Merck & Co. (MRK) 28 Jul 222022 Q2 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Good morning. My name is Alan, and I will be your conference moderator today. At this time, I would like to welcome everyone to the Merck & Company Q2 Sales and Earnings Conference Call. [Operator Instructions].

conference recorded. this reminder, a is being As Thank you. the would Peter to like turn now to conference Dannenbaum, over I VP Investor Relations. ahead. go Please

Welcome Conference XXXX Second Merck's Call. to Quarter

Davis, Officer; Speaking and Lee, President Labs. Officer; be call Research on Dean Rob Merck today's and Dr. Chief Litchfield, Caroline Executive of Chief Financial will President

like started, Before out few we I'd get items. a point to

items. You'll restructuring costs charges, such as see that acquisition-related we have certain items other in our GAAP results and

statements a reconciliation You Merck's on that current uncertainties that may provide uncertainties. inaccurate non-GAAP have forward-looking the from results U.S. would Private these I materialize, and Securities management excluded If prove safe those results in some statements that you Litigation our our should significant we Such may from made beliefs in like our within the statements are make Reform harbor of risks note we of or the subject actual forward-looking XXXX. the Act remind the to release. of press are assumptions provision today and and statements. to considered materially meaning underlying based be differ the of of

no cause to to factors in Our Item identify company's risk the that obligation any our XA forward-looking and of statements. any differ morning. results the could undertakes cautionary imply this XXXX SEC certain actual Merck materially from statements projected XX-K, and including filings, those forward-looking made statements update

turn to that, remarks. as section accompany will Relations posted to speaker's our website. the all presentation The are as Merck's today filings to slide a of like our the call, Rob. today's With SEC earnings presentation over During release well call I'd Investor

priorities success the the sustain shareholders. pipeline. the well. robust for and and additional long thank pleased joining by deliver I'm and report top simultaneously proud call. the investments our to of to firmly guided perform bottom We into We're extremely in during bid and Thanks, long-term strategic executing necessary and our to patients report value achieved to while our continues future. growth growth today's front Peter. us to we today, in that Good made to business I'm advancements remain you line morning, that making opportunities on the quarter, clinical important second

Turning again first to our growth exceptional results. and strong including this led key by KEYTRUDA, achieved performance products, We BRIDION. quarter of GARDASIL

innovative from by in results Our momentum to LAGEVRIO, the fighting is we see continue to pleased which in revenue our are our confident to in our updated rated guidance. COVID-XX. we portfolio helping which underlying reflect demand We're as for business,

research Moving to organization.

pipeline continue for suite approval received case, the in to most prevention expanded FDA of VAXNEUVANCE pediatric pneumococcal We our advance pneumococcal important option from for our sort an significantly invasive in providing an disease. across vaccines.

vaccine, June, In and reiterated into oncology we in an well also from become presented to milestones ambition the to of and ASCO. our children sustaining our designed highlighted remaining At the depth opportunities We hosted and leading the our program. taste of see by pipeline. by we phase address of success goal event, address next we event significant confidence oncology also we've the in VXXX, the company the and adults, the investor this taken have XXXX of the in studies We needs of at to population breadth our decade. studies. the specific initiated These reinforce our additional approach we difficult adults. clinical We've understand results specifically III

The employees progress every across We're on strong bands in challenging all us. across production meaningful strong by of of demonstrating As achieving making our levels and front in the in growth, worth CEO, taking expand opportunity our our in execution market I'm resilience and driving focused outlook. exceptionally position operations, a the impressive on worldwide a we've global revenue manufacturing significant of environment. delivering pretty business pipeline indication in starting interim my We're pleased year unwavering I as our important aspects our of first leader to as significant global business. made advancing reflect pharmaceutical is momentum our steps

Our turn to strategy long-term even and and our our bright. confident goals, positioned value medicines patients very I our With we anchored by and all is that, important over that today working ago, deliver confident including year to and future achieve a was Caroline. well to I'm is of near more to and to I'll our vaccines the shareholders. call stakeholders, are commitment

Good you, Thank morning. Rob.

momentum further another is demonstrate core strategy in working. exceptional are earnings. year's our that revenue maintaining we this with highlighted, performance personal and quarter of our both of Rob science the strong results As These as

Our $XX.X billion, an success increase value excellent to patients, products globe the of across continue dedicated $X.X contributing revenue. enabled were shareholders. execution in our and for and is by the being XX%. company customers deliver revenues billion LAGEVRIO of

very growth be The remainder will XX%. delivered of an basis. my comments strong ex-exchange on Excluding LAGEVRIO, of business the

