Merck & Co., Inc., Rahway, N.J., USA Announces Third-Quarter 2026 Financial
Merck & Co., Inc., Rahway, N.J., USA Announces Third-Quarter 2026 Financial Results; Highlights Multiple Milestones Advancing Broad, Diverse Pipeline
Sales Growth Reflects Continued Strength in Oncology and Animal Health, Plus Contributions From Other Products in Broader Portfolio, Including WINREVAIR Financial Highlights
GAAP EPS Was $2.04; Non-GAAP EPS Was $2.49; GAAP and Non-GAAP EPS - Include a One-Time Charge of $0.12 per Share Related to a Global License Agreement With SciBrunch
- Presented First-Time Pivotal Data From Phase 3 Trials Across Robust Oncology Pipeline at ESMO Congress 2026, Including:
TroFuse-005 Trial Evaluating Sacituzumab Tirumotecan (sac-TMT) in o Certain Patients With Advanced or Recurrent Endometrial Cancer; U.S. FDA Accepted for Priority Review a Biologics License Application Based on These Data
INTerpath-001 Trial Evaluating Intismeran Autogene Plus KEYTRUDA as o Adjuvant Treatment for Patients With Resected Stage IIB-IV Melanoma, in Collaboration With Moderna
Announced Positive Phase 2b Results in Moderate to Severe Hidradenitis - Suppurativa From Clinical Study of Investigational Immunology Candidate Tulisokibart
- Presented One-Year Results From Phase 2b/3 BRUNELLO Trial Evaluating Remigromig in Adults With Diabetic Macular Edema
- Narrows and Raises the Midpoint of Worldwide Sales Range; Now Expects Sales To Be Between $66.8 Billion and $67.3 Billion
Narrows and Raises Expected Non-GAAP EPS Range To Be Between $2.77 - and $2.82; Outlook Now Includes One-Time Charge of $0.12 per Share Related to the Global License Agreement With SciBrunch
RAHWAY, N.J., Oct. 29, 2026 – Merck & Co., Inc., Rahway, N.J., USA (NYSE: MRK), known as MSD outside the United States and Canada, today announced financial results for the third quarter of 2026.
“Our science-led strategy is transforming our business,” said Robert M. Davis, chairman and chief executive officer. “The potentially practice-changing advances in oncology presented at last weekend’s ESMO meeting, including new data for our antibody-drug conjugate sac-TMT and the first Phase 3 validation of a therapeutic cancer vaccine, further clinically de-risk the substantial long-term opportunity of our late-phase pipeline. With positive momentum across multiple therapeutic areas, I’m increasingly confident in our ability to deliver long-term value for patients and shareholders.”
*Refer to table on page 7. For the third quarter of 2026, Generally Accepted Accounting Principles (GAAP) earnings per share (EPS) assuming dilution was $2.04 and non-GAAP EPS was $2.49. Both GAAP and non-GAAP EPS in the third quarter of 2026 include a one-time charge of $0.12 per share related to a global license agreement with SciBrunch Therapeutics Co., Ltd. (SciBrunch). Both GAAP and non-GAAP EPS in the third quarter of 2025 include a charge of $0.10 per share for a milestone payment to LaNova Medicines Ltd. (LaNova, acquired by Sino Biopharmaceutical Limited) associated with the technology transfer for MK-2010.
Non-GAAP EPS excludes acquisition- and divestiture-related costs and costs related to restructuring programs, as well as income and losses from investments in equity securities. Non-GAAP EPS in the third quarter of 2025 also excludes tax expense relating to audit reserve adjustments.
3 The Company is providing certain 2026 and 2025 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. - 3 - Year-to-date results can be found in the attached tables.
The following table reflects sales of the Company’s top products and significant performance drivers.
Change $ in Third Ex- mill… Quart… 2026 2025 Chan… Excha… ────────────────────────────────────────────────────────────────────────────── Total $ 18,0… $ 17,276 5 % 4 % Sales Incr… prim… driv… by grow… in KEYT… QLEX, WINR… GARD… 9, WELI… ENFL… and the incl… of OHTU… sale… Grow… bene… from the timi… Phar… 16,2… 15,611 4 % 4 % of purc… by appr… $550 mill… Grow… was part… offs… by decl… in BRID… JANU… and LAGE… as well as lower alli… reve… rela… to Kose… Grow… prim… driv… by stro… glob… upta… in earl… indi… incl… trip… brea… canc… cerv… canc… head and neck canc… and blad… canc… as well as high… glob… dema… in KEYT… meta… KEYT… 8,601 8,147 6 % 6 % indi… QLEX incl… urot… canc… Timi… of whol… purc… unfa… affe… sales in the U.S. but was larg… offs… by a bene… from incr… inve… in the chan… Sales of KEYT… QLEX were $830 mill… Incr… prim… due to high… sales in the GARD… 1,995 1,749 14 % 14 % U.S. 9 refl… favo… publ… purc… patt… and high… net pric… Incr… prim… PROQ… due M-M-R to II 730 684 7 % 7 % high… and dema… VARI… in cert… Euro… mark… Grow… prim… refl… high… dema… and favo… whol… and spec… phar… purc… patt… in WINR… 694 360 93 % 94 % the U.S., as well as laun… upta… in cert… inte… mark… part… in Euro… and Japa… Decl… prim… driv… by lower dema… due to JANU… 380 624 -39 % -39 % gene… comp… foll… loss of mark… excl… in the U.S. Decl… prim… due to lower net pric… in Lynp… 352 379 -7 % -7 % the U.S. and lower dema… and pric… in Chin… Incr… prim… due PREV… 347 266 30 % 31 % to high… dema… glob…
Third Quar… $ in Chan… mil… 2026 2025 Chan… Ex- Comm… Exch… Grow… prim… driv… by high… dema… in the U.S. WEL… 307 196 56 % 58 % and cont… laun… upta… in inte… mark… part… in Japa… Grow… prim… due to Len… 287 258 11 % 11 % high… dema… in the U.S. Incr… prim… driv… by laun… upta… in seve… inte… mark… part… in Asia Paci… and Euro… CAP… 263 244 8 % 7 % part… offs… by lower sales in the U.S. refl… lower adult pneu… vacc… rates and lower net pric… Incr… prim… driv… by seas… dema… and asso… ENF… 187 79 138 % 136 % inve… build in the U.S. and cert… inte… mark… Prod… obta… as part of the OHT… 184 - - - Comp… Octo… 2025 acqu… of Vero… Phar… plc. Decl… prim… driv… by lower dema… in the BRI… 144 439 -67 % -67 % U.S. due to gene… comp… foll… loss of mark… excl… Decl… larg… due LAG… 17 138 -88 % -88 % to lower dema… in Japa… Grow… attr… to both Ani… 1,676 1,615 4 % 3 % Live… Hea… and Comp… Anim… prod… port… Grow… prim… driv… by Liv… 1,048 1,023 2 % 2 % high… dema… for poul… prod… Grow… larg… driv… by new prod… laun… Sales of BRAV… line of prod… were $264 mill… and $262 Com… mill… Ani… 628 592 6 % 6 % in the curr… and prio… quar… resp… which repr… an incr… of 1%, or flat excl… impa… of fore… exch… Incr… prim… due to favo… impa… of reve… Oth… 141 50 185 % -25 % acti… Rev… part… offs… by lower reve… from thir… manu… arra…
*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. In addition, Koselugo alliance revenue was $13 million in the third quarter of 2026 compared with $214 million in the third quarter of 2025. The decrease was due to an amendment to the collaboration agreement with AstraZeneca in 2025, which discontinued the provisions whereby the Company shared revenue and costs with AstraZeneca, and revised the payment structure, resulting in the Company’s recognition of a $150 million upfront payment and a $50 million regulatory milestone in the third quarter of 2025. - 5 - Third-Quarter Expense and Related Information
Gross margin was 72.9% for the third quarter of 2026 compared with 77.7% for the third quarter of 2025. The decrease was primarily due to higher amortization of intangible assets, restructuring costs and production costs.
