- Merck & Co. said it borrowed doses of Gardasil 9 from a stockpile kept the U.S. Centers for Disease Control and Prevention, as demand for the HPV vaccine once again outstripped supply.
- The drugmaker has looked to the CDC for a loan in the past, borrowing supplies in a 2017 move that reduced sales by about $240 million in the third quarter of that year. Then, the decision was spurred in part by temporary production shutdowns caused by a cyber attack.
- This time, Merck expects a revenue hit of about $120 million in the fourth quarter, according to the company's earnings statement for the third quarter.
Gardasil is a key product for Merck, earnings $1.3 billion in the months from July to September. But the drugmaker hasn't been able to keep enough of the vaccine flowing to meet rising demand, especially in China.
The company plans to have more production capacity for Gardasil on line by 2023, thanks to the construction of two new bulk manufacturing facilities. Until then, Merck executives are trying to keep investor expectations for the vaccine in check.
"Demand for Gardasil continues to outpace supply and we expected tempered growth rates for the product versus what we reported over the last couple years," Chief Financial Officer Rob Davis said on an Oct. 29 call with investors.
The company narrowed its overall revenue guidance for the year to between $46.5 billion and $47 billion, which includes the impact of this month's borrowing of Gardasil from the CDC stockpile.
Demand for Gardasil has been rising as it becomes a routine vaccination in the U.S. and elsewhere. In addition to demand in Asia, the company singled out higher vaccination rates for both boys and girls in Europe.
"Anticipate additional supply coming onboard significantly in 2023," Chief Commercial Officer Frank Clyburn said on the call. While growth rates may not be as high as previously, "we do believe we can still grow Gardasil over the next several years as we continue to match and move supply to match our demand around the world," he said.