NEW YORK – Merck announced on Thursday a 24 percent increase in revenues for the fourth quarter of 2021, driven by sales of its immune checkpoint inhibitor Keytruda (pembrolizumab).
For the three months ending Dec. 31, the Kenilworth, New Jersey-based company reported $13.52 billion in sales compared to $10.95 billion in Q4 2020, outperforming analysts' consensus estimate of $13.16 billion.
Pharmaceutical sales during Q4 2021 totaled $12.04 billion, up 23 percent from $9.81 billion in the prior year's quarter.
Growth in the oncology segment in Q4 was largely driven by higher Keytruda sales of $4.58 billion, up 15 percent from $3.99 billion in Q4 2020. According to the firm, continued growth of the blockbuster immune checkpoint inhibitor comes from its lucrative non-small cell lung cancer indications as well as uptake in renal cell carcinoma, head and neck squamous cell carcinoma, microsatellite instability-high cancers, and triple-negative breast cancer.
The European Commission approved Keytruda's TNBC indication in October. Merck is also evaluating the drug in a number of combination treatment settings.
Given the impending loss of several key patents for Keytruda, the firm's top-selling product, Merck is "intensely focused on successfully navigating the headwinds created by likely biosimilar competition to Keytruda at the end of the decade," Merck CEO Robert Davis said in a conference call to discuss the Q4 and full-year financial results. "At the very least, we will work to minimize the headwind and shorten the time it takes to return to strong growth."
Sales of the firm's PARP inhibitor Lynparza (olaparib) — which it markets with AstraZeneca — brought in $268 million in alliance revenue during Q4 2021, up 30 percent from $206 million in Q4 2020.
Merck's GAAP net income for the quarter was $3.82 billion, or $1.51 per share, compared to a loss of $2.62 billion, or $1.03 per share, in Q4 2020. The firm's non-GAAP EPS was $1.80, above analysts' average estimate of $1.53.
R&D spending was down 47 percent to $3.07 billion during the fourth quarter from $5.79 billion in Q4 2020. Selling, general, and administrative costs went up 8 percent to $2.83 billion from $2.62 billion during the prior year's quarter.
For full-year 2021, Merck's revenue rose 17 percent to $48.70 billion versus $41.52 billion in 2020, beating Wall Street analysts' consensus estimate of $48.48 billion.
Keytruda sales grew 20 percent in 2021 to $17.19 billion from $14.38 billion in 2020. Lynparza alliance revenue for the year increased 36 percent to $989 million from $725 million in 2020.
For the full year, Merck's GAAP net income was $12.35 billion, or $4.86 per share, versus $4.52 billion, or $1.78 per share, in 2020. Non-GAAP EPS for the full year was $6.02, exceeding analysts' consensus estimates of $5.76.
R&D spending was down 9 percent to $12.25 billion in 2021, from $13.40 billion during 2020. Selling, general, and administrative costs increased 7 percent to $9.63 billion, from $8.96 during 2020.
In 2022, Merck is expecting revenues to be between $56.1 billion and $57.6 billion, and non-GAAP EPS to be between $7.12 and $7.27.