Selling, general and administrative (SG&A) expenses were $2.9 billion in the third quarter of 2026, an increase of 10% compared with the third quarter of 2025. The increase was primarily due to higher administrative costs, as well as higher promotional costs in support of product launches.
Research and development (R&D) expenses were $4.5 billion in the third quarter of 2026, an increase of 7% compared with the third quarter of 2025. The increase was primarily due to a $400 million charge related to a global license agreement with SciBrunch and higher clinical development spending, partially offset by lower restructuring costs and a $200 million reduction in R&D expenses as part of a funding agreement with Blackstone Life Sciences (Blackstone). R&D expenses in the third quarter of 2025 include a $300 million charge for a milestone payment to LaNova for the completion of the technology transfer for MK-2010.
Other (income) expense, net, was $27 million of expense in the third quarter of 2026 compared with $238 million of income in the third quarter of 2025. The unfavorability was primarily due to higher net interest expense.
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, licensing arrangements and asset acquisitions, and recognition of fair value step-up to inventories for asset acquisitions. - 6 - The effective income tax rate for the third quarter of 2026 was 8.9%, reflecting the favorable impacts of certain discrete items, as well as jurisdictional mix of income and expense.
GAAP EPS was $2.04 for the third quarter of 2026 compared with $2.32 for the third quarter of 2025. The decrease was primarily driven by higher operating expenses, reflecting increased investments to advance the R&D pipeline and support product launches, higher amortization of intangible assets, higher net interest expense and increased restructuring costs, partially offset by operational strength in the business and a lower effective income tax rate.
Non-GAAP gross margin was 81.4% for the third quarter of 2026 compared with 81.9% for the third quarter of 2025. The decrease was primarily due to higher production costs.
Non-GAAP SG&A expenses were $2.9 billion in the third quarter of 2026, an increase of 10% compared with the third quarter of 2025. The increase was primarily due to higher administrative costs, as well as higher promotional costs in support of product launches.
Non-GAAP R&D expenses were $4.5 billion in the third quarter of 2026, an increase of 13% compared with the third quarter of 2025. The increase was primarily due to a $400 million charge related to a global license agreement with SciBrunch and higher clinical development spending, partially offset by a $200 million reduction in R&D expenses as part of a funding agreement with Blackstone. R&D expenses in the third quarter of 2025 include a $300 million charge for a milestone payment to LaNova for the completion of the technology transfer for MK-2010.
Non-GAAP other (income) expense, net, was $420 million of expense in the third quarter of 2026 compared with $106 million of expense in the third quarter of 2025. The unfavorability was primarily due to higher net interest expense.
The non-GAAP effective income tax rate for the third quarter of 2026 was 10.9%, reflecting the favorable impacts of certain discrete items, as well as jurisdictional mix of income and expense.
Non-GAAP EPS was $2.49 for the third quarter of 2026 compared with $2.58 for the third quarter of 2025. The decrease was primarily driven by higher operating expenses, reflecting increased investments to advance the R&D pipeline and support product launches, and higher net interest expense, partially offset by operational strength in the business and a lower effective income tax rate. - 7 - A reconciliation of GAAP to non-GAAP net income and EPS is provided in the table that follows.
$ in millions, except EPS amounts Third Quarter EPS 2026 2025 ────────────────────────────────────────────────────────────────────────────── GAAP EPS $ 2.04 $ 2.32 Difference 0.45 0.26 Non-GAAP EPS that excludes items listed $ 2.49 $ 2.58 below3 Net Income GAAP $ 5,065 $ 5,785 net income2 Difference 1,094 663 Non-GAAP net income that excludes items $ 6,159 $ 6,448 listed below2,3 Excluded Items: Acquisition- $ 1,167 $ 659 and divestiture-related costs4 Restructuring costs 581 390 Income from investments in equity (393 ) (344 ) securities Decrease to net income before 1,355 705 taxes Estimated (261 ) (42 ) income tax (benefit) expense5 Decrease to net income $ 1,094 $ 663
In the third quarter, the Company achieved key regulatory and clinical milestones to meaningfully advance its broad and diverse pipeline.
U.S. Food and Drug Administration (U.S. FDA) approved WELIREG plus Lenvima, in collaboration with Eisai, for certain previously treated o adult patients with advanced renal cell carcinoma with a clear cell component (ccRCC), based on Phase 3 LITESPARK-011 trial.
Approval represents first approved combination of an oral hypoxia-inducible § factor-2 alpha inhibitor and a multi-targeted vascular endothelial growth factor tyrosine kinase inhibitor (TKI) for these patients.
In October, U.S. FDA accepted a Biologics License Application (BLA) seeking approval of sac-TMT for the treatment of adult patients with endometrial cancer who o have previously received platinum containing chemotherapy and a programmed death receptor 1 or programmed death ligand 1 inhibitor, separately or in combination, based on Phase 3 TroFuse-005 trial.
In October, European Commission (EC) approved KEYTRUDA plus Padcev o as perioperative treatment for adults with resectable muscle-invasive bladder cancer (MIBC), based on Phase 3 KEYNOTE-B15 trial.
5Includes the estimated income tax impacts on the reconciling items based on applying the statutory rate of the originating territory of the non-GAAP adjustments for all periods presented. Amount in the third quarter of 2025 also includes $86 million of tax expense relating to audit reserve adjustments. - 8 -
Ministry of Health, Labor and Welfare in Japan approved subcutaneous pembrolizumab and berahyaluronidase alfa injection under the trademark o KEYJECT (marketed as KEYTRUDA QLEX in the U.S.) for all KEYTRUDA indications approved in Japan, based on Phase 3 MK-3475A-D77 trial.
At the European Society for Medical Oncology (ESMO) Congress 2026 in October, positive new data were presented during three late-breaking o Presidential Symposia across three Phase 3 trials from the Company’s robust oncology pipeline and portfolio, including:
Results from Phase 3 TroFuse-005 trial evaluating sac-TMT for patients with § advanced or recurrent endometrial cancer previously treated with chemotherapy and anti-PD-1/L1 immunotherapy.
Results from Phase 3 INTerpath-001 trial, in collaboration with Moderna, Inc. § (Moderna), evaluating adjuvant treatment with intismeran autogene (intismeran; V940 or mRNA-4157) in combination with KEYTRUDA.
Results from Phase 3 KEYNOTE-C93 trial evaluating KEYTRUDA monotherapy versus platinum doublet chemotherapy as a first-line treatment for certain patients with mismatch repair § deficient (dMMR) advanced or recurrent endometrial cancer who had not previously received systemic chemotherapy or who experienced recurrence more than six months after completing prior adjuvant therapy.
In § addition, data were presented from Phase 3 OptiTROP studies in China, led by Kelun-Biotech, evaluating sac-TMT in non-small cell lung cancer (NSCLC), including:
Results · from the OptiTROP-Lung06 study as first-line treatment for PD-L1-negative advanced non-squamous NSCLC.
Final · overall survival data from the OptiTROP-Lung04 study in epidermal growth factor receptor (EGFR)-mutated NSCLC following progression on EGFR TKIs.
Ifinatamab deruxtecan (I-DXd) Biologics License Application (BLA), o in collaboration with Daiichi Sankyo, for certain patients with previously treated extensive-stage small cell lung cancer (ES-SCLC) was voluntarily withdrawn.
