8-K

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 26, 2023

Merck & Co., Inc.

(Exact name of registrant as specified in its charter)

New Jersey<br> <br>(State or other jurisdiction<br> <br>of incorporation)	1-6571<br> <br>(Commission<br> <br>File Number)	22-1918501<br> <br>(I.R.S Employer<br> <br>Identification No.)

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126 East Lincoln Avenue, Rahway, NJ<br> <br>(Address of principal executive offices)	07065<br> <br>(Zip Code)

(Registrant’s telephone number, including area code)

(908) 740-4000

Not Applicable

(Former name, former address and former fiscal year, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common<br> Stock ($0.50 par value)	MRK	New York Stock Exchange
0.500% Notes due 2024	MRK 24	New York Stock Exchange
1.875% Notes due 2026	MRK/26	New York Stock Exchange
2.500% Notes due 2034	MRK/34	New York Stock Exchange
1.375% Notes due 2036	MRK 36A	New York Stock Exchange

Item2.02. Results of Operations and Financial Condition**.**

The following information, including the exhibits hereto, is being furnished pursuant to this Item 2.02.

Incorporated by reference is a press release issued by Merck & Co., Inc. on October 26, 2023, regarding earnings for the third quarter of 2023, attached as Exhibit 99.1. Also incorporated by reference is certain supplemental information not included in the press release, attached as Exhibit 99.2.

This information shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, and is not incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit 99.1	Press release issued October 26, 2023, regarding earnings for the third quarter of 2023
Exhibit 99.2	Certain supplemental information not included in the press release
Exhibit 104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		Merck & Co., Inc.
Date: October 26, 2023	By:	/s/ Kelly E. W. Grez
		Kelly E. W. Grez
		Corporate Secretary

Exhibit 99.1

News Release

Merck Announces Third-Quarter 2023 FinancialResults

-	Sales Reflect Sustained Growth, Particularly in Oncology and Vaccines
-	Total Worldwide Sales Were $16.0 Billion, an Increase of 7% From Third Quarter 2022;
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Excluding LAGEVRIO, Growth Was 6%; Excluding LAGEVRIO and the Impact of Foreign Exchange, Growth Was 8%

o	KEYTRUDA Sales Grew 17% to $6.3 Billion; Excluding the Impact of Foreign Exchange, Sales Also Grew 17%
o	GARDASIL/GARDASIL 9 Sales Grew 13% to $2.6 Billion; Excluding the Impact of Foreign Exchange, Sales Grew 16%
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o	LAGEVRIO Sales Grew 47% to $640 Million; Excluding the Impact of Foreign Exchange, Sales Grew 51%
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-	GAAP EPS Was $1.86; Non-GAAP EPS Was $2.13
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-	Announced Collaboration Agreement With Daiichi Sankyo for Three Clinical-Stage ADC Candidates
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-	Received FDA Approval of KEYTRUDA for Perioperative Treatment of Certain Patients With NSCLC in Combination With Chemotherapy, Based<br>on KEYNOTE-671 Trial
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-	Obtained FDA Priority Review of Biologics License Application for Sotatercept
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-	Presented Compelling Data at ESMO 2023 Congress, Including:
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o	Phase 3 KEYNOTE-671 Trial
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o	Phase 3 KEYNOTE-A39/EV-302 Trial Conducted in Collaboration With Seagen and Astellas
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-	Initiating Phase 3 Trials in 2023 Across Multiple Therapeutic Areas, Including Oncology, Cardiometabolic and Immunology
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-	Full-Year 2023 Financial Outlook:
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o	Raises and Narrows Expected Worldwide Sales Range To Be Between $59.7 Billion and $60.2 Billion, Including Negative Impact of<br>Foreign Exchange of Approximately 2 Percentage Points; Outlook Includes Approximately $1.3 Billion of LAGEVRIO Sales
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o	Now Expects Non-GAAP EPS To Be Between $1.33 and $1.38, Including the Negative Impact of Foreign Exchange of Approximately 6<br>Percentage Points; Outlook Reflects Negative Impact From Upfront Charge of $5.5 Billion, or $1.70 per Share, Related to the Collaboration<br>Agreement With Daiichi Sankyo
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RAHWAY, N.J., Oct. 26, 2023 – Merck (NYSE: MRK), known as MSD outside the United States and Canada, today announced financial results for the third quarter of 2023.

“Our strong results this quarter reflect our talented team’s commitment to bringing forward important innovation and pursuing breakthroughs for all those who count on us,” said Robert M. Davis, chairman and chief executive officer, Merck. “We continue to push the boundaries of science, making disciplined investments to augment our diverse pipeline and applying our expertise to accelerate potentially transformative treatments to address patient needs – including through our recently announced collaboration with Daiichi Sankyo. I am proud of our progress as we continue to execute at the highest level and work to generate strong and sustainable value, today and well into the future.”

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Financial Summary

	Third<br> Quarter
$ in millions, except EPS amounts	2023		2022		Change			Change<br> Ex-<br> Exchange
Sales	$	15,962	$	14,959		7	%		9	%
GAAP<br> net income^1^		4,745		3,248		46	%		56	%
Non-GAAP<br> net income that excludes certain items^1,2*^		5,427		4,703		15	%		22	%
GAAP EPS		1.86		1.28		45	%		55	%
Non-GAAP<br> EPS that excludes certain items^2*^		2.13		1.85		15	%		22	%

*Refer to table on page 6.

Generally Accepted Accounting Principles (GAAP) earnings per share (EPS) assuming dilution was $1.86 for the third quarter of 2023. Non-GAAP EPS was $2.13 for the third quarter of 2023. The increases in GAAP and non-GAAP EPS in the third quarter versus the prior year were primarily due to operational strength in the business, as well as $0.22 of charges recorded in 2022 related to collaboration and licensing agreements with Moderna, Inc. (Moderna), Orna Therapeutics (Orna) and Orion Corporation (Orion). The increase in GAAP EPS in the third quarter of 2023 was also driven by the impacts of intangible asset impairment charges recorded in 2022, compared with no such charges recorded in 2023, and lower losses from investments in equity securities in 2023. The increases in both GAAP and non-GAAP EPS in the third quarter were partially offset by the unfavorable impact of foreign exchange.

Non-GAAP EPS excludes acquisition- and divestiture-related costs, costs related to restructuring programs, as well as income and losses from investments in equity securities.

Year-to-date results can be found in the attached tables.

^1^ Net income attributable to Merck & Co., Inc.

^2^ Merck is providing certain 2023 and 2022 non-GAAP information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors’ understanding of the company’s results because management uses non-GAAP results to assess performance. Management uses non-GAAP measures internally for planning and forecasting purposes and to measure the performance of the company along with other metrics. In addition, senior management’s annual compensation is derived in part using a non-GAAP pretax income metric. This information should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP. For a description of the non-GAAP adjustments, see Table 2a attached to this release.

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Third-Quarter Sales Performance

The following table reflects sales of the company’s top products and significant performance drivers.

