Merck & Company, Inc. · NYSE:MRK
Merck & — Q1 2025 Earnings Presentation
29 slides from Merck &'s earnings presentation, Apr 24, 2025
Slide 1: First-Quarter 2025 Sales and Earnings
First-Quarter 2025 Sales and Earnings Merck & Co., Inc., Rahway, N.J., USA April 24, 2025
Slide 2: Agenda
Strategy and Business Update Robert M. Davis Chairman and Chief Executive Officer Financial Results and Outlook Caroline Litchfield Executive Vice President and Chief Financial Officer Agenda Agenda Research Update Dr. Dean Y. Li Executive Vice President and President, Research Laboratories Question
Slide 3: Forward-looking statement of Merck & Co., Inc., Rahway, N.J., USA
Forward-looking statement of Merck & Co., Inc., Rahway, N.J., USA This presentation 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 state
Slide 4: Strategy and Business Update
Strategy and Business Update Robert M. Davis Chairman and Chief Executive Officer 4
Slide 5: Q1 2025 total company performance and pipeline progress
Q1 2025 total company performance and pipeline progress Cardiometabolic Q1 Worldwide Sales Important results for WINREVAIR from Phase 3 ZENITH trial $15.5B Licensed HRS-5346, oral Lp(a) inhibitor, from Hengrui Pharma Infectious Disease Results from two Phase 3 switch studies for islatravir + doravir
Slide 6: Delivering the next wave of innovation
Delivering the Well positioned to successfully navigate next wave of through the KEYTRUDA LOE period innovation Advancing Early- and Late-Phase Pipeline Nearly tripled late-phase pipeline since 2021 Launching New Growth Drivers >$50B commercial opportunity by mid-2030s from recent launches and late-
Slide 7: Confident in our strategic direction
“Confident in our strategic direction, our commitment to research and development as the source for sustainable value-creation, and our enduring promise to positively impact patients” 7
Slide 8: Financial Results and Outlook
Financial Results and Outlook Caroline Litchfield Executive Vice President and Chief Financial Officer 8
Slide 9: Q1 worldwide performance driven by demand for our innovative portfolio
Q1 worldwide performance driven by demand for our innovative portfolio WORLDWIDE SALES1 Human Health Animal Health $15.5B -2% decrease $13.6B -3% decrease -1% ex-exchange +5% ex-GARDASIL China2 $1.6B +5% growth +10% ex-exchange +1% ex-exchange +7% ex-GARDASIL China, ex-exchange +6% ex-GARDASIL China
Slide 10: Oncology: KEYTRUDA continues to benefit patients and drive growth
Oncology: KEYTRUDA continues to benefit patients and drive growth KEYTRUDA sales of $7.2B increased 6%, driven by increased uptake from earlier-stage cancers and robust demand from metastatic indications ‒ In earlier-stage settings, growth driven by increased utilization in resectable TNBC, RCC and
Slide 11: Oncology: Important contributions across broad portfolio
Oncology: Important contributions across broad portfolio WELIREG sales grew 63%, driven by increased $137M uptake in certain adult patients with $42M $85M +63% previously treated advanced RCC in the U.S +128% +102% ‒ Now market leader for treatment of adult patients with advanced RCC following indic
Slide 12: Vaccines: Broad vaccines portfolio driving global impact
Vaccines: Broad vaccines portfolio driving global impact GARDASIL sales of $1.3B decreased 40%, driven by continued soft demand in China where channel inventories remain elevated $2.2B $2.0B +17% ‒ In the U.S., sales benefitted from price and +43% demand $1.3B ‒ Outside the U.S. and China, growth dr
Slide 13: Cardiovascular: Successful ongoing launch of WINREVAIR
Cardiovascular: Successful ongoing launch of WINREVAIR Global Q1 sales of $280M U.S.: Continued growth in new patient starts and TRx U.S. Launch Progress ‒ >1,400 new patients prescribed in the quarter Total Prescriptions (TRx) ‒ ~6,600 total patients prescribed since launch ‒ ~5,200 patients with c
Slide 14: Animal Health: Robust growth driven by demand for livestock products
Animal Health: Robust growth driven by demand for livestock products Animal Health sales increased 10% to $1.6B ‒ Livestock sales grew 16%, driven by higher demand across all species, as well as benefit from timing of ruminant sales and inclusion of sales from recently expanded aqua portfolio ‒ Comp
Slide 15: Q1 2025 non-GAAP financial results summary
Q1 2025 non-GAAP financial results summary1 $ in billions, except EPS amounts Change Q1 2025 Q1 2024 Change Ex-FX Sales $15.5 $15.8 -2% +1% Non-GAAP Gross Margin 82.2% 81.2% +1.0pts +1.5pts Non-GAAP Operating Expenses $6.1 $6.4 -4% -3% Non-GAAP Tax Rate 14.2% 16.1% -1.9pts N/A Non-GAAP EPS2,3 $2.22