U.S. FDA accepted a supplemental BLA (sBLA) for ENFLONSIA to expand its indication to include prevention of respiratory syncytial virus (RSV) o lower respiratory tract disease (LRTD) in children under 2 years of age at increased risk for severe RSV disease through their second RSV season, based on Phase 3 SMART trial.
Applications § to expand marketing authorization for ENFLONSIA for same population in Europe and Japan, based on Phase 3 SMART trial, have also been accepted.
U.S. FDA accepted a supplemental New Drug Application (sNDA) for IDVYNSO for the treatment of certain adults with HIV-1 infection who had not previously received o antiretroviral treatment, based on Phase 3 P053 trial. U.S. FDA also accepted an sNDA to include 96-week data for IDVYNSO in certain virologically suppressed adults, based on the Phase 3 P051 and P052 trials.
U.S. FDA approved an update to U.S. product label for WINREVAIR to include efficacy and safety data from the Phase 3 HYPERION trial o evaluating adults recently diagnosed with pulmonary arterial hypertension (PAH, World Health Organization [WHO] Group 1 pulmonary hypertension).
In HYPERION, in patients diagnosed with PAH in the last 12 months, adding § WINREVAIR on top of background therapy reduced the risk of clinical worsening events compared to placebo.
o Presented results from Phase 2b study of tulisokibart in adults with moderate to severe hidradenitis suppurativa (HS).
At the American Academy of Ophthalmology (AAO) 2026 Annual Meeting in October, presented for the first time one-year results from Phase 2b/3 BRUNELLO trial o evaluating remigromig, an investigational, tetravalent, tri-specific antibody designed to agonize the Wingless-related integration site (Wnt) pathway, in adults with diabetic macular edema (DME).
Announced an exclusive global license agreement with SciBrunch for o MK-2690 (SPR2015), an investigational preclinical oral KRAS G12D (ON) inhibitor.
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.*
Sac-TMT Reduced Risk of Death by 32% and Risk of Disease Progression or Death by Oncology 41% Compared to Chemotherapy in Certain Patients With Advanced or Recurrent Endometrial Cancer; Results From Phase 3 TroFuse-005 Trial The Company and Moderna Presented Results From Landmark Phase 3 INTerpath-001 Trial for Intismeran Plus KEYTRUDA at ESMO 2026 Presidential Symposium; Intismeran Plus KEYTRUDA Significantly Reduced Risk of Recurrence or Death by 42% (HR=0.58 [95% CI, 0.45–0.75]; Two-Sided p<0.001) Compared to KEYTRUDA Alone for Patients With Completely Resected Stage IIB-IV Melanoma KEYTRUDA as Monotherapy Reduced Risk of Disease Progression or Death by 43% for Certain Patients With Advanced or Recurrent Endometrial Cancer With dMMR Tumors Compared to Chemotherapy; Results From Phase 3 KEYNOTE-C93 Trial U.S. FDA Approved WELIREG Plus Lenvima for Certain Previously Treated Adult Patients With ccRCC; Based on Results From Phase 3 LITESPARK-011 Trial, Presented at ESMO
KEYTRUDA QLEX Approved in Japan for Subcutaneous Administration for All KEYTRUDA Indications Approved in Japan; Based on Results From Phase 3 MK-3475A-D77 Trial EC Approved KEYTRUDA Plus Padcev as Perioperative Treatment for Adults With Resectable MIBC; Based on Results From Phase 3 KEYNOTE-B15 Trial I-DXd BLA for Certain Patients With ES-SCLC Voluntarily Withdrawn The Company Entered Into Exclusive Global License Agreement With SciBrunch for SPR2015, an Investigational Oral KRAS G12D (ON) Inhibitor U.S. FDA Accepted sBLA for ENFLONSIA to Update Its RSV LRTD Indication to Vaccines Include Children Under 2 Years at and Infectious Diseases Increased Risk for Severe RSV for Their Second Season; Based on Results From Phase 3 SMART Trial; FDA Set PDUFA Date of March 22, 2027 U.S. FDA Approved Update to the Label for Cardiometabolic, WINREVAIR to Include Data From the Respiratory and Specialty Phase 3 HYPERION Trial Evaluating Adults Recently Diagnosed With PAH (PAH, WHO Group 1 Pulmonary Hypertension) Tulisokibart Immunology Met Primary and Key Secondary Endpoints in Phase 2b Study in Patients With Moderate to Severe HS The Company Presented One-Year Results From Pivotal Phase 2b/3 BRUNELLO Ophthalmology Study Evaluating Remigromig, a Tri-Specific Agonist of the Wnt Pathway, in Adults With DME, at AAO 2026
*References in the above news release titles have been modified for the purpose of this announcement.
The Company’s 2025/2026 Purpose for Progress Impact Report provided a comprehensive view of the Company’s measurable progress across its sustainability priorities, including achieving all goals targeted for completion by 2025. The Company also introduced new targets for 2030, including a goal to reach 100 million people with access solutions that close gaps in care by 2030.
Full Year 2026 Updated Prior Sales* $66.8 billion to $67.3 $66.3 billion to $67.3 billion billion Non-GAAP Approximately 81% Approximately 81% Gross margin3 Non-GAAP $42.4 billion to $42.9 $42.0 billion to $42.7 Operating expenses3** billion billion Non-GAAP Approximately $1.4 Approximately $1.4 Other (income) billion expense billion expense expense, net3 Non-GAAP Effective income tax 32.0% to 33.0% 35.0% to 36.0% rate3 Non-GAAP $2.77 to $2.82 $2.66 to $2.76 EPS3*** Share count (assuming Approximately 2.48 Approximately 2.48 dilution) billion billion
**Includes one-time R&D charges of $9.0 billion for the acquisition of Cidara Therapeutics, Inc. (Cidara), $5.7 billion for the acquisition of Terns Pharmaceuticals, Inc. (Terns), and $400 million related to the global license agreement with SciBrunch. Outlook does not assume any additional significant potential business development transactions.
***Includes one-time charges of $3.62 per share for the acquisition of Cidara, $2.31 per share for the acquisition of Terns, and $0.12 per share related to the global license agreement with SciBrunch. 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 income 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. - 11 - The Company now anticipates full-year 2026 sales to be between $66.8 billion and $67.3 billion, including a positive impact from foreign exchange of approximately 1% at mid-October 2026 exchange rates.
The Company now expects the full-year non-GAAP effective income tax rate to be between 32.0% and 33.0%, including the impact of the non-tax-deductible one-time charges for the acquisitions of Cidara and Terns.
The Company now expects full-year 2026 non-GAAP EPS to be between $2.77 and $2.82, including a positive impact from foreign exchange of approximately $0.15 per share at mid-October 2026 exchange rates. This range includes one-time charges of $9.0 billion, or $3.62 per share, related to the acquisition of Cidara; $5.7 billion, or $2.31 per share, related to the acquisition of Terns; and $400 million, or $0.12 per share, related to the global license agreement with SciBrunch. The charge related to SciBrunch was not previously included in the outlook. In 2025, non-GAAP EPS of $8.98 was negatively impacted by one-time charges of $0.20 per share in the aggregate related to certain business development transactions.
Consistent with past practice, the financial outlook does not assume additional significant potential business development transactions.
Investors, journalists and the general public may access a live audio webcast of the call on Thursday, Oct. 29, at 9 a.m. EDT 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.
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. - 12 - 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, 2025 and the Company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site ().