	Third Quarter
$ in millions	2023		2022		Change			Change<br> Ex-<br> Exchange			Commentary
Total Sales	$	15,962	$	14,959		7	%		9	%
Pharmaceutical		14,263		12,963		10	%		11	%	Increase driven by growth in oncology, vaccines, and virology due to sales of LAGEVRIO, partially offset by diabetes. Excluding LAGEVRIO, growth of 9%. Excluding LAGEVRIO and unfavorable impact of foreign exchange, growth of 10%.
KEYTRUDA		6,338		5,426		17	%		17	%	Growth driven by increased global uptake in earlier-stage indications, including triple-negative breast cancer (TNBC) and renal cell carcinoma (RCC), and continued strong global demand from metastatic indications.
GARDASIL / GARDASIL 9		2,585		2,294		13	%		16	%	Growth due to strong demand, particularly in China, and higher pricing in the U.S., partially offset by public-sector buying patterns in the U.S.
JANUVIA / JANUMET		835		1,133		-26	%		-25	%	Decline primarily due to generic competition in several international markets, particularly in Europe, and lower demand in the U.S.
PROQUAD, M-M-R II and VARIVAX		713		668		7	%		6	%	Growth largely due to higher pricing in the U.S.
LAGEVRIO		640		436		47	%		51	%	Growth largely attributable to higher demand in Japan, partially offset by lower demand in Australia and nonrecurrence of sales in the U.K.
BRIDION		424		423		0	%		0	%	Relatively flat compared with prior year due to higher demand in the U.S., offset by generic competition primarily in Europe.
Lynparza*		299		284		5	%		6	%	Growth driven primarily by higher pricing in the U.S. and increased demand in Latin America.
Lenvima*		260		202		29	%		30	%	Growth primarily due to higher demand in the U.S. and certain international markets, and timing of shipments in China.
VAXNEUVANCE		214		16		***N/M			N/M		Growth driven largely by continued uptake in pediatric indication in the U.S. and launches in Europe.
Animal Health		1,400		1,371		2	%		2	%	Growth primarily driven by higher pricing in both Livestock and Companion Animal product portfolios.
Livestock		874		829		5	%		7	%	Growth primarily due to higher pricing across product portfolio, as well as higher demand for ruminant, poultry and swine products.
Companion Animal		526		542		-3	%		-4	%	Decline primarily due to lower vet visits in the U.S., partially offset by higher pricing. Sales of BRAVECTO were $235 million and $241 million in the current and prior-year quarters, respectively, which represented a decline of 3%.
Other Revenues**		299		625		-52	%		-18	%	Decline primarily due to impact of revenue hedging. Excluding unfavorable impact of foreign exchange, decline due to lower revenue from third-party manufacturing arrangements.

*Alliance revenue for this product represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs.

**Other revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities.

***Not meaningful

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Third-Quarter Expense, EPS and Related Information

The table below presents selected expense information.

$ in millions	GAAP		Acquisition- and Divestiture- Related Costs^3^			Restructuring<br> Costs		(Income)<br> Loss From<br> Investments<br> in Equity<br> Securities		Non- GAAP^2^
Third Quarter 2023
Cost of sales	$	4,264	$	552		$	33	$	-	$	3,679
Selling, general and administrative		2,519		17			40		-		2,462
Research and development		3,307		10			-		-		3,297
Restructuring costs		126		-			126		-		-
Other (income) expense, net		126		(24	)		-		17		133
Third Quarter 2022
Cost of sales	$	3,934	$	446		$	54	$	-	$	3,434
Selling, general and administrative		2,520		22			26		-		2,472
Research and development		4,399		902			1		-		3,496
Restructuring costs		94		-			94		-		-
Other (income) expense, net		429		(26	)		-		350		105

GAAP Expense, EPS and Related Information

Gross margin was 73.3% for the third quarter of 2023 compared with 73.7% for the third quarter of 2022. The decrease was primarily due to the unfavorable impact of foreign exchange, higher LAGEVRIO sales, which have a low gross margin, and higher acquisition- and divestiture-related costs. The gross margin decline was partially offset by lower revenue from third-party manufacturing arrangements, lower manufacturing-related costs and the favorable impact of product mix.

Selling, general and administrative (SG&A) expenses were $2.5 billion in both the third quarters of 2023 and 2022, primarily reflecting increased promotional spending, offset by lower administrative costs.

^3^ Includes expenses for the amortization of intangible assets and purchase accounting adjustments to inventories recognized as a result of acquisitions of businesses, intangible asset impairment charges and expense or income related to changes in the estimated fair value measurement of liabilities for contingent consideration. R&D expenses in the third quarter of 2022 include intangible asset impairment charges of $887 million largely related to nemtabrutinib. Also includes integration, transaction and certain other costs associated with acquisitions and divestitures, as well as amortization of intangible assets related to collaborations and licensing arrangements.

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Research and development (R&D) expenses were $3.3 billion in the third quarter of 2023 compared with $4.4 billion in the third quarter of 2022. The decrease was primarily due to charges recorded in 2022 of $887 million for intangible asset impairments, largely related to nemtabrutinib, and $690 million for collaboration and licensing agreements with Moderna, Orna and Orion. The decrease in R&D expenses was partially offset by higher compensation and benefit costs in 2023, reflecting in part increased headcount, higher investments in discovery research and early drug development and higher clinical development spending.

Other (income) expense, net, was $126 million of expense in the third quarter of 2023 compared with $429 million of expense in the third quarter of 2022, primarily due to lower net losses from investments in equity securities.

The effective tax rate was 15.5% for the third quarter of 2023 compared with 9.2% in the third quarter of 2022.

GAAP EPS was $1.86 for the third quarter of 2023 compared with $1.28 for the third quarter of 2022.

Non-GAAP Expense, EPS and Related Information

Non-GAAP gross margin was 77.0% for both the third quarters of 2023 and 2022, due to the unfavorable impact of foreign exchange, and higher LAGEVRIO sales, which have a low gross margin, offset by lower revenue from third-party manufacturing arrangements, lower manufacturing-related costs and the favorable impact of product mix.

Non-GAAP SG&A expenses were $2.5 billion in both the third quarters of 2023 and 2022, primarily reflecting increased promotional spending, offset by lower administrative costs.

Non-GAAP R&D expenses were $3.3 billion in the third quarter of 2023 compared with $3.5 billion in the third quarter of 2022. The decrease was primarily due to charges of $690 million in 2022 related to collaboration and licensing agreements with Moderna, Orna and Orion. The decrease in R&D expenses was partially offset by higher compensation and benefit costs in 2023, reflecting in part increased headcount, higher investments in discovery research and early drug development and higher clinical development spending.

Non-GAAP other (income) expense, net, was $133 million of expense in the third quarter of 2023 compared with $105 million of expense in the third quarter of 2022.

The non-GAAP effective tax rate was 15.0% for the third quarter of 2023 compared with 13.6% in the third quarter of 2022.

Non-GAAP EPS was $2.13 for the third quarter of 2023 compared with $1.85 for the third quarter of 2022.

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A reconciliation of GAAP to non-GAAP net income and EPS is provided in the table that follows.

	Third Quarter
$ in millions, except EPS amounts	2023			2022
EPS
GAAP EPS	$	1.86		$	1.28
Difference		0.27			0.57
Non-GAAP EPS that excludes items listed below^2^	$	2.13		$	1.85
Net Income
GAAP net income^1^	$	4,745		$	3,248
Difference		682			1,455
Non-GAAP net income that excludes items listed below^1,2^	$	5,427		$	4,703
Excluded Items:
Acquisition- and divestiture-related costs^3^	$	555		$	1,344
Restructuring costs		199			175
Loss from investments in equity securities		17			350
Net decrease (increase) in income before taxes		771			1,869
Estimated income tax (benefit) expense		(89	)		(414	)
Decrease (increase) in net income	$	682		$	1,455

Pipeline and Portfolio Highlights

Merck continued to achieve regulatory and clinical milestones across its expansive pipeline and portfolio. The company is initiating Phase 3 trials in 2023 in multiple therapeutic areas, including oncology, cardiometabolic and immunology, and in new modalities. These include investigational individualized neoantigen therapy V940 in combination with KEYTRUDA, antibody-drug conjugate (ADC) MK-2870 and lysine-specific demethylase-1 inhibitor MK-3543 in oncology, oral PCSK9 inhibitor candidate MK-0616 in cardiovascular, and humanized monoclonal antibody MK-7240 in immunology.

