Anyone crafting a bull case for the pharmaceutical giant (NYSE: MRK) should include Keytruda as the company's best asset. The cancer drug has been Merck's top-selling medicine and its biggest growth driver -- by a mile. And last year, it became the best-selling drug worldwide, taking over from the immunology superstar Humira. However, Keytruda won't hold that title forever. What will happen if Merck's most important cash cow runs into stiff competition?
Recent developments suggest that it might, and that's not to mention a fast-approaching patent cliff. Let's look further into the dangers threatening Merck's crown jewel and decide whether the company's shares are worth buying anyway.
To see how vital Keytruda is to Merck, it's important to look at the company's financial results. In the second quarter, the drugmaker reported revenue of $16.1 billion, up 7% year over year. Keytruda's sales came in at $7.3 billion, increasing 16% compared to the year-ago period. So, Keytruda made up about 45% of Merck's top line. While the medicine has earned scores of indications, it can be safely assumed that a high percentage of Keytruda's sales come from non-small cell lung cancer (NSCLC) patients.
Source Fool.com