HSBC upgrades Merck KGaA to Buy on attractive valuation; shares climb

Merck and Gilead Sciences are developing a weekly oral HIV treatment combining islatravir and lenacapavir, both FDA-approved separately. The combination aims to offer an alternative to daily HIV medication.

Merck & Co's Tredaptive failed in a major trial, showing no benefit over statins and increased side effects. Merck will not seek U.S. approval and advises against new prescriptions. Shares fell 2.5% to $42.56. Tredaptive had $13M sales in 2012, with potential $300M global sales forecast if successful. Analysts suggest it may be removed from overseas markets.

Merck KGaA (MRCG) stock rose 1.7% to €141.30 after HSBC upgraded its rating to Buy, citing attractive valuation, strong growth, and underperformance. The company's Q2 2026 results showed 4.1% organic sales growth, with Life Science Process Solutions up 15%. HSBC noted the stock's recent lag despite fundamentals, raising full-year 2026 outlook.

MSD's (Merck & Co.) Keytruda (pembrolizumab) received approval in Korea for PD-L1-positive platinum-resistant ovarian cancer. Clinical trials showed a 28% reduction in disease progression or death risk. Experts highlight the importance of PD-L1 screening and insurance coverage for patient access. Keytruda is the first immunotherapy approved for ovarian cancer in Korea, offering a new treatment option for patients with limited alternatives.

President Trump announced new voluntary drug pricing agreements with nine pharmaceutical companies, including Amgen, Bristol Myers Squibb, and Merck, to lower U.S. prescription drug prices. The deals, part of the TrumpRx platform, aim to align prices with those in other wealthy nations. Companies receive tariff relief in exchange for participation. Critics note limited impact on patient costs and lack of public contract details.

Merck & Co. and Moderna developed a personalized cancer vaccine, customized for each patient's tumor genome, to be used with Merck's Keytruda. The FDA granted Breakthrough Therapy designation in 2023. Phase 3 trials showed a 44% reduction in recurrence risk for melanoma patients. The companies are also exploring its use in lung, renal cell, and bladder cancers.