with Hengrui Pharma, increased clinical development spending, higher compensation and benefit costs, and higher restructuring costs. Other (income) expense, net, was $7 million of income in the second quarter of 2025 compared with $42 million of expense in the second quarter of 2024. The effective tax rate of 11.4% for the second quarter of 2025 includes a 2.9 percentage point favorable impact due to tax benefits primarily resulting from favorable audit adjustments. GAAP EPS was $1.76 for the second quarter of 2025 compared with $2.14 for the second quarter of 2024. The decrease reflects increased operating expenses driven by higher restructuring costs and research and development spending, a charge related to the closing of a license agreement with Hengrui Pharma, unfavorable tax impacts, and the unfavorable impact of foreign exchange. Non-GAAP Expense, EPS and Related Information Non-GAAP gross margin was 82.2% for the second quarter of 2025 compared with 80.9% for the second quarter of 2024. The increase was primarily due to the favorable impact of product mix, partially offset by higher inventory write-offs. Non-GAAP SG&A expenses were $2.6 billion in the second quarter of 2025, a decrease of 2% compared with the second quarter of 2024. The decrease was primarily due to lower administrative and promotional costs. Non-GAAP R&D expenses were $4.0 billion in the second quarter of 2025, an increase of 15% compared with the second quarter of 2024. The increase was primarily due to a $200 million charge for an upfront payment made in the second quarter of 2025 for a license agreement with Hengrui Pharma, increased clinical development spending, and higher compensation and benefit costs. Non-GAAP other (income) expense, net, was $54 million of expense in the second quarter of 2025 compared with $108 million of expense in the second quarter of 2024. The non-GAAP effective tax rate was 15.0% for the second quarter of 2025. Non-GAAP EPS was $2.13 for the second quarter of 2025 compared with $2.28 for the second quarter of 2024. The decrease reflects increased operating expenses driven by higher research and development spending, a charge related to the closing of a license agreement with Hengrui Pharma, and the unfavorable impact of foreign exchange. A reconciliation of GAAP to non-GAAP net income and EPS is provided in the table that follows. Second Quarter $ in millions, except EPS amounts 2025 2024 EPS GAAP EPS $1.76 $2.14 Difference 0.37 0.14 Non-GAAP EPS that excludes items listed below3 $2.13 $2.28 Net Income GAAP net income2 $4,427 $5,455 Difference 939 354 Non-GAAP net income that excludes items listed below2,3 $5,366 $5,809 Excluded Items: Acquisition- and divestiture-related costs4 $594 $633 Restructuring costs 779 177 Income from investments in equity securities (61) (49) Decrease to net income before taxes 1,312 761 Estimated income tax (benefit) expense5 (373) (407) Decrease to net income $939 $354 Planned Acquisition of Verona Pharma On July 9, 2025, the Company furthered its science-led business development strategy by announcing an agreement under which the Company, through a subsidiary, will acquire Verona Pharma plc (Verona Pharma) for $107 per American Depository Share, each of which represents eight Verona Pharma ordinary shares, for a total transaction value of approximately $10 billion. Through the acquisition, the Company will add Ohtuvayre, a first-in-class selective dual inhibitor of phosphodiesterase 3 and 4 (PDE3 and PDE4), to its growing cardio-pulmonary pipeline and portfolio. The U.S. Food and Drug Administration (FDA) approved Ohtuvayre in June 2024 for the maintenance treatment of chronic obstructive pulmonary disease (COPD) in adult patients. It is the first novel inhaled mechanism for the treatment of COPD in more than 20 years. The transaction is anticipated to close in the fourth quarter of 2025. Pipeline and Portfolio Highlights In the second quarter, the Company continued to advance its broad and diverse pipeline with multiple regulatory and clinical milestones. In