Slide 16: Updated 2025 financial outlook
Updated 2025 financial outlook Prior Guidance Updated Guidance Key Assumptions • Now assumes ~1 percentage point FX headwind Revenue $64.1B to $65.6B $64.1B to $65.6B • Implies +0% to +2% nominal (+1% to +3% ex-FX) Non-GAAP • Now includes ~$200M of costs related to tariffs Gross Margin Rate ~82.5% ~
Slide 17: Key modeling considerations
Key modeling considerations • Following successful HPV catch-up vaccination program in Japan, expect uptake to moderate as future sales will predominantly reflect GARDASIL the primary age cohort Family1 • Therefore, global GARDASIL growth ex-China, while still strong, is anticipated to slow going fo
Slide 18: Remain committed to balanced capital allocation strategy
Remain committed to balanced capital allocation strategy Q1 Spend ($ in billions)1 Capital allocation order of priority Continue to invest in our pipeline and business while augmenting our pipeline $3.1 with value-enhancing business development $2.0 $1.5 $1.3 $1.2 2 After-Tax R&D CapEx Dividends Bus
Slide 19: Research Update
Research Update Dr. Dean Y. Li Executive Vice President and President, Research Laboratories 19
Slide 20: Broadening our impact in cardiometabolic research
Broadening our impact in cardiometabolic research WINREVAIR - ZENITH Study HRS-5346 • First study in PAH to use a primary endpoint comprised entirely of • Entered exclusive license agreement major morbidity and mortality events with Hengrui Pharma to develop investigational oral small molecule • Fir
Slide 21: Progress across vaccines and infectious disease programs
Progress across vaccines and infectious disease programs Vaccines HIV CAPVAXIVE • Presented detailed results from two pivotal Phase 3 trials • EC granted approval for active immunization for evaluating investigational, once-daily, oral fixed dose prevention of invasive disease and pneumonia caused b
Slide 22: Continuing to advance our broad oncology program
Continuing to advance our broad oncology program Subcutaneous pembrolizumab KEYTRUDA in Earlier Stage WELIREG Announced detailed findings from 3475A- KEYNOTE-689: FDA granted priority EC conditionally approved WELIREG for D77 pivotal Phase 3 trial, evaluating six- review for KEYTRUDA as part of a tr
Slide 23: Save the Date: Key upcoming dates and milestones
Key upcoming dates and milestones Upcoming Milestones: Oncology Save the Date: • KEYNOTE-689 in locally advanced HNSCC - PDUFA date June 23rd • Subcutaneous pembrolizumab - PDUFA date September 23rd ASCO Investor Event in Chicago RSV • Clesrovimab in RSV to help protect infants during their first RS
Slide 24: Q&A
Q&A Robert M. Davis Chairman and Chief Executive Officer Caroline Litchfield Executive Vice President and Chief Financial Officer Dr. Dean Y. Li Executive Vice President and President, Research Laboratories Peter Dannenbaum Senior Vice President, Investor Relations
Slide 25: Appendix
Appendix 25
Slide 26: Q1 2025 GAAP financial results summary
Q1 2025 GAAP financial results summary $ in billions, EPS amounts Q1 2025 Q1 2024 Change Change Ex-FX Sales $15.5 $15.8 -2% +1% Operating Expenses1 $6.2 $6.5 -5% -3% Tax Rate 13.9% 15.9% -2.0pts N/A GAAP EPS1 $2.01 $1.87 +7% +13% 26 1. 1Q24 GAAP results includes $656 million charge, or $0.26 negativ
Slide 27: Capital allocation: Trailing twelve months
Capital allocation: Trailing twelve months Over the past 12 months Order of priority $15 Well-positioned balance sheet $12 $12.4 with capacity to fund Billions $9 additional value-enhancing $6 $7.9 business development $3 $3.9 $5.1 $2.3 opportunities $0 After-Tax R&D 1 CapEx Dividends Paid Business
Slide 28: Driving value for patients and shareholders by progressing our pipeline
Driving value for patients and shareholders by progressing our pipeline Key regulatory milestones since the last earnings call: Key data & clinical advancements since the last earnings call: In the U.S., the FDA: Presented data for: • Accepted for review a BLA for subcutaneous pembrolizumab with ber
Slide 29: Broad and innovative pipeline to address significant unmet medical needs
Broad and innovative pipeline to address significant unmet medical needs Phase 2 Phase 3 Under regulatory review Oncology Cardiometabolic Oncology Oncology MK-1022 (patritumab MK-2870 (sacituzumab MK-5475 MK-1022 (patritumab deruxtecan)1 KEYTRUDA (MK-3475) KEYTRUDA (MK-3475) deruxtecan)1,3 tirumotec