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How Merck’s Zepatier and Isentress Are Positioned

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Zepatier revenue

In 3Q17, Merck’s (MRK) Zepatier generated revenue of $468 million, compared with $164 million in 3Q16. In 3Q17, Zepatier revenue fell 9% QoQ (quarter-over-quarter). During the first nine months of 2017, Zepatier generated revenue of $1.4 billion, compared with $326 million during the same period in 2016. Higher sales growth in the United States, Europe, and Japan primarily contributed to Zepatier’s revenue growth in 3Q17.

In October 2017, Merck presented the results from its retrospective database analysis of individuals with chronic hepatitis C virus (or HCV) genotype 1 or 4 infections and CKD (chronic kidney disease) on Zepatier (elbasvir and grazoprevir) therapy. In the trial, 95.6% of patients with severe CKD and 97.1% of patients with moderate CKD achieved a sustained virologic response.

In the marketplace, Zepatier competes with Gilead Sciences’ (GILD) Epclusa and Harvoni, Johnson & Johnson’s (JNJ) Olysio, and AbbVie’s (ABBV) Technivie and Viekira. In 3Q17, Gilead Sciences’ Epclusa and Harvoni reported revenue of $882 million and $973 million, respectively. Zepatier revenue growth could boost the iShares Russell 1000 Value ETF (IWD), of which Merck makes up ~1.2%.

Isentress revenue trends

In 3Q17, Isentress reported revenue of ~$310 million, a ~17% fall YoY (year-over-year) and ~10% growth QoQ. Lower sales in the US market due to competitive pressure, lower sales volumes, and pricing in Europe dragged down Isentress’s YoY revenue. Isentress (raltegravir) is indicated in combination with other antiretroviral agents for the treatment of adult individuals with human immunodeficiency virus (or HIV) type 1 infections.

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