Health business growth strong or continued our LAGEVRIO pillars. by XX%, of Human Our XX% momentum key its driven with excluding

business with Health companion and both sales X% Our increasing also livestock driven strong animal products. performance, our Animal across delivered by growth

is vast cancers. renal-cell and early the experiencing transfers, KEYTRUDA success Now its growth KEYTRUDA continues melanoma. in oncology, as continued strong new more across to global the into indications patient and recent demonstrate indications stage continued demand reflect the driven approved globe. growth. launches $X.X and X performance confident is in now In seen strong brands. physician momentum is earlier our to billion, as turning metastatic grew it by impact to patients experience triple-native the from second In in are having breast of expansion including as indication preponed to carcinoma KEYTRUDA utilization key XX% and and the well U.S., in stage We've in

KEYTRUDA setting, triple-net XX metastatic patients. KEYTRUDA particularly X the the an uptake leadership distinct strong maintained KEYNOTE-XXX, area based unmet a out indicators United the need. encouraging Initial inhibitor. also renal was patients The in cancer lung cancer European of U.S., neck cancer States seen by key treatment neoadjuvant lung in markets. to in cancer indications, Outside part Lynparza in the ongoing non-small a continued high-mileage cancer in and breast including cell market-leading a have and on remains point significant driven capturing in offering carcinoma. uptake cell position the We adjuvant breast In carcinoma renal and in trends of non-small

in potentially XX% to Our approval strong the endometrial in by following uptaking forward stage based revenue PMOTXXX XX%, digital leadership demand We by and reaching grew Lenvima of cancer renal prospect cell carcinoma the following expanding look on metastatic cancer by early due driven with breast grew patients FDA to revenue high-risk patients [indiscernible]. advanced cancer. study. launch

New tumors strong. patient target remain

U.S. growth continue rate to we XX% WELIREG in GARDASIL, in CDC growth In although as particularly Lastly, expectations. impact increased from the line delivered to billion. tracking due was • driven which to be $X.X demand, as to underlying well encouraged decrease Outside purchasing again increased patterns, U.S., [indiscernible]. which China Portfolio by the GARDASIL strong supply. is that primarily by with by significant we continue be excellent

invest that increase prevent our the XX%, acute their and division We help greater to surgical males. HPV-related sales behind was portfolio, hospital both to campaign routine care growth We during in recognize confident and certain In importance [indiscernible]. particularly by procedures. ability share proven the GARDASIL cancers driven the the in trajectory of in females parents to continue given children, of to remain the ensure activation among

$X.X these favorable reflecting increased Operating expense. now business million, of will expense increasing solid of quarter X%, in was you and line XX.X%, through health costs, impact across poultry. mix of higher portfolio reflected the partially expenses in my $XXX XX% percentage the year's as plan, was exchange. XXXX manufacturing charges remainder related higher-than-expected incline our animal R&D will a driven increased key of of points. decrease $X.X offset due our Gross walk by grew Other a our is for Operating X.X decreased baseline million to Companion of last X%, on by quarter, driven pipeline. demand Our the another be [indiscernible], effect. second demand inventory remainder reflecting primarily was settlement acquisition The I expenses to decrease drivers product. product sales delivered approximately basis. P&L, with and excluding global charges X% margin and billion, our by pension animal growth which higher to in foreign sales to due comments investments non-GAAP the

Our tax rate XX.X%. was

Taken add per together, we share. $X.XX

revenue to to billion now full be XXXX our underlying expect $XX.X enables of guidance. narrow and our business Turning non-GAAP strength rate between guidance. billion. us now We year $XX.X and revenue The our to

July rent Our incremental approximately burn more to or XX% range a impact to X%. exchange. impact exchange of net The LAGEVRIO excluding guidance of foreign an represents using XX% and increased than X% XX%, this revenue headwind the projected impact from growth from includes of resulting XX%

between our XX% of XX.X%. and gross We are maintaining margin expectation

primarily by the to upfront We Corporation. collaboration are expense operating $XXX driven our Orion announced billion, $XX.X the million payment with recently increasing to from projection billion $XX.X

settlement not to expense million, potential practice, approximately We higher-than-anticipated As $XXX finance an ongoing other significant when our we of development increased include expense. expectations our transaction. reflecting does pension

tax XX.X% X.XX assume outstanding. billion We to continue shares XX.X%. rate a full between year and assumed We

