Merck & Co., Inc. (NYSE:MRK) reported fourth-quarter 2025 revenue of $16.4 billion, up 5% year over year (4% excluding foreign exchange), as continued growth in oncology and animal health helped offset a sharp decline in Gardasil sales driven by weaker demand in China and Japan. Management also outlined its initial 2026 non-GAAP guidance and highlighted a slate of upcoming clinical and regulatory milestones across cardiometabolic and respiratory, infectious disease, immunology, oncology, and ophthalmology.
Quarterly performance driven by Keytruda and newer launches
Chief Financial Officer Caroline Litchfield said oncology remained the largest driver of results. Sales of the Keytruda family, including Keytruda and Keytruda QLEX, rose 5% to $8.4 billion globally, supported by uptake in earlier-stage cancers and sustained demand in metastatic settings. Litchfield noted that utilization in tumors that primarily affect women (including breast, cervical, and endometrial cancers) contributed to growth, along with increased use of Keytruda in combination with Padcev in locally advanced or metastatic urothelial cancer.
Beyond Keytruda, Merck pointed to continued momentum in its broader oncology portfolio. Welireg sales increased 37% to $220 million, driven largely by greater use in certain previously treated advanced renal cell carcinoma patients in the U.S. and continued international launch uptake.
Vaccines mixed as Gardasil declines, pneumococcal launch advances
Merck’s vaccine portfolio showed a split performance. Gardasil sales totaled $1.0 billion, down 35%, reflecting lower demand in China and Japan. Litchfield said other international markets grew 8% on the timing of purchases, while U.S. sales rose 7%, “largely due to price.”
In pneumococcal vaccines, the Capvaxive launch generated $279 million in sales, supported by retail and non-retail demand and seasonal immunization activity in the U.S. In RSV, Enflonsia recorded $21 million in sales, though initial uptake was constrained by lower-than-expected infant immunization rates and elevated total RSV monoclonal antibody inventory in the market.
Winrevair and COPD launch contribute to cardiometabolic and respiratory growth
Merck highlighted continued demand for Winrevair in pulmonary arterial hypertension, reporting global sales of $467 million in the quarter. In the U.S., Litchfield said more than 1,500 new patients received a prescription and more than 27,000 total prescriptions were dispensed. She also noted an increasing proportion of patients whose background therapies do not include prostacyclin. Outside the U.S., Merck said it is progressing approvals and reimbursement.
Merck also discussed the early performance of Ohtuvayre, a COPD maintenance treatment acquired through the Verona transaction that closed October 7. Q4 sales were $178 million, reflecting revenue following the acquisition date. Litchfield cited growth in new patient starts, total patients treated, and the number of prescribing physicians. She cautioned that the company expects early-year seasonality as Medicare deductibles reset and said Merck is investing to support the U.S. launch.
Pipeline and regulatory updates: PCSK9, HIV, influenza prevention, and oncology
Chief Executive Officer Rob Davis and Research Labs President Dr. Dean Li emphasized pipeline progress and business development, including the acquisitions of Verona Pharma and Cidara Therapeutics. Davis said Merck now has “line of sight to over $70 billion of potential commercial opportunity by the mid-2030s,” which he said is $20 billion higher than a year earlier.
Among notable clinical and regulatory developments discussed on the call:
- Enlicitide (oral PCSK9 inhibitor): Li said phase III data from CORALreef Lipids and CORALreef HeFH showed statistically significant, sustained reductions across multiple atherogenic factors, including LDL-C, ApoB, non-HDL-C, and Lp(a). Results from CORALreef Add-on are expected to be presented at ACC in March, and the CORALreef Outcomes study is ongoing and fully enrolled.
- Winrevair label expansion and Cadence: Li said the European Commission approved an expanded PAH indication (WHO functional class II-IV) based on the phase III Zenith study. He also said the phase II Cadence trial met its primary endpoint in combined post- and pre-capillary pulmonary hypertension due to HFpEF, supporting proof of concept and informing a phase III program.
