Last day. This has been a great conference. I can't tell you how grateful I am for everyone for joining. My name's Akash Tewari . I'm a pharm and biotech analyst here at Jefferies. We have Merck, also goes by the alias MSD when they're not on that side of the Atlantic. Peter, why don't I hand it off to you for some intro remarks, and we'll get started.
Oh, thank you all for being here. Appreciate your time and your interest. Akash, thanks for hosting us. With me is Chirfi Guindo, our Chief Marketing Officer, and Marjorie Green, who leads clinical development for oncology.
Understood. I'll start off with, I think, you know, obviously, your team's been very active on the BD front recently, and there was another major acquisition that your team consummated in Cidara. And, you know, this is kind of a theme that we're starting to see emerge of, you know, how do you build a vaccine business but kind of almost make it vaccine-adjacent, right? Talk to me about what you saw in Cidara and why the flu market really needed a long-acting antiviral, you know, to maybe build that market out.
Yeah. No, thank you for the question, and, you know, thank you all for giving us the opportunity to tell the story of our fantastic company. You know, for those of you who just, if you haven't been paying attention, we had a phenomenal week, and Cidara was just one of a number of milestones announced just this past week. We announced the good news on HIV, right, in the naive population with Islatravir/ Doravirine, basically, you know, phase III, so really, really exciting. We announced the Winrevair, Cadence , phase II readout, you know, also very, very exciting. Keytruda s ubQ approved in Europe yesterday. A lot happening in our company.
Cidara indeed represents a significant opportunity, first and foremost, for the protection of many, many people around the world who, you know, who have high risk of complications from influenza infection or who are immunocompromised. I'll talk a little bit about the rationale for Cidara and how we see value creation with this particular acquisition. You know, traditional vaccines have limited efficacy in certain populations. If you're immunocompromised, obviously, you know, you're going to continue to have risks. If you have COPD, right, HIV, if you have had an event, you know, atherosclerotic cardiovascular disease patients, and the list goes on and on, these are all populations who are at high risk. As we look at the opportunity, we've looked at the U.S. just as an example.
Mm-hmm.
There are about 110 million people, right, who really could benefit from this long-acting antiviral, which, by the way, really, I should say this, is really strain-agnostic. You take it once at the beginning of the season, and you get protection through the whole season, right? Whether you've been vaccinated before or you've not been vaccinated, you can benefit from this, from this long-acting antiviral. What we've seen in the phase II data is 76% efficacy in protecting against influenza infection, independent of the strain of the influenza infection. From 110 million people in the United States, 85 million of them are people with underlying disease, right? Immunocompromised, cancer survivors, you know, HIV patients, COPD patients, and so on and so forth.
Twenty-five million are people who are 65 or older without comorbid conditions who also really could get additional protection from this long-acting antiviral. We believe that by bringing this to market, you know, we have the opportunity to really, you know, help many, many patients. Clinical benefit is clear, as I described, but there is also a huge economic benefit. You know, in the last season, as an example, there were up to 1.6 million hospitalizations due to influenza in the United States alone, right? Last year was a really tough one, big one, but this season is also proving to be very challenging. You know, there are new strains that are being talked about here in the U.K., in Canada, in Japan.
We see this as a real opportunity to protect millions of people around the world and to really create value for our company and for our shareholders.
Understood. You know, I—your answer also, I think, when it comes to infectious disease, a lot about product uptake is also about patient education, but also kind of getting the governments behind recognizing the value of certain products. I think we certainly saw that with COVID-19, but even if you think about the long-term story on Gardasil, we're in a different FDA, and I think there has been an increase in vaccine hesitancy, not just, you know, say what you will about the FDA, but really at the ground level, Americans are more hesitant to use vaccines in a way that we haven't seen historically.
As you think about a long-acting antiviral like Cidara's drug and think about the importance maybe to the U.S. Government and nationally, do you feel like there might be alignment with how, let's say, the FDA and the Trump administration values that product and how Merck does?
Yeah. We believe that there is going to be alignment. In fact, the FDA has asked Cidara to expand the patient population for the phase III program to include 65-year-olds and above who do not have comorbid conditions, just goes to show the level of interest that exists within the FDA and the U.S. government more generally. We believe that CD388, which is the asset that we're talking about, will be really attractive also in terms of, you know, government policy, public health policy, and pandemic prevention in the U.S., but also in Europe, importantly. BARDA might be interested in this as a strategy for prevention of future pandemics. This, I think.