In oncology, the company received U.S. Food and Drug Administration (FDA) approval of KEYTRUDA for the treatment of certain patients with resectable non-small cell lung cancer (NSCLC) as a neoadjuvant/adjuvant treatment, the company’s eighth approval of KEYTRUDA in earlier-stage cancer. The FDA also granted priority review to two supplemental New Drug Applications (sNDAs): for WELIREG in certain previously treated patients with advanced RCC, and for KEYTRUDA in cervical cancer. Notably, Merck presented compelling new data at the European Society for Medical Oncology (ESMO) Congress 2023 that showcased the company’s progress in earlier stages of cancers, its foundational position in metastatic disease and continued momentum in its diverse oncology pipeline.

In cardiovascular disease, Merck received priority review from the FDA for a new Biologics License Application (BLA) for sotatercept, the company’s novel investigational activin signaling inhibitor for the treatment of adults with pulmonary arterial hypertension (PAH) (World Health Organization Group 1), based on clinically meaningful results from the Phase 3 STELLAR trial. The FDA set a Prescription Drug User Fee Act (PDUFA), or target action, date of March 26, 2024. If approved, sotatercept would be the first in its class, bringing a novel approach to address a rare and progressive disease of the pulmonary arteries. Merck’s submission for sotatercept to the Committee for Medicinal Products for Human Use (CHMP) in the European Union (EU) has also been completed.

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Additionally, Merck entered into a collaboration agreement with Daiichi Sankyo for three potentially first-in-class clinical-stage DXd ADCs for the treatment of multiple solid tumors, both as monotherapy and/or in combination with other treatments. This collaboration with Daiichi Sankyo will further augment and diversify Merck’s oncology pipeline.

Notable recent news releases on Merck’s pipeline and portfolio are provided in the table that follows.

Oncology	FDA Approved KEYTRUDA for Treatment of Patients With Resectable (T≥4 cm or N+) NSCLC in Combination With Chemotherapy as Neoadjuvant Treatment, Then Continued as Single Agent as Adjuvant Treatment After Surgery, Based on Results From Phase 3 KEYNOTE-671 Trial	(Read Announcement)
	FDA Granted Priority Review to Merck’s Application for KEYTRUDA Plus Concurrent Chemoradiotherapy as Treatment for Patients With Newly Diagnosed High-Risk Locally Advanced Cervical Cancer, Based on Results From Phase 3 KEYNOTE-A18 Trial; FDA Set PDUFA Date of Jan. 20, 2024	(Read Announcement)
	FDA Accepted for Priority Review Merck’s sNDA for WELIREG in Certain Previously Treated Patients With Advanced RCC, Based on Results From Phase 3 LITESPARK-005 Trial; FDA Set PDUFA Date of Jan. 17, 2024	(Read Announcement)
	European Commission (EC) Approved KEYTRUDA as Adjuvant Treatment for Adults With NSCLC at High Risk of Recurrence Following Complete Resection and Platinum-Based Chemotherapy, Based on Results From Phase 3 KEYNOTE-091 Trial	(Read Announcement)
	EC Approved KEYTRUDA Plus Trastuzumab and Chemotherapy as First-Line Treatment for HER2-Positive Advanced Gastric or Gastroesophageal Junction (GEJ) Adenocarcinoma Expressing PD-L1 (CPS ≥1), Based on Results From Phase 3 KEYNOTE-811 Trial	(Read Announcement)
	EU Granted Positive CHMP Opinion for KEYTRUDA Plus Chemotherapy as First-Line Treatment for HER2-Negative Advanced Gastric or GEJ Adenocarcinoma Expressing PD-L1 (CPS ≥1), Based on Results From Phase 3 KEYNOTE-859 Trial	(Read Announcement)
	Japan Ministry of Health, Labor and Welfare Approved Lynparza Plus Abiraterone and Prednisolone for Treatment of BRCA-Mutated Metastatic Castration-Resistant Prostate Cancer, Based on Results From Phase 3 PROpel Trial	(Read Announcement)
	KEYTRUDA Plus Chemotherapy Before Surgery and Continued as Single Agent After Surgery Reduced Risk of Death by 28% Versus Pre-Operative Chemotherapy in Resectable Stage II, IIIA or IIIB NSCLC, Based on Results From Phase 3 KEYNOTE-671 Trial	(Read Announcement)
	KEYTRUDA Plus Padcev Reduced Risk of Death by More Than Half Versus Chemotherapy in Patients With Previously Untreated Locally Advanced or Metastatic Urothelial Cancer, Based on Results From Phase 3 KEYNOTE-A39/EV-302 Trial	(Read Announcement)
	KEYTRUDA Plus Concurrent Chemoradiotherapy Significantly Improved Progression-Free Survival (PFS) Versus Concurrent Chemoradiotherapy Alone in Newly Diagnosed, High-Risk Locally Advanced Cervical Cancer, Based on Results From Phase 3 KEYNOTE-A18 Trial	(Read Announcement)
	WELIREG Significantly Improved PFS and Objective Response Rates Versus Everolimus in Certain Previously Treated Patients With Advanced RCC, Based on Results From Phase 3 LITESPARK-005 Trial	(Read Announcement)
	KEYTRUDA Plus Chemotherapy Showed Statistically Significant Improvement in Pathological Complete Response Rate as Neoadjuvant Therapy Versus Chemotherapy in High-Risk, Early-Stage ER+/HER2- Breast Cancer, Based on Results From Phase 3 KEYNOTE-756 Trial	(Read Announcement)
	KEYTRUDA Plus Trastuzumab and Chemotherapy Significantly Improved PFS Versus Trastuzumab and Chemotherapy in First-Line HER2-Positive Advanced Gastric or GEJ Adenocarcinoma, Based on Results From Phase 3 KEYNOTE-811 Trial	(Read Announcement)
	KEYTRUDA Significantly Improved Disease-Free Survival in Certain Patients With Muscle-Invasive Urothelial Carcinoma After Surgery, Based on Results From Phase 3 KEYNOTE-123 Trial	(Read Announcement)

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Cardiovascular	FDA Accepted for Priority Review a New BLA for Sotatercept, an Activin Signaling Inhibitor to Treat Adults With PAH, Based on Results From Phase 3 STELLAR Trial; FDA Set PDUFA Date of March 26, 2024	(Read Announcement)
	Merck Presented New Analyses Supporting the Promising Potential of Sotatercept, Its Investigational Medicine for Adults With PAH, Based on Results From Phase 3 STELLAR and SOTERIA Trials	(Read Announcement)
	Merck Initiated Phase 3 Clinical Program for Oral PCSK9 Inhibitor Candidate MK-0616	(Read Announcement)
Vaccines	Long-Term Follow-up Data on Sustained Immunogenicity and Safety for GARDASIL Published in Pediatrics	(Read Announcement)
Hospital Acute Care	Merck Received Positive EU CHMP Opinion for PREVYMIS for Prevention of CMV Disease in High-Risk Adult Kidney Transplant Recipients and Extended 200-Day Dosing in Adult Hematopoietic Stem Cell Transplant Recipients at Risk for Late CMV Infection and Disease, Based on Results From Phase 3 P002 and P040 Trials	(Read Announcement)

Sustainability Highlights

Merck issued its 2022/2023 Impact Report highlighting the company’s performance across its sustainability efforts, reflecting strong progress toward its commitments to advance access to health and operate responsibly. The report noted how the company reached more than 500 million people around the world with its innovations in 2022 and expanded two of its 2025 Access to Health goals.

