Group 1 - Merck is acquiring Terns Pharma in a deal valued at up to $6.7 billion to enhance its cancer drug pipeline [1] - The acquisition is strategically timed as Merck faces an impending patent loss for its leading cancer therapy, Keytruda [1]

Core Viewpoint - The drugmaker is actively working to enhance its product pipeline in anticipation of the impending loss of patent protection for its leading drug, Keytruda [1] Group 1 - The company is focusing on strengthening its pipeline to mitigate the impact of Keytruda's patent expiration [1]

Core Viewpoint - Merck is nearing a $6 billion all-cash acquisition of Terns Pharma, indicating a significant move in the biotech sector [1][2]. Group 1: Acquisition Details - The deal is reported to be at an advanced stage, with a potential agreement expected in the coming days [2]. - The acquisition reflects Merck's strategy to expand its portfolio in the biotech industry [1]. Group 2: Company Responses - Neither Merck nor Terns Pharma provided immediate comments regarding the acquisition discussions [2].

Group 1 - The Hong Kong pharmaceutical market saw a significant rebound, with the Hong Kong Stock Connect Innovation Drug ETF (159570) rising nearly 3% and achieving a trading volume exceeding 900 million yuan, reflecting strong capital inflow [1] - The ETF's latest scale has surpassed 21.4 billion yuan, leading its peers in the same category [1] - The "20CM Innovation Drug New Species" ETF from Huatai-PineBridge (589120) surged by 4%, with strong capital inflow for two consecutive days [1] Group 2 - Rongchang Biopharmaceutical announced the approval of its antibody-drug conjugate (ADC) Vidi Xituzumab (brand name: Aidiqi®) for a new indication, making it the first domestic ADC therapy approved for treating adult breast cancer patients with low HER2 expression and liver metastasis [3] - Gilead Sciences agreed to acquire Ouro Medicines, which holds approximately 15% equity in Ouro, marking a strategic move in the biopharmaceutical sector [3] Group 3 - WuXi AppTec reported a record high in 2025, achieving revenue of 45.456 billion yuan, a year-on-year increase of 15.8%, and a net profit of 19.195 billion yuan, up 105.2% year-on-year [4] Group 4 - The Hong Kong Stock Connect Innovation Drug ETF (159570) saw most of its underlying index stocks perform positively, with notable gains from companies like Connaissance-B, which rose over 4%, and others like Innovent Biologics and Rongchang Biopharmaceutical, which increased by over 2% [5] Group 5 - The AACR 2026 conference will take place in San Diego, featuring numerous innovative pharmaceutical companies discussing breakthroughs from basic research to clinical translation [6] - Key presentations will include Merck's disclosure of clinical data for MK-2010 and updates from various companies on their clinical trials and research advancements [6][7][8][9] Group 6 - The innovation drug sector is experiencing a surge in funding, with approximately 700 billion yuan raised for research and development from January 1, 2024, to March 21, 2026, across Hong Kong and A-share markets [10] - The BD income and post-listing fundraising are providing substantial financial support for innovative drug companies [10][15] Group 7 - Despite short-term volatility in the innovation drug sector, the long-term growth potential remains intact, with a focus on overseas clinical deployment and product progress becoming critical for future success [16][17] - Leading innovative drug companies are entering a positive cycle of product commercialization, which is expected to exceed market expectations [18]

Core Insights - The FDA has approved a higher-dose version of Novo Nordisk's obesity drug Wegovy, expanding its presence in the competitive weight-loss market [1] - Wegovy HD (7.2 mg) shows an average weight loss of 21% in clinical trials, enhancing Novo Nordisk's competitiveness against Eli Lilly's Zepbound [2] - The obesity drug market is becoming a significant revenue stream for pharmaceutical companies, with drugs like Wegovy transitioning from lifestyle products to essential long-term investment themes [3] Market Dynamics - The obesity prevalence among U.S. adults is at 40.3% as of 2023, creating a substantial market opportunity for weight-loss drugs [4] - The usage of GLP-1 drugs in the U.S. is projected to reach 30 million users by 2030, indicating a growing market for leading drugmakers like Novo Nordisk [5] - The obesity drug market is characterized by intense competition, particularly from Eli Lilly [7] Investment Strategies - Direct investment in Novo Nordisk carries stock-specific risks, including potential supply-chain constraints and manufacturing issues [6] - Healthcare ETFs provide a diversified investment approach, reducing exposure to single-stock risks while capitalizing on the growth of the obesity drug market [8] ETF Recommendations - Roundhill GLP-1 & Weight Loss ETF (OZEM) has net assets of $53.5 million, with top holdings including LLY (16.18%) and NVO (13.31%), and has surged 23.1% over the past year [10] - Amplify Weight Loss Drug & Treatment ETF (THNR) has net assets of $4 million, with top holdings including NVO (12.23%) and LLY (11.79%), and has risen 4.2% over the past year [11] - VanEck Pharmaceutical ETF (PPH) has net assets of $1.31 billion, with NVO holding an 4.77% weightage, and has soared 11% over the past year [12] - iShares Global Healthcare ETF (IXJ) has net assets of $3.60 billion, with NVO holding a 1.58% weightage, and has risen 0.7% over the past year [13]

© 2026 Surrozen, Inc. March 2026 Restoring Vision Through the Science of Renewal Legal Disclaimers This presentation contains certain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements generally are accompanied by words such as "will," "plan," "intend," "potential," "expect," "could," or the negative of these words and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-look ...