Yeah.
This is aligned with government strategy.
Just two quick points on that. A, sometimes we'll see you have to put out an initial efficacy data set to kind of prove that the product works, but then you start to get, certainly with vaccines, expedited routes to market after that. Is that a framework we could potentially think about for a long-acting antiviral like Cidara, where let's say you have the new strains and you can show that this is completely neutralizing them? Is that type of pragmatism potentially applied to your product with the FDA? Number two, as we think about the National Priority Review Voucher, a pathway that's now suddenly available, is this product potentially something that Merck could pursue?
We will pursue all options. What I can tell you, you know, really is there's a high level of interest. The fact that this is strain-agnostic.
Mm-hmm.
Makes it uniquely important in terms of public health. We will continue to engage both with the FDA and the administration more broadly, to make this available as early as we can, right? We are in phase III. Whether you are vaccinated or not vaccinated, you are going to be a candidate for phase III enrollment, and, you know, for the high-risk populations that I am talking about.
Sure.
Just to be clear, we look forward to generating the data that will really motivate public health to adopt this prevention.
Understood. Now, maybe hitting on Winrevair and, you had mentioned the Cadence data had come out. I look, I think you there you have to give credit to your team. If I look at the report card of the Acceleron acquisition, if we knew Zenith would hit, Hyperion would hit, Cadence would hit, the drug would launch well, I, you know, you think about the value that Acceleron would be at right now. A couple of things. Number one, now that you have Hyperion , Zenith data, I mean, really data to support the use of sotatercept broadly in PAH, should we expect a corresponding increase in patient starts in 2026?
Number two, the Cadence data came out. I think the issue for a lot of investors, and we're struggling as well, is it doesn't seem to be a clear relationship between PVO2 and the endpoints we've traditionally seen in this population, like six-minute walk. Why should we feel confident that this drug will gain regulatory approval ultimately in phase III?
Yeah. The first point is, you know, we're really pleased with the uptake so far in the launch of Winrevair in PAH. It has been transformative. I mean, you know, PAH is a really terrible disease, disease of young women. Most, you know, most of the patients are women in their 30s and 40s, and the survival rate of five years is less than 50%. It is a really, really terrible disease. Before these patients die, unfortunately, they have a terrible quality of life. What we've seen in the clinical program, but also in the real world since the launch, is really, really the benefit that Winrevair brings to these patients and to the community. You're right in saying that all of the studies have been positive. You know, we have a world of data now around Winrevair, right?
In the advanced patients on triple, but also with Hyperion , we now have data, convincing data, in the dual therapy treated patients, which really is giving confidence to the community to begin to adopt Winrevair to a broader base of patients, right? So far, most of the prescriptions are still in the more advanced triple therapy treated patients.
Mm-hmm.
We're beginning to see uptake, you know, moving to earlier stages and more of the dual therapy patients. That's what I will say. We have about 500 or so patients that are initiated every month on an ongoing basis in the United States. We're beginning to see uptake in Japan, in Germany, in France, and other parts of, you know, of the world. We are really bullish about the PAH opportunity going forward. As far as Cadence, you know, this is a different patient population. This is group two PH. In fact, it's a subset of group two PH, you know, the CPC PH. You could think about that as a rare disease also with a similar size to PAH, you know, roughly 40,000-50,000 patients in the United States, similar to the PAH population.
The diagnosis rate is very low in this case. The phase II data is very promising. You saw the press release, you know, the level of excitement is high because there's no treatment for these patients, right, with CPC PH. Now we're getting into phase III. We're really excited about the opportunity to advance the program. We believe we do have to do a phase III program. Our team is working with the FDA to define the parameters of the phase III and the endpoints, you know, whether it's functional endpoints or, you know, to your question, all of that will be determined in the coming periods. Stay tuned for the phase II presentation that will be delivered early in the new year. For the phase III, we'll keep you updated as well.
It is really exciting and hope for those patients who really have no options to speak of as of today.