Full-Year 2023 Financial Outlook

The following table summarizes the company’s full-year financial outlook.

	Full Year 2023
	Updated	Prior
Sales^*^	$59.7 to $60.2 billion	$58.6 to $59.6 billion
Non-GAAP Gross margin^2^	Approximately 77%	Approximately 77%
Non-GAAP Operating expenses^2**^	$39.8 to $40.4 billion	$34.0 to $34.6 billion
Non-GAAP Other (income) expense, net^2^	Approximately $200 million	Approximately $100 million
Non-GAAP Effective tax rate^2***^	39.0% to 40.0%	30.5% to 31.5%
Non-GAAP EPS^2****^	$1.33 to $1.38	$2.95 to $3.05
Share count (assuming dilution)	2.55 billion	2.55 billion

*Includes approximately $1.3 billion of LAGEVRIO sales. The company does not have any non-GAAP adjustments to sales.

**Includes an aggregate $17.1 billion of R&D expenses related to the Prometheus Biosciences, Inc. (Prometheus) and Imago BioSciences, Inc. (Imago) acquisitions, and upfront payments for the license and collaboration agreement with Kelun-Biotech (a holding subsidiary of Sichuan Kelun Pharmaceutical Co., Ltd) and collaboration agreement with Daiichi Sankyo. Outlook does not assume any additional significant potential business development transactions.

***Includes an approximate 24.5 percentage point negative impact related to business development (Imago, Prometheus and Daiichi Sankyo).

****Includes $6.22 of one-time charges related to the Prometheus and Imago acquisitions and upfront payments to Kelun-Biotech and Daiichi Sankyo.

Merck has not provided a reconciliation of forward-looking non-GAAP gross margin, non-GAAP operating expenses, non-GAAP other (income) expense, net, non-GAAP effective tax rate and non-GAAP EPS to the most directly comparable GAAP measures, given it cannot predict with reasonable certainty the amounts necessary for such a reconciliation, including intangible asset impairment charges, legal settlements, and income and losses from investments in equity securities either owned directly or through ownership interests in investment funds, without unreasonable effort. These items are inherently difficult to forecast and could have a significant impact on the company’s future GAAP results.

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Merck continues to experience strong sustained demand for key growth products, particularly in oncology and vaccines. As a result, Merck is raising and narrowing its full-year sales outlook. Merck now expects full-year sales to be between $59.7 billion and $60.2 billion, including a negative impact of foreign exchange of approximately 2 percentage points, at mid-October 2023 exchange rates. This full-year outlook includes approximately $1.3 billion of LAGEVRIO sales.

Merck’s full-year non-GAAP effective income tax rate is expected to be between 39.0% and 40.0%, which includes an approximate 24.5 percentage point negative impact related to business development activity.

Merck now expects its full-year non-GAAP EPS to be between $1.33 and $1.38, including a negative impact of foreign exchange of approximately 6 percentage points, at mid-October 2023 exchange rates. This revised non-GAAP EPS range reflects the following, which were not previously included in the outlook:

·	Additional strength in the business of approximately $0.15 per share.
·	A pretax charge of $5.5 billion, or $1.70 per share, for the collaboration<br>agreement with Daiichi Sankyo.
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·	Estimated expense in the fourth quarter of 2023 of approximately $0.04 per<br>share to advance the ADC assets and finance the transaction with Daiichi Sankyo.
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·	A 1%, or approximately $0.05 per share, incremental negative impact of foreign<br>exchange.
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The non-GAAP EPS range excludes acquisition- and divestiture-related costs, costs related to restructuring programs, income and losses from investments in equity securities, and a previously disclosed charge related to settlements with certain plaintiffs in the Zetia antitrust litigation.

Earnings Conference Call

Investors, journalists and the general public may access a live audio webcast of the earnings conference call on Thursday, Oct. 26, at 9 a.m. ET via this weblink. A replay of the webcast, along with the sales and earnings news release, supplemental financial disclosures, prepared remarks and slides highlighting the results, will be available at www.merck.com.

All participants may join the call by dialing (888) 769-8514 (U.S. and Canada Toll-Free) or (517) 308-9208 and using the access code 8206435.

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About Merck

At Merck, known as MSD outside of the United States and Canada, we are unified around our purpose: We use the power of leading-edge science to save and improve lives around the world. For more than 130 years, we have brought hope to humanity through the development of important medicines and vaccines. We aspire to be the premier research-intensive biopharmaceutical company in the world – and today, we are at the forefront of research to deliver innovative health solutions that advance the prevention and treatment of diseases in people and animals. We foster a diverse and inclusive global workforce and operate responsibly every day to enable a safe, sustainable and healthy future for all people and communities. For more information, visit www.merck.com and connect with us on Twitter, Facebook, Instagram, YouTube and LinkedIn.

Forward-Looking Statement of Merck & Co., Inc., Rahway,N.J., USA

This news release of Merck & Co., Inc., Rahway, N.J., USA (the “company”) includes “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based upon the current beliefs and expectations of the company’s management and are subject to significant risks and uncertainties. There can be no guarantees with respect to pipeline candidates that the candidates will receive the necessary regulatory approvals or that they will prove to be commercially successful. If underlying assumptions prove inaccurate or risks or uncertainties materialize, actual results may differ materially from those set forth in the forward-looking statements.

Risks and uncertainties include but are not limited to, general industry conditions and competition; general economic factors, including interest rate and currency exchange rate fluctuations; the impact of the global outbreak of novel coronavirus disease (COVID-19); the impact of pharmaceutical industry regulation and health care legislation in the United States and internationally; global trends toward health care cost containment; technological advances, new products and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approval; the company’s ability to accurately predict future market conditions; manufacturing difficulties or delays; financial instability of international economies and sovereign risk; dependence on the effectiveness of the company’s patents and other protections for innovative products; and the exposure to litigation, including patent litigation, and/or regulatory actions.

The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the company’s Annual Report on Form 10-K for the year ended December 31, 2022, and the company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site (www.sec.gov).

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Appendix

Generic product names are provided below.

Pharmaceutical

BRIDION (sugammadex)

GARDASIL (Human PapillomavirusQuadrivalent [Types 6, 11, 16 and 18] Vaccine, Recombinant)

GARDASIL 9 (Human Papillomavirus9-valent Vaccine, Recombinant)

JANUMET (sitagliptinand metformin HCl)

JANUVIA (sitagliptin)

KEYTRUDA (pembrolizumab)

LAGEVRIO (molnupiravir)

Lenvima (lenvatinib)

Lynparza (olaparib)

M-M-R II (Measles, Mumpsand Rubella Virus Vaccine Live)

PREVYMIS (letermovir)

PROQUAD (Measles, Mumps,Rubella and Varicella Virus Vaccine Live)

VARIVAX (Varicella VirusVaccine Live)

VAXNEUVANCE (Pneumococcal15-valent Conjugate Vaccine)

WELIREG (belzutifan)

Animal Health

BRAVECTO (fluralaner)

Media Contacts:	Investor Contacts:
Robert Josephson<br><br> <br>(203) 914-2372<br><br> <br>robert.josephson@merck.com<br><br> <br><br><br> <br>Michael Levey<br><br> <br>(215) 872-1462<br><br> <br>michael.levey@merck.com	Peter Dannenbaum<br><br> <br>(732) 594-1579<br><br> <br>peter.dannenbaum@merck.com<br><br> <br><br><br> <br>Steven Graziano<br><br> <br>(732) 594-1583<br><br> <br>steven.graziano@merck.com

MERCK & CO., INC.

