A few days ago, Merck released its 2023 financial report. The company's annual global sales were 601US$1.5 billion, up 1% year-on-year, and full-year sales increased 9% year-on-year after deducting the impact of the new crown oral drug lagevrio (molnupiravir); GAAP net income was 3$6.5 billion, up from $14.5 billion in 2022$1.9 billion, down 97% year-on-year. Its PD-1 inhibitor pembrolizumab (Keytruda, commonly known as K drug) achieved sales of 250 percent last year1.1 billion US dollars, the performance of the drug exceeded the sales of Humira (adalimumab) and became the new "king of drugs" in the world. However, with the strong growth of semaglutide and tirpatide, the throne of the global "drug king" of K drug is not stable.
K medicine has become the new "king of medicine".
Pharmaceuticals, animal health and other businesses make up Merck's business landscape. Among them, the pharmaceutical business is the core business unit. In 2023, the business segment achieved revenue of 535$8.3 billion, up 3% year-on-year.
K drug is undoubtedly the trump card product of Merck's pharmaceutical division. In September 2014, Drug K was approved for marketing in the United States and in China in 2018. As of January 2024, the drug has been approved for 39 indications in the U.S. and 12 in China, covering melanocytic tumor, non-small cell lung cancer, gastric cancer, esophageal cancer and breast cancer.
In 2023, the global sales of K drug will reach 250US$1.1 billion, up 19% year-on-year, contributing approximately 4667% of pharmaceutical revenues. The revenue growth of nearly 20% has pushed K drug to the throne of the global "drug king".
Due to its wide range of indications and high sales, Humira, a subsidiary of AbbVie, has topped the list of best-selling drugs in the world for many years. As the world's first fully human anti-tumor necrosis factor monoclonal antibody approved for marketing, the drug was approved by the US FDA in 2002 for the treatment of **moderate to severe rheumatoid arthritis, and was launched in China in 2010. At present, the drug has been approved for rheumatoid arthritis, ankylosing spondylitis, psoriasis and Crohn's disease.
However, due to the impact of competing products such as biosimilars, Humira's growth began to decline. From 2020 to 2022, Humira's global sales were 198$3.2 billion, $206$9.6 billion, 212$3.7 billion. By 2023, Humira's revenue will decline by 322% to 1440.4 billion US dollars.
In an interview with a reporter from Beijing Business Daily, Li Xu, an investor in the pharmaceutical industry, said that although K medicine has become the new global "king of medicine" this year, with the strong growth of semaglutide and tirpatide, the global "king of medicine" has ushered in a number of strong competitors, and the position of the global "king of medicine" of K medicine is difficult to last long.
HPV vaccine revenue increased by 29%.
K drug is the largest product in the pharmaceutical division in terms of revenue, and the HPV vaccine Gardasil is the strongest product in the pharmaceutical division. In 2023, Merck achieved sales of 88 percent of its HPV vaccine$8.6 billion, up 29% year-on-year. Together, K-drug and HPV vaccine support half of Merck's performance. In its financial report, Merck specifically mentioned that the growth of the pharmaceutical business was mainly due to the increase in sales of oncology drugs and vaccine products.
Merck's HPV vaccine is divided into quadrivalent vaccine and 9-valent vaccine, and since its launch, neither of the above vaccines has a competitor with the same price. As the world's first approved 9-valent HPV vaccine, Merck's Gardasil 9 was approved in China in April 2018 for women aged 16-26. In August 2022, the new indication of gardasil 9 was approved by the National Medical Products Administration, and the applicable population was expanded to women aged 9-45 years.
The two-dose vaccination schedule of Gardasil 9 (0,6-12 months) was approved by the National Medical Products Administration in January this year, and on the basis of the previous three-dose vaccination schedule for 9-45 years old, Merck Sharp & Dohme's 9-valent HPV vaccine added a two-dose vaccination schedule for 9-14 years old.
The Chinese market has become an important market for the growth of HPV vaccines. In the fourth quarter of 2023, Gardasil's global sales increased 27% year-over-year to 18$7.1 billion. Merck said Gardasil's growth was mainly due to strong global demand, especially in China, as well as purchases from the U.S. public sector.
The strong demand for gardasil in the Chinese market can be seen from the financial report of Zhifei Biotech, a leading domestic company. In the first half of 2023, Zhifei Biotech's ** products will achieve an operating income of 2358.3 billion yuan, a year-on-year increase of 4135%。Quadrivalent HPV vaccine batch issued 626670,000, a year-on-year increase of 285%；The batch issuance of 9-valent HPV vaccine reached 1467820,000, a year-on-year increase of 5785%。
The sales of drug K and HPV vaccines performed well, accounting for 56% of Merck's total revenue4%, but the patent cliff and the catch-up of competitors have made both products challenging. It is reported that the patent of drug K is expected to expire in 2028. In addition, Chinese vaccine manufacturers have accelerated the research and development of 9-valent HPV vaccines, and a number of products have entered phase 3 clinical trials.
Among the big pharma peers, Merck is the company most affected by patent expiration, and its $55 billion in sales will lose patent protection between 2023 and 2030, according to analysts. Robert M., CEO of MSD"The focus of the discussion at this stage is undoubtedly Keytruda and 2028, but we are increasingly less focused on 2028, which is just a year," D**is saying at this year's J.P. Morgan Healthcare Conference.
Despite Robert MD**is optimistic, but under his leadership, Merck has signed multibillion-dollar agreements to help build new product lines.
Beijing Business Daily reporter Yao Qian.