Merck’s New Keytruda Shot Is a Rare Real-Time ‘Product Hop’ (1)

Merck & Co.‘s planned debut this fall of an injectable form of its breakthrough cancer treatment Keytruda will simplify care, expand access, and save more lives, the company says. But by shifting patients to a version protected by newer patents, it will also extend Merck’s control over the world’s best-selling drug.

Merck is performing a sleight-of-hand known as a “product hop” by tweaking how the drug is delivered. The pivot will preserve its exclusivity and could box out lower-cost rivals for Keytruda, which last year made $29.5 billion globally.

“Product hopping is not something companies do without a good reason,” said Anna Kaltenboeck, a health economist who’s worked on pharmaceutical pricing and market access strategies. “And that reason is usually financial.”

Merck has pitched subcutaneous Keytruda, set for an October US launch, as a patient-centered innovation that could cut treatment time nearly in half. The company says the new version offers comparable safety and effectiveness to the IV formulation, approved in the US for 41 uses across 18 cancer types. It touts the new form, delivered in a two-minute injection every six weeks rather than a 30-minute infusion as often as every three weeks, as improving access and reducing the burden on patients.

But Merck CEO Rob Davis has given critics ammunition, suggesting the new formulation could buffer competition from biosimilars as the company faces the 2028 expiration of the main patents behind Keytruda’s IV version—which provided $17.9 billion in US revenue last year, more than a quarter of Merck’s total. He’s said the company anticipates the injectable version could capture 30% to 40% of Keytruda’s US patient base, turning the looming patent cliff into “more of a hill.”

Merck isn’t the first drugmaker—or the first maker of a high-profile biologic—to use seemingly small changes to lock in new patents for existing treatments and hold off rivals.

AbbVie launched a citrate-free version of Humira in 2018, helping extend its dominance until biosimilars arrived in 2023. Roche’s Genentech introduced Herceptin Hylecta, a subcutaneous alternative to its IV cancer drug, in 2019 as biosimilar rivals entered. In both cases, the core ingredient stayed the same, but the delivery shift slowed competition.

But few product hops play out as publicly as Merck’s Keytruda gambit, unfolding in real time on the edge of a patent cliff Bloomberg Intelligence estimates risks $59 billion in revenue by 2030.

“How often do you get to see the magic trick unfolding?” University of California College of the Law, San Francisco, professor Robin Feldman said.

Strategy

Merck has blanketed Keytruda in patents—104 issued from an estimated 289 applications, with 106 still pending, according to updated data from the Initiative for Medicines, Access & Knowledge’s 2022 Drug Patent Book shared with Bloomberg Law.

Two patents had been issued from 17 applications I-MAK identified as tied to the new subcutaneous version, including method-of-treatment and manufacturing process claims that could extend exclusivity into 2042, I-MAK said.

Drugmakers defend their patent strategies by pointing to research and development investments. An April 30 report backed by pharmaceutical industry group PhRMA, claims patent protections incentivize drugmakers to invest nearly 34% of annual sales into R&D, exceeding other industries. But Rachel Sachs, a law professor at Washington University in St. Louis specializing in drug regulation and patent law, argues product hops primarily serve to maintain monopoly pricing at patients’ expense.

“The company is motivated financially to maintain its monopoly as long as it can, to preserve its ability to charge higher prices as long as it can,” Sachs said. “And there are patients who are being harmed in the meantime.”

That motivation extends to enforcing drugs’ exclusivity in court. Legal battles over Keytruda biosimilars could begin as early as 2026, industry observers said, noting that patent lawsuits over biologics typically start around two years before exclusivity ends.

A company spokesperson told Bloomberg Law Merck “does not expect any patent protection specifically directed to SC pembrolizumab"—the subcutaneous formulation of the drug’s active ingredient—"to impact the potential marketing of a biosimilar intravenous form of Keytruda.”

The careful wording—"a biosimilar intravenous form"— echoed how Merck’s CEO sought to draw a line between the two formulations at a February 2024 Senate hearing.

Policy

In February 2023, four members of Congress urged the US Patent and Trademark Office to scrutinize Merck’s Keytruda patent portfolio, saying its applications appeared to reflect “anti-competitive business practices,” such as patent thicketing and product hopping.

Lawmakers are pushing legislation directly targeting those tactics.

The Senate Judiciary Committee last month approved bipartisan bills targeting product-hopping and other tactics that delay cheaper biosimilars from reaching patients. Supporters say they would rein in drugmakers that exploit the US patent and regulatory systems to stretch monopolies and drive up prices.

One, the Drug Competition Enhancement Act, would let antitrust enforcers treat product hopping as anticompetitive conduct. Another, the Affordable Prescriptions for Patients Act, seeks to streamline litigation timing over biologic drugs like Keytruda.

Pressed at the 2024 committee hearing by Sen. Ben Ray Luján (D-N.M.) on whether the new formulation could undercut biosimilar competition, Davis said Merck doesn’t expect the subcutaneous version to pose a barrier to entry—but didn’t directly answer whether the company would steer patients toward the newer patent-protected formulation.

Luján remains unsatisfied. In a statement to Bloomberg Law this month, he called product hopping “anticompetitive” and pledged support for legislation like the Drug Competition Enhancement Act.

Scholars including Feldman argue that if a modification truly benefits patients, “they’ll pay for that change” without needing to extend a government-granted monopoly to prove its value.

As Merck’s launch date approaches, the company may cement its hold on the Keytruda market before biosimilar rivals—or legislative changes—have a chance to catch up.

“These are not optional medications,” Sachs said. “And I really worry about the impact on patients of keeping these prices high for a very long time.”