CONSOLIDATED STATEMENT OF INCOME - GAAP

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table 1

	GAAP									GAAP
	3Q23			3Q22			% Change			Sep YTD<br><br> 2023			Sep YTD<br><br> 2022			% Change
Sales	$	15,962		$	14,959			7	%	$	45,485		$	45,453			–
Costs, Expenses and Other
Cost of sales		4,264			3,934			8	%		12,214			13,530			-10	%
Selling, general and administrative		2,519			2,520			–			7,700			7,355			5	%
Research and development		3,307			4,399			-25	%		20,904			9,773			*
Restructuring costs		126			94			34	%		344			288			19	%
Other (income) expense, net		126			429			-71	%		388			1,576			-75	%
Income Before Taxes		5,620			3,583			57	%		3,935			12,931			-70	%
Taxes on Income		870			330						2,332			1,423
Net Income		4,750			3,253			46	%		1,603			11,508			-86	%
Less: Net Income Attributable to Noncontrolling Interests		5			5						12			6
Net Income Attributable to Merck & Co., Inc.	$	4,745		$	3,248			46	%	$	1,591		$	11,502			-86	%
Earnings per Common Share Assuming Dilution	$	1.86		$	1.28			45	%	$	0.62		$	4.53			-86	%
Average Shares Outstanding Assuming Dilution		2,546			2,542						2,549			2,540
Tax Rate		15.5	%		9.2	%					59.3	%		11.0	%

* 100% or greater

MERCK & CO., INC.

THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 GAAP TO NON-GAAP RECONCILIATION

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table2a

	GAAP			Acquisition and Divestiture-Related Costs ^(1)^			Restructuring Costs ^(2)^			(Income)<br><br><br> Loss from<br><br> Investments<br><br> in Equity<br><br> Securities			Certain<br><br><br> Other Items			Adjustment<br><br><br> Subtotal			Non-GAAP
Third<br> Quarter
Cost of sales	$	4,264			552			33									585		$	3,679
Selling,<br> general and administrative		2,519			17			40									57			2,462
Research<br> and development		3,307			10												10			3,297
Restructuring<br> costs		126						126									126			–
Other (income)<br> expense, net		126			(24	)					17						(7	)		133
Income Before<br> Taxes		5,620			(555	)		(199	)		(17	)					(771	)		6,391
Income Tax<br> Provision (Benefit)		870			(53	)^(4)^		(32	)^(4)^		(4	)^(4)^					(89	)		959
Net Income		4,750			(502	)		(167	)		(13	)					(682	)		5,432
Net Income<br> Attributable to Merck & Co., Inc.		4,745			(502	)		(167	)		(13	)					(682	)		5,427
Earnings<br> per Common Share Assuming Dilution	$	1.86			(0.20	)		(0.07	)		–						(0.27	)	$	2.13
Tax Rate		15.5	%																	15.0	%
Sep YTD
Cost of sales	$	12,214			1,564			94									1,658		$	10,556
Selling,<br> general and administrative		7,700			62			93									155			7,545
Research<br> and development		20,904			29			1									30			20,874
Restructuring<br> costs		344						344									344			–
Other (income)<br> expense, net		388			(12	)					(218	)		573	^(3)^		343			45
Income Before<br> Taxes		3,935			(1,643	)		(532	)		218			(573	)		(2,530	)		6,465
Income Tax<br> Provision (Benefit)		2,332			(249	)^(4)^		(88	)^(4)^		47	^(4)^		(60	)^(4)^		(350	)		2,682
Net Income		1,603			(1,394	)		(444	)		171			(513	)		(2,180	)		3,783
Net Income<br> Attributable to Merck & Co., Inc.		1,591			(1,394	)		(444	)		171			(513	)		(2,180	)		3,771
Earnings<br> per Common Share Assuming Dilution	$	0.62			(0.55	)		(0.18	)		0.07			(0.20	)		(0.86	)	$	1.48
Tax Rate		59.3	%																	41.5	%

Only the line items that are affected by non-GAAP adjustments are shown.

Merck is providing certain non-GAAP information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing non-GAAP information enhances investors’ understanding of the company’s results because management uses non-GAAP measures to assess performance. Management uses non-GAAP measures internally for planning and forecasting purposes and to measure the performance of the company along with other metrics. In addition, senior management’s annual compensation is derived in part using a non-GAAP pretax income metric. The non-GAAP information presented should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP.

^(1)^Amounts included in cost of sales primarily reflect expenses for the amortization of intangible assets.  Amounts included in selling, general and administrative expenses reflect integration, transaction and certain other costs related to acquisitions and divestitures.  Amounts included in research and development expenses primarily reflect expenses for the amortization of intangible assets.  Amounts included in other (income) expense, net, primarily reflect royalty income, partially offset by an increase in the estimated fair value measurement of liabilities for contingent consideration related to the prior termination of the Sanofi-Pasteur MSD joint venture.  Additionally, the nine-month period includes a $37 million loss on the sale of a business.

^(2)^Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to activities under the company's formal restructuring programs.

^(3)^Reflects a charge related to settlements with certain plaintiffs in the Zetia antitrust litigation.

^(4)^Represents the estimated tax impacts on the reconciling items based on applying the statutory rate of the originating territory of the non-GAAP adjustments.

MERCK & CO., INC.

