Merck & Co Inc (NYSE:MRK) stock fell 1.51% (As on February 5, 11:21:22 AM UTC-4, Source: Google Finance) after the company provided weaker-than-expected 2025 guidance. The company is halting shipments of a top-selling vaccine to China to help a key local supplier reduce excess inventory, hurting sales forecasts for one of its blockbuster medicines. The sales growth in newly launched hypertension drug Winrevair, which Merck acquired in 2021 in an $11.5bn acquisition, was also more tepid than expected, generating just under $420mn last year. Keytruda brought in $29.5 billion in sales in 2024, an 18% increase compared to 2023, while Gardasil brought in $8.6 billion, a 2% decline compared to 2023.

MRK in the fourth quarter of FY 24 has reported the adjusted earnings per share of $7.65, beating the analysts’ estimates for the adjusted earnings per share of $7.56. The company had reported the adjusted revenue growth of 7 percent to $64.2 billion in the fourth quarter of FY 24, beating the analysts’ estimates for revenue of $64 billion. Gross margin was 75.5% for the fourth quarter of 2024 compared with 73.3% for the fourth quarter of 2023. The increase was primarily due to the favorable effects of product mix (including lower royalty rates related to KEYTRUDA and GARDASIL/GARDASIL 9) and foreign exchange, partially offset by higher manufacturing-related costs (including inventory write-offs) and higher amortization of intangible assets.

Moreover, in oncology, Merck announced positive topline results from the pivotal Phase 3 MK-3475A-D77 trial evaluating the noninferiority of subcutaneous pembrolizumab and berahyaluronidase alfa, in combination with chemotherapy, versus intravenous (IV) KEYTRUDA administered with chemotherapy, for the first-line treatment of adult patients with metastatic NSCLC. Additionally, Merck received new approvals for KEYTRUDA-based regimens in Japan and China, as well as for WELIREG and Lynparza in China. In vaccines and infectious diseases, the FDA accepted the Biologics License Application (BLA) for clesrovimab, an investigational prophylactic long-acting monoclonal antibody designed to protect infants from respiratory syncytial virus (RSV) disease.

The pharmaceutical group forecast full-year sales to be of between $64.1bn and $65.6bn in 2025, broadly flat compared with $64.1bn of sales last year and less than consensus expectations of $67.3bn.Merck blamed the lower than expected forecast on the decision to pause shipments of its Gardasil vaccine to China until at least mid-year. Gardasil is given to patients to prevent human papillomavirus, which is linked with cervical cancer. It also projected earnings per share of between $8.88 and $9.03 for 2025, below Wall Street expectations of $9.19.