Pharmaceutical BRIDION(sugammadex) CAPVAXIVE(Pneumococcal 21-valent Conjugate Vaccine)
GARDASIL (Human Papillomavirus Quadrivalent [Types 6, 11, 16 and 18] Vaccine, Recombinant) GARDASIL 9(Human Papillomavirus 9-valent Vaccine, Recombinant)
Media Contacts: Investor Contacts: Michael Levey Peter Dannenbaum michael.levey@msd.com (732) 594-1579 John Cummins Steven Graziano john.cummins2@msd.com (732) 594-1583
(1)Because the Company recorded a net loss in the first nine months of 2026, no potential dilutive common shares were used in the computation of loss per common share assuming dilution as the effect would have been anti-dilutive. MERCK & CO., INC., RAHWAY, N.J., USA
Only the line items that are affected by non-GAAP adjustments are shown. The Company is providing certain 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 non-GAAP information enhances investors’ understanding of the Company’s results because management uses non-GAAP measures 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. The non-GAAP information presented should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP. (1) Amounts included in cost of sales reflect expenses for the amortization of intangible assets, as well as the recognition of fair value step-up of inventories related to the 2025 Verona Pharma plc acquisition. Amounts included in selling, general and administrative expenses reflect integration, transaction and certain other costs related to acquisitions and divestitures. (2) Amounts primarily include employee separation costs, accelerated depreciation and asset impairment charges associated with facilities to be closed or divested, as well as contractual termination costs, related to activities under the Company's formal restructuring programs. (3) Represents the estimated tax impacts on the reconciling items based on applying the statutory rate of the originating territory of the non-GAAP adjustments. (4) Because the Company recorded a net loss in the first nine months of 2026, no potential dilutive common shares were used in the computation of loss per common share assuming dilution as the effect would have been anti-dilutive.
MERCK & CO., INC., RAHWAY, N.J., USA FRANCHISE / KEY PRODUCT SALES (AMOUNTS IN MILLIONS) (UNAUDITED) Table 3
(2)Alliance Revenue represents the Company's share of profits, which are product sales net of cost of sales and commercialization costs.
(4)Alliance Revenue represents the Company's share of profits from sales in Bayer's marketing territories, which are product sales net of cost of sales and commercialization costs.
(6)Includes Pharmaceutical products not individually shown above. Also reflects total alliance revenue for Koselugo of $161 million, $10 million and $13 million in the first, second and third quarter of 2026, respectively, and $44 million, $43 million and $214 million in the first, second and third quarter of 2025, respectively.
(7)Other Revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities. Other Revenues related to the receipt of milestone payments for out-licensed products were $132 million, $0 million and $2 million in the first, second and third quarter of 2026, respectively, and $95 million, $5 million and $11 million in the first, second and third quarter of 2025, respectively.
Full text with the tables
Exhibit 99.1
- 1 -
News Release
Merck & Co., Inc., Rahway, N.J., USA Announces Third-Quarter 2026 Financial
Results; Highlights Multiple Milestones Advancing Broad, Diverse Pipeline
Sales Growth Reflects Continued Strength in Oncology and Animal Health, Plus
Contributions From Other Products in Broader Portfolio, Including WINREVAIR
Financial Highlights
- Total Worldwide Sales Were $18.1 Billion (5% Growth; 4% Growth ex-FX)
o KEYTRUDA/KEYTRUDA QLEX1 Sales Were $8.6 Billion (6% Growth;
6% Growth ex-FX); Includes KEYTRUDA QLEX Sales of $830 Million
o WINREVAIR Sales Were $694 Million (93% Growth; 94% Growth ex-FX)
o Animal Health Sales Were $1.7 Billion (4% Growth; 3% Growth ex-FX)
GAAP EPS Was $2.04; Non-GAAP EPS Was $2.49; GAAP and Non-GAAP EPS
- Include a One-Time Charge of $0.12 per Share Related to a Global License
Agreement With
SciBrunch
Pipeline & Portfolio Highlights
- Presented First-Time Pivotal Data From Phase 3 Trials Across Robust
Oncology Pipeline at ESMO Congress 2026, Including:
TroFuse-005 Trial Evaluating Sacituzumab Tirumotecan (sac-TMT) in
o Certain Patients With Advanced or Recurrent Endometrial Cancer; U.S. FDA
Accepted for Priority
Review a Biologics License Application Based on These Data
INTerpath-001 Trial Evaluating Intismeran Autogene Plus KEYTRUDA as
o Adjuvant Treatment for Patients With Resected Stage IIB-IV Melanoma, in
Collaboration With
Moderna
Announced Positive Phase 2b Results in Moderate to Severe Hidradenitis
- Suppurativa From Clinical Study of Investigational Immunology Candidate
Tulisokibart
- Presented One-Year Results From Phase 2b/3 BRUNELLO Trial Evaluating
Remigromig in Adults With Diabetic Macular Edema
Full-Year 2026 Financial Outlook
- Narrows and Raises the Midpoint of Worldwide Sales Range; Now Expects
Sales To Be Between $66.8 Billion and $67.3 Billion
1
Available in some markets as KEYTRUDA SC.
- 2 -
Narrows and Raises Expected Non-GAAP EPS Range To Be Between $2.77
- and $2.82; Outlook Now Includes One-Time Charge of $0.12 per Share
Related to the Global
License Agreement With SciBrunch
RAHWAY, N.J., Oct. 29, 2026 – Merck & Co., Inc.,
Rahway, N.J., USA (NYSE: MRK), known as MSD outside the United States and
Canada, today announced financial results for the third quarter
of 2026.
“Our science-led strategy is transforming
our business,” said Robert M. Davis, chairman and chief executive officer. “The
potentially practice-changing advances in
oncology presented at last weekend’s ESMO meeting, including new data for our
antibody-drug conjugate sac-TMT and the first Phase
3 validation of a therapeutic cancer vaccine, further clinically de-risk the
substantial long-term opportunity of our late-phase pipeline.
With positive momentum across multiple therapeutic areas, I’m increasingly
confident in our ability to deliver long-term value
for patients and shareholders.”
Financial Summary
$ in
millio…
except Change
EPS Third Ex-
amounts Quarter 2026 2025 Change Exchan…
──────────────────────────────────────────────────────────────────────────────
Sales $ 18,085 $ 17,276 5 % 4 %
GAAP
net 5,065 5,785 -12 % -14 %
incom…
Non-G…
net
income
that 6,159 6,448 -4 % -5 %
exclu…
certa…
items…
GAAP 2.04 2.32 -12 % -13 %
EPS
Non-G…
EPS
that 2.49 2.58 -3 % -5 %
exclu…
certa…
items…
*Refer to table on page 7.
For the third quarter of 2026, Generally Accepted
Accounting Principles (GAAP) earnings per share (EPS) assuming dilution was
$2.04 and non-GAAP EPS was $2.49. Both GAAP and non-GAAP
EPS in the third quarter of 2026 include a one-time charge of $0.12 per share
related to a global license agreement with SciBrunch Therapeutics
Co., Ltd. (SciBrunch). Both GAAP and non-GAAP EPS in the third quarter of 2025
include a charge of $0.10 per share for a milestone
payment to LaNova Medicines Ltd. (LaNova, acquired by Sino Biopharmaceutical
Limited) associated with the technology transfer for MK-2010.
Non-GAAP EPS excludes acquisition- and divestiture-related
costs and costs related to restructuring programs, as well as income and losses
from investments in equity securities. Non-GAAP EPS in
the third quarter of 2025 also excludes tax expense relating to audit reserve
adjustments.
2
Net income attributable to the Company.
3
The Company is providing certain 2026 and 2025 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.
- 3 -
Year-to-date results can be found in the attached
tables.
Third-Quarter Sales Performance
The following table reflects sales of the Company’s
top products and significant performance drivers.