FRANCHISE / KEY PRODUCT SALES

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3

	2023									2022											3Q			Sep YTD
	1Q		2Q		3Q		Sep<br> YTD		1Q		2Q		3Q		Sep<br> YTD		4Q		Full<br> Year		Nom<br> %	Ex-Exch<br> %		Nom<br> %	Ex-Exch<br> %
TOTAL<br> SALES ^(1)^	$	14,487	$	15,035	$	15,962	$	45,485	$	15,901	$	14,593	$	14,959	$	45,453	$	13,830	$	59,283	7		9	-	3
PHARMACEUTICAL		12,721		13,457		14,263		40,442		14,107		12,756		12,963		39,826		12,180		52,005	10		11	2	4
Oncology
Keytruda		5,795		6,271		6,338		18,403		4,809		5,252		5,426		15,487		5,450		20,937	17		17	19	21
Alliance<br> Revenue – Lynparza ^(2)^		275		310		299		884		266		275		284		825		292		1,116	5		6	7	10
Alliance<br> Revenue – Lenvima ^(2)^		232		242		260		734		227		231		202		660		216		876	29		30	11	13
Welireg		42		50		54		146		18		27		38		83		40		123	43		43	77	77
Alliance<br> Revenue – Reblozyl ^(3)^		43		47		52		142		52		33		39		124		41		166	35		35	14	14
Vaccines<br> ^(4)^
Gardasil / Gardasil 9		1,972		2,458		2,585		7,015		1,460		1,674		2,294		5,428		1,470		6,897	13		16	29	34
ProQuad / M-M-R II / Varivax		528		582		713		1,823		470		578		668		1,716		526		2,241	7		6	6	6
RotaTeq		297		131		156		584		216		173		256		644		139		783	-39		-39	-9	-8
Vaxneuvance		106		168		214		488		5		12		16		32		138		170	*		*	*	*
Pneumovax 23		96		92		140		327		173		153		131		457		145		602	6		4	-28	-27
Vaqta		40		42		69		151		36		35		64		134		39		173	8		9	12	13
Hospital Acute Care
Bridion		487		502		424		1,413		395		426		423		1,244		441		1,685	-		-	14	15
Prevymis		129		143		157		430		94		103		114		310		118		428	38		38	39	41
Dificid		65		76		74		215		52		66		77		196		67		263	-4		-4	10	10
Primaxin		80		53		41		174		58		64		63		185		54		239	-35		-31	-6	-
Noxafil		60		55		51		167		57		60		62		180		58		238	-18		-12	-7	-1
Zerbaxa		50		54		53		157		30		46		43		120		49		169	23		22	31	33
Cardiovascular
Alliance<br> Revenue - Adempas/Verquvo ^(5)^		99		68		92		259		72		98		88		258		82		341	5		5	-	-
Adempas<br> ^(6)^		59		65		65		189		61		63		57		181		57		238	15		11	5	7
Virology
Lagevrio		392		203		640		1,236		3,247		1,177		436		4,859		825		5,684	47		51	-75	-73
Isentress / Isentress HD		123		136		119		377		158		147		161		466		167		633	-27		-27	-19	-17
Neuroscience
Belsomra		56		63		58		176		69		69		62		199		59		258	-6		-4	-11	-6
Immunology
Simponi		180		180		179		539		186		181		173		540		166		706	3		-2	-	-
Remicade		51		48		45		144		61		53		49		163		44		207	-8		-10	-12	-10
Diabetes<br> ^(7)^
Januvia		551		511		581		1,642		779		756		717		2,252		561		2,813	-19		-17	-27	-24
Janumet		329		354		255		937		454		476		417		1,347		353		1,700	-39		-38	-30	-28
Other<br> Pharmaceutical ^(8)^		584		553		549		1,690		602		528		603		1,736		583		2,319	-9		-7	-3	-
ANIMAL HEALTH		1,491		1,456		1,400		4,347		1,482		1,467		1,371		4,320		1,230		5,550	2		2	1	3
Livestock		849		807		874		2,530		832		826		829		2,486		814		3,300	5		7	2	6
Companion Animal		642		649		526		1,817		650		641		542		1,834		416		2,250	-3		-4	-1	-
Other<br> Revenues ^(9)^		275		122		299		696		312		370		625		1,307		420		1,728	-52		-18	-47	-19

*200% or greater

Sum of quarterly amounts may not equal year-to-date amounts due to rounding.

^(1)^Only select products are shown.

^(2)^Alliance Revenue represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs.

^(3)^Alliance Revenue represents royalties and a milestone payment of $20 million received in the first quarter of 2022.

^(4)^Total Vaccines sales were $3,133 million, $3,557 million and $4,002 million in the first, second and third quarter of 2023, respectively, and $2,481 million, $2,709 million and $3,552 million in the first, second and third quarter of 2022, respectively.

^(5)^Alliance Revenue represents Merck's share of profits from sales in Bayer's marketing territories, which are product sales net of cost of sales and commercialization costs.

^(6)^Net product sales in Merck's marketing territories.

^(7)^Total Diabetes sales were $950 million, $951 million and $924 million in the first, second and third quarter of 2023, respectively, and $1,305 million, $1,300 million and $1,231 million in the first, second and third quarter of 2022, respectively.

^(8)^Includes Pharmaceutical products not individually shown above.

^(9)^Other Revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities.  Other Revenues related to the receipt of upfront and milestone payments for out-licensed products were $51 million, $3 million and $65 million in the first, second and third quarter of 2023, respectively, and $114 million, $32 million and $10 million in the first, second and third quarter of 2022, respectively.

Exhibit 99.2

MERCK & CO., INC.

CONSOLIDATED STATEMENT OF OPERATIONS - GAAP

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table1a

	2023												2022																		%<br> Change
	1Q			2Q			3Q			Sep<br> YTD			1Q			2Q			3Q			Sep<br> YTD			4Q			Full<br> Year			3Q			Sep<br> YTD
Sales	$	14,487		$	15,035		$	15,962		$	45,485		$	15,901		$	14,593		$	14,959		$	45,453		$	13,830		$	59,283			7	%		–
Costs, Expenses and Other
Cost of sales		3,926			4,024			4,264			12,214			5,380			4,216			3,934			13,530			3,881			17,411			8	%		-10	%
Selling, general and administrative		2,479			2,702			2,519			7,700			2,323			2,512			2,520			7,355			2,687			10,042			–			5	%
Research and development		4,276			13,321			3,307			20,904			2,576			2,798			4,399			9,773			3,775			13,548			-25	%		*
Restructuring costs		67			151			126			344			53			142			94			288			49			337			34	%		19	%
Other (income) expense, net		89			172			126			388			708			438			429			1,576			(75	)		1,501			-71	%		-75	%
Income (Loss) Before Taxes		3,650			(5,335	)		5,620			3,935			4,861			4,487			3,583			12,931			3,513			16,444			57	%		-70	%
Income Tax Provision		825			637			870			2,332			554			538			330			1,423			495			1,918
Net Income (Loss)		2,825			(5,972	)		4,750			1,603			4,307			3,949			3,253			11,508			3,018			14,526			46	%		-86	%
Less: Net Income (Loss) Attributable<br> to Noncontrolling Interests		4			3			5			12			(3	)		5			5			6			1			7
Net Income (Loss) Attributable<br> to Merck & Co., Inc.	$	2,821		$	(5,975	)	$	4,745		$	1,591		$	4,310		$	3,944		$	3,248		$	11,502		$	3,017		$	14,519			46	%		-86	%
Earnings<br> (Loss) per Common Share Assuming Dilution ^(1)^	$	1.11		$	(2.35	)	$	1.86		$	0.62		$	1.70		$	1.55		$	1.28		$	4.53		$	1.18		$	5.71			45	%		-86	%
Average<br> Shares Outstanding Assuming Dilution ^(1)^		2,551			2,539			2,546			2,549			2,537			2,540			2,542			2,540			2,548			2,542
Tax Rate		22.6	%		-11.9	%		15.5	%		59.3	%		11.4	%		12.0	%		9.2	%		11.0	%		14.1	%		11.7	%

* 100% or greater

Sum of quarterly amounts may not equal year-to-date amounts due to rounding.

^(1)^Because the company recorded a net loss in the second quarter of 2023, no potential dilutive common shares were used in the computation of loss per common share assuming dilution as the effect would have been anti-dilutive.

MERCK & CO., INC.

THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022 GAAP TO NON-GAAP RECONCILIATION

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table 2b

****	GAAP		****	Acquisition and Divestiture-Related Costs ^(1)^		****	Restructuring Costs ^(2)^		****	(Income) Loss from Investments in Equity Securities		****	Adjustment Subtotal		****	Non-GAAP		****
Third Quarter
Cost of sales	$	3,934			446			54						500		$	3,434
Selling, general and administrative		2,520			22			26						48			2,472
Research and development		4,399			902			1						903			3,496
Restructuring costs		94						94						94			–
Other (income) expense, net		429			(26	)					350			324			105
Income Before Taxes		3,583			(1,344	)		(175	)		(350	)		(1,869	)		5,452
Income Tax Provision (Benefit)		330			(302	)^(3)^		(35	)^(3)^		(77	)^(3)^		(414	)		744
Net Income		3,253			(1,042	)		(140	)		(273	)		(1,455	)		4,708
Net Income Attributable to Merck & Co., Inc.		3,248			(1,042	)		(140	)		(273	)		(1,455	)		4,703
Earnings per Common Share Assuming<br> Dilution	$	1.28			(0.40	)		(0.06	)		(0.11	)		(0.57	)	$	1.85
Tax Rate		9.2	%														13.6	%
Sep YTD
Cost of sales	$	13,530			1,577			167						1,744		$	11,786
Selling, general and administrative		7,355			137			74						211			7,144
Research and development		9,773			936			30						966			8,807
Restructuring costs		288						288						288			–
Other (income) expense, net		1,576			(138	)					1,268			1,130			446
Income Before Taxes		12,931			(2,512	)		(559	)		(1,268	)		(4,339	)		17,270
Income Tax Provision (Benefit)		1,423			(587	)^(3)^		(97	)^(3)^		(281	)^(3)^		(965	)		2,388
Net Income		11,508			(1,925	)		(462	)		(987	)		(3,374	)		14,882
Net Income Attributable to Merck & Co., Inc.		11,502			(1,925	)		(462	)		(987	)		(3,374	)		14,876
Earnings per Common Share Assuming<br> Dilution	$	4.53			(0.76	)		(0.18	)		(0.39	)		(1.33	)	$	5.86
Tax Rate		11.0	%														13.8	%

Only the line items that are affected by non-GAAP adjustments are shown.

Merck is providing certain non-GAAP information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends.  Management believes that providing non-GAAP information enhances investors’ understanding of the company’s results because management uses non-GAAP measures to assess performance.  Management uses non-GAAP measures internally for planning and forecasting purposes and to measure the performance of the company along with other metrics.  In addition, senior management’s annual compensation is derived in part using a non-GAAP pretax income metric.  The non-GAAP information presented should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP.

^(1)^Amounts included in cost of sales primarily reflect expenses for the amortization of intangible assets.  Amounts included in selling, general and administrative expenses reflect integration, transaction and certain other costs related to acquisitions and divestitures.  Amounts included in research and development expenses for the three and nine month periods primarily reflect $887 million of intangible asset impairment charges largely related to nemtabrutinib, which was obtained as part of the 2020 ArQule, Inc. acquisition, and expenses for the amortization of intangible assets.  Amounts included in other (income) expense, net, for the three and nine month periods primarily reflect royalty income and a decrease in the estimated fair value measurement of liabilities for contingent consideration related to the prior termination of the Sanofi-Pasteur MSD joint venture.

^(2)^Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to activities under the company's formal restructuring programs.

^(3)^Represents the estimated tax impacts on the reconciling items based on applying the statutory rate of the originating territory of the non-GAAP adjustments.

MERCK & CO., INC.

FRANCHISE / KEY PRODUCT SALES

THIRD QUARTER 2023

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3a

	Global					U.S.						International
	3Q<br> 2023		3Q<br> 2022		%<br> Change	3Q<br> 2023		3Q<br> 2022		%<br> Change		3Q<br> 2023		3Q<br> 2022		%<br> Change
TOTAL<br> SALES ^(1)^	$	15,962	$	14,959	7	$	7,715	$	7,322		5	$	8,247	$	7,637		8
PHARMACEUTICAL		14,263		12,963	10		7,153		6,620		8		7,110		6,343		12
Oncology
Keytruda		6,338		5,426	17		3,795		3,331		14		2,543		2,095		21
Alliance<br> Revenue – Lynparza ^(2)^		299		284	5		153		144		7		146		140		4
Alliance<br> Revenue – Lenvima ^(2)^		260		202	29		160		142		13		100		60		67
Welireg		54		38	43		51		38		35		3				-
Alliance Revenue – Reblozyl		52		39	35		43		32		34		10		7		42
Vaccines<br> ^(3)^
Gardasil / Gardasil 9		2,585		2,294	13		838		957		-12		1,746		1,337		31
ProQuad / M-M-R II / Varivax		713		668	7		567		532		7		146		136		7
Vaxneuvance		214		16	*		182		15		*		33		1		*
RotaTeq		156		256	-39		108		154		-30		48		102		-53
Pneumovax 23		140		131	6		42		68		-39		98		63		55
Vaqta		69		64	8		32		27		18		37		36		1
Hospital Acute Care
Bridion		424		423	-		265		233		14		159		190		-17
Prevymis		157		114	38		70		49		43		87		64		35
Dificid		74		77	-4		69		72		-3		5		6		-20
Zerbaxa		53		43	23		29		24		19		24		19		27
Noxafil		51		62	-18		4		13		-71		47		49		-3
Primaxin		41		63	-35						N/M		41		63		-35
Cardiovascular
Alliance<br> Revenue - Adempas/Verquvo ^(4)^		92		88	5		96		85		13		-4		3		*
Adempas<br> ^(5)^		65		57	15								65		57		15
Virology
Lagevrio		640		436	47								640		436		47
Isentress / Isentress HD		119		161	-27		58		68		-15		61		93		-35
Neuroscience
Belsomra		58		62	-6		23		20		12		35		42		-15
Immunology
Simponi		179		173	3								179		173		3
Remicade		45		49	-8								45		49		-8
Diabetes<br> ^(6)^
Januvia		581		717	-19		328		332		-1		252		385		-34
Janumet		255		417	-39		43		90		-52		211		327		-35
Other<br> Pharmaceutical ^(7)^		549		603	-9		197		194		2		353		410		-14
ANIMAL HEALTH		1,400		1,371	2		462		475		-3		938		896		5
Livestock		874		829	5		205		186		10		669		643		4
Companion Animal		526		542	-3		257		289		-11		269		253		6
Other<br> Revenues ^(8)^		299		625	-52		100		227		-56		199		398		-50

*200% or greater

N/M - Not Meaningful

Sum of U.S. plus international may not equal global due to rounding.

^(1)^Only select products are shown.

^(2)^Alliance Revenue represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs.

^(3)^Total Vaccines sales were $4,002 million in the third quarter of 2023 and $3,552 million in the third quarter of 2022.

^(4)^Alliance Revenue represents Merck's share of profits from sales in Bayer's marketing territories, which are product sales net of cost of sales and commercialization costs.

^(5)^Net product sales in Merck's marketing territories.

^(6)^Total Diabetes sales were $924 million in the third quarter of 2023 and $1,231 million in the third quarter of 2022.

^(7)^Includes Pharmaceutical products not individually shown above.

^(8)^Other Revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities.  Other Revenues related to the receipt of upfront and milestone payments for out-licensed products were $65 million in the third quarter of 2023 and $10 million in the third quarter of 2022.

MERCK & CO., INC.

