Merck & Co., Inc.

Welcome to the Merck and Company Inc. Raleigh, New Jersey, USA third quarter sales and earnings conference call. At this time, all participants are in a listen-only mode until the question and answer session of today's conference. At that time, to ask a question, press star 1 on your phone and record your name at the prompt. This call is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the call over to Mr. Peter Dannenbaum. Senior Vice President, Investor Relations. Sir, you may begin.

Thank you, Julie, and good morning, everyone. Welcome to the third quarter 2025 conference call for American Company Incorporated, Rahway, New Jersey, USA. Speaking on today's call will be Rob Davis, Chairman and Chief Executive Officer, Caroline Litchfield, Chief Financial Officer, and Dr. Dean Lee, President of Research Labs. Before we get started, I'd like to point out that we have items in our GAAP results, such as acquisition-related charges, restructuring costs, and certain other items that we have excluded from our non-GAAP results. There is a reconciliation in our press release. I will also remind you that some of the statements that we make today may be considered forward-looking statements within the meaning of the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. Such statements are made based on the current beliefs of our company's management and are subject to significant risks and uncertainties. If our underlying assumptions prove inaccurate or uncertainties materialize, Actual results may differ materially from those set forth in the forward-looking statements. Our SEC filings, including Item 1A and the 2024 10-K, identify certain risk factors and cautionary statements that could cause the company's actual results to differ materially from those projected in any of our forward-looking statements made this morning. Merck and Company Incorporated, Raleigh, New Jersey, USA, undertakes no obligation to publicly update any forward-looking statements. During today's call, a slide presentation will accompany our speaker's prepared remarks. These slides, along with the earnings release, today's prepared remarks, and our SEC filings are all posted to the investor relations section of our company's website. With that, I'd like to turn the call over to Rob.

Thank you, Peter. Good morning, and thank you for joining today's call. We continue to make meaningful progress in using the power of leading in science to save and improve lives around the world. We're delivering value to patients and customers today through our innovative portfolio of medicines and vaccines, And we're securing our future by making important investments in our pipeline, the strongest and deepest in recent memory. We now have approximately 80 phase three trials underway across a diverse array of therapeutic areas, with important readouts coming over the next year in cardiopulmonary, immunology, HIV, ophthalmology, and of course, oncology. We're investing behind more than 20 compelling launch opportunities, some already underway. These programs will transform our commercial portfolio and fuel future growth, with over $50 billion of revenue opportunity by the mid-2030s. And we remain committed to the pursuit of disciplined science and value-driven business development to further augment our expansive pipeline. In the third quarter, we continue to successfully execute on our strategy with important pipeline advancements, significant approvals, and successful new product launches. Additionally, in October, we completed the strategic acquisition of Verona Pharma. This provides us yet another important growth driver with multibillion-dollar commercial potential into the next decade. We're making strong progress across the business, and I remain confident in our ability to further broaden our impact to patients and deliver long-term growth and value for shareholders. With respect to U.S. healthcare policy, as I've said before, we share the administration's goal of decreasing patient out-of-pocket costs for our products in the U.S., while at the same time realizing greater prices for our medicines and vaccines in countries that have not been paying fair value for the innovation we provide. We're actively engaged with the administration in an effort to find a path forward that achieves these objectives. We also want to preserve our ability to invest in the breakthrough innovations we intend to bring to patients in the future, while ensuring the sustainability of our business long term. and we're optimistic about our ability to do so. We continue to make significant investments in manufacturing in the United States. Last week, we announced a groundbreaking event at our Elkton, Virginia site as part of a broader plan that will result in the investment of more than $70 billion in expanded domestic manufacturing and R&D. These investments will support our plans to drive long-term growth and will strengthen the U.S. as a global leader and biopharmaceutical innovation. Turning to our third quarter results, we're pleased to deliver solid performance with continued strength across oncology and animal health, as well as increasing contributions from our new product launches, WinRiver, CatBaxiv, and most recently, Implonzia. In research, several notable updates highlight our strong progress. In cardiovascular, we announced positive top-line results from the coral reef lipids trial, the third and largest phase three study evaluating imlicitide, our investigational oral PCSK9 inhibitor, and the treatment of hyperlipidemia. We look forward to sharing these results at the American Heart Association meeting next week and submitting these data to regulatory authorities. In pulmonary arterial hypertension, full results from the Hyperion study in recently diagnosed patients reinforce our confidence in the practice-changing potential of Win-Revere. Additionally, we secured FDA approval for our supplemental BLA for Win-Revere based on the strong results of the Zenith trial. In oncology, we're pleased that the FDA approved subcutaneous prembolizumab, or Keytruda Q-Lex, and that the CHMP granted a positive opinion. Keytruda Q-Lex will provide patients and providers an important new option that can be injected in as little as one minute. We're working relentlessly to continue to develop and deliver new treatment options for patients with cancer. At ESMO, we presented data across a broad range of oncology medicines and candidates, including important findings from breakthrough therapy-designated ADCs. Finally, we continue to expand our efforts in immunology, including for another of our important late-stage candidates, Taliso Kiebart. where we initiated phase 2B trials in three immune-mediated inflammatory diseases. These add to the phase 2 study already underway in SSC-ILD and the ongoing phase 3s in ulcerative colitis and Crohn's disease. We're pleased to welcome our new colleagues from Verona Pharma and look forward to adding our commercial capabilities and scale to accelerate the launch of Odover, a novel first-in-class maintenance treatment for chronic obstructive pulmonary disease. Strategic business development remains a top priority. We're assessing potential targets with urgency given our desire to make additional compelling investments when both science and value align. In summary, we remain highly focused on building on the strong clinical and commercial progress we made in the quarter. The investments we're making to advance and expand our pipeline are increasingly translating into positive clinical results and successful new product launches. This is giving us improved line of sight towards the transformation of our portfolio to one with a far more diversified set of growth drivers. With each milestone we achieve, including compelling strategic business development, my conviction that we're well positioned to drive the next chapter of success for our company increases. I want to recognize the commitment and effort of our teams across the world. Together, I'm confident we'll achieve long-term growth and create sustainable value for both patients and shareholders. With that, I'll turn the call over to Caroline.