MERCK & CO INC earnings calls

2027 outlook and R&D spending

Q (Christopher Schott · JPMorgan): Analyst asked if 2027 guidance is reflected in consensus and whether current R&D spend brings forward the earnings trough around KEYTRUDA loss of exclusivity.

A: Management said 2027 is a year of investment behind pipeline and launches, expects moderate top-line growth with over $2 billion of LOE/generic headwinds, and that earnings should return to growth after a shallow revenue dip around LOE.

"For 2027, we see it as another year of investment as we invest behind our expansive pipeline and our new product launches to drive long term growth." — Caroline Litchfield (CFO)

WINREVAIR one-time timing benefit and CORAAL trial

Q (Vamil Divan · Guggenheim): Analyst asked how much one-time benefit WINREVAIR gave this quarter and how CORAAL differs from CADENCE in endpoints and population.

A: Management said the quarter included a $550 million timing benefit, with $50 million relating to WINREVAIR that will unwind in Q4. They also said CORAAL will start Phase 3 this year using the CADENCE population characteristics, a 0.3 mg/kg dose, and time to clinical worsening as the endpoint.

"We had a benefit in the third quarter of $550 million as a result of the timing of purchases, $200 million of that relates to Keytruda, which we will expect to unwind in full in the fourth quarter." — Caroline Litchfield (CFO)

translating China TROP2 data globally

Q (Michael Yee · UBS): Analyst asked which non-lung/breast indications for the sac-TMT (TROP2 ADC) are most notable and how China data inform global trials.

A: Management said they purposely expanded sac-TMT trials beyond lung and breast and that the Kelun/Chinese data gave a useful signal to design global trials like GloboTROfuse-O5. They expressed confidence they can translate those Chinese signals into global studies and plan aggressive lung development as well.

"So the bottom line is that experience working closely with Kelun, it is not like you are gonna translate them exactly but it gives you the signal as to how you might translate it into global." — Dean Y. Li (PRESIDENT)

QLEX/Keytruda subcutaneous IP and Europe status

Q (Courtney Breen · Bernstein): Analyst asked about litigation over the hyaluronidase component, whether the Dutch injunction is definitive, and U.S. risk for subcutaneous Keytruda.

A: Management said they remain confident in U.S. freedom to operate and see strong U.S. subcutaneous adoption; they will not supply in certain European countries while they work to overturn the Dutch injunction, and those restricted markets are smaller in volume.

"So for now, we will not supply in Italy, Denmark, The Netherlands, France, Belgium, and Ireland." — Johannes J. Oosthuizen (PRESIDENT)

KRAS G12C trial endpoint change and FDA stance

Q (Akash Tewari · Jefferies): Analyst asked why the first-line KRAS G12C NSCLC trial changed its primary endpoint from PFS and OS to PFS and whether that reflects an FDA stance, and how that affects upcoming sac-TMT PD-1/VEGF trial design.

A: Management said calderasib (KRAS G12C) is a potent selective molecule and they are moving rapidly to test it first-line with Keytruda, aiming for a chemo-free option; they noted discussions with FDA and that both PFS and OS remain important but they are proceeding with speed and rigor.

"But, yes, we are moving with speed, and rigor to get this krasirag in first-line lung with Keytruda, but especially subcu-- subcu KEYTRUDA-- moving quite fast." — Dean Y. Li (PRESIDENT)

full RAS portfolio and other isoforms

Q (Daina Graybosch · Leerink Partners): Analyst asked how the company is thinking about the broader RAS portfolio beyond calderasib and combinations across indications.

A: Management said they aim to replicate the KRAS G12C strategy for other isoforms, noting promising data for krasirag in CRC, and they expect clinical data for KRAS G12D within about a year to evaluate similar strategies in lung, CRC, and possibly pancreas.

"The other place that we have we think, quite good data is krasirag in relationship to CRC, especially in first-line CRC." — Dean Y. Li (PRESIDENT)

TL1A combination strategy and BD approach

Q (Mohit Bansal · Wells Fargo): Analyst asked whether company wants all combination partners in-house for TL1A or would partner with marketed products.

A: Management said combinations can matter but their benefit varies by indication; they have internal assets for potential combinations and remain open to business development for both development- and commercial-stage partners.

"So starting with we have several assets coming through early development in house." — Robert Davis (CEO·CHAIR)

LIPFENDRA uptake and revenue impact

Q (Steve Scala · TD Cowen): Analyst asked what LIPFENDRA sales were this quarter and how many prescriptions are free drug, and whether it can reach Lipitor-like early sales.

A: Management said they focus on affordability and access via couponing and sampling, and they will not disclose near-term revenue specifics; they noted strong script data and active payer discussions to expand coverage in 2027 (commercial) and 2028 (Medicare).

"we are focused on affordability and access in the way we have structured this." — Robert Davis (CEO·CHAIR)

LIPFENDRA prescriptions and prescribers

Q: Follow-up asked for prescription counts, prescriber details, and how much usage is switches versus new patients.

A: Management said early uptake is positive: in Q3 they saw over 11 thousand prescriptions from over 6.5 thousand prescribers, with uptake across cardiologists and general practitioners and many prescriptions in patients on other lipid therapies rather than switches from injectable PCSK9s; sampling and coupons affect near-term revenue.

cancer vaccine efficacy by neoantigen load and drivers

Q (Umer Raffat · Evercore): Analyst asked how vaccine efficacy varied for patients with lower neoantigen counts and for tumors lacking major driver mutations, and implications for RCC readout.

A: Management declined to overinterpret early data, highlighted external experts calling the melanoma vaccine a landmark, said melanoma tends to have high TMB so melanoma TMB may not predict RCC, and noted TMB is only one factor for immune response so they will examine RCC independently.

"I do think the data as interpreted by those people who are scientific leaders is that this is a landmark study in its own right And because of that, we would expect that." — Dean Y. Li (PRESIDENT)

$70 billion mid-2030s revenue opportunity update

Q (Asad Haider · Goldman Sachs): Analyst asked for updated framing on the $70 billion opportunity given this year's developments, what was omitted, and what surprised management.

A: Management said recent positive clinical readouts increase their confidence in the $70 billion target and they plan to raise the number because Prometheus was not included, PD-1/VEGF combos and broader SAC TMT indications are showing upside, and entismaron's profile looks better than initially assumed.

"And as such, as we have indicated, we expect now to be raising that number not only because what we are seeing confidence in what we have, but what was not included, which is, I think, part of your question." — Robert Davis (CEO·CHAIR)

INT-PN-001 poster and tumor-type implications

Q (Terence Flynn · Morgan Stanley): Analyst asked how the INT-PN-001 ESMO poster should be interpreted and its importance for other tumor types.

A: Management said they have multiple Phase 3 and Phase 2 INTERPATH trials to expand from melanoma into lung, bladder, RCC and other immune-responsive tumors; they are testing perioperative and IO-free settings across indications to learn both tumor-type relevance and mechanism.

"We have, like, 4 Phase 3 INTerpaths and we have 5 Phase 2s." — Dean Y. Li (PRESIDENT)