Merck announced on February 25, 2025, that it expects its top-selling cancer therapy, Keytruda, to be selected in 2026 for government price setting. This would become effective on January 1, 2028, under the Inflation Reduction Act (IRA).
The inclusion of Keytruda in price negotiations represents a significant long-term financial headwind for Merck. Keytruda generated nearly $29.5 billion in sales last year, making it a critical revenue driver for the company.
This development underscores the increasing pressure on pharmaceutical pricing in the U.S. and the potential impact of healthcare reform on blockbuster drugs. Merck is actively contesting the IRA program legally, but the expectation of price negotiation remains a concern for investors.
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