Merck & Co. reported better-than-expected quarterly earnings, fueled by sales of its new Keytruda immuno-oncology drug and Januvia diabetes treatment, sending its shares up 2 percent in premarket trading.
The second-biggest U.S. drugmaker said revenue grew 1 percent in the second quarter to $9.84 billion, above analysts' average estimate of $9.78 billion.
Keytruda, a recently approved treatment for melanoma and lung cancer that Merck is counting on to boost its earnings for years to come, posted sales of $314 million, about $20 million more than analysts had forecast.
The medicine, which takes the brakes off the immune system, is competing with Bristol-Myers Squibb's similar Opdivo treatment. They belong to a new family of medicines called PD-1 inhibitors.
Keytruda was approved in October 2015 for patients with advanced lung cancer who had failed to benefit from previous treatments. A recent clinical trial suggested Keytruda is also effective in previously untreated patients, spurring hopes U.S. regulators will soon expand approved use of the drug to that far larger population.