Merck Provides Update on Accelerated Strategic Actions for Growth at 32nd Annual J.P. Morgan Healthcare Conference
January 13, 2014 8:35 am ET
- Initiates rolling submission of U.S. Biologics License Application (BLA) for MK-3475, the company’s anti-PD-1 immunotherapy; expects to complete application in first half of 2014.
- Prepares for 2014 regulatory actions for V503, vintafolide (EU), vorapaxar, NOXAFIL IV, vaniprevir (Japan) and AIT-Grass and AIT-Ragweed; anticipates filing odanacatib, suvorexant.
- Evaluates the role of Merck’s Animal Health and Consumer Care businesses in the company’s strategy for long-term value creation; expects conclusions to be reached and action, if any, to be taken in 2014.
- Divests assets, including a portion of the U.S. ophthalmics business, SAPHRIS U.S. marketing rights and Sirna Therapeutics, Inc.
Merck (NYSE: MRK), known as MSD outside the United States and Canada,
today will report on the strategic and operating actions it is taking to
drive short- and long-term growth, including sharpening its focus in
core markets and therapeutic areas, advancing its innovative pipeline
and unlocking the value in non-core areas of its business. In October
2013, Merck announced a multi-year initiative to resource opportunities
that offer the greatest potential return on investment, improve the
company’s performance in the short term and create long-term value.
“We’re taking significant and decisive action to make Merck a more
competitive company, better positioned to drive innovation and growth,”
said Kenneth C. Frazier, chairman and chief executive officer, Merck.
“We’re pleased with the solid progress we have already made against each
of our key areas of focus, and we are quickly moving ahead to build on
this momentum to make Merck a leaner, more agile company focused on the
best opportunities to create value and advance global health.”
As part of the initiative announced last
October, the company expects to realize a net reduction of annual
operating expenses of approximately $2.5 billion by the end of 2015 with
40 percent, or $1.0 billion, to be realized by the end of 2014. These
savings are off of the company’s full-year 2012 expense levels.
The company continues to make progress on its innovative pipeline and in
2014 expects to complete its regulatory application for MK-3475,
the company’s anti-PD-1 immunotherapy, in patients with advanced
melanoma who have previously been treated with ipilimumab; as
well as applications for odanacatib for osteoporosis; and suvorexant for
insomnia. The company may also receive regulatory approvals for multiple
promising candidates, including V503, the company’s 9-valent HPV vaccine
candidate; vintafolide in the European Union for use in
platinum-resistant ovarian cancer; vorapaxar for the reduction of
atherothrombotic events when added to standard of care in patients with
a history of heart attack and no history of stroke or transient ischemic
attack; NOXAFIL IV for fungal infections; vaniprevir in Japan for the
treatment of chronic hepatitis C virus (HCV) infection; and the allergy
immunotherapies AIT-Grass and AIT-Ragweed.
Core Markets and Commercial Therapeutic Area
The company has taken steps to significantly sharpen its focus on select
core markets and commercial therapeutic areas. Progress since the
October announcement includes:
Increasing focus on the key markets of the United States, Japan,
France, Germany, Canada, United Kingdom, China, Brazil, Russia and
Intensifying its portfolio assessment process and recently announcing
the divestiture of a portion of the company’s U.S. ophthalmics
business and the sale of the U.S. marketing rights for SAPHRIS.
Consistent with Merck’s new emphasis on its diabetes, acute hospital
care, vaccines and oncology businesses, the company established its
integrated oncology business unit and is recruiting external talent
with deep scientific and commercial experience in oncology to promote
Merck’s existing portfolio of products, as well as the future launch
Prioritized Pipeline in Focus
Merck continues to prioritize its R&D efforts and focus on candidates
that it believes represent breakthrough science that will make a
difference for patients and payers, with increased emphasis on
externally sourced programs. Progress since the October announcement
Initiated the rolling submission of a BLA in the U.S. for MK-3475 in
patients with advanced melanoma who have previously been treated with
ipilimumab. A rolling submission allows completed portions of the
application to be submitted and reviewed by the FDA on an ongoing
basis. Merck expects to complete its application in the first half of
Started additional MK-3475 clinical trials and now has 10 trials in
more than 10 cancers, including a collaboration with GlaxoSmithKline
to evaluate MK-3475 in combination with pazopanib in advanced
renal cell carcinoma.