The EPS being operational guidance upfront expected more in reflects to would second our Orion, than on have X% expense confidence XX% offset year. $X.XX. our approximately This that the will our settlement strength $XXX underlying the have range headwind of the pension that half led managed by with the we is to due front together, in Taken momentum guidance. in to by our and of increase our an Overall, into continue entry exchange strong business [indiscernible]. incremental foreign business

there keep a you are As models, mind. few to your consider things in

this seeing we we our normalized continue respect as sales, resulting additional Organon from adverse impact of First, pandemic program. a other Other we the we we remainder exchange, actively expect growth through half as as other hedging of In negative to our growth benefits for extent the pneumococcal [indiscernible], half the experience negative new our expect favorable in revenues industry revenue foreign from foreign in year. exchange also benefits will rate exchange in includes products, second the to did reset and to related To of Health, half to to impact given XXXX. a we revenue we adults Johnson from Animal the With of the ending we're supply the total, as Also, its see foreign the vaccine in COVID-XX trends the out first arrangements. see vaccine. further to versus see expect and over to pandemic On our managed revenue quarter. saving to headwinds. we & licensing in yearly for shift the tailing higher well be the U.S. as Johnson towards impact first

XXXX in our beyond. given and However, growth broad we to positioned well to the are drive portfolio, innovative continue market

look to Finally, to we $X.X of with unchanged. sales the fourth second billion, Adaptation remain half continue to $X expect to billion full at priorities quarter. weighted year sales

in value will pipeline continue to our business many the We [indiscernible]. of near opportunities and realize clarify in the and investments long-term to

pursue to with augment compelling our internal continue business We development pipeline. strategic to

We execution dividend, collaboration our with through of is expect of we increase time. example Orion this recent to Our to which committed another our strategy. the remain

share extra for confident end global we extent our to in Finally, vaccines. we will medicines we demand the remain of of cash, at by and To repurchases. second driven the it very the year, return through have half the to innovative conclude, business, shareholders

to to to turn excellent over future. to value shareholders Our enable the execution well to With like into us patients deliver and I'd that, the Dean. call continue now will

Thank quarter you, call. the provide progress pleasure update since Caroline. an our first my on It's to

on continue to strategy. our We execute pipeline

are an vaccine I benefit Today, our as patients. pipeline highlight that to clear program recent will LAGEVRIO. in signs provide as generate update and provide vaccines advancing latest on the oncology our for We and medicines progress well

decade. approved year noted, we we currently pneumococcal serotypes for pneumococcal XX quarter pneumococcal of for XXF. are available to approval Building invasive first VAXNEUVANCE pneumococcal provides approval vaccine, X indication serotype compared against for for have invasive and received pediatric our conjugate Last to pneumococcal in and populations in vaccine, using XXF the the XXF progress help coverage FDA the responsible VAXNEUVANCE protect conjugate and As pneumococcal across be a month, the VAXNEUVANCE shared significant pediatric we conjugate for X, option valent ago. portfolio. expanded invasive to a Rob an Serotype upon is important XX adult populations disease disease. XXF vaccine our made received all comparable for a key known in more disease than almost XX immunogenicity children. improved valent serotype immunogenicity new

years as VAXNEUVANCE to approval, Practices under Advisory FDA of on for Following XX CDC's children endorse the age. Immunization an voted Committee option unanimously

V Additionally, diseases the recommendation positive our ACID XX% coverage XX unanimously pneumococcal cases on Phase Also report. conjugate study the the the for publication from of investigation and adult. vaccine final vaccines designed weekly licensed compared and CEC as and States pneumococcal June, United to morbidity that serotypes we XXX delink and the in currently at for Toronto, vaccines in in XX expand of naive pneumococcal in We XXXX. include VAXNEUVANCE voted mortality to I/II invasive targeting the is in disease Symposium our VXXX, older program. pneumococcal to vaccine significantly children all account pneumococi International adults results pneumococcal aged in of by evaluating presented await

X first patient the As progress, STRIDE a strong evaluating X Phase into III indicator of trial. of the recently in the enrolled first trial VXXX our adult, current vaccine-naive we

a pneumococcal the thoughtful to and production of targeting pneumococcal look progress targeting updates strains to candidate, greatest designed taken I candidate additional VXXX, investigational forward and to approach on our pipeline tailored specific for establishing risk the VAXNEUVANCE, forward specifically disease. vaccine to a pediatric our providing posing of VXXX We by populations. have program

oncology. to Turning

with on a drug build of based XX, that The earlier-stage momentum on reduction of patients application of ongoing has cancers. the the following to date cancer surgical prescription non-small FDA in adjuvant treatment the KEYTRUDA for announced our trial. the set accepted user lung results the continue cell KEYNOTE-XXX FDA has January XXXX. We We for

subgroups that Clinical during Meeting state. the analysis the in data in cancer adjuvant treatment we in process may Oncology melanoma, breast further in At IC for June, may the KEYNOTE-XXX and However, data be on IIb X, expanded presented Stage Society the and neoadjuvant RCC. in new and American key early-stage endpoints provided delay for adjuvant provided and KEYNOTE-XXX triple-negative KEYNOTE-XXX review high-risk

