Blockbuster Hopes

Merck’s Potential Miracle Medicine

  • Why it matters

    Why it matters

    The new drug owned by Merck Group and Pfizer could generate billions of euros in annual revenue, finally giving Merck a new blockbuster medicine after two decades of failed products.

  • Facts

    Facts

    • Merck’s new cancer drug is based on immunotherapy, which strengthens the body’s own powers of defense against cancer cells.
    • Darmstadt-based Merck Group, founded in 1668, once owned the American firm Merck & Co, although the two have been completely separate since 1917.
    • President Donald Trump has said he will end non-negotiated drug prices in the United States, a highly profitable market for pharma firms.
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    Audio

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main 80229226 source Hero Images Getty Images – Female cancer survivor with shaved head looking at remote rural view
The new medicine gives hope to thousands of people as well as Merck's shareholders. Source: Hero Images / Getty Images

Even rather esoteric knowledge can lead to a major breakthrough. Stefan Oschmann, formerly head of the biopharma division at German group Merck and now its CEO, understands only a smattering of Farsi, Iran’s national language. He made use of it once while visiting the company’s research center in Boston.

Chatting with an Iranian researcher, she explained she was working on an immune therapy that strengthens the body’s own powers of defense against cancer cells. A promising project – except that unfortunately no one was interested in it. Mr. Oschmann was. Spontaneously, according to the legend at Merck, the Persian-speaking CEO agreed to a couple million euros and a good dozen people to work on it.

Today, six years later, this small investment is starting to pay off for the German firm, which should not be confused with U.S. pharmaceutical giant Merck & Co. Darmstadt-based Merck Group once owned the American firm of the same name, although the two have been completely separate since 1917.

After decades in which Merck’s research pipeline was at best dribbling, Mr. Oschmann is looking to revolutionize cancer treatment with the drug called Bavencio and finally make some real money with pharmaceuticals. Mr. Oschmann himself is speaking of a “historically important event.” Analysts are expecting billions of revenue thanks the drug, which costs $13,000 a month in the US and has been developed together with Pfizer since November 2014. The US peer is entitled to half the turnover generated by the new medicine.

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