Change
$ in Third Ex-
mill… Quart… 2026 2025 Chan… Excha…
──────────────────────────────────────────────────────────────────────────────
Total $ 18,0… $ 17,276 5 % 4 %
Sales
Incr…
prim…
driv…
by
grow…
in
KEYT…
QLEX,
WINR…
GARD…
9,
WELI…
ENFL…
and
the
incl…
of
OHTU…
sale…
Grow…
bene…
from
the
timi…
Phar… 16,2… 15,611 4 % 4 % of
purc…
by
appr…
$550
mill…
Grow…
was
part…
offs…
by
decl…
in
BRID…
JANU…
and
LAGE…
as
well
as
lower
alli…
reve…
rela…
to
Kose…
Grow…
prim…
driv…
by
stro…
glob…
upta…
in
earl…
indi…
incl…
trip…
brea…
canc…
cerv…
canc…
head
and
neck
canc…
and
blad…
canc…
as
well
as
high…
glob…
dema…
in
KEYT… meta…
KEYT… 8,601 8,147 6 % 6 % indi…
QLEX incl…
urot…
canc…
Timi…
of
whol…
purc…
unfa…
affe…
sales
in
the
U.S.
but
was
larg…
offs…
by a
bene…
from
incr…
inve…
in
the
chan…
Sales
of
KEYT…
QLEX
were
$830
mill…
Incr…
prim…
due
to
high…
sales
in
the
GARD… 1,995 1,749 14 % 14 % U.S.
9 refl…
favo…
publ…
purc…
patt…
and
high…
net
pric…
Incr…
prim…
PROQ… due
M-M-R to
II 730 684 7 % 7 % high…
and dema…
VARI… in
cert…
Euro…
mark…
Grow…
prim…
refl…
high…
dema…
and
favo…
whol…
and
spec…
phar…
purc…
patt…
in
WINR… 694 360 93 % 94 % the
U.S.,
as
well
as
laun…
upta…
in
cert…
inte…
mark…
part…
in
Euro…
and
Japa…
Decl…
prim…
driv…
by
lower
dema…
due
to
JANU… 380 624 -39 % -39 % gene…
comp…
foll…
loss
of
mark…
excl…
in
the
U.S.
Decl…
prim…
due
to
lower
net
pric…
in
Lynp… 352 379 -7 % -7 % the
U.S.
and
lower
dema…
and
pric…
in
Chin…
Incr…
prim…
due
PREV… 347 266 30 % 31 % to
high…
dema…
glob…
- 4 -
Third
Quar…
$ in Chan…
mil… 2026 2025 Chan… Ex- Comm…
Exch…
Grow…
prim…
driv…
by
high…
dema…
in
the
U.S.
WEL… 307 196 56 % 58 % and
cont…
laun…
upta…
in
inte…
mark…
part…
in
Japa…
Grow…
prim…
due
to
Len… 287 258 11 % 11 % high…
dema…
in
the
U.S.
Incr…
prim…
driv…
by
laun…
upta…
in
seve…
inte…
mark…
part…
in
Asia
Paci…
and
Euro…
CAP… 263 244 8 % 7 % part…
offs…
by
lower
sales
in
the
U.S.
refl…
lower
adult
pneu…
vacc…
rates
and
lower
net
pric…
Incr…
prim…
driv…
by
seas…
dema…
and
asso…
ENF… 187 79 138 % 136 % inve…
build
in
the
U.S.
and
cert…
inte…
mark…
Prod…
obta…
as
part
of
the
OHT… 184 - - - Comp…
Octo…
2025
acqu…
of
Vero…
Phar…
plc.
Decl…
prim…
driv…
by
lower
dema…
in
the
BRI… 144 439 -67 % -67 % U.S.
due
to
gene…
comp…
foll…
loss
of
mark…
excl…
Decl…
larg…
due
LAG… 17 138 -88 % -88 % to
lower
dema…
in
Japa…
Grow…
attr…
to
both
Ani… 1,676 1,615 4 % 3 % Live…
Hea… and
Comp…
Anim…
prod…
port…
Grow…
prim…
driv…
by
Liv… 1,048 1,023 2 % 2 % high…
dema…
for
poul…
prod…
Grow…
larg…
driv…
by
new
prod…
laun…
Sales
of
BRAV…
line
of
prod…
were
$264
mill…
and
$262
Com… mill…
Ani… 628 592 6 % 6 % in
the
curr…
and
prio…
quar…
resp…
which
repr…
an
incr…
of
1%,
or
flat
excl…
impa…
of
fore…
exch…
Incr…
prim…
due
to
favo…
impa…
of
reve…
Oth… 141 50 185 % -25 % acti…
Rev… part…
offs…
by
lower
reve…
from
thir…
manu…
arra…
*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.
In addition, Koselugo alliance revenue was $13
million in the third quarter of 2026 compared with $214 million in the third
quarter of 2025. The decrease was due to an amendment to
the collaboration agreement with AstraZeneca in 2025, which discontinued the
provisions whereby the Company shared revenue and costs
with AstraZeneca, and revised the payment structure, resulting in the Company’s
recognition of a $150 million upfront payment and
a $50 million regulatory milestone in the third quarter of 2025.
- 5 -
Third-Quarter Expense and Related Information
The table below presents selected expense information.
(In…
$ Loss
in Acq… From
mi… and Inv…
Th… Div… in
Qu… Rel… Res… Equ… Non-
20… GAAP Cos… Cos… Sec… GAA…
──────────────────────────────────────────────────────────────────────────────
Co…
of $ 4,8… $ 1,1… $ 396 $ - $ 3,…
sa…
Se…
ge… 2,8… 24 - - 2,…
and
ad…
Re…
and 4,5… 3 1 - 4,…
de…
Re… 184 - 184 - -
co…
Ot…
(i… 27 - - (3… ) 420
ex…
net
Th…
Qu…
20…
Co…
of $ 3,8… $ 621 $ 110 $ - $ 3,…
sa…
Se…
ge… 2,6… 34 - - 2,…
and
ad…
Re…
and 4,2… 4 233 - 3,…
de…
Re… 47 - 47 - -
co…
Ot…
(i… (238 ) - - (3… ) 106
ex…
net
GAAP Expense, EPS and Related Information
Gross margin was 72.9% for the third quarter of
2026 compared with 77.7% for the third quarter of 2025. The decrease was
primarily due to higher amortization of intangible assets, restructuring
costs and production costs.
Selling, general and administrative (SG&A)
expenses were $2.9 billion in the third quarter of 2026, an increase of 10%
compared with the third quarter of 2025. The increase was
primarily due to higher administrative costs, as well as higher promotional
costs in support of product launches.
Research and development (R&D) expenses were
$4.5 billion in the third quarter of 2026, an increase of 7% compared with the
third quarter of 2025. The increase was primarily due
to a $400 million charge related to a global license agreement with SciBrunch
and higher clinical development spending, partially offset
by lower restructuring costs and a $200 million reduction in R&D expenses as
part of a funding agreement with Blackstone Life Sciences
(Blackstone). R&D expenses in the third quarter of 2025 include a $300 million
charge for a milestone payment to LaNova for the completion
of the technology transfer for MK-2010.
Other (income) expense, net, was $27 million of
expense in the third quarter of 2026 compared with $238 million of income in the
third quarter of 2025. The unfavorability was primarily
due to higher net interest expense.
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, licensing arrangements and asset acquisitions,
and recognition of fair value step-up to inventories
for asset acquisitions.
- 6 -
The effective income tax rate for the third quarter
of 2026 was 8.9%, reflecting the favorable impacts of certain discrete items, as
well as jurisdictional mix of income and expense.