oncology, the FDA approved KEYTRUDA as part of a therapy regimen for the treatment of certain adult patients with resectable locally advanced head and neck squamous cell carcinoma (HNSCC), based on results from the Phase 3 KEYNOTE-689 trial. This approval is the first perioperative anti-PD-1 treatment regimen for adults with resectable locally advanced HNSCC whose tumors express PD-L1 (CPS ≥1). In addition, the Ministry of Health, Labor and Welfare (MHLW) in Japan approved WELIREG as monotherapy for the treatment of adults with von Hippel-Lindau (VHL) disease-associated tumors, and for adults with unresectable or metastatic RCC that has progressed after chemotherapy. At the 2025 American Society of Clinical Oncology Annual Meeting, the Company announced new research across more than 25 types of cancer in multiple treatment settings. Data were presented for several candidates, including MK-1084, an investigational oral selective KRAS G12C inhibitor, and from the Company’s pipeline of antibody-drug conjugates (ADCs). The Company also presented data from Phase 3 trials evaluating new combination regimens with KEYTRUDA, and longer-term data for studies of KEYTRUDA and WELIREG, with the KEYTRUDA studies including people with earlier stages of cancer. The Company announced results from the Phase 3 KEYNOTE-B96 trial (also known as ENGOT-ov65) evaluating KEYTRUDA plus chemotherapy, which met its primary endpoint of progression-free survival (PFS) for the treatment of patients with platinum-resistant recurrent ovarian cancer whose tumors express PD-L1 and in all comers, as well as a secondary endpoint of overall survival (OS) in patients whose tumors express PD-L1. In addition, a pre-specified interim analysis of the Phase 3 KEYNOTE-937 study found that compared to placebo, KEYTRUDA did not show a statistically significant improvement in the primary endpoint of recurrence-free survival for certain patients with hepatocellular carcinoma. Also, a pre-specified interim analysis of the Phase 3 LEAP-014 trial found that KEYTRUDA plus Lenvima, in combination with platinum-based chemotherapy, did not show a statistically significant improvement in its primary endpoint of OS compared to KEYTRUDA plus chemotherapy for the first-line treatment of patients with metastatic esophageal squamous cell carcinoma (ESCC). In vaccines and infectious diseases, the Company received FDA approval of ENFLONSIA for the prevention of respiratory syncytial virus (RSV) lower respiratory tract disease in newborns and infants who are born during or entering their first RSV season. ENFLONSIA is the first and only RSV preventive option administered to infants using the same dose regardless of weight. The CDC’s Advisory Committee on Immunization Practices (ACIP) also recommended ENFLONSIA for the prevention of RSV in infants younger than 8 months of age born during or entering their first RSV season. In addition, the Company announced initiation of the MOBILIZE-1 Phase 3 trial evaluating V181, an investigational single-dose quadrivalent vaccine for the prevention of dengue disease. In addition, the FDA accepted a New Drug Application (NDA) for doravirine/islatravir, an investigational, once-daily, oral, two-drug regimen for the treatment of adults with virologically suppressed HIV-1 based on the Phase 3 MK-8591A-051 and MK-8591A-052 trials. The FDA set a Prescription Drug User Fee Act (PDUFA) date of April 28, 2026. The Company also announced the initiation of the EXPrESSIVE Phase 3 trials for MK-8527, its investigational once-monthly oral candidate for HIV pre-exposure prophylaxis (PrEP). In cardiovascular disease, the Company announced positive topline results from Phase 3 CORALreef HeFH and CORALreef AddOn, the first two of three Phase 3 clinical trials evaluating the safety and efficacy of enlicitide decanoate, an investigational, oral proprotein convertase subtilisin/kexin type 9 (PCSK9) inhibitor being evaluated for the treatment of adults with hyperlipidemia already on lipid-lowering therapies, including at least a statin. In both trials, enlicitide