high IIb treatment for strategy or melanoma; KEYNOTE-XXX regulatory KEYNOTE-XXX of breast different types; completely and in and patients from with mismatched actions tumors approvals delivering our United resected on also or European and XC cancer. cancer; and certain States. for adjuvant for Commission of and/or on cervical are persistent MSI the the XX include KEYNOTE-XXX metastatic KEYNOTE-XXX years Notable KEYTRUDA types We outside in Stage X recurrent based the early-stage high-risk triple-negative in X cancer KEYNOTE-XXX older

addition, breast readout with In we OLYMPIA of based EV-XXX EU collaboration trial. on a with serotypes by LYNPARZA opinion adjuvant for the patients CHMP received encouraged urothelial of high-risk for early-stage KEYNOTE-XXX II finally, we are positive treatment positive and or cancer with cancer, Phase in the And first-line which is SGI.

efforts impacts to survival. Next, low of at I treat prostate our Prostate advanced disease with ongoing men rates cancer. want of discuss millions those to cancer X-year and

Orion ODM-XXX agreement cancer includes for that the II to of is cytochrome prostate steroid metastatic ongoing key strong commercial generate continue month, therapy the on patient currently build synthesis LYNPARZA on KEYNOTE-XXX, for prostate with licensing and a the improving in this KEYTRUDA ODM-XXX, development on investigational complementary which KEYNOTE-XXX with based novel Earlier cancer. outcomes. with trial. a insight we and focused strategy work, and global our castrate-resistant PXXX PROPEL cancer KEYNOTE-XXX program, with inhibitor, We anti-androgen of XXXX, KEYTRUDA chemotherapy from a we approach targets diverse based development relation on treatment remains pipeline. our to antiandrogen Phase combination based about which element broad-based therapy and our is a maintain announced and prostate of Business development remain and to and oral

and hospitalization are effective for need to the rate Next, notably most treatment resistance Omicron to therapies LAGEVRIO increased pandemic SARS-CoV-X vulnerable. of variants these threat the solid especially transmission and and variants, evolve. to antiviral continues evidence reinforces from with BX. antibody for and emerging for The multiple BX options, the There COVID-XX persists of those

patients, improved show high-risk therapeutic evidence continues intervention For to that prompt outcome.

to from support am To real-world regimen Hong intervention for avoids conclude, pipeline and of and to a Kong monitor adjust We can future. kidney on as they individuals, timely I high-risk to the data in across the plan more treatment, share proud functions our now turn will adults, further I LAGEVRIO additional large utility available. scientific of provided back medications Recently, updates interaction for chronic of forward look Peter. facilitate for Denmark, and appropriate need low the our including during likely date dosing settings. reported for and liver data LAGEVRIO's patients. drug-drug to Importantly, the advancements become primaries the propensity which have in receiving conditions. existing proportion Poland are providing older And to call

Alan, Dean. Q&A ready you, Thank for the session. we're

the queue. please assemble If you could

Instructions]. [Operator

Terence Our first with Flynn will from come question Stanley. Morgan

one here. Maybe X-part a

Just extend would then with of formulation maybe there And KEYTRUDA antibody on that IP some of via technical from the other a co-formulation pathway wondering perspective to either KEYTRUDA formulator a drug if subcu prohibit there's a anything patents? type is an conjugate?

different This we an demand, will this. cancer, go to I and stages a to Dean. of providers guess up highlighted as there take formulations really go especially early demand come relationship with I will In routes you patients into infusion administration, I you've is formulations that, have where think other the of to center. to the intravenous besides by be

the could pembrolizumab the KEYTRUDA current subcutaneous that the is required novel, and viewed very situation is to And innovation past subcutaneous and through be I for serve need. history, useful important would So nonobvious. imagine

about based I is do for any that co-formulations there or IO they're TIGIT drug any Oftentimes, In think drug weight LAG-X. to to that with antibody to how or formulations could path think we CTLA-X issue of, The bit work be when challenging with to chemo-based co-formulations. on would so basis, PD-X example, take In antibody innovation. I well to I general, with, or that think agent with about coal that conjugates that. and a So relationship clinically. example, conjugate chemotherapy think be little a for hesitant do base, IO-IO

Evan be Seigerman Markets. That BMO Capital with will from

the directly and of negotiate Senators with us your So Schumer, forward? the widespread thoughts to with potential manufacturers deal news Medicare structure kind impact of R&D reimbursement with on reports management going with can for the on you a potential provide drug and for

is the This thanks for Evan, Rob. Yes. question.