Received Breakthrough Therapy designation for MK-5172/MK-8742, the
company’s chronic HCV combination regimen, and advanced the
combination into Phase IIB in a diverse range of chronic HCV patients.
Filed vaniprevir (MK-7009), an investigational protease inhibitor for
the treatment of chronic HCV infection, in Japan.
Initiated Phase III trials for its BACE inhibitor for Alzheimer’s
- Received priority review status for NOXAFIL IV.
- Plans to divest Sirna Therapeutics, Inc. to Alnylam.
Unlocking Value in Non-Core Areas
The company is continuing to evaluate all aspects of how it operates as
a business and has adopted a streamlined operating model to ensure
improved allocation of resources to the most critical business areas.
The company’s goal is for each of its priority business areas to be
industry leaders. The company assesses on an ongoing basis whether
particular assets are core to its strategy, if they provide strategic
advantage and whether they would generate greater long-term value as
part of the company, or not. Progress since the October announcement
Exploring strategic options for its Animal Health and Consumer Care
businesses to determine the most value-creating option for each and
could reach different decisions about the two businesses. The company
expects to complete the process and take action, if any, in 2014.
Over the last four months of 2013, the company announced plans to
close or sell manufacturing operations at Swords, Ireland; La Vallée,
France; Arecibo and Barceloneta, Puerto Rico; and completed the sale
of its active pharmaceutical ingredient (API) operations at Oss, the
Netherlands; and announced closure of the Summit, N.J. site.
Today’s Merck is a global healthcare leader working to help the world be
well. Merck is known as MSD outside the United States and Canada.
Through our prescription medicines, vaccines, biologic therapies, and
consumer care and animal health products, we work with customers and
operate in more than 140 countries to deliver innovative health
solutions. We also demonstrate our commitment to increasing access to
healthcare through far-reaching policies, programs and partnerships. For
more information, visit www.merck.com
and connect with us on Twitter,
Merck Forward-Looking Statement
This news release includes “forward-looking statements” within the
meaning of the safe harbor provisions of the United States Private
Securities Litigation Reform Act of 1995. These statements are based
upon the current beliefs and expectations of Merck’s management and are
subject to significant risks and uncertainties. There can be no
guarantees with respect to pipeline products that the products will
receive the necessary regulatory approvals or that they will prove to be
commercially successful. If underlying assumptions prove inaccurate or
risks or uncertainties materialize, actual results may differ materially
from those set forth in the forward-looking statements.
Risks and uncertainties include but are not limited to, general industry
conditions and competition; general economic factors, including interest
rate and currency exchange rate fluctuations; the impact of
pharmaceutical industry regulation and health care legislation in the
United States and internationally; global trends toward health care cost
containment; technological advances, new products and patents attained
by competitors; challenges inherent in new product development,
including obtaining regulatory approval; Merck’s ability to accurately
predict future market conditions; manufacturing difficulties or delays;
financial instability of international economies and sovereign risk;
dependence on the effectiveness of Merck’s patents and other protections
for innovative products; and the exposure to litigation, including
patent litigation, and/or regulatory actions.
Merck undertakes no obligation to publicly update any forward-looking
statement, whether as a result of new information, future events or
otherwise. Additional factors that could cause results to differ
materially from those described in the forward-looking statements can be
found in Merck’s 2012 Annual Report on Form 10-K and the company’s other
filings with the Securities and Exchange Commission (SEC) available at
the SEC’s Internet site (www.sec.gov).
Kelley Dougherty, 908-423-4291
Steven Cragle, 908-423-3461
Carol Ferguson, 908-500-1101
Justin Holko, 908-423- 5088