GAAP EPS was $2.04 for the third quarter of 2026
compared with $2.32 for the third quarter of 2025. The decrease was primarily
driven by higher operating expenses, reflecting increased
investments to advance the R&D pipeline and support product launches, higher
amortization of intangible assets, higher net interest
expense and increased restructuring costs, partially offset by operational
strength in the business and a lower effective income tax
rate.
Non-GAAP Expense, EPS and Related Information
Non-GAAP gross margin was 81.4% for the third
quarter of 2026 compared with 81.9% for the third quarter of 2025. The decrease
was primarily due to higher production costs.
Non-GAAP SG&A expenses were $2.9 billion in
the third quarter of 2026, an increase of 10% compared with the third quarter of
2025. The increase was primarily due to higher administrative
costs, as well as higher promotional costs in support of product launches.
Non-GAAP R&D expenses were $4.5 billion in
the third quarter of 2026, an increase of 13% compared with the third quarter of
2025. The increase was primarily due to a $400 million
charge related to a global license agreement with SciBrunch and higher clinical
development spending, partially offset by a $200 million
reduction in R&D expenses as part of a funding agreement with Blackstone. R&D
expenses in the third quarter of 2025 include a
$300 million charge for a milestone payment to LaNova for the completion of the
technology transfer for MK-2010.
Non-GAAP other (income) expense, net, was $420
million of expense in the third quarter of 2026 compared with $106 million of
expense in the third quarter of 2025. The unfavorability
was primarily due to higher net interest expense.
The non-GAAP effective income tax rate for the
third quarter of 2026 was 10.9%, reflecting the favorable impacts of certain
discrete items, as well as jurisdictional mix of income
and expense.
Non-GAAP EPS was $2.49 for the third quarter of
2026 compared with $2.58 for the third quarter of 2025. The decrease was
primarily driven by higher operating expenses, reflecting increased
investments to advance the R&D pipeline and support product launches, and higher
net interest expense, partially offset by operational
strength in the business and a lower effective income tax rate.
- 7 -
A reconciliation of GAAP to non-GAAP net income
and EPS is provided in the table that follows.
$ in millions, except EPS
amounts Third Quarter
EPS 2026 2025
──────────────────────────────────────────────────────────────────────────────
GAAP EPS $ 2.04 $ 2.32
Difference 0.45 0.26
Non-GAAP
EPS that excludes items listed $ 2.49 $ 2.58
below3
Net Income
GAAP $ 5,065 $ 5,785
net income2
Difference 1,094 663
Non-GAAP
net income that excludes items $ 6,159 $ 6,448
listed below2,3
Excluded Items:
Acquisition- $ 1,167 $ 659
and divestiture-related costs4
Restructuring costs 581 390
Income from investments in
equity (393 ) (344 )
securities
Decrease to net income before 1,355 705
taxes
Estimated (261 ) (42 )
income tax (benefit) expense5
Decrease to net income $ 1,094 $ 663
Pipeline and Portfolio Highlights
In the third quarter, the Company achieved key
regulatory and clinical milestones to meaningfully advance its broad and diverse
pipeline.
· Oncology:
U.S. Food and Drug Administration (U.S. FDA) approved WELIREG plus
Lenvima, in collaboration with Eisai, for certain previously treated
o adult patients with
advanced renal cell carcinoma with a clear cell component (ccRCC), based
on Phase 3 LITESPARK-011
trial.
Approval
represents first approved combination of an oral hypoxia-inducible
§ factor-2 alpha inhibitor
and a multi-targeted vascular endothelial growth factor tyrosine kinase
inhibitor (TKI) for
these patients.
In October, U.S. FDA accepted a Biologics License Application (BLA)
seeking approval of sac-TMT for the treatment of adult patients with
endometrial cancer who
o have previously received platinum containing chemotherapy and a
programmed death receptor
1 or programmed death ligand 1 inhibitor, separately or in combination,
based on Phase 3
TroFuse-005 trial.
U.S.
FDA set Prescription Drug User Fee Act (PDUFA) date of June 15, 2027. The
Company is
§ in discussions with the U.S. FDA and is hopeful for an earlier approval.
──────────────────────────────────────────────────────────────────────────────
In October, European Commission (EC) approved KEYTRUDA plus Padcev
o as perioperative treatment for adults with resectable muscle-invasive
bladder cancer (MIBC),
based on Phase 3 KEYNOTE-B15 trial.
5Includes
the estimated income tax impacts on the reconciling items based on applying the
statutory rate of the originating territory of the non-GAAP
adjustments for all periods presented. Amount in the third quarter of 2025 also
includes $86 million of tax expense relating to audit
reserve adjustments.
- 8 -
Ministry of Health, Labor and Welfare in Japan approved subcutaneous
pembrolizumab and berahyaluronidase alfa injection under the trademark
o KEYJECT (marketed
as KEYTRUDA QLEX in the U.S.) for all KEYTRUDA indications approved in
Japan, based on Phase
3 MK-3475A-D77 trial.
At the European Society for Medical Oncology (ESMO) Congress 2026
in October, positive new data were presented during three late-breaking
o Presidential Symposia
across three Phase 3 trials from the Company’s robust oncology pipeline
and portfolio,
including:
Results
from Phase 3 TroFuse-005 trial evaluating sac-TMT for patients with
§ advanced or recurrent
endometrial cancer previously treated with chemotherapy and anti-PD-1/L1
immunotherapy.
Results
from Phase 3 INTerpath-001 trial, in collaboration with Moderna, Inc.
§ (Moderna), evaluating
adjuvant treatment with intismeran autogene (intismeran; V940 or
mRNA-4157) in combination
with KEYTRUDA.
Results
from Phase 3 KEYNOTE-C93 trial evaluating KEYTRUDA monotherapy versus
platinum doublet chemotherapy
as a first-line treatment for certain patients with mismatch repair
§ deficient (dMMR) advanced
or recurrent endometrial cancer who had not previously received systemic
chemotherapy or
who experienced recurrence more than six months after completing prior
adjuvant therapy.
In
§ addition, data were presented from Phase 3 OptiTROP studies in China, led
by Kelun-Biotech,
evaluating sac-TMT in non-small cell lung cancer (NSCLC), including:
Results
· from the OptiTROP-Lung06 study as first-line treatment for PD-L1-negative
advanced non-squamous
NSCLC.
Final
· overall survival data from the OptiTROP-Lung04 study in epidermal growth
factor receptor
(EGFR)-mutated NSCLC following progression on EGFR TKIs.
Ifinatamab deruxtecan (I-DXd) Biologics License Application (BLA),
o in collaboration with Daiichi Sankyo, for certain patients with
previously treated extensive-stage
small cell lung cancer (ES-SCLC) was voluntarily withdrawn.
· Vaccines
and Infectious Diseases:
U.S. FDA accepted a supplemental BLA (sBLA) for ENFLONSIA to expand
its indication to include prevention of respiratory syncytial virus (RSV)
o lower respiratory
tract disease (LRTD) in children under 2 years of age at increased risk
for severe RSV disease
through their second RSV season, based on Phase 3 SMART trial.
U.S.
§ FDA set PDUFA date of March 22, 2027.
──────────────────────────────────────────
Applications
§ to expand marketing authorization for ENFLONSIA for same population in
Europe and Japan,
based on Phase 3 SMART trial, have also been accepted.
- 9 -
U.S. FDA accepted a supplemental New Drug Application (sNDA) for IDVYNSO
for the treatment of certain adults with HIV-1 infection who had not
previously received
o antiretroviral treatment, based on Phase 3 P053 trial. U.S. FDA also
accepted an sNDA to
include 96-week data for IDVYNSO in certain virologically suppressed
adults, based on the
Phase 3 P051 and P052 trials.
U.S.