FRANCHISE / KEY PRODUCT SALES

SEPTEMBER YEAR-TO-DATE 2023

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3b

	Global					U.S.						International
	Sep YTD 2023		Sep YTD 2022		% Change	Sep YTD 2023		Sep YTD 2022		% Change		Sep YTD 2023		Sep YTD 2022		% Change
TOTAL SALES ^(1)^	$	45,485	$	45,453	-	$	21,393	$	20,927		2	$	24,092	$	24,526		-2
PHARMACEUTICAL		40,442		39,826	2		19,840		19,119		4		20,602		20,707		-1
Oncology
Keytruda		18,403		15,487	19		11,142		9,307		20		7,261		6,180		17
Alliance Revenue – Lynparza ^(2)^		884		825	7		439		427		3		445		397		12
Alliance Revenue – Lenvima ^(2)^		734		660	11		476		426		12		258		235		10
Welireg		146		83	77		141		83		70		6				-
Alliance Revenue – Reblozyl ^(3)^		142		124	14		108		87		24		33		37		-10
Vaccines ^(4)^
Gardasil / Gardasil 9		7,015		5,428	29		1,718		1,803		-5		5,297		3,624		46
ProQuad / M-M-R II / Varivax		1,823		1,716	6		1,435		1,337		7		388		379		2
RotaTeq		584		644	-9		381		427		-11		203		218		-7
Vaxneuvance		488		32	*		423		31		*		65		1		*
Pneumovax 23		327		457	-28		105		280		-63		223		177		26
Vaqta		151		134	12		91		72		25		60		62		-3
Hospital Acute Care
Bridion		1,413		1,244	14		841		665		27		572		579		-1
Prevymis		430		310	39		186		136		37		244		174		40
Dificid		215		196	10		199		184		8		16		12		33
Primaxin		174		185	-6		2		1		69		173		185		-6
Noxafil		167		180	-7		29		39		-26		138		141		-2
Zerbaxa		157		120	31		86		64		33		71		55		29
Cardiovascular
Alliance Revenue - Adempas/Verquvo ^(5)^		259		258	-		249		244		2		10		14		-28
Adempas ^(6)^		189		181	5								189		181		5
Virology
Lagevrio		1,236		4,859	-75				1,523		-100		1,236		3,336		-63
Isentress / Isentress HD		377		466	-19		165		196		-16		212		270		-21
Neuroscience
Belsomra		176		199	-11		60		60		-		117		139		-16
Immunology
Simponi		539		540	-								539		540		-
Remicade		144		163	-12								144		163		-12
Diabetes ^(7)^
Januvia		1,642		2,252	-27		842		958		-12		800		1,294		-38
Janumet		937		1,347	-30		182		258		-30		755		1,089		-31
Other Pharmaceutical ^(8)^		1,690		1,736	-3		540		511		6		1,147		1,225		-6
ANIMAL HEALTH		4,347		4,320	1		1,418		1,425		-1		2,929		2,894		1
Livestock		2,530		2,486	2		543		521		4		1,987		1,965		1
Companion Animal		1,817		1,834	-1		875		904		-3		942		929		1
Other Revenues ^(9)^		696		1,307	-47		135		383		-65		561		925		-39

*200% or greater

Sum of U.S. plus international may not equal global due to rounding.

^(1)^Only select products are shown.

^(2)^Alliance Revenue represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs.

^(3)^Alliance Revenue represents royalties and a milestone payment of $20 million received in the first quarter of 2022.

^(4)^Total Vaccines sales were $10,692 million and $8,743 million on a global share basis for September YTD 2023 and 2022, respectively.

^(5)^Alliance Revenue represents Merck's share of profits from sales in Bayer's marketing territories, which are product sales net of cost of sales and commercialization costs.

^(6)^Net product sales in Merck's marketing territories.

^(7)^Total Diabetes sales were $2,826 million and $3,836 million on a global share basis for September YTD 2023 and 2022, respectively.

^(8)^Includes Pharmaceutical products not individually shown above.

^(9)^Other Revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities.  Other Revenues related to the receipt of upfront and milestone payments for out-licensed products were $118 million and $156 million on a global share basis for September YTD 2023 and 2022, respectively.

MERCK & CO., INC.

PHARMACEUTICAL GEOGRAPHIC SALES

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3c

	2023												2022																		% Change
	1Q			2Q			3Q			Sep YTD			1Q			2Q			3Q			Sep YTD			4Q			Full Year			3Q		Sep YTD
TOTAL PHARMACEUTICAL	$	12,721		$	13,457		$	14,263		$	40,442		$	14,107		$	12,756		$	12,963		$	39,826		$	12,180		$	52,005			10		2
United States		6,117			6,570			7,153			19,840			6,773			5,726			6,620			19,119			5,871			24,989			8		4
% Pharmaceutical Sales		48.1	%		48.8	%		50.1	%		49.1	%		48.0	%		44.9	%		51.1	%		48.0	%		48.2	%		48.1	%
Europe ^(1)^		2,326			2,401			2,497			7,224			3,309			2,677			2,427			8,412			2,494			10,906			3		-14
% Pharmaceutical Sales		18.3	%		17.8	%		17.5	%		17.9	%		23.5	%		21.0	%		18.7	%		21.1	%		20.5	%		21.0	%
China		1,694			1,887			1,674			5,255			1,113			1,355			1,419			3,887			1,216			5,102			18		35
% Pharmaceutical Sales		13.3	%		14.0	%		11.7	%		13.0	%		7.9	%		10.6	%		10.9	%		9.8	%		10.0	%		9.8	%
Japan		737			652			1,062			2,451			965			1,092			653			2,710			832			3,542			63		-10
% Pharmaceutical Sales		5.8	%		4.8	%		7.4	%		6.1	%		6.8	%		8.6	%		5.0	%		6.8	%		6.8	%		6.8	%
Asia Pacific (other than China and Japan)		703			705			636			2,045			786			854			702			2,342			691			3,034			-9		-13
% Pharmaceutical Sales		5.5	%		5.2	%		4.5	%		5.1	%		5.6	%		6.7	%		5.4	%		5.9	%		5.7	%		5.8	%
Latin America		470			566			696			1,731			435			453			511			1,399			472			1,871			36		24
% Pharmaceutical Sales		3.7	%		4.2	%		4.9	%		4.3	%		3.1	%		3.6	%		3.9	%		3.5	%		3.9	%		3.6	%
Eastern Europe/Middle East/Africa		381			370			301			1,052			450			339			360			1,149			320			1,469			-16		-8
% Pharmaceutical Sales		3.0	%		2.7	%		2.1	%		2.6	%		3.2	%		2.7	%		2.8	%		2.9	%		2.6	%		2.8	%
Canada		141			127			133			401			189			166			166			521			158			678			-20		-23
% Pharmaceutical Sales		1.1	%		0.9	%		0.9	%		1.0	%		1.3	%		1.3	%		1.3	%		1.3	%		1.3	%		1.3	%
Other		152			179			111			443			87			94			105			287			126			414			6		54
% Pharmaceutical Sales		1.2	%		1.6	%		0.9	%		0.9	%		0.6	%		0.6	%		0.9	%		0.7	%		1.0	%		0.8	%

Sum of quarterly amounts may not equal year-to-date amounts due to rounding.       ^^

^(1)^Europe represents all European Union countries, the European Union accession markets and the United Kingdom.

MERCK & CO., INC.

OTHER (INCOME) EXPENSE, NET - GAAP

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 4

OTHER (INCOME) EXPENSE, NET

		3Q23			3Q22			Sep YTD<br><br>2023			Sep YTD<br><br>2022
Interest income	$	(73	)	$	(40	)	$	(295	)	$	(62	)
Interest expense		317			244			836			727
Exchange losses		85			96			208			220
Loss (income) from investments in equity securities, net ^(1)^		33			371			(240	)		1,361
Net periodic defined benefit plan (credit) cost other than service cost		(138	)		(60	)		(364	)		(208	)
Other, net		(98	)		(182	)		243			(462	)
Total	$	126		$	429		$	388		$	1,576

^(1)^Includes net realized and unrealized gains and losses from investments in equity securities either owned directly or through ownership interests in investment funds.  Unrealized gains and losses from investments that are directly owned are determined at the end of the reporting period, while gains and losses from ownership interests in investment funds are accounted for on a one quarter lag.