Merck's Financials: Keytruda Soars, Gardasil Faces China Challenge

Merck & Co reported stronger-than-expected quarterly earnings thanks to rising Keytruda sales. However, Gardasil's weak demand in China dragged down performance, with sales falling 11%. The decline is attributed to economic factors, and anti-corruption campaigns affecting promotional activities. Sales in China fell 40%, highlighting challenges in this key market.

Merck & Co's quarterly earnings surpassed Wall Street expectations, propelled by robust sales of its flagship cancer drug, Keytruda. Despite this success, demand for the Gardasil vaccine dwindled in China, resulting in an 11% decline in sales to $2.31 billion, falling short of analyst projections of $2.46 billion.

In morning trading, Merck's shares dipped 4% after revealing the dip in vaccine sales. CEO Rob Davis attributed the shortfall to economic conditions, curbs on promotional activities, and inventory adjustments amid China's ongoing anti-corruption drive targeting doctors and hospital arrangements with foreign pharmaceutical firms.

Sales in China dropped sharply by 40% from last year, impacting overall performance. Davis remains optimistic about the vaccine's long-term potential in China, despite present challenges. Merck forecasts potential sales of $2 billion to $3 billion in China, possibly buoyed by expanding Gardasil's market to men, alongside expected Q4 shipments mirroring Q3 volumes.

(With inputs from agencies.)