Q2 FY26 · Ended Jun 30, 2026 · View SEC filing
Buying a drug candidate wiped out the quarter's profit
Merck charged the Terns purchase straight to research expense, so R&D more than doubled and a pretax profit became a loss.
For investorsWhat the bought pipeline has to deliver to earn back its cost
For foundersBuying science others started: the playbook behind Merck's deals
The deal charges brought no tax deduction, so Merck booked tax on its ongoing business and reported a deeper net loss.
The purchases were paid for as investments, so operating cash of $5.37B shows the business still earns strongly.
Cost of sales grew 23.6% against sales growth of 5.1%, which the filing ties to deal amortization and vaccine write-downs.
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Business Lens describes Merck from its own filings with the SEC. It is not a view on its shares, a target, or advice to buy, sell or hold anything; figures are as filed and may be restated by the company later. The filing is linked above.