Yeah, that's a good point. Maybe just jumping to a couple other products that your team is consistently pointing out, ex-oncology is important to you. Talk to me a bit about EyeBio, that, you know, that deal, you have a trispecific immune mechanism of action, in a, in a quite mature market. And I think a lot of investors say, well, you know, there's going to be bi-similar Eylea, there's bi-similar Lucentis. ASBs have been just in, you know, in secular decline. Why is Merck interested in this opportunity? What makes your asset different in what's becoming a pretty mature marketplace?
Yeah. This is another exciting part of our portfolio that we believe is underappreciated, frankly. The acquisition of EyeBio is really motivated by the, you know, great science, unmet medical need, and value opportunity. Why do we think there's an unmet medical need? Because the anti-VEGFs that have now been adopted broadly have done a really, really nice job in helping many, many patients. You're talking millions of patients. Again, for context, in the United States, there are about one and a half million people who live with diabetic macular edema.
Mm-hmm.
A similar number who live with, you know, neovascular or wet AMD. These are big numbers of patients. 40% of these patients who are treated continue to have issues. They're either not responding or they do not respond adequately to the anti-VEGFs. There is an unmet medical need, and there's a need for a new MOA. That is what the EyeBio portfolio brings us, right? You have the Wnt pathway, which is the MK-3000, right? Then you have the bispecific of TIE2 and VEGF, which we have with our Tiespectus assets. Two assets that we have acquired as part of the EyeBio acquisition that are responding to an unmet medical need.
Mm-hmm.
In this patient population. It is a large pool of patients who are treated, but 40% of them are not treated adequately. This is the opportunity, right? As we come to market, we believe that we are going to, you know, create value. We are going to have, you know, rapid adoption in this patient population. The data so far is really, really encouraging. The program is advancing, in fact, accelerating, which is always an indication. When you have acceleration of clinical trial enrollment, it is an early indicator.
Mm-hmm.
Of adoption, at a later stage. Next year, you know, look out for the phase III readout for DME for our MK-3000. That's going to happen next year. Last October, we presented data on Tiespectus , which is really, really encouraging. It's early phase I-B data, you know, presented at the Orlando meeting, the American Academy of Ophthalmology. All this to say that we are really looking forward to bringing these two drugs to market to augment.
Right.
Right, the anti-VEGFs and to provide additional value for patients. This is a multi-billion dollar opportunity, by the way.
Mm-hmm.
Stay tuned on that.
Oral PCSK9, you know, really a robust data. I mean, you're getting biologic-like efficacy. I think there's two questions. A, food effect, is this going to be problematic? I think there's another one too, which is, you know, Dean's mentioned for outcomes, you're designing a study and you're going to be patient. You're looking for greater than 20% risk reduction. That seems to be important. That also means that you're going to have to wait several years for outcomes to read out. You can't, you know, have your cake and eat it too.
Yeah.
That kind of brings an interesting question, which is without outcomes data, maybe for a bit, how is Merck thinking about access and uptake here to allow this drug to be commercially viable without the outcomes data out of the gate? How are you thinking about that challenge?
Yeah. I mean, we are really excited about Enlicitide. This is really our, you know, our, I would say chemistry masterpiece, if I can put it this way. The reason why I say this is our chemists have been working for a number of years to try to deliver a biologic in a pill. They have succeeded in doing that. It's really, I invite you to read up on the story and the molecule of Enlicitide itself. When it was presented a few weeks ago at the American Heart Association conference, you know, it blew the field away because it's able to deliver the potency and the efficacy of the antibodies.
Just to summarize it a little bit, you get 60%, approximately 60% reduction in LDL cholesterol on top of the statin. You get 50% reduction in non-HDL cholesterol, 50% reduction in ApoB, and 30% reduction in Lp(a), right? That is what you get in this one simple tablet that you take in the morning 30 minutes before your breakfast, right? The so-called food effect really was not an issue in the clinical trial program. In fact, 97% or more of the patients had no problems, you know, following the regimen of morning intake, 30 minutes before meals. We look forward to bringing it to market. You know, we have a large, we have experience in the space. You know, the data is celebrated.
