$Merck & Co (MRK.US)$ Lowered the upper limit of the annual sales guidance, as the demand for its HPV vaccine in the china market has declined for the second consecutive quarter.

In the third quarter, sales of the Gardasil vaccine (a vaccine for adolescents and young adults to prevent viruses associated with certain cancers) were $2.3 billion, a decrease of 11% year-on-year. Apart from the Chinese market, sales of this vaccine in most other regions globally have been increasing.

Merck's Chief Financial Officer, Caroline Litchfield, stated in an interview, "What we are seeing in the market is a slowdown in promotional activities," both with Chinese distribution partners and local health departments. Merck is collaborating with its partners to increase promotional activities in the Chinese market to raise awareness about this vaccine.

Earlier this year, the pharmaceutical company's stock price had been steadily rising, but the news in late July that sales of the Gardasil vaccine were below expectations erased all of those gains. Since then, as of the close on Wednesday, the stock has fallen by 18% in total.

Merck currently anticipates that total product sales for this year could reach a maximum of $64.1 billion, $0.3 billion lower than the upper limit provided by the company three months ago. The company has also raised the lower end of its expected range, with the midrange expectation remaining essentially the same.

In terms of third-quarter performance, Merck has overall performed well. Adjusted earnings per share were $1.57, comfortably surpassing analysts' expectations of $1.48, and revenue was $16.7 billion, approximately $0.2 billion higher than expected.

Keytruda, a heavyweight drug driving profit growth for a long time, has performed outstandingly in this period. Sales reached $7.4 billion, a 17% increase from the same period last year. Litchfield stated that this growth was fueled by increased usage in early-stage and late-stage lung cancer in the usa, as well as strong usage of triple-negative breast cancer overseas.

Due to the expected pricing pressure on Keytruda later this decade, merck has invested heavily to reduce its dependence on Keytruda.

In 2023, the company spent nearly $11 billion to acquire the self-immune disease treatment drug manufacturer Prometheus Biosciences Inc., and signed a cancer drug collaboration agreement worth as much as $22 billion with Daiichi Sankyo Co. Previously, in 2021, the company spent $11 billion to acquire Acceleron Pharma Inc.

The new drug Winrevair obtained in the Acceleron trade for treating rare lung diseases had sales of $0.149 billion in the third quarter. Litchfield stated that merck expects the drug to continue to grow strongly. Sales of the cancer drug Lynparza during the same period were $0.337 billion, with a 13% increase.