- M K-1406 (formerly CD388) influenza prevention: Management emphasized the Cidara acquisition and the potential of MK-1406 as a long-acting, preventative antiviral candidate. Li said the phase III ANCHOR study completed Northern Hemisphere enrollment in November, with recruitment planned in the Southern Hemisphere to broaden the data set across populations, strains, and vaccination status. In Q&A, Li said the trial is event-driven and stressed the need for robust subgroup data; the company did not outline communication plans for any interim analysis.
- HIV (doravirine/islatravir and weekly regimens): Li said phase III top-line results showed a once-daily, two-drug doravirine/islatravir regimen was noninferior in efficacy and safety versus Biktarvy, calling it the first two-drug regimen without an integrase inhibitor to demonstrate that outcome. Management also highlighted upcoming top-line data from ISLAND-1 and ISLAND-2 evaluating islatravir and lenacapavir as a once-weekly oral two-drug regimen.
- Oncology updates: Li cited FDA approval of Keytruda and Keytruda QLEX in combination with Padcev as neoadjuvant and adjuvant treatment for cisplatin-ineligible muscle-invasive bladder cancer, and positive top-line results from KEYNOTE-B15 in cisplatin-eligible patients. He also referenced 5-year follow-up data from KEYNOTE-942 with Moderna in melanoma and an EU approval for subcutaneous pembrolizumab (Keytruda SC) across all Keytruda adult indications.
2026 outlook: modest revenue growth with notable headwinds and a large Cidara-related charge
For 2026, Merck guided to non-GAAP revenue of $65.5 billion to $67.0 billion, representing 1% to 3% growth, including an estimated one percentage point benefit from foreign exchange at mid-January rates. Merck’s non-GAAP gross margin assumption is approximately 82%.
Merck guided to operating expenses of $35.9 billion to $36.9 billion, including a one-time charge of approximately $9 billion tied to the Cidara acquisition. The company guided to other expense of about $1.3 billion, including financing costs for Cidara and Verona, and a full-year tax rate of 23.5% to 24.5%, reflecting the non-tax-deductible nature of the Cidara charge.
On the bottom line, Merck forecast 2026 non-GAAP EPS of $5.00 to $5.15 (midpoint $5.08), including an estimated $0.10 foreign exchange benefit. Excluding approximately $3.65 per share related to the upfront Cidara charge and $0.30 per share of ongoing costs to advance MK-1406 and finance the transaction, management said the EPS midpoint would be $9.03.
Litchfield said the company expects 2026 growth to be driven by new launches and continued strength in oncology and animal health, despite an estimated $2.5 billion headwind from generic competition, IRA price setting, and a restructured agreement for Koselugo. She said generic competition is expected to primarily impact the Januvia family, Bridion, and Dificid, and the company expects significantly lower Lagevrio sales due to soft demand.
In capital allocation, Merck reaffirmed its commitment to investing in the business and the dividend, and said its guidance assumes approximately $3 billion of share repurchases.
In Q&A, management also addressed Keytruda intellectual property timing, describing a patent estate that includes a compound patent expiring in December 2028 and additional method-of-making and method-of-use patents extending into 2029. Merck said it continues to plan conservatively around 2028 while aiming to defend the full patent estate, and reiterated expectations that Keytruda QLEX adoption could reach 30% to 40% by 2028.
About Merck & Co., Inc. (NYSE:MRK)
Merck & Co, Inc is a global biopharmaceutical company engaged in the discovery, development, manufacture and marketing of prescription medicines, vaccines, biologic therapies and animal health products. Its portfolio spans multiple therapeutic areas with a particular emphasis on oncology, vaccines and infectious disease, as well as therapies for metabolic and chronic conditions. Among its well-known products are the cancer immunotherapy Keytruda (pembrolizumab) and the human papillomavirus vaccine Gardasil; the company also markets a range of medicines and vaccines for veterinary use through Merck Animal Health.
Founded in the late 19th century as the U.S.
