MRK
#Thank you, Rob, and good morning, everyone
This morning I'll provide highlights on the Performance of Global Human Health for the third quarter
And my comments will be on a constant currency basis
Global Human Health delivered sales of $9.2 billion, a decline of 4%, primarily driven by the loss of exclusivity for several products
We continue to see strong underlying growth from launch products, including KEYTRUDA, ZEPATIER, and BRIDION
Now I'll highlight a few of our key franchises and product launches, and I'll start with oncology
This is an exciting time for Merck as a global leader in immuno-oncology
We remain focused on executing on the extensive opportunity that we have with KEYTRUDA
And we are also excited about the growth opportunity for LYNPARZA, which we have begun co-marketing globally with AstraZeneca
I'll start with KEYTRUDA
Worldwide sales for KEYTRUDA in the quarter exceeded $1 billion for the first time, making KEYTRUDA the second-largest product in the Merck portfolio
And in 2017 alone, we have launched six new indications in the U.S
, four in Europe, and three in Japan
, more new patients now start on KEYTRUDA than any other I-O agent across all indications
With 10 indications in six tumor types and MSI-high cancers, U.S
KEYTRUDA sales grew to just over $600 million in the quarter
Although there was some noise in the channel this quarter, as distributors normalized their inventory levels, if you look at the most recent script data, we have seen substantial growth in demand both year over year as well as quarter over quarter
We continued to build on our leadership position in lung cancer with growth driven by continued adoption of KEYTRUDA monotherapy in high expressers, as well as the uptake of the KEYTRUDA/ALIMTA combination in the first-line setting
Across all of lung cancer, nearly one in three new lung cancer patients in the U.S
are being started on KEYRUDA, making it the most prescribed treatment for new metastatic lung cancer patients
Lung cancer was our largest tumor type, but indications outside of lung cancer contributed to approximately 45% of U.S
sales
In addition to continued leadership position in melanoma and head and neck cancer, we have seen strong momentum for the bladder cancer launch
Within just two months in the second line or greater setting, KEYTRUDA achieved I-O leadership in new Rx share, despite being the fifth market entrant
Outside of the United States, KEYTRUDA continues to maintain a leadership position in the PD-1 class in melanoma
And we are seeing a greater contribution from lung cancer, as reimbursement is established in additional markets in the first-line and second-line settings
Following our recent 1bladder cancer approval in Europe, we're now also working through the reimbursement process for this indication in each country
Early performance in Japan is also strong, with PD-L1 testing rates in lung cancer consistent with that in the U.S
Altogether, we see great opportunity for KEYTRUDA around the world, and we remain focused on establishing KEYTRUDA as a foundation for the treatment of cancer
We also began working side by side with our colleagues at AstraZeneca and are ramping up our sales force to support the ongoing launch of LYNPARZA
We are excited about the opportunity we see with the broader label in ovarian cancer
And we're looking forward to the upcoming opportunity in metastatic breast cancer
Now I'll move to JANUVIA
Global sales for the JANUVIA franchise were $1.5 billion, a decline of 2%
While we saw volume growth globally, we also experienced continued pricing pressure as we've discussed for the last several years
While we expect pricing pressure to continue, macro trends support volume growth going forward, especially outside of the U.S
As a result, we view our diabetes franchise as a relatively stable foundation from which to grow our portfolio of new products
Moving now to our Vaccine business
Global sales were $1.9 billion with growth outside of the U.S
, including the contribution from the European JV termination
Underlying demand for GARDASIL remains strong
And increased patient starts are helping to offset the negative impact in the transition to the two-dose regimen in the U.S
GARDASIL worldwide sales would have grown in the quarter absent our borrowing from the stockpile
Based on current trends, we are confident in the continuous supply in the U.S
going forward
We continue to see opportunities for growth in our Vaccine business, particularly from the continued strength in GARDASIL as we move into the next year
Moving now to Hospital and Specialty
The ZEPATIER launch progressed well in the quarter with growth driven by Europe, Japan, and the U.S
However, we recognize the evolving marketplace and competitive landscape
And while we remain focused on maximizing its potential, we expect significant pressure on ZEPATIER throughout the remainder of this year and into next year
Finally, BRIDION delivered another great quarter with growth of more than 30%, driven by strong demand in most markets around the world, including the ongoing launch in the U.S
We have seen nearly 95% repurchasing from top accounts in the U.S
, which demonstrates the market's continued positive experience with BRIDION
In closing, our results show the benefit from our strong execution and the contribution from launches
We have good momentum in our global oncology and Vaccine businesses in addition to others
And we believe these franchises position us well for success heading into 2018. Now I'll turn the call over to <UNK>
And to answer your question regarding the uptake in lung cancer, I mean in the United States and also in Japan, we're seeing a very strong uptake in lung cancer
And if you look at the high expressers above 50, we're seeing significant utilization of KEYTRUDA monotherapy
If you look at expressers between 1 and 50, that's where we're seeing increased use of the combination with ALIMTA
We're hearing that now that it's in our label, physicians are being more comfortable to prescribe the combination therapy
We're hearing that a lot in the community sector where they treat most of the lung cancer patients
And they're used to using chemotherapy, so they feel very comfortable with the combination
In addition, what we're really trying to work on now is in the non-expressers or in the patients that are not PD-L1 tested to reinforce that we have the indication for the combination to be used in those patients, which we think represents an additional significant opportunity
And we're spending a lot of time educating physicians on those patient types
To give you a rough estimate, we think about 55% of our sales are coming from lung cancer in the U.S
, about 20% melanoma, 10% head and neck, 5% bladder, and then 10% everything else
And with regard to lung, we continue to see good progress
And in the EU, we've worked really hard to increase the number of patients being tested for PD-L1 status
And as you look across the various countries, we're seeing the pickup very significantly
So in Germany, it's over 60% already
In the UK, it's greater than 90%
Our focus right now is really continuing to work through the reimbursement process for first-line and second-line lung
And each and every month, we have new countries that are coming on
And we're getting more and more reimbursement
We'll have to wait ultimately to see more about KEYNOTE-021G before we can comment