You know, we look forward to guidelines now being updated in the U.S. so experts are now talking about needing to update those guidelines in the context of the Vesalius data that was presented from Amgen. Again, excellent data. Our data, there is now a reason for them to begin to think about updating those guidelines so we can, you know, have those conversations with payers. We do intend to think about broad access, right? Our strategy is going to be price to value and price to access for Enlicitide. Very important. We think, you know, Dean has used the concept of democratizing access to PCSK9, and that is very much what we're going to be doing. We believe there will be uptake, uptake prior to the CV outcome data that you referenced because of the mechanistic way in which Enlicitide works. It really works similar to the antibodies.
Mm-hmm.
Very different than the traditional small molecules, right? We believe that there is going to be recognition for that in the guidelines, which will then help us with the payers. You know, obviously the pricing strategy will also help, you know, with early adoption.
Understood. Marjorie, maybe, turning to you, you know, we had lunch earlier. You described sac-TMT in a way that, I think is, I've not heard an ADC described before. You think of ENHERTU and you say, okay, if you have breast cancer and clearly, even if it's HER2 low or nonexistent, apparently there's a clinical effect, but there's a segment of people who take ENHERTU. If you take PADCEV, you know, you're a urologist, you're likely looking at that. You describe sac-TMT as a drug that might be useful for community oncologists. Can you talk about what that means? Because I, I don't think we've thought about ADCs with that framework before.
Yeah, I, yeah, thanks for the question. Ultimately, what we hope to see with sac-TMT is, you know, efficacy across multiple diseases. And we have a great partnership with Kelun. A lot of data has been generated in China, some of which y'all have seen at ESMO recently, and hormone receptor positive breast cancer, EGFR mutated non-small cell lung cancer. There have been other phase II data sets and there's more that haven't been publicly presented. That led to our 15 registration studies that are currently ongoing across multiple tumor types, including gynecologic tumors, lung cancer, breast cancer, and many more.
In thinking about drugs, ultimately we want a drug that is highly active and really does change the standard and not only for the academic oncologist out there, but also thinking about in the United States, 80% of oncology care is given in the community. Often these are physicians who see people who have multiple different tumor types. There are some practices where people are subspecialized. I'm a breast oncologist by training and all I saw was breast cancer patients. I was in the academic world. A person can see a patient with lung cancer. They could see a person who has endometrial cancer. They could see someone who has gastric cancer.
By having a drug with potent efficacy and what we hope we will see in the global phase III studies is really good tolerability, that ability to keep people on drugs, it becomes the choice then. I have someone who has non-small cell lung cancer and I want to give a trip to ADC and Keytruda. Okay, there's data with sac-TMT . My next patient has endometrial cancer. I have sac-TMT . It is the workhorse ADC because it's got, we think, again, I've described this for those who know the Goldilocks and the Three Bears kind of analogy. It's just right. It's really potent, but that tolerability comes out. ADCs are not identical at all. I think this really is for the community oncologist, something that we would be able to provide great value through the clinical efficacy and the broad utility across multiple indications.
Understood. And you talk a lot about tolerability, but, you know, one of the things that we saw certainly at ESMO, you have similar response rates to some of the early trope two ADCs when you had your phase I, II data. And I think that's what I think a lot of the field saw. What we're starting to see is that on overall survival, there seems to be a very different shape curve than when I look at Trodelvy or I look at Dato-DXd. So talk to me about how tolerability plays a role into overall survival. And what I would say is also when you think about sac-TMT , you know, 15 phase III trials, that's a lot of investment. What do you want to see on OS for this to be needle moving and kind of the workhorse product for Merck in the way that Keytruda is?
Multiple sort of aspects of that question. Again, we need to see what the global data looks like. I think that the phase III studies that Kelun has done have been really impressive. You're seeing consistent data across multiple different kinds of diseases with sac-TMT and the phase III data that Kelun has generated. The survival is interesting. I think we have all gotten a little spoiled in oncology with the checkpoint inhibitors. I think, you know, I don't want to discount that PFS is still an important endpoint in oncology.
Mm-hmm.
It's clinically meaningful if you have, because patients don't always, or people with cancer, don't always make it to the next therapy. If it's a large enough number and they can't get to subsequent therapy, then you start seeing overall survival. There are different aspects that go into overall survival. Can people make it to their next therapy? Can people stay on therapy a long period of time like you see in the progression-free survival? That's where I think the ability to stay on therapy becomes a part of the equation. Cancer's smart. It develops resistance to therapies. Unfortunately, for people, many, their cancers will develop resistance and progress. It's that long-term ability to have disease control that we think can, in, like, impact the overall survival.
