Merck & Co. (MRK) Q3 2026 Earnings Call: Q&A Summary

Q: Chris Schott from JPMorgan asked if 2027 guidance is reflected in consensus estimates and if R&D spending is pulling forward the earnings trough.

A: Caroline Litchfield explained that 2027 is an investment year with moderate top-line growth offset by $2 billion in headwinds from generic competition and loss of exclusivity. She noted that while KEYTRUDA growth will moderate, the company expects a shallow revenue dip before returning to growth.

Q: Asad Haider from Goldman Sachs asked for an update on the $70 billion revenue opportunity target for the mid-2030s.

A: Rob Davis stated he has increased confidence in the $70 billion target, noting it excludes the Turns acquisition, the PD-1 VEGF bispecific, and the stronger-than-expected commercial profile of intismeran.

Q: Vamil Divan from Guggenheim Securities asked for the WINREVAIR one-time benefit amount and details on the CORE trial design.

A: Caroline Litchfield clarified that the $550 million total benefit included $200 million for KEYTRUDA, $50 million for WINREVAIR, and $300 million for vaccines. Dean Li explained the CORE trial for Group 2 pulmonary hypertension targets a high unmet need and is not expanding the patient population significantly.

Q: Michael Yee from UBS asked about the confidence in replicating China data for the TroFuse ADC program and other notable indications.

A: Dean Li stated the company has a two-pronged strategy focusing on gynecologic cancers and differentiation in breast and lung, noting that Kelun data provides a signal for global translation. Brian Foard added that the company will not supply subcutaneous KEYTRUDA in several European markets due to a Dutch ruling but remains confident in overall adoption.

Q: Akash Tewari from Jefferies asked about the KRAS G12C trial endpoint change and implications for the sac-TMT PD-1 VEGF bispecific trial.

A: Dean Li emphasized the importance of the KRAS G12C inhibitor calderasib and the company's strategy to create a chemo-free option by combining it with KEYTRUDA.

Q: Daina Graybosch from Leerink Partners asked about the portfolio strategy for other RAS assets beyond calderasib.

A: Dean Li explained they are using calderasib to measure their approach and hope to replicate success in other RAS subtypes like KRAS G12D in CRC and pancreas.

Q: Terence Flynn from Morgan Stanley asked about the implications of the INT PDAC poster presented at ESMO.

A: Dean Li explained the strategy to broaden the cancer vaccine program from melanoma to lung, bladder, and RCC, testing both with and without IO agents to understand the mechanism of action.

Q: Mohit Bansal from Wells Fargo asked about the combination strategy for TL1A and if the company prefers internal or external assets.

A: Dean Li noted that while combinations in immunology have historically struggled, the company remains open to testing them. Rob Davis added they have internal assets and remain open to business development for both development and commercialized products.

Q: Steve Scala from TD Cowen asked about LIPFENDRA sales and the percentage of free drug prescriptions.

A: Brian Foard stated they saw over 11,000 prescriptions from 6,500 prescribers in the third quarter. He noted they expect broad commercial access by 2027 and Medicare access by 2028.

Q: Umer Raffat from Evercore ISI asked about the melanoma cancer vaccine data breakdown and implications for the upcoming RCC readout.

A: Dean Li cautioned against over-interpreting melanoma data for RCC, citing experts who called the melanoma results a landmark in cancer drug development. He emphasized that RCC is already immunoresponsive.