[tomertu/Adobe Stock]
In 2023, demand for GLP-1 receptor agonists such as Lilly’s tirzepatitde and Novo Nordisk’s semaglutide surged just as demand for COVID-19 therapies waned. As a result, Novo Nordisk had 33% growth at constant exchange rates over the first nine months of the year. Similarly, Lilly experienced a 37% jump in revenue in the third quarter, with strong sales of Mounjaro (tirzepatitde) helping lead the way.
Below is a roundup of the year-to-date revenue for several Big Pharma companies that have publicly shared third-quarter financial data. For J&J and Roche, the companies’ non-pharma sales were excluded. Merck’s figures also include sales from its veterinary business.
Merck having a banner year
Given all of the attention GLP-1 drugs have received in 2023, Merck's robust performance may be easy to overlook. In August, it raised its sales guidance. And in its third-quarter earnings announcement, the company announced that it had raised its full-year revenue guidance to $59.7-$60.2 billion, equating to 11% to 12% underlying growth, excluding the COVID-19 antiviral Lagevrio sales and foreign exchange considerations. Demand remains strong for the oncology blockbuster Keytruda. In the third-quarter, the drug's sales grew 17% to $6.3 billion, thanks in part to expanded use in earlier-stage cancers like lung, breast, and bladder. In the third-quarter, Keytruda sales were up 17% thanks to continued uptake in lung, breast, bladder and other cancers.
Sales of the HPV vaccine Gardasil were also brisk. The company aims for the vaccine to hit $11 billion in sales by 2030.
The megablockbuster Keytruda has been a cash cow for Merck since it debuted in 2014. But the initial patent for Keytruda is set to expire in 2028. The company has filed for several additional patents that extend exclusivity into 2040. The most recent patents granted don't expire until 2036, giving Keytruda some cushion IP protection.
In its recent earnings call, Merck execs noted the company expects to sustain its oncology leadership for the next decade based on Keytruda’s broad label and enduring efficacy across lines of therapy. The recent antibody-drug-conjugate collaborations with Daiichi Sankyo and Kelun Biotech further bolster the company's capabilities in oncology.
Pfizer faces eroding demand for COVID-19 therapies
In the third quarter, Pfizer announced that its revenues were down 41% operationally year-over-year as a result of reduced demand for the company's COVID-19 vaccine and Paxlovid antiviral. "We have rebased our COVID expectations, and now I think it's very easy for everyone to be able to model what I think will be stable COVID revenues going forward," said CEO Albert Bourla in an earnings call. The decline of the COVID-19 products is not new. Flagging demand for the segment contributed to notable stock declines at the mid-year point as well.
Outside of its COVID-19 products, however, the firm saw 10% operational revenue growth compared to Q3 2022. The firm noted that growth drivers include the new RSV vaccine Abrysvo, Vyndaqel for transthyretin amyloid cardiomyopathy, and Prevnar pneumococcal vaccines.
To boost its operational efficiency, the company has announced a restructuring program targeting at least $3.5 billion in net cost savings by end of 2024.
Bourla notes that the company's RSV vaccine, Abrysvo, has "exceeded our expectations." He noted that the company was aiming to ride on "the coattails of flu vaccinations," which are typically high in September and October. "We have about a 70% co-administration rate," Bourla said. He also highlighted the potential of combination products that could combine vaccines for different diseases, such as COVID, flu, and RSV, into a single injection.