Merck Diversifies Portfolio Ahead of Keytruda Patent Expiration

Merck's portfolio is expanding rapidly as it prepares for the eventual loss of exclusivity on its blockbuster cancer drug Keytruda in 2028. The company generated $16.40 billion in revenue from Keytruda in the first half of this year, accounting for more than 55% of total pharmaceutical sales.

Keytruda's subcutaneous formulation, Qlex, contributed $590 million to the total during the period. While its patent exclusivity will expire in 2028, Keytruda's sales are expected to remain strong until then.

Merck is diversifying its revenue base and building a portfolio capable of offsetting the anticipated pressure on the top line. Newer products such as Winrevair, a treatment for pulmonary arterial hypertension, and Capvaxive, a 21-valent pneumococcal conjugate vaccine, have already emerged as important contributors to top-line growth.

The company has also accelerated acquisitions over the past year, adding late-stage influenza and hematology/cancer pipeline assets through the buyouts of Cidara Therapeutics and Terns Pharmaceuticals. Merck's management expects a 'shallow dip with a fast return back to growth' as the company assembles a multi-product growth bridge.