back to is elements there the deal is that better yesterday you As have really out plan build a of just related came part with said, potential reports Senator in the and been what of of drug pricing. out

So and development have significant understand, is, think will the it's do drugs one that, there of on see do think chilling be is that first concern as we important is first on on it's foremost, setting I is which effect, oncology termed a at important price we of approval. area the what oncology, it of fact if because, in future in it negotiation. an what drug that is price believe period the setting, we after provision, the we to that look long after very especially you like element But the area innovation And continues an about time. highly as

KEYTRUDA, XXXX, take and XXXX we indications XX-plus had approved. XXXX like something between the in you If launch

We cause that discounts, And discounts expect start that you to have that to concern see threat you're have the that could companies well mandatory to you'll of XXXX. because more not question the question than have if and to or return. whether XXXX is innovation between going double our to

business our how that we we communicate And something might of going for effect add to our look United and will you as the important there. only importantly, at about of planned will while we the make and the as concerns thing It's an sure as assumed always impact, we about some States. pressure obviously, this, have chilling to think business, have think at that that including it's the both higher forward. form it as a price see we the we So other continue that, is, I of understand in coming, future this to industry we've

in we've communicated I think past. that the

around and strong we've for guidance this, to think long-range includes expectations of you at assumptions through and past relative the period. That of look the we our a this. given as growth the continues in So

about So the manage think in it, we while worry what to innovation it will do I I will do industry.

Citi. from with come Andrew Will Baum

A couple of questions.

announced Firstly, of China from of you've a couple licensing ATC.

the operationally, and reported Chinese I have i.e., in go, III that have up in how update the discussions second catch expediting think in late-stage seems has which doors drug market compete Pastor with to you're Seagen, us in Dr. approval into Is another it advantage development. with talks prophylactic, and population as how categories? of in But obviously would care enable PREP III And to molecule, resuming I'm It's neither? using terms alive HERX. enable here to one is is signals trials. efficacy interested, then there from a of with the leaders data FDA safety you Phase the from with you could in question Chinese closed Gilead widely a you just seeking Phase In on move them or you the to respective data ADC that terms you and U.S. an in fast trials. on as does that perhaps general, knowing islatravir, your this of both in in a the treatment, which

partnership FDA to and we relationship you've and I with In that non-small importance have United in said as studies cell doing those a they've the The Dean. they United a was most One productive those should a ADCs, the in it have to recently what such just geography announced, clear announced X and moving global announced Thank questions. years. support with I but the trials, lung FDA you Kelyn. breast And cancer first Trop-X cancer. that had which emphasize is your question example, this X has really related they're partnership declared, think of molecules this for single but States, very our advancing for recently, much progress for not to in in States. programs. productive, in the tackle of recently very those this. we've been include relationship the past to relates in China So China,

in human at to And think to to ability signal us give really us important our and level. how for so the global is a population navigate a allows partners a about it

so we patients many second that hopeful partnership of benefits ADC the this [indiscernible]. are will as And us To in possible. relationship to to to stroke as allow question your this accelerate with

also extremely a noticed, and that nRTTI. tissue III resident resistance. Nevertheless, there still meaningful had has It's but our to Phase lymphocytes excellent our in time it we dependent. had has is high symptomatic, a number clinically As results. potent a of in X we reduction programs, a most a that of that's barrier across MK-XXXX, combo you've studies trial have was And with reduction

path We to understanding that have the We last to on that cells. the there it spent X better. understand We far effects the is and and months potential believe reduce efficacy maintain blood have also a that. forward

FDA. We are with in active the discussions

have PREP, make should and treatment compound that advancing could interested within possibilities, we provide think are don't are will be of of I we them molecules applying FDA the want broadly I treatment get they to question used just that of in and and recognizes discussions that data clearly the just need. to thought So discussions X to of relationship there, want and partners. In the this NRTTI is myself sure we ahead with those both islatravir that always of but have with active in -- both in our class of everyone in I the midst this class and those PrEP, we we

Chen Louise be with Cantor. will That

strategy. the Or setting? What paradigm inhibitor How done? is are your doctors in uptake the wanted of thoughts be this checkpoint changing think do there you treatment cancer on about you you neoadjuvant yet? inhibitors about convinced ask I and to to opportunity work more do adoption are think the in setting. And checkpoint and adjuvant the for So

least Well, Rob think been at And will for let standpoint. it's that that apriority really effective me keep be impressive. the do And I Maybe medicine and tumor it's range answer to it from standpoint. been market it Carolina answer has not for me, benefit/risk stages. a from different growing important a incredible And have early in we'll just through the broad it's a a or metastatic truly of who PD-Xs a we metastatic scientific types. have ratio in stage. patient highlight, works very earlier

renal whether We many a breast, it be have and And have advancing. relationship we have X lung, cell positive trial in in and we carcinoma approvals, to others in melanoma.

part of that been it uptake will that adopt scientifically, think good. data the is is think think been important I but And thing the has good, field most the I I the has it. So very

I that not a talking field the one of that is things necessarily oncologist. think will be oftentimes, now it adopts medical you're critical about the as

of think to So there for the I do will I And data, work would results in with that the themselves. you it's that do, be want people us at Caroline, for to think that? an and take terms important speak uptake, but the that I recommend look advancement in field. But

Dean. you, Thank Yes.