Yeah, I don't, every disease indication and segment is a little different about what kind of survival advantage is clinically meaningful. I still believe that progression-free survival is a clinically meaningful endpoint. I am very excited about the upcoming phase III readouts.
Okay. Understood. Now, maybe towards the end here, let's touch a bit on HIV. Again, another product your team talks about, Street maybe not be paying enough attention to. I think even when we do talk about it, it's about PrEP, right? It's about the monthly PrEP. I want you to talk about, A, the importance of a two-drug regimen that could compete against Biktarvy in the antiviral side. What do you think about that product opportunity? Then separately, what do you think about the impact of a monthly PrEP option as well?
Yeah. No, thank you for the question. We announced this week, as I mentioned earlier, the naive data for islatravir/doravirine. This is our daily two-drug regimen that basically is indistinguishable, or non, you know, non-inferior to Biktarvy in terms of efficacy. This one will be, the PDUFA on this one is going to be April next year. Next year, we also have two important treatment readouts in phase III. That is a weekly oral, right? Islatravir with lenacapavir, right? Just to paint the picture a little bit. The PrEP one will come later in 2027, in terms of readout. Coming back to the treatment, daily treatment, why is there a need for a two-drug regimen that does not contain integrase inhibitor? You know, for a number of years, the field has been looking for options, a new anchor treatment, right?
Integrase inhibitor is the current anchor treatment. And Biktarvy is the standard of care. No question about that. Now, as you get older on your treatment, you know, physicians are looking for options, right, to save or to, you know, preserve if you want the integrase inhibitor. For the first time, we have data now that suggests that with islatravir as anchor, you can have the same efficacy as Biktarvy. And potentially you can avoid some of the liabilities of integrase inhibition over time, right? Cardiometabolic, toxicity over time. This is really the appealing part of this two-drug regimen. You get less drug. And you have, you know, the cardiometabolic issues that you don't have to worry about as the patients get older on their treatment. That is really the compelling case for this two-drug regimen.
Can you maybe just define what of the anti, the branded antiviral opportunity would be those patients who really want to try a non-integrase option?
What is the, sorry?
Like, as in, you know, the market you're alluding to for people who would explore that new option. How big of that, what subset of that is of the antivirals as a whole?
As we talk to clinicians, again, we've done a lot of market research on this. You know, we asked them this question. I mean, you think about diabetic patients, think about patients with, you know, obesity and other cardiometabolic issues, maybe some patients with renal issues. Those are the types of patients that are most likely to be prioritized for this type of regimen. That is the insight that we're getting from non-clinicians.
That's very helpful. Maybe for the monthly PrEP.
PrEP. Yeah, for the monthly PrEP. This one is gonna be also really important for the field because, I have to say, first of all, that the injectables have been really, really impressive in terms of protecting people against HIV infection, right? Whether you're talking about the twice yearly injection, once yearly injection soon, or even every three to four months injection. Those are all very effective drugs at prevention, preventing HIV infection. What we hear from people who are at risk is that they do prefer to have a long-acting oral option. About a third of the people that we've surveyed tell us that, you know, if there's a long-acting oral option, especially a monthly oral option, they would prefer that to having to go through the doctor, get an injection.
You know, with the oral option, you can get it in the privacy of your home, you get it sent to you, you do not have to go see the doctor, and you get effective protection with a single pill that you take and it starts working within 30 minutes. You get protection for the whole month, right? That is the compelling case for our PrEP option. You know, we look forward to bringing that one also to market.
Understood.
Collectively, you're talking about a multi-billion dollar opportunity for HIV, which we think has been underappreciated.
Just for perfect clarity, the PDUFA date in April is for the islatravir/doravirine.
The daily.
Switch.
The daily.
Right.
Yes.
Yeah. What we read out this week, top line, was the treatment-naive. It's for the same regimen, just in a different setting.
Yeah. Perfect. Yeah. Thanks for the clarification.
We're gonna call it here. There's a lot more that we're talking about. I do encourage investors to really dig into their pipeline. So appreciative of your time.
Thank you so much. Thank you.