demonstrated statistically significant and clinically meaningful reductions in low-density lipoprotein cholesterol. If approved, it would be the first marketed oral PCSK9 inhibitor. In addition, the FDA granted priority review for a new supplemental Biologics License Application for WINREVAIR seeking approval to update the U.S. product label based on compelling results from the Phase 3 ZENITH trial. The FDA has set a PDUFA date of Oct. 25, 2025. The Company also provided an update on the Phase 3 HYPERION study evaluating WINREVAIR in recently diagnosed adults with pulmonary arterial hypertension (PAH). In the study, WINREVAIR added on top of background therapy within 12 months after initial diagnosis of PAH demonstrated a statistically significant and clinically meaningful reduction in the risk of clinical worsening events when compared to placebo. Further, the MHLW in Japan approved sotatercept for the treatment of adults with PAH under the trademark AIRWIN. It is the first activin signaling inhibitor therapy for PAH approved in Japan. In the Animal Health business, the FDA approved BRAVECTO QUANTUM, an injectable formulation of BRAVECTO for dogs for the treatment and persistent killing of fleas and ticks. In addition, the European Commission (EC) approved NUMELVI tablets for dogs, a once-daily, second-generation Janus kinase (JAK) inhibitor, indicated for the treatment of pruritus associated with allergic dermatitis including atopic dermatitis and treatment of clinical manifestations of atopic dermatitis. Notable recent news releases on the Company’s pipeline and portfolio are provided in the table that follows. Visit the News Releases section of the Company’s website to read the releases*. Oncology FDA Approved KEYTRUDA for PD-L1+ Resectable Locally Advanced HNSCC as Neoadjuvant Treatment, Continued as Adjuvant Treatment Combined With Radiotherapy With or Without Cisplatin Then as a Single Agent; Based on Results From Phase 3 KEYNOTE-689 Trial FDA Approved WELIREG for Treatment of Adults and Pediatric Patients 12 Years and Older With Locally Advanced, Unresectable, or Metastatic Pheochromocytoma or Paraganglioma; Based on Results From Phase 2 LITESPARK-015 Clinical Trial Phase 3 KEYNOTE-B96 Trial Met Primary Endpoint of PFS in Patients With Platinum-Resistant Recurrent Ovarian Cancer Whose Tumors Expressed PD-L1 and in All Comers KEYTRUDA Plus Trodelvy Reduced Risk of Disease Progression or Death by 35% Versus KEYTRUDA Plus Chemotherapy in First-Line PD-L1+ Metastatic Triple-Negative Breast Cancer; Based on Results From Phase 3 ASCENT-04/KEYNOTE-D19 Trial MK-1084, an Investigational KRAS G12C Inhibitor, Showed Antitumor Activity in Phase 1 Trial of Patients With Advanced Colorectal Cancer and Non-Small Cell Lung Cancer Whose Tumors Harbor KRAS G12C Mutations Investigational Zilovertamab Vedotin at 1.75 mg/kg Dose Plus Standard of Care Showed Promising Antitumor Activity, Including Complete Response Rate, in Patients With Relapsed/Refractory Diffuse Large B-Cell Lymphoma; Based on Results From Phase 2 WaveLINE-003 Trial IDeate-Prostate01 Phase 3 Trial of Ifinatamab Deruxtecan Initiated in Patients With Pretreated Metastatic Castration-Resistant Prostate Cancer IDeate-Esophageal01 Phase 3 Trial of Ifinatamab Deruxtecan Initiated in Certain Patients With Pretreated Advanced or Metastatic ESCC Vaccines and Infectious Diseases FDA Approved ENFLONSIA for Prevention of RSV Lower Respiratory Tract Disease in Infants Born During or Entering Their First RSV Season; Based on Results From Phase 2b/3 CLEVER Trial ACIP Recommended Use of ENFLONSIA for Prevention of RSV Lower Respiratory Tract Disease in Infants Younger Than 8 Months of Age Born During or Entering Their First RSV Season FDA Accepted NDA for Doravirine/Islatravir, an Investigational, Once-Daily, Oral, Two-Drug Regimen for Treatment of Adults With Virologically Suppressed HIV-1; Based on Results From Phase 3 MK-8591A-051 and MK-8591A-052 Trials; FDA Set PDUFA Date of April 28, 2026 EXPrESSIVE Phase 3 Trials Initiated for Investigational