§ FDA set a PDUFA date for both sNDAs of April 22, 2027.
───────────────────────────────────────────────────────────
· Cardiometabolic,
Respiratory and Specialty:
U.S. FDA approved an update to U.S. product label for WINREVAIR to
include efficacy and safety data from the Phase 3 HYPERION trial
o evaluating adults recently
diagnosed with pulmonary arterial hypertension (PAH, World Health
Organization [WHO] Group
1 pulmonary hypertension).
In
HYPERION, in patients diagnosed with PAH in the last 12 months, adding
§ WINREVAIR on top of
background therapy reduced the risk of clinical worsening events compared
to placebo.
· Immunology:
o Presented results from Phase 2b study of tulisokibart in adults with
moderate to severe hidradenitis suppurativa (HS).
· Ophthalmology:
At the American Academy of Ophthalmology (AAO) 2026 Annual Meeting
in October, presented for the first time one-year results from Phase 2b/3
BRUNELLO trial
o evaluating remigromig, an investigational, tetravalent, tri-specific
antibody designed to
agonize the Wingless-related integration site (Wnt) pathway, in adults
with diabetic macular
edema (DME).
· Business
Development:
Announced an exclusive global license agreement with SciBrunch for
o MK-2690 (SPR2015), an investigational preclinical oral KRAS G12D (ON)
inhibitor.
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.*
Sac-TMT
Reduced Risk of Death by 32% and Risk
of Disease Progression or Death by
Oncology 41% Compared to Chemotherapy in
Certain Patients With Advanced
or Recurrent Endometrial Cancer;
Results From Phase 3 TroFuse-005
Trial
The
Company and Moderna Presented Results
From Landmark Phase 3 INTerpath-001
Trial for Intismeran Plus KEYTRUDA at
ESMO 2026 Presidential
Symposium; Intismeran Plus KEYTRUDA
Significantly Reduced Risk of
Recurrence or Death by 42% (HR=0.58
[95% CI, 0.45–0.75];
Two-Sided p<0.001) Compared to
KEYTRUDA Alone for Patients With
Completely Resected Stage IIB-IV
Melanoma
KEYTRUDA
as Monotherapy Reduced Risk of
Disease Progression or Death by 43%
for Certain Patients With Advanced or
Recurrent Endometrial Cancer
With dMMR Tumors Compared to
Chemotherapy; Results From Phase 3
KEYNOTE-C93 Trial
U.S.
FDA Approved WELIREG Plus Lenvima for
Certain Previously Treated Adult
Patients With ccRCC; Based on Results
From Phase 3 LITESPARK-011
Trial, Presented at ESMO
- 10 -
KEYTRUDA
QLEX Approved in Japan for
Subcutaneous Administration for All
KEYTRUDA Indications Approved in
Japan; Based on Results From Phase
3 MK-3475A-D77 Trial
EC
Approved KEYTRUDA Plus Padcev as
Perioperative Treatment for Adults
With Resectable MIBC; Based on
Results From Phase 3 KEYNOTE-B15
Trial
I-DXd
BLA for Certain Patients With ES-SCLC
Voluntarily Withdrawn
The
Company Entered Into Exclusive Global
License Agreement With SciBrunch for
SPR2015, an Investigational Oral KRAS
G12D (ON) Inhibitor
U.S.
FDA Accepted sBLA for ENFLONSIA to
Update Its RSV LRTD Indication to
Vaccines Include Children Under 2 Years at
and Infectious Diseases Increased Risk for Severe
RSV for Their Second Season; Based on
Results From Phase 3 SMART Trial; FDA
Set PDUFA Date of March 22, 2027
U.S.
FDA Approved Update to the Label for
Cardiometabolic, WINREVAIR to Include Data From the
Respiratory and Specialty Phase 3 HYPERION Trial Evaluating
Adults Recently Diagnosed
With PAH (PAH, WHO Group 1 Pulmonary
Hypertension)
Tulisokibart
Immunology Met Primary and Key Secondary
Endpoints in Phase 2b Study in
Patients With Moderate to Severe HS
The
Company Presented One-Year Results
From Pivotal Phase 2b/3 BRUNELLO
Ophthalmology Study Evaluating Remigromig, a
Tri-Specific Agonist of the Wnt
Pathway, in Adults With DME, at AAO
2026
*References in the above news release titles have been modified for
the purpose of this announcement.
Sustainability Highlights
The Company’s 2025/2026 Purpose for Progress
Impact Report provided a comprehensive view of the Company’s measurable progress
across its sustainability priorities, including
achieving all goals targeted for completion by 2025. The Company also introduced
new targets for 2030, including a goal to reach
100 million people with access solutions that close gaps in care by 2030.
Full-Year 2026 Financial Outlook
The following table summarizes the Company’s
full-year financial outlook.
Full
Year 2026
Updated Prior
Sales* $66.8 billion to $67.3 $66.3 billion to $67.3
billion billion
Non-GAAP Approximately 81% Approximately 81%
Gross margin3
Non-GAAP $42.4 billion to $42.9 $42.0 billion to $42.7
Operating expenses3** billion billion
Non-GAAP Approximately $1.4 Approximately $1.4
Other (income) billion expense billion expense
expense, net3
Non-GAAP
Effective income tax 32.0% to 33.0% 35.0% to 36.0%
rate3
Non-GAAP $2.77 to $2.82 $2.66 to $2.76
EPS3***
Share count (assuming Approximately 2.48 Approximately 2.48
dilution) billion billion
*The Company does not have any non-GAAP adjustments
to sales.
**Includes one-time R&D charges of $9.0 billion
for the acquisition of Cidara Therapeutics, Inc. (Cidara), $5.7 billion for the
acquisition of Terns Pharmaceuticals, Inc.
(Terns), and $400 million related to the global license agreement with
SciBrunch. Outlook does not assume any additional significant
potential business development transactions.
***Includes one-time charges of $3.62 per share
for the acquisition of Cidara, $2.31 per share for the acquisition of Terns, and
$0.12 per share related to the global license agreement
with SciBrunch.
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 income
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.
- 11 -
The Company now anticipates full-year 2026 sales
to be between $66.8 billion and $67.3 billion, including a positive impact from
foreign exchange of approximately 1% at mid-October 2026
exchange rates.
The Company now expects the full-year non-GAAP
effective income tax rate to be between 32.0% and 33.0%, including the impact of
the non-tax-deductible one-time charges for the acquisitions
of Cidara and Terns.
The Company now expects full-year 2026 non-GAAP
EPS to be between $2.77 and $2.82, including a positive impact from foreign
exchange of approximately $0.15 per share at mid-October 2026
exchange rates. This range includes one-time charges of $9.0 billion, or $3.62
per share, related to the acquisition of Cidara; $5.7
billion, or $2.31 per share, related to the acquisition of Terns; and $400
million, or $0.12 per share, related to the global license
agreement with SciBrunch. The charge related to SciBrunch was not previously
included in the outlook. In 2025, non-GAAP EPS of $8.98
was negatively impacted by one-time charges of $0.20 per share in the aggregate
related to certain business development transactions.
Consistent with past practice, the financial outlook
does not assume additional significant potential business development
transactions.
Earnings Conference Call
Investors, journalists and the general public
may access a live audio webcast of the call on Thursday, Oct. 29, at 9 a.m. EDT
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.
- 12 -
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, 2025 and the Company’s other
filings with the Securities and Exchange
Commission (SEC) available at the SEC’s Internet site ().
