US FDA approves Merck's injectable version of blockbuster cancer therapy Keytruda

The FDA has approved Merck's new subcutaneous formulation of its blockbuster cancer therapy, Keytruda (Keytruda Qlex), offering a more convenient administration in minutes compared to the 30-minute intravenous infusion. This strategic approval, ahead of the drug's 2028 patent expiry and looming biosimilar competition, is critical for Merck to defend Keytruda's nearly $30 billion annual sales, with the company projecting 30-40% patient adoption of the injectable version within two years, despite being the third to market with such a therapy.

Analysis

The U.S. FDA's approval of Keytruda Qlex, a subcutaneous formulation of Merck's flagship oncology drug, represents a significant positive development for the company. This new version critically reduces administration time from approximately 30 minutes for an IV infusion to just one or two minutes, enhancing both patient convenience and clinic efficiency. Strategically, this approval is a key pillar in Merck's defense against the looming 2028 patent expiry of Keytruda, which generated nearly $30 billion in 2023 sales. By aiming to convert 30% to 40% of patients to this new formulation within two years, Merck seeks to insulate a substantial portion of its revenue from future biosimilar competition. Although Merck is the third entrant into the subcutaneous cancer immunotherapy market behind Roche and Bristol Myers Squibb, the company believes its faster injection time and flexible dosing schedules (every three or six weeks) provide a competitive advantage that will drive adoption upon its U.S. launch in late September.

Key Decisions for Investors

• The approval of Keytruda Qlex materially strengthens Merck's defensive strategy for its largest revenue source, potentially mitigating revenue erosion from the 2028 patent cliff and subsequent biosimilar entry.
• Investors should closely track the product's U.S. launch in late September and monitor initial adoption rates against the company's two-year target of 30-40% patient conversion, as this is a key performance indicator for the franchise's longevity.
• Consider the competitive positioning against Roche's and Bristol Myers Squibb's subcutaneous therapies; outperformance will depend on whether Keytruda Qlex's faster administration and dosing flexibility prove to be meaningful clinical differentiators.