Once-Monthly HIV Prevention Pill, MK-8527 The Company Initiated MOBILIZE-1 Phase 3 Study Evaluating Dengue Vaccine Candidate Cardiovascular FDA Granted Priority Review for WINREVAIR to Update Label Based on Results From ZENITH Trial; FDA Set PDUFA Date of Oct. 25, 2025 The Company Announced Positive Topline Results From First Two Phase 3 CORALreef Trials Evaluating Enlicitide Decanoate for the Treatment of Adults With Hyperlipidemia Phase 3 HYPERION Study of WINREVAIR Met Primary Endpoint in Recently Diagnosed Adults With PAH Animal Health FDA Approved BRAVECTO QUANTUM EC Approved NUMELVI Tablets for Dogs *References to the Company’s name in the above news release titles have been modified for the purpose of this announcement. New Multiyear Optimization Initiative, Which Includes a Restructuring Program The Company launched a new multiyear optimization initiative to enable the transformation of its portfolio by generating an expected $3.0 billion in annual cost savings from productivity actions, which will be fully reinvested to support new product launches and its pipeline across multiple therapeutic areas. In July 2025, as part of this initiative, the Company approved a new restructuring program, in which it expects to eliminate certain administrative, sales and R&D positions. The Company will, however, continue to hire employees into new roles across strategic growth areas of the business. In addition, the Company will reduce its global real estate footprint and continue to optimize its manufacturing network, aligning the geography of its global manufacturing to its customers and reflecting changes in the Company’s business. The Company anticipates cumulative pretax costs related to the program to be approximately $3.0 billion. For the second quarter of 2025, the Company recorded charges in its GAAP results of $649 million related to this restructuring program. The Company expects the actions under the restructuring program to result in annual cost savings of approximately $1.7 billion, which will be substantially realized by the end of 2027. This restructuring program is part of the multiyear optimization initiative expected to achieve $3.0 billion in annual cost savings by the end of 2027. Manufacturing and R&D Investment The Company continued to make long-term investments in its U.S. manufacturing and R&D capabilities. This includes the start of construction for a $1.0 billion, 470,000-square-foot state-of-the-art biologics center of excellence in Wilmington, Delaware, which will serve as a launch and commercial production facility and the primary U.S. manufacturing site for KEYTRUDA. In addition, the Company announced an $895 million expansion of its Animal Health manufacturing facility in De Soto, Kansas; the 200,000-square-foot facility will increase capacity for Animal Health vaccines and biologic products. Full-Year 2025 Financial Outlook The following table summarizes the Company’s full-year financial outlook. Full Year 2025 Updated Prior Sales* $64.3 billion to $65.3 billion $64.1 billion to $65.6 billion Non-GAAP Gross margin3 Approximately 82% Approximately 82% Non-GAAPOperating expenses3** $25.6 billion to $26.4 billion $25.6 billion to $26.6 billion Non-GAAPOther (income) expense, net3 $300 million to $400 million expense $300 million to $400 million expense Non-GAAPEffective tax rate3 15.0% to 16.0% 15.5% to 16.5% Non-GAAPEPS3*** $8.87 to $8.97 $8.82 to $8.97 Share count (assuming dilution) Approximately 2.51 billion Approximately 2.51 billion *The Company does not have any non-GAAP adjustments to sales. **Includes one-time R&D charges of $300 million for a milestone payment to LaNova Medicines Ltd. (LaNova) associated with the technology transfer for MK-2010 expected to be recorded in the third quarter of 2025 and $200 million for the upfront payment for the license agreement completed with Hengrui Pharma in the second quarter of 2025. Outlook does not assume any additional significant potential business development transactions. ***Includes one-time charges totaling $0.16 per share