Louis, are stages we into possibilities outcomes earlier really we better are can impact patients greater. have of opportunities that we of the moving cancer. about So then, if excited the Clearly,

and cancers on renal melanoma. in very early-stage we touch impressive And the just breast States had triple-negative approval last I strong the carcinoma We have seen in We're our cell performance United cancer, cancer, triple-negative KEYNOTE-XXX if July in of here breast year. performance. seeing

triple-negative During in treatment seeing neoadjuvent now return neoadjuvant seeing surgery to on treatment their the their treatment, We're second cancer. also some part What we're KEYTRUDA is for breast of them uptake year, we of surgery. only getting segment coming the last following then patients first weeks XX of people to tremendous not ahead later. saw the

impact optimistic we have that we're on about very and the the can So setting opportunities we have adjuvant patients. in the

will Evercore. We Umer to go Raffat with

I here, may. I if have X

deals mentioned you've KEYTRUDA looking my to KEYTRUDA, I focus foundational from on individual based And KEYTRUDA. M&A different given first diversification market me I in like lot that much also, how you to And think increased a is you M&A roll have how in I'm basically has extent basically could across about question, you've being a tumors. on discounts. U.S. approach this given And exercise And in different Rob, that wouldn't want or I'm any in of know at tumors. in. to so Separately, guess And further in fairly being Acceleron a there drug. brings deployment. discount part of bucket pricing general franchises track quantify what the critical oncology, I of away there you at B length and about high-quality capital the mandatory First, attempting on at oncology. despite considering in is the which you sure I'm business mentioned discounts. non-oncology all? comparable, you're many of it's I'm about in the considering that price run explore problem getting how share to make to sure shares deals solving thought markets, KEYTRUDA not FTC treatment you oncology for market And KEYTRUDA just do a do ex-U.S. very internally and at top thinking off mandatory like drug key Rob, is sure guys not KEYTRUDA's be is a much

very success so just impact see oncology importantly, it's that around appreciate and field, continues we've competitive No, the many fact so think And to be the But it's the important with it's to space across tumor start M&A as you an field. your the been monolithic. I oncology obviously, question not able in I lives, to and understand KEYTRUDA that I people's the many questions. saying, would and incredibly on we are types. say, different Yes. had proud by of first what we

tumor tumor look to even targeted have I/O or therapy. modalities, by it's whether and You

indication accelerate to that States navigate and as these how very modalities deals have it we we a So we thoughtful to those that of at are be look path medicines have the to of and are and by deals investing tumor specific. and as where thought to as believe patients forward. show there indication to that we very world to that regard, drugs a believe, And it you science we we still in each in about I we'll access the can develop that the bring continue move multiple to it doing be that multiple long complex. there expand are more United there's it, different we in on forward. science-driven, approaches, environment we as And done to and is are is the around innovation, obviously, we And as can know, we believe, while

Obviously, slow be way you it where language is you're is of, look and to be if across And we'll look discount today, what XX large for at of now once legislation language mandatory for year being has molecule. effect a is the point. Right drug X during some it in proposed pick. at. is after done a their XX the for for period at think and expand it's on discount. treatments proposed, importantly, continue would specifically to and shareholders. then X On a its But as potential why being look you for period so a to drug year period stakeholders, is as pick as with molecules, the we determine they for the regulation. where right upcoming drug the it at the I speaking HSS to time, large is look the would molecule year the discounting a take at and and the we're very if is discussion for operate way small of able were select price your depends benefit for there no to drugs of that up you roughly time years patients to outlined that's if it. is much determination negotiation you of exclusivity question, molecules, finalized. is including the believe frankly, the approved which for that for that all itself which far opportunity to for second exists now, a and the depending to years discount the and focusing At continue opportunity on Obviously, and to discussed, determined it drugs But to HSS negotiation --

exclusivity as to language proposed to in periods products talking of potentially subject development And of loss like obviously, it. really of other would something you allow around we're that's not biosimilar are KEYTRUDA, for the So of are exception there being out be time that there's coming you in think time XXXX. an about if that then

unclear from KEYTRUDA then comes we will of specified reality the But obviously, important impacts the part short we specific out. language that language will it's discounts will of it have impact relates be drugs, term, the or then that So be see to be in it final the is And the how set. our what in to GARDASIL. It and the don't regulation. the term longer as see

then the not believe setting And to mandatory costs innovation. we for have the at B Part it's price around actually reduce it our obviously, what discounts after -- will now. reason the focus continue support which out-of-pocket way but is patients reforms, So right up as time that, the that, a of there oppose beyond chilling we that counter, they're a strong because belief overall we period that is reference legislation in on the the they