Core Viewpoint - Merck Animal Health has received FDA approval for an expanded label for BRAVECTO® QUANTUM, allowing for the treatment and control of specific tick species in dogs for an extended duration of 12 months [1] Group 1: Product Information - The product BRAVECTO® QUANTUM is an extended-release injectable suspension containing fluralaner [1] - The updated indication specifically targets the Asian longhorned tick (H. longicornis) and Gulf Coast tick (A. maculatum) [1] Group 2: Regulatory Approval - The approval was granted by the U.S. Food and Drug Administration (FDA) [1]

Core Insights - Merck celebrates the 10th anniversary of its SPARK™ employee volunteer program, which connects employees with communities through science education and local service [1][2] - The program has expanded globally, with employees from 48 countries volunteering nearly 200,000 hours and reaching over 600,000 students directly [2][4] - Merck aims to broaden access to science education, setting ambitious goals for the next decade, including reaching two million students directly and 75 million through nonprofit partners [4] Program Achievements - SPARK™ has provided interactive science experiences and classroom learning, supported by employee volunteers [1][2] - The program has indirectly reached an additional 9.47 million students globally through nonprofit partnerships [2] - Employees receive up to 16 hours of paid volunteer time annually to engage in meaningful community activities [3] Future Goals - Merck plans to log 650,000 volunteer hours across employees in 66 countries and expand the Curiosity Cube™ to three additional continents [4] - The company aims to deliver 12,000 Curiosity Labs™ lessons as part of its commitment to science education [4] - These goals reflect Merck's dedication to strengthening communities and expanding access to science education [4] Company Overview - Merck operates across life science, healthcare, and electronics, employing over 62,000 individuals [6] - In 2025, the company generated sales of €21.1 billion in 65 countries [6] - Merck has a long history of scientific exploration and responsible entrepreneurship since its founding in 1668 [7]

Core Viewpoint - Merck announced the presentation of new clinical and real-world data supporting the long-term effectiveness of its 9-valent HPV vaccine, GARDASIL®9, and its 4-valent HPV vaccine, GARDASIL, against certain HPV-related cancers and diseases at the EUROGIN International conference [1]. Group 1 - The company is reaffirming the effectiveness of its HPV vaccines through new data [1]. - GARDASIL®9 is a 9-valent Human Papillomavirus vaccine, while GARDASIL is a 4-valent version [1]. - The presentation will take place at the EUROGIN International conference, highlighting the importance of the findings [1].

Core Insights - Merck (MRK) is focusing on long-term growth through new products and a promising pipeline as its key PD-1 inhibitor, Keytruda, approaches patent expiration in 2028 [2][3] - Keytruda accounts for approximately 55% of Merck's pharmaceutical sales, with sales reaching $31.7 billion in 2025, reflecting a 7% year-over-year increase [2][11] - Management projects over $70 billion in potential non-risk-adjusted commercial opportunities from its pipeline by the mid-2030s, significantly higher than previous estimates [4][11] Pipeline and Product Development - Merck's phase III pipeline has nearly tripled since 2021, bolstered by in-house progress and M&A activities [5] - Key new products include Capvaxive, a 21-valent pneumococcal conjugate vaccine with sales of $759 million, and Winrevair, a pulmonary arterial hypertension drug with sales of $1.4 billion in 2025 [6][5] - Other promising candidates in late-stage development include enlicitide decanoate/MK-0616 for hypercholesterolemia and tulisokibart for ulcerative colitis [8] Competitive Landscape - Keytruda faces competition from other PD-L1 inhibitors such as Bristol Myers' Opdivo, Roche's Tecentriq, and AstraZeneca's Imfinzi, with Opdivo generating $10.05 billion in sales in 2025 [10][12] - Merck's strong pipeline and new product launches are expected to help sustain growth even after Keytruda loses exclusivity [9] Financial Performance - Year-to-date, Merck's shares have increased by 9.9%, outperforming the industry and the S&P 500 [13] - The company's shares are trading at a premium with a price/earnings ratio of 18.13, compared to the industry average of 17.58 [15] - Zacks Consensus Estimate for 2026 earnings per share has decreased slightly from $5.54 to $5.47 [16]