associated with the payment for the LaNova technology transfer for MK-2010 and upfront payment to Hengrui Pharma. The Company has not provided a reconciliation of forward-looking non-GAAP gross margin, non-GAAP operating expenses, non-GAAP other (income) expense, net, non-GAAP effective tax rate and non-GAAP EPS to the most directly comparable GAAP measures, given it cannot predict with reasonable certainty the amounts necessary for such a reconciliation, including intangible asset impairment charges, legal settlements, and income and losses from investments in equity securities either owned directly or through ownership interests in investment funds, without unreasonable effort. These items are inherently difficult to forecast and could have a significant impact on the Company’s future GAAP results. The Company now expects full-year 2025 sales to be between $64.3 billion and $65.3 billion, including a revised negative impact of foreign exchange of approximately 0.5% at mid-July 2025 exchange rates. The Company now expects its full-year non-GAAP effective income tax rate to be between 15.0% and 16.0%. The Company now expects its full-year non-GAAP EPS to be between $8.87 and $8.97, including a revised negative impact of foreign exchange of approximately $0.15 per share. This revised non-GAAP EPS range continues to reflect the impacts of a one-time charge of $200 million (recorded in the second quarter of 2025) for an upfront payment made in connection with the closing of a license agreement with Hengrui Pharma and the one-time charge of $300 million (to be recorded in the third quarter of 2025) related to a payment to LaNova for the completion of the technology transfer for MK-2010, which will impact EPS by approximately $0.16 in the aggregate. In 2024, non-GAAP EPS of $7.65 was negatively impacted by a net charge of $1.28 per share related to certain asset acquisitions, licensing agreements and collaborations. The financial outlook does not include the anticipated impact of the announced acquisition of Verona Pharma. Consistent with past practice, the financial outlook does not assume additional significant potential business development transactions. The $200 million of costs previously included in the Company’s financial outlook related to the impact of tariffs is unchanged pending the outcome of additional potential government actions. Earnings Conference Call Investors, journalists and the general public may access a live audio webcast of the call on Tuesday, July 29, at 9 a.m. ET via this weblink. A replay of the webcast, along with the sales and earnings news release, supplemental financial disclosures and slides highlighting the results, will be available on the Company’s website. All participants may join the call by dialing (800) 369-3351 (U.S. and Canada Toll-Free) or (517) 308-9448 and using the access code 9818590. About Our Company At Merck & Co., Inc., Rahway, N.J., USA, known as MSD outside of the United States and Canada, we are unified around our purpose: We use the power of leading-edge science to save and improve lives around the world. For more than 130 years, we have brought hope to humanity through the development of important medicines and vaccines. We aspire to be the premier research-intensive biopharmaceutical company in the world – and today, we are at the forefront of research to deliver innovative health solutions that advance the prevention and treatment of diseases in people and animals. We foster a diverse and inclusive global workforce and operate responsibly every day to enable a safe, sustainable and healthy future for all people and communities. Forward-Looking Statement of Merck & Co., Inc., Rahway, N.J., USA This news release of Merck & Co., Inc., Rahway, N.J., USA (the “Company”) includes “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. There can be no guarantees with respect to pipeline candidates that the candidates will receive the necessary regulatory approvals or that they will prove to be commercially successful. If underlying assumptions prove inaccurate