So I that's what I'm not were think your to you trying sure but I got at. get question,

from will Meacham with be of Geoff Bank America. That

add I CRT are year or had study ask on does new any if just recent And COVID, present it you at assumptions? just look any the a trends going of the or change then significance. I LAGEVRIO at couple future broadly, KEYNOTE-XXX, hit emergence And investments even in didn't backbone studies? in of more quick to make you over to you to Did the guys course about -- Dean, complexity variants, ones. the the look recent does keynote other strategy of your terms particular other when this other on the orals? CRT challenges wanted that you of the infection a indications,

both take All of right. Keynote-XXX. I'll them, the I'll take

there So to patients regimen you're placebo in the as the KEYTRUDA who -- speaking a and about you're who trying plus survival into early compared event-free stage us at improvement the you've speaking neck was received the about emphasized, -XXX, go to DRT.

However, on statistical our these results did not meet statistical based plan. significance

But in would when a how not gives I relationship line. it -- signal, think indications it did not or about say So In cross to and there's I that radiation clearly positive you this. to the relationship CRT in other to trials -- just was extra see in just an in there. other it that complication. people to but EFS. us these have the would other emphasize improvement We'll combination but

complicating early everyone it a into only our that us. this a I So that need statistical sure that wouldn't did foray just say issue make I do isn't was significance. stage. neck recognizes want to for We

KEYNOTE-XXX a in treatment the have adjuvant neoadjuvant that's We and also as well.

So a lead to a EFS positive that cautiously optimistic we're significance. did statistical fact relationship neck the despite early because the in can have break not what into be been careful so In I with we at need a predicted it one who's They've happen stage KEYNOTE-XXX, had that the not all to to bit everyone all pandemic, pandemic common had will right. little thread.

those mechanisms around actually how so And can it's just to clear. give other That's is. use of you great if it that, are amino-acid example, if what you to, the and what States, who virus the would this of on there's medical this real-world the few LAGEVRIO vulnerable especially also want would want well drug important have really do have mortality I this amino free quite you're acids such a emphasize of have impressive I have that therapies, reducing interested an focused has we'll We'll see that give that the those having throughout extremely United drug quickly resistance we And complicating other to on action of changes changes is pandemic. to the the that be most just have evidence you very multiple sort may and impact found a world resistance for and emphasize can see does is like on example, see happens is, take but and it. you really been emphasize it importance it outside medicines, have to substantiate. we'll to to But that mutate see patient with can takes quite the based begun patient uptake, which they're this but me has on of believe therapies, the issues that I you in can speed for to might mortality, this, where and emergence surprising to many it feel fact get protein. it what population and and you multiple then attributes and of the

molecule only impactful as is we coronavirus, belief of a out. as investments and and be I pan could flu. only And in is not Jeff, molecule further that will prove would RSA add COVID-XX, the thing in against result, The in to programs Caroline. a appropriate being this also terms our invest try And that but

will Goldstein from Mara That Mizuho. be with

you cash to dividend? if for additional statement I Firstly, Or about and I thinking about just amendment? are you're non-small And And be share committed raising secondarily, on wanted major just about excess cancer? asked supplemental wanted we the also get also PDUFA the what for for to planning comment adjuvant have a then for that neoadjuvant KEYTRUDA you data? clarity been repurchase. some should to And understand threshold cell lung at

Yes.

just Dean. dual you you dual everyone, of the remind the And So that's primary that this take had trials lung reason are if have to And endpoints. you hit I to I'll both. one on KEYNOTE-XXX the And distinction primary emphasize I'll -- the endpoints, want this a to those hit adjuvant. positive a is where have is trial. that means that co-primary that on from a is

with may I survival, we of positive terms has move XX%, dual disease-free is KEYNOTE-XXX, data, because in all positive those to forward. it's trend, as to not the DFS relationship well, in OS So but TPS a we a positive which to emphasize in matures And than The of of trend just want people I a a that other and got primary imagine, the those as comers regardless have in see there is cancer, lung greater trials significant. KEYNOTE-XXX would KeyLink is XXX. this and early-stage PD-LX. as data trial it's want

