December 25, 2025 — Even with U.S. markets closed for Christmas Day, Merck & Co., Inc. (NYSE: MRK) is ending 2025 as one of the most-watched large-cap pharma names on Wall Street. The stock closed at $106.45 on Wednesday, Dec. 24, and commentary published today points to a six-day winning streak that has pushed investors back into “what’s next” mode: how Merck replaces Keytruda’s eventual loss of exclusivity while navigating a shifting U.S. drug-pricing backdrop. [1]
Below is a comprehensive, as-of-today roundup of the most consequential news, forecasts, and analyst analysis shaping Merck’s outlook heading into 2026—covering oncology, cardiovascular ambitions, regulatory accelerants, and the policy tradeoffs that could influence margins and demand.
What’s driving Merck’s late-December rally?
A major catalyst widely cited in investor coverage is a high-profile rating change from BMO Capital Markets. BMO upgraded Merck to Outperform and raised its price target to $130, explicitly framing the call around confidence in Merck’s ability to build a sustainable growth engine after Keytruda’s expected 2028 loss of exclusivity—one of the biggest patent cliffs in biopharma. [2]
BMO’s thesis, as summarized in market reporting, is that Merck is assembling enough “next wave” contributors to absorb the Keytruda headwind over time. The firm highlighted Enflonsia, Reblozyl, and Welireg as near-term growth drivers and suggested improving sentiment tied to Gardasil performance (a product line that has been under heightened scrutiny at different points in 2025). [3]
Investor-oriented analysis published on Dec. 25 also links the move to a cluster of pipeline and regulatory developments—including high-profile oncology data and a European regulatory milestone for Winrevair (sotatercept). [4]
The core strategic question: How Merck is building for “life after Keytruda”
Merck’s market narrative still revolves around the same central reality: Keytruda remains the company’s defining asset, and its eventual biosimilar competition later this decade is a structural challenge investors model years in advance. Reuters reporting this month again described Keytruda as the world’s top-selling drug with nearly $30 billion in annual sales, while noting Merck’s urgency to advance and launch new medicines before the late-decade inflection point. [5]
That’s why analysts often evaluate Merck less like a “steady pharma compounder” and more like a company mid-transition—one that must consistently produce:
- new indications and combinations in oncology,
- new launches in adjacent disease areas (cardio-metabolic and immunology),
- and durable, high-margin growth outside a single flagship.
BMO’s upgrade is important because it argues the market may be underestimating Merck’s ability to diversify the revenue base before the patent cliff arrives. [6]
FDA fast-track accelerant: National priority review vouchers for enlicitide and sac‑TMT
One of the most material, forward-looking developments in recent days is Merck’s inclusion in the U.S. FDA Commissioner’s National Priority Voucher program—an initiative designed to accelerate review timelines for therapies deemed critical to public health or national security needs.
On Dec. 19, Reuters reported the FDA granted vouchers to Merck’s investigational:
- enlicitide (a cholesterol pill), and
- sac‑TMT (an antibody-drug conjugate cancer therapy). [7]
According to Reuters, the program can reduce drug review timelines to one to two months, from a more typical 10–12 months. [8]
Why enlicitide is getting investor attention
Reuters notes enlicitide meaningfully reduced LDL cholesterol in a late-stage study and is positioned to compete with injectable PCSK9 therapies such as Amgen’s Repatha—an important point, because oral convenience could materially affect real-world uptake if efficacy and safety hold up. [9]
Why sac‑TMT matters beyond the headline
On the oncology side, Reuters describes sac‑TMT as an antibody-drug conjugate (ADC) designed to deliver cancer drugs more precisely to malignant cells, with less damage to healthy tissue than traditional chemotherapy. Reuters also reported Merck signed a $700 million development funding deal with Blackstone Life Sciences for sac‑TMT, underscoring how seriously Merck is investing in the ADC platform as a potential post-Keytruda growth pillar. [10]
The takeaway for investors: even if these programs remain developmental, regulatory acceleration mechanisms can pull forward value and compress timelines—especially in categories where “first-in-class” or “best-in-class” positioning affects long-term share.
