MSD Halts Supply of HPV Vaccine to China After Slump in Demand
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American pharmaceutical giant Merck Sharp & Dohme, known as MSD, said Tuesday it is suspending supplies of its human papillomavirus vaccine (HPV) Gardasil to the Chinese market from this month. The suspension is expected to last until at least mid-2025.
Rob Davis, MSD chairman and CEO, said the move came in response to sluggish demand, rising inventory levels and financial challenges faced by its Chinese distributor, Chongqing Zhifei Biological Products Co. Ltd.
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- Merck Sharp & Dohme (MSD) is suspending its HPV vaccine Gardasil supply to China until mid-2025 due to sluggish demand and financial issues faced by its distributor, Chongqing Zhifei Biological Products Co. Ltd.
- MSD expects to gradually adjust shipments based on market conditions, with intentions to stabilize Zhifei's financial position by reducing inventory.
- Despite current challenges, MSD remains committed to the Chinese market, planning to leverage male vaccination expansion and the large number of unvaccinated women in future strategies.
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Who’s Who
- Merck Sharp & Dohme
- Merck Sharp & Dohme (MSD), an American pharmaceutical giant, is suspending supplies of its HPV vaccine, Gardasil, to China due to sluggish demand and financial challenges faced by its distributor, Chongqing Zhifei Biological Products Co. Ltd. The suspension is expected to last until mid-2025. Despite this, MSD is committed to the Chinese market, especially after expanding Gardasil's approval for males aged 9-26, and sees potential for future growth.
- Chongqing Zhifei Biological Products Co. Ltd.
- Chongqing Zhifei Biological Products Co. Ltd. is MSD's exclusive distributor for Gardasil in China. The company is experiencing financial strain, with a forecasted 67% to 77% drop in net profit for 2024. Its revenue fell 25% year-on-year in the first half of 2024, with a 69% revenue drop in the third quarter, resulting in its first quarterly loss since 2017. 96% of Zhifei's revenue comes from distributed products.
- GSK
- The article mentions GSK's Cervarix as one of the five approved HPV vaccine products in China, alongside MSD's Gardasil and others. However, it does not provide further details about GSK beyond listing its product within the Chinese market.
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What Happened When
- Beginning of 2024：
- Zhifei's inventory levels were significantly lower than later in the year, eventually reaching a record 20.69 billion yuan by the third quarter.
- January 2024：
- MSD received regulatory approval from China's National Medical Products Administration to expand Gardasil's eligibility to males aged 9-26.
- First half of 2024：
- Gardasil sales grew 7% year-on-year to $4.73 billion, largely driven by higher U.S. pricing and demand.
- First half of 2024：
- Zhifei Biological's revenue fell 25% year-on-year, and net profit dropped nearly 48%.
- Third quarter of 2024：
- Zhifei reported a steep revenue decline of 69% and its first quarterly loss since 2017.
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