or risks or uncertainties materialize, actual results may differ materially from those set forth in the forward-looking statements. Risks and uncertainties include but are not limited to, general industry conditions and competition; general economic factors, including interest rate and currency exchange rate fluctuations; the impact of pharmaceutical industry regulation and health care legislation in the United States and internationally; global trends toward health care cost containment; technological advances, new products and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approval; the Company’s ability to accurately predict future market conditions; manufacturing difficulties or delays; financial instability of international economies and sovereign risk; dependence on the effectiveness of the Company’s patents and other protections for innovative products; and the exposure to litigation, including patent litigation, and/or regulatory actions. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 and the Company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site (www.sec.gov). Appendix Generic product names are provided below. Pharmaceutical BRIDION (sugammadex) CAPVAXIVE (Pneumococcal 21-valent Conjugate Vaccine) ENFLONSIA (clesrovimab-cfor) GARDASIL (Human Papillomavirus Quadrivalent [Types 6, 11, 16 and 18] Vaccine, Recombinant) GARDASIL 9 (Human Papillomavirus 9-valent Vaccine, Recombinant) JANUMET (sitagliptin and metformin HCl) JANUVIA (sitagliptin) KEYTRUDA (pembrolizumab) Lenvima (lenvatinib) Lynparza (olaparib) M-M-R II (Measles, Mumps and Rubella Virus Vaccine Live) PREVYMIS (letermovir) PROQUAD (Measles, Mumps, Rubella and Varicella Virus Vaccine Live) SIMPONI (golimumab) VARIVAX (Varicella Virus Vaccine Live) VAXNEUVANCE (Pneumococcal 15-valent Conjugate Vaccine) WELIREG (belzutifan) WINREVAIR (sotatercept-csrk) Animal Health BRAVECTO (fluralaner) BRAVECTO QUANTUM (fluralaner for extended-release injectable suspension) NUMELVI (atinvicitinib) 1 All trademarks are property of their respective owners. 2 Net income attributable to the Company. 3 The Company is providing certain 2025 and 2024 non-GAAP information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors’ understanding of the Company’s results because management uses non-GAAP results to assess performance. Management uses non-GAAP measures internally for planning and forecasting purposes and to measure the performance of the Company along with other metrics. In addition, annual employee compensation, including senior management’s compensation, is derived in part using a non-GAAP pretax income metric. This information should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP. For a description of the non-GAAP adjustments, see Table 2a attached to this release. 4 Reflects expenses related to business combinations, including the amortization of intangible assets, intangible asset impairment charges, and expense or income related to changes in the estimated fair value measurement of liabilities for contingent consideration. Also includes integration, transaction and certain other costs associated with acquisitions and divestitures, as well as amortization of intangible assets related to collaborations and licensing arrangements. 5 Includes the estimated tax impacts on the reconciling items based on applying the statutory rate of the originating territory of the non-GAAP adjustments for both periods presented. Amount in the second quarter of 2025 also includes a $146 million benefit primarily resulting from favorable audit adjustments. Amount in the second quarter of 2024 also includes a $259 million benefit due to a reduction in reserves for unrecognized income tax benefits resulting from the expiration of the statute of limitations for assessments related to the 2019 federal tax return year. GAAP % Change GAAP % Change 2Q25 2Q24 June YTD 2025 June YTD 2024 $ 15,806 $ 16,112 -2% $ 31,335 $ 31,887 -2% 3,557 3,745 -5% 6,976 7,285 -4% 2,649 2,739 -3% 5,202 5,221 0% 4,048 3,500 16% 7,669 7,492 2% 560 80 * 629 202 * (7 ) 42 * (43 ) 12 * 4,999 6,006 -17% 10,902 11,675 -7% 571 545 1,388 1,447 4,428 5,461 -19% 9,514 10,228 -7% 1 6 8 11 $ 4,427 $ 5,455 -19% $ 9,506 $ 10,217 -7% $ 1.76 $ 2.14 -18% $ 3.77 $ 4.02 -6% 2,513 2,544 2,522 2,544 11.4 % 9.1 % 12.7 % 12.4 % $ 3,557 576 165 741 $ 2,816 2,649 15 1 16 2,633 4,048 3 53 56 3,992 560 560 560 – (7 ) (61 ) (61 ) 54 4,999 (594 ) (779 ) 61 (1,312 ) 6,311 571 (102 ) (3) (139 ) (3) 14 (3) (146 ) (4) (373 ) 944 4,428 (492 ) (640 ) 47 146 (939 ) 5,367 4,427 (492 ) (640 ) 47 146 (939 ) 5,366 $ 1.76 (0.20 ) (0.25 ) 0.02 0.06 (0.37 ) $ 2.13 11.4 % 15.0 % $ 6,976 1,196 201 1,397 $ 5,579 5,202 38 1 39 5,163 7,669 10 53 63 7,606 629 629 629 – (43 ) (3 ) (168 ) (171 ) 128 10,902 (1,241 ) (884 ) 168 (1,957 ) 12,859 1,388 (219 ) (3) (157 ) (3) 36 (3) (146 ) (4) (486 ) 1,874 9,514 (1,022 ) (727 ) 132 146 (1,471 ) 10,985 9,506 (1,022 ) (727 ) 132 146 (1,471 ) 10,977 $ 3.77 (0.40 ) (0.29 ) 0.05 0.06 (0.58 ) $ 4.35 12.7 % 14.6 % 2025 2024 2Q June YTD 1Q 2Q June YTD 1Q 2Q June YTD 3Q 4Q Full Year Nom % Ex-Exch % Nom % Ex-Exch % $15,529 $15,806 $31,335 $15,775 $16,112 $31,887 $16,657 $15,624 $64,168 -2 -2 -2 0 13,638 14,050 27,688 14,006 14,408 28,415 14,943 14,042 57,400 -2 -3 -3 -2 7,205 7,956 15,161 6,947 7,270 14,217 7,429 7,836 29,482 9 9 7 8 312 370 682 292 317 609 337 365 1,311 17 15 12 12 258 265 523 255 249 504 251 255 1,010 6 5 4 4 137 162 300 85 126 211 139 160 509 29 29 42 43 119 107 226 71 90 161 100 110 371 19 19 40 40 1,327 1,126 2,453 2,249 2,478 4,727 2,306 1,550 8,583 -55 -55 -48 -48 539 609 1,148 570 617 1,187 703 594 2,485 -1 -2 -3 -3 230 229 459 219 189 408 239 161 808 21 20 13 13 228 121 349 216 163 379 193 139 711 -26 -26 -8 -7 107 129 236 47 50 97 - - - - 41 38 79 61 59 120 68 74 263 -36 -37 -35 -33 441 461 902 440 455 895 420 449 1,764 1 1 1 1 208 228 436 174 188 362 208 215 785 21 20 20 21 83 96 179 73 92 165 96 79 340 5 5 8 9 70 74 145 56 62 118 64 70 252 21 21 23 24 280 336 615 70 70 149 200 419 106 123 229 98 106 203 102 109 415 16 16 12 12 68 80 147 70 72 142 72 73 287 10 6 4 4 102 83 185 350 110 460 383 121 964 -25 -27 -60 -59 90 86 176 111 89 200 102 92 394 -3 -4 -12 -11 67 83 150 56 60 116 65 69 249 40 35 30 30 45 41 86 42 39 81 42 40 163 5 4 6 6 50 40 90 46 53 99 78 45 222 -24 -26 -9 -8 184 172 356 189 543 -100 -100 -100 -100 39 35 74 41 114 -100 -100 -100 -100 549 372 921 419 405 824 278 232 1,334 -8 -8 12 13 247 251 498 251 224 475 204 255 935 12 14 5 8 729 584 1,313 632 618 1,252 638 699 2,590 -6 -7 5 6 1,588 1,646 3,234 1,511 1,482 2,993 1,487 1,397 5,877 11 11 8 11 924 961 1,885 850 837 1,686 886 889 3,462 15 16 12 16 664 685 1,349 661 645 1,307 601 508 2,415 6 6 3 4 303 110 413 258 222 479 227 185 891 -50 -3 -14 7 Media Contacts: Michael Levey michael.levey@msd.com Johanna Herrmann johanna.herrmann@msd.com Investor Contacts: Peter Dannenbaum (732) 594-1579 Steven Graziano (732) 594-1583

作者｜与安7月9日，默沙东宣布与Verona Pharma（下称“Verona”）达成协议，将通过子公司以每股107美元的价格收购Verona的美国存托股票（ADS），较其在纳斯达克前一交易日收盘价溢价23%，较60日成交量加权平均价溢价39%，交易预计今年第四季度完成，总价值约达100亿美元。金额之高，一举成为今年生物医药领域第二大并购案，仅次于此前强生146亿美元收购Intra-Cellular。通过此次收购，默沙东将获得Verona的重磅呼吸病新药Ohtuvayre（ensifentrine，恩司芬群）。这是一款针对磷酸二酯酶3和4（PDE3和PDE4）的first-in-class选择性双重抑制剂，可作为单药或与现有类固醇疗法联用，用于治疗慢性阻塞性肺病（COPD，俗称“烟肺”），也是二十多年来首款新药，自上市以来市场表现十分强劲，目前预计年销售峰值已达数十亿美元，其独特的双重机制和强大的市场潜力为本次重磅交易提供了强力支撑。图1 默沙东宣布收购Verona  01   百亿买局默沙东瞄准“神药第二”默沙东近年的重大交易基本以隔年一次的节奏推进。2021年以115亿美元收购Acceleron及其肺动脉高压（PAH）治疗药物Winrevair，2023年则以108亿美元纳入Prometheus及其晚期肠道疾病候选药物PRA023，而本次收购同样延续了这种步调，以百亿美金的成交金额创下了自2023年以来最大手笔。如此连番豪掷，远不仅是以优势标的对自家管线做强力扩充，更是默沙东面对已然逼近的专利悬崖和增长停摆，为摆脱对王牌产品的过度依赖所做出的关键抉择和战略举措。短期来看，本次交易将为默沙东带来直接有力的营收增长。未来5年，生物医药领域将迎来新一波专利悬崖到期潮，其中不乏多款常年销冠和主力选手，如此形势下，各大药企争相瞄准拥有商业化产品的biotech，以更低风险和即时收益填补专利到期造成的营收鸿沟。现有增长主力中，占据默沙东营收近半壁江山的全球药王Keytruda（pembrolizumab，帕博利珠单抗）即将于2028年迎来专利到期，美国政府预计将在2026年根据IRA对该产品实施谈判，一旦仿制药上市，K药销售额预计暴跌30%-50%，默沙东或将面临近150亿美元的收入缺口。与此同时，第二大畅销产品HPV疫苗Gardasil则直面来自中国国产疫苗的激烈竞争，万泰生物的首款国产疫苗定价499元，相较Gardasil9的1331元直接打了6折。至今年一季度，Gardasil中国市场销售额暴跌约11亿元，其余市场虽整体实现了14％的增长，该药总销售额仍然下降了41％。随着支柱性产品相继面临不确定性，挖掘新的增长主力迫在眉睫。此时这款加速商业化的新药的加入，就显得格外关键。