Merck's Cancer Revenue Mix Under Scrutiny as New Oncology Data Emerges

Merck's investment narrative is being put to the test as new oncology data emerges. A recent trial collaboration between Merck and Perspective Therapeutics aims to combine Keytruda with [212Pb]PSV359 in treating non-small cell lung and colorectal cancers. This partnership gives Merck 'extra shots on goal' around Keytruda at a time when competition from drugs like ivonescimab is intensifying.

The latest Phase 3 survival data from Akeso and Summit Therapeutics shows that ivonescimab outperformed Keytruda in lung cancer treatment. This raises concerns about the long-term viability of Merck's cancer revenue mix and investment priorities.

Analysts are re-examining their forecasts, with some still optimistic about Merck's earnings power. However, the consensus story relies on numerical assumptions rather than loose optimism, pointing to revenue rising by 4.1% a year over the next three years and profit margins moving from 4.8% to 29.9%.