TrumpRx and drug pricing: Merck joins a new U.S. affordability framework
Another headline issue in Merck’s current news cycle is policy—and, increasingly, how the company positions itself proactively amid pricing pressure.
On Dec. 19, Merck announced it reached an agreement with the U.S. government (under the Trump administration) aimed at expanding access and lowering costs. The company said it plans to provide certain products through a direct-to-patient program and that JANUVIA, JANUMET, and JANUMET XR will be offered to eligible U.S. patients at a cash price about 70% off the current list price. [11]
Merck’s statement also said the direct-to-patient approach would be expanded in the future to include enlicitide if the drug is approved—an early signal that Merck may treat affordability and distribution model innovation as part of its launch playbook, not just a political necessity. [12]
The broader industry deal
In parallel, the Associated Press reported that nine drugmakers, including Merck, agreed to lower drug prices in ways tied to Medicaid and “most-favored-nation” pricing for newly launched medicines, alongside a TrumpRx platform that officials said is expected to launch in January and allow patients to buy certain medicines directly from manufacturers. [13]
Why this matters for Merck’s 2026 forecasts
For Merck, the policy story isn’t only about revenue pressure. It’s also about:
- volume opportunity (if lower prices expand the addressable market),
- reputational and regulatory positioning (less adversarial posture may reduce longer-term policy risk),
- and potential tradeoffs between list price, net price, and channel economics.
This is the kind of “policy alpha” investors increasingly try to model—especially for mega-cap pharma companies where U.S. reimbursement structures can move earnings expectations.
Oncology is still the engine: Keytruda + Padcev posts pivotal results in muscle-invasive bladder cancer
While the policy headlines are loud, Merck’s day-to-day value creation remains deeply anchored in oncology—especially in expanding Keytruda’s reach through combinations and earlier-stage settings.
On Dec. 17, Merck announced that KEYTRUDA (pembrolizumab) plus Padcev (enfortumab vedotin) significantly improved event-free survival, overall survival, and pathologic complete response rates versus standard treatment in cisplatin-eligible muscle-invasive bladder cancer (MIBC) when given before and after surgery. Merck described the trial as the Phase 3 KEYNOTE‑B15 (EV‑304) study and said it enrolled 808 patients. [14]
Pfizer (a Padcev partner alongside Astellas) also released a statement confirming positive topline results from the interim analysis and reinforcing the potential implications for perioperative care in MIBC. [15]
Why investors care about this specific readout
For investors, perioperative (pre- and post-surgery) success is strategically meaningful because it can:
- expand use into earlier-stage disease, where patient numbers can be larger than in metastatic settings,
- support longer treatment duration per patient, and
- deepen Keytruda’s competitive moat through combination standards of care.
Even as the market models eventual Keytruda biosimilar competition, clinical wins like KEYNOTE‑B15 can still influence the slope of Keytruda’s revenue curve over the next several years.
Winrevair (sotatercept) momentum: Europe signals a potentially broader label
Merck’s other major “next era” narrative is Winrevair (sotatercept), a therapy for pulmonary arterial hypertension (PAH) that many analysts view as a foundational growth platform outside oncology.
On Dec. 12, Merck said the European Medicines Agency’s Committee for Medicinal Products for Human Use (CHMP) recommended approval of an expanded indication for Winrevair—in combination with other PAH therapies—covering adult patients in WHO Functional Class II, III, and IV, based on the Phase 3 ZENITH study. Merck said a final decision from the European Commission is expected in the first quarter of 2026. [16]
The EMA also maintains a public page documenting CHMP opinions and indication extensions for medicines, providing additional confirmation of the regulatory pathway for the product in Europe. [17]
For Merck’s forward outlook, this matters because broader labels can increase addressable patient populations and strengthen the product’s long-term revenue trajectory—particularly if the drug continues to show benefits on clinically meaningful outcomes in PAH.
