US-based Merck, Sharp & Dohme Inc. (MSD, NYSE: MRK) released its Q4 2024 financial report, highlighting strong global revenue growth. Global revenues reached USD 15.6 billion in Q4, up 9% year-on-year (YOY) excluding currency impacts. Over the full year, revenues increased 10% to USD 64.17 billion. The growth was driven by robust performance in pharmaceutical sales and key products like Keytruda.
Pharmaceutical Sales and Keytruda Performance
Full-year 2024 pharmaceutical sales grew 10% to USD 57.4 billion. The company’s PD-1 drug Keytruda (pembrolizumab) continued to dominate, recording USD 29.48 billion in sales, up 22% YOY. Meanwhile, the HPV vaccine family Gardasil/Gardasil 9 saw a slight decline, with global sales falling 2% YOY to USD 8.58 billion. Animal Health sales also grew, rising 4% to USD 5.9 billion for the full year.
China Market Challenges and Gardasil Suspension
In China, MSD faced significant challenges in 2024. Full-year sales in China fell 20% YOY to USD 5.394 billion, with Q4 sales plummeting 41% YOY to USD 864 million. The primary driver of this decline was falling demand for Gardasil/Gardasil 9, which saw a 17% YOY drop in Q4 sales to USD 1.55 billion. As a result, MSD announced it will pause deliveries of all Gardasil vaccines to China from February 2025 until at least mid-year. Additionally, sales of sitagliptin and sitagliptin + metformin were impacted by generic competition.
CEO Comments and Future Outlook
During the earnings call, CEO Rob Davis addressed the Gardasil situation, noting increased pressure on discretionary consumer spending and elevated channel inventory levels. The aim is to reduce inventory and support the financial position of distribution partner Zhifei Bio. Gardasil sales in 2025 are forecast to be zero at the low end or up to USD 1 billion at the high end, with expectations for market demand to return in 2026 and 2027. MSD has withdrawn its original USD 11 billion sales target for Gardasil, focusing on resolving market dynamics in China.
2025 Financial Guidance
Despite the challenges in China, MSD issued its 2025 non-GAAP guidance, projecting revenues between USD 64.1 billion and USD 65.6 billion, representing 2% to 4% growth. Excluding the impact of Gardasil, sales are forecast to grow 7% to 9%.-Fineline Info & Tech