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)
IDVYNSO(doravirine/islatravir)
JANUMET (sitagliptin and metformin HCl)
JANUVIA (sitagliptin)
KEYTRUDA(pembrolizumab)
KEYTRUDA QLEX(pembrolizumab and berahyaluronidase alfa-pmph)
- 13 -
LAGEVRIO (molnupiravir)
Lenvima (lenvatinib)
Lynparza (olaparib)
M-M-R II (Measles, Mumps and Rubella Virus Vaccine Live)
OHTUVAYRE(ensifentrine)
PREVYMIS(letermovir)
PROQUAD (Measles, Mumps, Rubella and Varicella Virus Vaccine Live)
VARIVAX (Varicella Virus Vaccine Live)
WELIREG(belzutifan)
WINREVAIR(sotatercept-csrk)
Animal HealthBRAVECTO(fluralaner)
###
Media Contacts: Investor Contacts:
Michael Levey Peter Dannenbaum
michael.levey@msd.com (732) 594-1579
John Cummins Steven Graziano
john.cummins2@msd.com (732) 594-1583
MERCK & CO., INC., RAHWAY, N.J., USA
CONSOLIDATED STATEMENT OF OPERATIONS - GAAP
(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)
(UNAUDITED)
Table 1
Sep Sep
% YTD YTD %
GA… 3Q… 3Q… Ch… GAAP 20… 2025 Ch…
──────────────────────────────────────────────────────────────────────────────
S… $ 18… $ 17… 5 % $ 50… $ 48,… 5 %
C…
E…
a…
O…
C…
of 4,… 3,… 27 % 13… 10,… 24 %
s…
S…
g… 2,… 2,… 10 % 8,… 7,8… 8 %
a…
a…
R…
a… 4,… 4,… 7 % 26… 11,… *
d…
R… 184 47 * 530 676 -22 %
c…
O…
(… 27 (2… ) * 262 (281 ) *
e…
n…
I…
B… 5,… 6,… -18 % 1,… 17,… -92 %
T…
I…
T… 492 958 1,… 2,3…
P…
N…
I… 5,… 5,… -12 % (5… ) 15,… *
(…
L…
N…
I…
(… 2 2 (3 ) 10
A…
to
N…
I…
N…
I…
(…
A…
to
M… $ 5,… $ 5,… -12 % $ (5… ) $ 15,… *
&
C…
I…
R…
N…
U…
E…
(…
p…
C… $ 2.… $ 2.… -12 % $ (0… ) $ 6.08 *
S…
A…
D…
(…
A…
S…
O… 2,… 2,… 2,… 2,5…
A…
D…
(…
E…
I… 8.9 % 14… % 13… % 13.3 %
T…
R…
* 100% or greater
(1)Because the Company recorded a net loss in the first nine months of 2026, no
potential dilutive common shares were used in the computation of loss per common
share assuming dilution as the effect would have been anti-dilutive.
MERCK & CO., INC., RAHWAY, N.J., USA
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2026 GAAP TO NON-GAAP RECONCILIATION
(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)
(UNAUDITED)
Table 2a
(I…
Lo…
fr…
Ac… In…
and in
T… Di… Re… Eq… Ad…
Q… GA… Co… Co… Se… Su… Non…
──────────────────────────────────────────────────────────────────────────────
C…
of $ 4,… 1,… 396 1,… $ 3,…
s…
S…
g… 2,… 24 24 2,…
a…
a…
R…
a… 4,… 3 1 4 4,…
d…
R… 184 184 184 –
c…
O…
(… 27 (3… ) (3… ) 420
e…
n…
I…
B… 5,… (1… ) (5… ) 393 (1… ) 6,…
T…
I…
T… 492 (2… )(… (1… )(… 83 -3 (2… ) 753
P…
(…
N… 5,… (9… ) (4… ) 310 (1… ) 6,…
I…
N…
I…
A…
to
M…
& 5,… (9… ) (4… ) 310 (1… ) 6,…
C…
I…
R…
N…
U…
E…
p…
C… $ 2.… (0… ) (0… ) 0.… (0… ) $ 2.…
S…
A…
D…
E…
I… 8.9 % 10… %
T…
R…
S…
Y…
C…
of $ 13… 3,… 817 4,… $ 9,…
s…
S…
g… 8,… 73 73 8,…
a…
a…
R…
a… 26… 9 34 43 26…
d…
R… 530 530 530 –
c…
O…
(… 262 (7… ) (7… ) 1,…
e…
n…
I…
B… 1,… (3… ) (1… ) 764 (3… ) 5,…
T…
I…
T… 1,… (6… )(… (2… )(… 163 -3 (7… ) 2,…
P…
(…
N…
(… (5… ) (2… ) (1… ) 601 (3… ) 2,…
I…
N…
(…
I…
A…
to
M… (5… ) (2… ) (1… ) 601 (3… ) 2,…
&
C…
I…
R…
N…
U…
(…
E…
p…
C… $ (0… ) (1… ) (0… ) 0.… (1… ) $ 1.…
S…
A…
D…
(…
E…
I… 13… % 49… %
T…
R…
Only the line items that are affected by non-GAAP adjustments
are shown.
The Company is providing certain 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 non-GAAP information enhances
investors’ understanding of the Company’s
results because management uses non-GAAP measures 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. The non-GAAP information
presented should be considered in addition to, but not as a substitute for
or superior to, information prepared in accordance with
GAAP.
(1)
Amounts included in cost of sales reflect expenses for the amortization of
intangible assets, as well as the recognition of fair
value step-up of inventories related to the 2025 Verona Pharma plc
acquisition. Amounts included in selling, general and administrative
expenses reflect integration, transaction and certain other costs related to
acquisitions and divestitures.
(2)
Amounts primarily include employee separation costs, accelerated
depreciation and asset impairment charges associated with facilities
to be closed or divested, as well as contractual termination costs, related
to activities under the Company's formal restructuring
programs.
(3)
Represents the estimated tax impacts on the reconciling items based on
applying the statutory rate of the originating territory of
the non-GAAP adjustments.
(4)
Because the Company recorded a net loss in the first nine months of 2026, no
potential dilutive common shares were used in the computation
of loss per common share assuming dilution as the effect would have been
anti-dilutive.
MERCK & CO., INC.,
RAHWAY, N.J., USA
FRANCHISE / KEY PRODUCT SALES
(AMOUNTS IN MILLIONS)
(UNAUDITED)
Table 3
…
… …
… …
% %
──────────────────────────────────────────────────────────────────────────────
$ 5 5
4 5
… 1
* *
… 0
… 6
… …
… …
… 1
7 2
… …
… …
8 …
… …
… …
… …
… 7
… …
… …
… …
… …
… …
… …
… …
- -
5 4
… 2
… …
4 8
2 8
6 8
… …
*200% or greater
Sum of quarterly amounts may not equal year-to-date amounts due to rounding.
(1)Only select products are shown.
(2)Alliance Revenue represents the Company's share of profits, which are product
sales net of cost of sales and commercialization costs.
(3)Alliance Revenue represents royalties.
(4)Alliance Revenue represents the Company's share of profits from sales in
Bayer's marketing territories, which are product sales net of cost of sales and
commercialization costs.
(5)Net product sales in the Company's marketing territories.
(6)Includes Pharmaceutical products not individually shown above. Also reflects
total alliance revenue for Koselugo of $161 million, $10 million and $13 million
in the first, second and third quarter of 2026, respectively, and $44 million,
$43 million and $214 million in the first, second and third quarter of 2025,
respectively.
(7)Other Revenues are comprised primarily of revenues from third-party
manufacturing arrangements and miscellaneous corporate revenues, including
revenue-hedging activities. Other Revenues related to the receipt of milestone
payments for out-licensed products were $132 million, $0 million and $2 million
in the first, second and third quarter of 2026, respectively, and $95 million,
$5 million and $11 million in the first, second and third quarter of 2025,
respectively.