Ohtuvayre自2024年6月底获批上市，市场表现一路走高，至年底便已实现4230万美元销售额，截至今年一季度，更是成倍飙升至7100万美元，环比增长95%，开出处方量已达25000张，新患者启动量环比增长超过25%，且其中60%的处方为续方，表明患者依从性和满意度较高。而自去年8月至今，其商业化甚至还未满一年，市场渗透力可谓惊人。根据SeekingAlpha预测，Ensifentrine的年峰值销售额已达21~36亿美元。如此强劲的市场表现，对默沙东的后续业绩可以说是一针尤为适时的强心剂，有望成为其新的核心增长引擎。图2 PDE3/PDE4双重抑制剂Ohtuvayre而长期考量，Ohtuvayre则将显著丰富默沙东的呼吸系统疾病管线，凭借出色的临床价值和应用前景，与PAH药物Winrevair、呼吸道合胞病毒（RSV）预防药物Enflonsia形成有效协同，推动构建一个多元化、多机制的产品矩阵，推动呼吸管线向第三战略支柱发展，打造更为坚固的竞争壁垒。关于未来交易，默沙东首席执行官Robert Davis此前公开表示，“将会持续寻求10-150亿美元的交易”，这位积极布局管线并购重构的CEO明确表示，“对并购交易持开放态度”，只要目标合适，更大规模的交易仍有可能。  02  全球首创单独给药实现双重疗效根据权威指南《慢性阻塞性肺疾病全球倡议》（GOLD 2025）介绍，COPD是一种异质性、持续性肺部疾病，其特征是由气道和/或肺泡异常导致的慢性呼吸道症状以及持续性、渐进性的气流受限，居全球死因前列，致病机理复杂，主要与吸烟和长期暴露于空气污染有关，俗称“烟肺”。当前治疗手段以3种吸入制剂为主，主要是扩张支气管的长效毒蕈碱拮抗剂（LAMA）和长效β2受体激动剂支气管扩张剂（LABA），以及吸入性糖皮质激素。作为首个用于COPD治疗的新型吸入式机制药物，Ohtuvayre是一款PDE3/PDE4小分子抑制剂，可同时作用于气道平滑肌、炎症细胞、支气管上皮细胞，由此形成其兼具支气管扩张和非甾体抗炎的独特双重机制：•支气管扩张：通过选择性抑制在平滑肌上表达较多的PDE3，舒张气道平滑肌，使呼吸更加顺畅•非甾体抗炎：通过抑制和炎症反应高度相关的PDE4，减轻呼吸道慢性炎症这就直接弥补了当前COPD治疗模式的一大缺陷，即通常绕不开的双联、三联用药，患者需要同时服用不同药物类别的、具有多种作用机制的药物（如支气管扩张剂和吸入性皮质类固醇），才能达到类似效果。通过在单一分子中融合双重疗效，Ohtuvayre由此形成了显著的差异化优势，其通过标准喷射雾化器直接递送至肺部的给药方式，基于相对简化的给药操作，最大化药物在肺部的暴露量、最小化与口服PDE抑制剂相关的全身性副作用，在疗效和安全性之间取得了更好平衡。图3 Ohtuvayre作用机制具体到临床数据上，Ohtuvayre在肺功能方面的出色疗效主要体现于两项关键Ⅲ期临床试验ENHANCE-1和ENHANCE-2。这两项随机、双盲、安慰剂对照多中心试验分别评估了该药作为单一疗法或作为LAMA或LABA的附加药物在40 岁至 80 岁的中重度 COPD 患者中的疗效和安全性。图4 Ohtuvayre两项Ⅲ期试验核心数据结果显示，两项试验中Ohtuvayre均达到主要终点，受试者的肺功能得到显著改善。与安慰剂相比，Ohtuvayre在24周内将COPD急性加重率降低36％-43％，恶化风险降低38%-42%，症状控制情况更加良好，在整个试验过程中表现出良好的耐受性。此外，体外研究表明，Ohtuvayre还能刺激囊性纤维化跨膜电导调节因子（CFTR），或将有助于改善黏液纤毛清除功能并降低黏液粘度。对于伴有慢性支气管炎的患者而言，这一特性可能带来额外的临床获益。目前，Verona Pharma还在探索Ohtuvayre用于治疗非囊性纤维化支气管扩张、囊性纤维化和哮喘等适应症，并开发了Ensifentrine+LAMA（Nebulizer）固定剂量组合疗法，以及ensifentrine吸入粉雾剂（DPI）和定量吸入气雾剂（MDI），进一步加强其临床应用布局的拓展与深化。  03   百亿市场拥抱COPD的广阔前景与挑战由于吸烟率攀高，加之人口老龄化增加患病率，据Research Nester预测，2025年COPD市场预计达到235.4亿美元，2024年全球市场规模超227亿美元，年复合增长率约为4.6％，到2037年将超过407.3亿美元。市场虽然广阔，前路却不好走。过往数十年，其治疗鲜少实现作用机制上的真正突破性，大多数“新药”只是将现有药物类别进行组合，上演一场新瓶装旧酒。但广泛需求却早已明确形成。在使用最大剂量的LAMA/LABA/ICS三联疗法后，仍有相当一部分患者的症状依然持续。以我国情况为例，现有方案治疗下，COPD患者得到有效控制的比例甚至不足5%。重点还是在于研发难度大。对默沙东来说，这也不是其在COPD领域的第一次尝试了，早年放弃开发的Setileuton、MK0873、SCH 351591等都是该适应症药物，最终未能破局。如今引入Ohtuvayre，也意味着该司在COPD领域正式落下一子。如今，各家药企也已先后实现突破，新晋入场的竞争对手包括赛诺菲2024年9月获批的IL-4R单抗度普利尤单抗和GSK今年5月获批的IL-5单抗美泊利珠单抗，蓄力抢占蓝海份额。而国内在研的PDE3/4抑制剂中，则有三款已进入临床阶段，分别是正大天晴的TQC3721、海思科的HSK39004和恒瑞医药的HRS-9821。其中，正大天晴的吸入混悬液剂型TQC3721是国内研发进度最快的国产PDE3/4抑制剂，用于治疗中重度慢性阻塞性肺病，目前位于全球进度第二。其IIa期临床数据显示其有同类最优的潜力，预计2025年启动治疗慢阻肺病（COPD）的Ⅲ期临床。其吸入粉雾剂剂型也已处于治疗COPD的1期临床阶段。海思科的HSK39004同样开发了吸入混悬液和吸入粉雾剂两种剂型，目前已登记Ⅱ期临床研究。恒瑞医药的HRS-9821吸入混悬液则已在去年获批临床试验默示，用于COPD维持治疗。值得一提的是，优锐医药（Nuance Pharma）于2021年获得了Ensifentrine在大中华区临床开发与商业化的独家权利，目前在中国开展的COPDⅢ期临床试验（ENHANCE-CHINA）也已达成主要终点，实现了肺功能显著改善，预计将在今年下半年向NMPA提交新药申请。  结语  一年不到，已达数十亿美元估值。默沙东大手一挥，再入重磅管线。面对将遇蚕食的市场份额，多方押注的默沙东能否突破重围？背靠巨头的研发和商业化能力，这枚机制独特的商业新星又能否续写K药神话？我们期待后续表现。但无论如何，可以肯定的是，各家药企争相加速推进的临床进展正在打破COPD治疗僵局，为患者带来更为有效的新选择。 主要参考文献 1. https://www-merck-com.libproxy1.nus.edu.sg/news/merck-to-acquire-verona-pharma-expanding-its-portfolio-to-include-ohtuvayre-ensifentrine-a-first-in-class-copd-maintenance-treatment-for-adults-and-expected-to-drive-growth-into-the-next-dec/2.Global Initiative for Chronic Obstructive Lung Disease (GOLD), 2025 Report.3.https://www.researchnester.com/cn/reports/chronic-obstructive-pulmonary-disease-market/70514.https://www.fiercepharma.com/pharma/merck-sweetens-its-portfolio-10b-acquisition-verona-and-potential-copd-blockbuster-ohtuvayre5.https://www.fiercepharma.com/pharma/pressuring-mercks-gardasil-china-home-made-9-valent-hpv-vaccine-priced-60-discount6.Global Initiative for Chronic Obstructive Lung Disease (GOLD), 2025 Report.7.Anzueto, A., Barjaktarevic, I. Z., Siler, T. M., Rheault, T., Bengtsson, T., Rickard, K., & Sciurba, F. (2023). Ensifentrine, a Novel Phosphodiesterase 3 and 4 Inhibitor for the Treatment of Chronic Obstructive Pulmonary Disease: Randomized, Double-Blind, Placebo-controlled, Multicenter Phase Ill Trials (the ENHANCE Trials). Americannjournal of respiratory and critical care medicine, 208(4), 406-416. https://doi-org.libproxy1.nus.edu.sg/10.1164/rccm.202306-0944OC8. 企业官网介绍等公开资料共建Biomedical创新生态圈！如何加入BiG会员？