Merck & Co. Inc. (MRK) experienced a slight increase in stock value, rising approximately 1.0% to $146.39 on Thursday. This uptick follows the company's involvement in groundbreaking commercial space research, particularly related to its cancer drug Keytruda.
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Research conducted aboard the International Space Station (ISS) has provided significant insights into protein crystallization, which aided in the development of a faster subcutaneous formulation of Keytruda. According to NASA, microgravity facilitates the formation of larger and more orderly protein crystals, yielding clearer structural information for researchers.
As the ISS nears the end of its operational life, emerging commercial space stations may provide drug manufacturers with dedicated equipment and more reliable research schedules. However, a challenge remains as regulators have yet to establish a specific approval process for medicines created in space.
Keytruda has generated substantial revenue for Merck, accounting for approximately $8.37 billion of the company's latest quarterly earnings of $16.61 billion, which is nearly half of its total revenue. The newly formulated subcutaneous version of Keytruda contributed $463 million, or about 5.5% of Keytruda's total sales.
Currently, Merck's stock price of $146.39 is 21.85% above the GF Value estimate of $120.14, indicating that investors are willing to pay a significant premium over what is deemed fair value. The future of space-based research for Merck raises critical questions about whether advancements from orbital studies can translate into commercially viable medications frequently enough to warrant the associated costs and regulatory challenges.