Merck's Non-Oncology Drugs Q3 Performance: What to Expect

Core Insights - Merck (MRK) is set to report its third-quarter 2025 results on October 30, with a focus on the sales performance of its leading cancer drug, Keytruda, which contributed over 50% of the company's pharmaceutical sales in the first half of 2025 [1][9] - The company is also monitoring the performance of its non-oncology drugs, particularly the newly approved 21-valent pneumococcal conjugate vaccine, Capvaxive, and the pulmonary arterial hypertension (PAH) drug, Winrevair, both of which showed strong sales in the first half of 2025 [2][9] Sales Performance - Keytruda remains a significant revenue driver, but its exclusivity is set to expire in 2028, prompting investors to pay attention to non-oncology products [2] - Capvaxive generated sales of $236 million, while Winrevair achieved $615 million in sales during the first half of 2025 [2] Growth Projections - The new drugs are expected to perform well in Q3 2025, supported by their strong initial uptake [3] - Merck's Animal Health business is also contributing to revenue growth, with an estimated compound annual growth rate (CAGR) of 5.9% over the next three years [3] Product Launches and Approvals - Merck's RSV antibody, Enflonsia, was approved in the U.S. in June 2025 and is under review in the EU, with plans for launch to protect infants during their first RSV season [4] - A fixed-dose combination for HIV treatment is also under review, with an FDA decision expected in April next year [4] Competitive Landscape - Winrevair faces competition in the PAH market from major players like United Therapeutics and Johnson & Johnson, which reported significant revenues from their PAH products [5][6] - Enflonsia will compete with AstraZeneca/Sanofi's RSV antibody, Beyfortus, and other vaccines approved for RSV prevention [6][7] Stock Performance and Valuation - Year-to-date, Merck's shares have declined by 12.3%, underperforming the industry and the S&P 500 [8] - The company's shares trade at a price/earnings ratio of 9.33, which is lower than the industry average of 15.56 and its 5-year mean of 12.63, indicating attractive valuation [10] Earnings Estimates - The Zacks Consensus Estimate for 2025 earnings per share has slightly decreased from $8.94 to $8.92, while the estimate for 2026 has decreased from $9.55 to $9.44 over the past 60 days [11]