Forecasts and analyst targets: Where Wall Street is landing on MRK as of Dec. 25, 2025
With MRK trading near the mid‑$100s, today’s coverage and the latest analyst datasets show a market that’s cautiously constructive—but not uniformly bullish.
Consensus price targets: low‑single‑digit upside, wide dispersion
- StockAnalysis lists an average price target of $111.93 with a consensus rating of “Buy” (lowest $85, highest $130). [18]
- MarketBeat’s compilation shows a consensus rating of “Hold” with an average target of $110.13 (also $85 low and $130 high). [19]
The key insight isn’t just the average; it’s the dispersion. The high target aligns with the “post-Keytruda confidence” trade (as reinforced by BMO), while the low end reflects skepticism that Merck can replace a once-in-a-generation oncology franchise quickly enough—especially amid pricing and reimbursement headwinds.
BMO’s $130 call is the “bull case” anchor
BMO’s upgrade and the jump to $130 is one of the clearest data points behind the late‑December momentum, as it explicitly argues the market is underpricing Merck’s portfolio build for the 2028 transition. [20]
Valuation commentary: “already priced in” vs. “still runway”
Some market commentary published today takes a more measured stance, noting that the stock’s move reflects news investors are reacting to after the fact—and that the question now becomes whether additional catalysts arrive quickly enough to extend the rerating. [21]
Key dates and what to watch next
As of this morning, Merck’s investor relations site is highlighting late-December news flow (the U.S. government agreement, KEYNOTE-B15 results, and the Winrevair CHMP opinion) as the main corporate developments investors are tracking into year-end. [22]
Here are the next concrete milestones that could shape near-term forecasts:
Q4 2025 earnings: February 3, 2026
Merck has its Q4 2025 earnings call scheduled for Feb. 3, 2026 at 9:00 a.m. ET, which is likely to be the next major moment for updated guidance, product-by-product trends, and pipeline timing disclosures. [23]
Europe’s Winrevair decision: expected in Q1 2026
Merck has said a European Commission decision on the expanded Winrevair indication is expected in Q1 2026, keeping PAH as a near-term catalyst category. [24]
Implementation details for TrumpRx and direct-to-patient pricing
Merck’s announced discounts and the broader TrumpRx effort will likely generate follow-up scrutiny: eligibility terms, product scope expansion, and how these programs impact net pricing versus volume. [25]
Pipeline acceleration via priority vouchers
With enlicitide and sac‑TMT now linked to an FDA fast-track framework, investors will watch for regulatory submissions, label scope, and any safety/efficacy disclosures that change probability-weighted value. [26]
Bottom line: A “quieter day,” but not a quiet story
As of Dec. 25, 2025, the Merck story is being re-shaped by three forces happening at once:
- A renewed analyst bull case (BMO’s upgrade to Outperform and $130 target) that says the market may be undervaluing Merck’s post-Keytruda portfolio build. [27]
- Regulatory acceleration signals (FDA national priority vouchers for enlicitide and sac‑TMT) that can compress timelines and pull forward value if programs continue to deliver. [28]
- A major U.S. pricing-policy pivot, with Merck participating in a government-led affordability framework tied to direct-to-patient pricing and the planned TrumpRx platform—an initiative that could influence both margins and demand dynamics. [29]
For investors and industry observers, Merck’s 2026 setup is no longer just about “how big is Keytruda?” It’s about whether Merck can prove—quarter by quarter—that its next generation of launches, combinations, and cardio-oncology adjacencies can carry the company through one of the most closely watched patent transitions in modern pharma.
If you want, I can also rewrite this into a Google Discover-style version with shorter paragraphs and more “mobile-first” pacing (still no images, no charts), while keeping the same fact base and citations.
References
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