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Merck (NYSE:MRK) just took a major hit. The stock tumbled nearly 9.5% as of 2.52 PM today, after the company hit pause on shipments of its blockbuster HPV vaccine, Gardasil, to Chinaan unexpected move that rattled investors. The pause, expected to last through mid-year, signals deeper challenges in a market that was once a growth engine for Merck. Demand has slumped, and with lingering regulatory hurdles, Merck scrapped its ambitious $11 billion annual sales target for the vaccine. Add in concerns over Keytruda's looming patent expiration in 2028, and it's clear why Wall Street is on edge.
Warning! GuruFocus has detected 1 Warning Sign with NVO. The company's 2025 forecast didn't help either. Revenue guidance of $64.1 billion to $65.5 billion landed well below analysts' $67 billion estimate. Gardasil's struggles in China drove a 17% drop in the vaccine's global Q4 sales, raising serious questions about how Merck plans to fill the gap. Keytruda was a rare bright spot, pulling in $7.8 billion for the quarterup 21%but with biosimilar competition on the horizon, Merck needs fresh growth drivers fast.
One play: an easier-to-use version of Keytruda set to launch later this year. But will it be enough? Merck still sees a long-term opportunity in China, betting on untapped demand for Gardasil, particularly among men. Meanwhile, it's doubling down on obesity drugs, striking a deal with Hansoh Pharmaceutical to take on Novo Nordisk (NYSE:NVO) and Eli Lilly (NYSE:LLY) in the weight-loss market. But with geopolitical risks, regulatory hurdles, and fierce competition in every direction, investors are left wondering: Can Merck navigate this storm and come out stronger? This article first appeared on GuruFocus. View Comments
Merck Stock Plunges 9.5% After China Halt--Is This the Beginning of Bigger Trouble?
February 04, 2025 08:01 PM GMT | By EODHD
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