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in to response And of priorities of allocation utilization are capital Mara, excess the your company on unchanged. question our cash, our

return us. done and Business first will we balance foremost do have front shareholders and We our that over in is invest in we intend our continue to development we and us, via then cash as our time to intend opportunities of dividend regard. this multiple the continue not past. raise development the for will a in any business invest in in that not of for use sheet to on We and capacity cash our periods sit are share excess to priority and to business great buyback. strategic time We with

cash. our So I the hope of that addresses use

It will be Guggenheim. from with Seamus Fernandez

actually And a timing the competing of overall or in then potential considered market wanted how little looking just potential in could a vision you clarify use adults? in cash bit question. will be would the market? market for see And target well. solely of competing potential evolving a trying be M&A could separately, envision of Or do there as of X pediatric opportunity to to Are opportunity at sense we if overall just get being just VXXX be all VXXX? time? or see the be over the would population a when any for maybe that then and really 'XX whether the you Merck you a to where transaction. patient that And how equity VXXX we that actually likely see So in as or just you just balance Can consider and get is high-use plans acquisition a

priority the question. on combination importantly, Seamus, science use And cash value growth deal long-term the or the innovations and that at shareholders. it can discussed. look I best because business wherever want for Yes. Obviously, specific our pipeline we've really development to remains don't transactions of for drive the as specific and or would us, be add Thanks, to speculate specific we find and would we future a hand. we enhance fact for equity to

wait. in to I so we'd we've that we the that the think, in said is to think point, broader capital want enforce And The and I sense, have have strength I balance and consistently is sheet our strategically augment after that we important continue scientific own us innovation that that we what brings to feel have to that go mentioned that anything to will allow internal I pipeline.

we really have optimize we business, the deal-specific. is how cash, flexibility and capacity best the it, how to So and equity to see structure between you debt the do that

to in to very had about VXXX, stereotypes that populations populations, just the for groups or reiterate is different Yes, relationship the questions different. most different you or is the are different want that in I reemphasize age that which strategy think, troublesome we

to where put be this serotypes that this We not place whole a view specifically into current the the vaccines. a that's patient would adults target to happening VXXX, to pediatric course. of of that the And VXXX would of VXXX important and the the had because have drive what would why vaccine the my are that trials Phase from not that. focus that scientifically, standpoint, is the run now population. right is, put to whole the that suggest we right is population the and as that, what its match that's is that of is I epidemiology for X serotypes There recognize want III focus So the vaccines first to to

add might just to I that. Yes.

adult And our look the then commercially, we with the the as will where a as approach be when in and a If highly we you think actions market. aimed we separate it that effective you about serotypes that bespoke VXXX approach see you children opportunity in infants think have disease real cause at combating approach. about think pediatric have future this you at

if most as to treated XX% with in those bespoke And of what you are set that of understanding after needs obviously different those on residual both in we the serotypes have you've disease, aimed it focusing that of We children, aligned will populations. is a adults. go are the in therapies driving it

very will see be highly will today products pediatric than have the effective the cover to adult us more than in what fact, competitor disease-causing and in the and this be what competitive, either allow in in both think I they you serotypes cover market.

strategy. So is excited something a see I And fact, -- very fruition as in this about. VXXX think really we're we

we drive we're and going So successful. where excited going because to can to I an be and definitely we're do with about highly area speed be think is it this competitive it.

That Gould Carter will Barclays. come from with

the out about not be in alone real should measures study of Is of -- that still just of be the next track how you, sort of come early think thinking primary want that some I subcutaneous quick, filing? And that study, to clinical around think sort ask about the formulation Phase are to end pembro. just in on to points of biomarker cell I Dean, sort read back the should we non-small And it year? differently? endpoints? should warranting a Or we III

Yes.

that be weeks different just X should weeks like trial emphasize I is emphasize should patient more is the on of subcutaneous sort have also that there it weeks different different So that for I should formulations. and may should than to group QX want that that important program trial QX our also have think subcutaneous QX a just I and were just and weeks -- be population intention support filings? intravenous. track, that we will different images emphasize formulations, we we and and because

open that well. the also it's think important in I as up we subcutaneous range that possibility

Thank Carter. very much, you Rob, closing comments? any

just Well, exceedingly my our around by ensure us. vaccines team the continuing in environment to conclude Merck I'll a our really, well for thank the reiterating and the today, are the maybe like science medicines everyone of Yes. that perform and reach on tough to and and world important just to we're us I'd appreciation counting efforts for tremendous patients advance joining

on I give that, move So continuing I you, With look as our updates appreciate I confident that, in our we a very day. can forward. great you to to have forward underwriting momentum, and I and progress tell remain