Merck & Co Inc (NYSE:MRK) stock fell 0.85% (As on April 25, 11:32:15 AM UTC-4, Source: Google Finance) after the company reported higher-than-expected quarterly earnings despite an apparent slowdown in sales growth for Keytruda, its flagship cancer immunotherapy. The US pharmaceutical group reported net income of $5.6bn, or $2.01 per share, for Q1, compared with $5.3bn, or $1.87 per share, a year earlier. In oncology, at the European Lung Cancer Congress 2025, Merck presented pivotal data from the 3475A-D77 Phase 3 trial evaluating the subcutaneous administration of pembrolizumab with berahyaluronidase alfa (subcutaneous pembrolizumab). Based on these data, applications for subcutaneous pembrolizumab are under review in the U.S. and Europe; in the U.S., the Prescription Drug User Fee Act (PDUFA) date is Sept. 23, 2025. Merck also announced the initiation of waveLINE-010, a Phase 3 trial evaluating a combination regimen that incorporates zilovertamab vedotin, an investigational antibody-drug conjugate (ADC) targeting receptor tyrosine kinase-like orphan receptor 1, for the treatment of patients with previously untreated diffuse large B-cell lymphoma (DLBCL).

MRK in the first quarter of FY25 has reported the adjusted earnings per share of $2.22, beating the analysts’ estimates for the adjusted earnings per share of $2.14. The company had reported the adjusted revenue decline of 2 percent to $15.5 billion in the first quarter of FY25, beating the analysts’ estimates for revenue of $15.3 billion. This is due to a 41% drop in Chinese sales of its HPV vaccine Gardasil. Revenue from Keytruda, its best-selling monoclonal antibody, rose 4% to $7.2bn, far from the double-digit growth rates seen in the past. Gross margin was 78.0% for the first quarter of 2025 compared with 77.6% for the first quarter of 2024. Research and development (R&D) expenses were $3.6 billion in the first quarter of 2025, a decrease of 9% compared with the first quarter of 2024. The decrease was primarily due to a $656 million charge for the acquisition of Harpoon in the first quarter of 2024 and the favorable impact of foreign exchange. The decrease was partially offset by a $100 million charge in the first quarter of 2025 associated with the achievement of a developmental milestone related to the 2024 acquisition of Eyebiotech Limited (EyeBio), increased compensation and benefit costs, higher clinical development costs, and increased discovery research and early drug development costs.

For the full year, Merck said it continues to target revenue of between $64.1bn and $65.6bn, but has lowered its EPS forecast to between $8.82 and $8.97 due to the recent licensing agreement with Hengrui Pharma. The laboratory said that these estimates take into account an additional cost of around $200m related to customs surcharges imposed by the US.