Merck stock jumped Thursday after the company won a patent battle against generic-drug maker Viatris over an ingredient used in diabetes meds Januvia and Janumet.
Viatris is trying to gain approval for generic versions of Januvia and Janumet. But a pair of patents covering an ingredient called sitagliptin protect against generics until at least 2026. A West Virginia court ruled in Merck's favor, saying Viatris infringed on those patents.
On the stock market today, Merck stock surged 3.5% to 87.51. Viatris stock fell 1.1% to 8.94.
Merck Stock: Key Diabetes Drugs
The patent decision affects Merck's powerhouse diabetes franchise. In the second quarter, Januvia and Janumet brought in a combined $1.2 billion in sales. Excluding the impact of exchange rates, sales grew 3% year over year. Merck stock sank after its earnings report, however.
Merck has already entered into agreements to allow multiple generic-drug makers to launch copycat versions of Januvia and Janumet in the U.S. in May 2026. Some could launch earlier under specific circumstances, Merck says Prefer attribution in present tense in a news release. But it didn't outline those circumstances.
Some companies are also on deck to launch extended-release versions of Janumet beginning in July 2026. Extended-release drugs deliver medicine into the body slowly, lowering the risk of side effects and offering benefits over time.
Following the Thursday decision, Merck stock's rise moved it closer to its 50-day moving average.
Shares are forming a flat base with a buy point at 95.82, according to MarketSmith.com. Still, Merck stock has a strong Relative Strength Rating of 87, IBD Digital shows. This puts shares' performance over the last 12 months in the leading 13% of all stocks.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
