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Merck's Molnupiravir: If Peer Reviews Confirm Results, The Implications Would Be Massive

Oct. 04, 2021 4:58 PM ETMerck & Co., Inc. (MRK)108 Comments
Matthias Schwarzer profile picture
Matthias Schwarzer


  • Merck published astonishing preliminary trial results for its anti-COVID pill.
  • If peer reviews confirm the study’s findings, I believe the drug’s market potential is much bigger than commonly anticipated.
  • There is one caveat though, which I will explain in this article.
  • Will the drug’s safety profile still not be a concern after the full results are published, I believe MRK’s stock could have 100% upside.

Gelbe Kapsel Medikament mit leeren Kopierraum auf gelbem Hintergrund.

Prasith_To/iStock via Getty Images


Merck logo

Source: Merck

Until October 1st, 2021, it was an unwritten law among medical professionals that there might never be an antiviral medication for severe diseases such as SARS-Cov-2-infections on the broad market. Not because of lack of efficacy, but because antiviral agents such

This article was written by

Matthias Schwarzer profile picture
I have been an entrepreneur, futures trader and investor for almost 20 years, and after taking care of a parent who was dying from cancer, I realized that life is just too short and time too precious, so I have decided to "retire" at 40, enjoy life and only focus on my investment portfolio. My role models are Buffett/Greenblatt and I specialize in small-caps with insider buying and DGI - always trying to find hidden gems. based in Austria/ Europe.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of MRK either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (108)

Matthias Schwarzer profile picture
The PFE news today really came in as a surprise. too early to tell, because both trials had slightly different designs, but after a first look I have to admit that Pfizer's results seem slightly superior to Molnupiravir. that would of course completely change the narrative here.
Hmmmmm. Maybe better keep an eye on this stuff.

Matthias Schwarzer profile picture
@freshlegacy absolutely. bit of cryptic news, so let's see what MRK has to say directly. but cautiousness warranted, I agree!
06 Oct. 2021
Well, MRK can't make $ off Ivermectin because the patent expired, so they went to a similar drug (look at the formulation for each), they know this will work, and at $700 per pill, I'm buying MRK! Good business move, but not sure about their ethics with respect to Ivermectin.
@eelawyer I know you have this wrong: The United States has agreed to purchase 1.7 million courses of molnupiravir for US$1.2 billion, which works out to about $700 per 5-day course.
As for Ivermectin, here is a good post from Brazil.

Brazil's tragic ivermectin frenzy is a warning to the US, experts say

Just let me have the proven safe (1986 - current date) Ivermectin.

It works and am living proof.
But since you do not know me, please take a look at the data from Uttar Pradesh India... 431 million population and basically zero Covid-19, but only -5% of population vaccinated (Ivermectin was distributed to the entire State of Uttar Pradesh).

Ivermectin is cheap and effective, especially if given within the first few days of illness. It can be used as a safe prophylaxis or an effective and safe treatment.

Merck put out misinformation about it’s own drug Ivermectin, because the patent ran out.
Now Merck wants to sell a newly patented drug that will not be cheap.... no thank you Big Pharma... fool me once shame on you... fool me twice (you know the rest)

Give me the cheap effective Ivermectin please.
Matthias Schwarzer profile picture
@I am Gruit I am not saying that it hasn't helped you, but please let us stick here to scientifically supported facts. Ivermectin isn't supported by the FDA or any other entity for treating COVID.
@Matthias Schwarzer
Now that is funny...
EIDD-2801 is moving toward EUA... like the current Jabs are under.

Stop and think clearly... the FDA blocked/shut down any repurposed drug use during a Pandemic, but gave EUA to “new” gene therapy drugs that have no long term studies and no double blind placebo studies.

Not giving EUA for repurposed drugs, like Ivermectin, that have a safety record of decades... really..
I have no faith in FDA and would rather listen to real doctors that treat COVID-19 patients. Also when facts.. real data is available... 431 million people free from COVID-19... a thinking person can see the truth.

Some people think, but most people only think they think... please think about that 🤔

So you think the FDA is god?

The FDA has approved drugs in the past that later had to be pulled due to long term damage to humans.
Thomas Mazzarino profile picture
@I am Gruit A single instance where you perceive ivermectin to have helped you is not a scientific case. In fact, you may have improved simply by coincidence. That is why scientific studies and governing bodies with doctors at the helm such as the FDA and CDC are important. You can try to discredit those organizations as much as you want and some criticism is warranted, but the fact remains that they are leagues more credible than any random anecdote from someone on the internet.
@Matthias Schwarzer

"...mutagens can be found in anything from food (burned foot, overly cooked meat..."

I must say I don't share your taste in food: "burned foot". 😊
Matthias Schwarzer profile picture
@Sam Clemens oh god, I am sorry. My native language is not English and apparently sometimes that still makes for "funny" mistakes... but thanks for making me blush AND laugh at the same time! :)
Isn’t the number of patients in the study too small to conclude that the risk of death is reduced to zero?
Matthias Schwarzer profile picture
@SU211 maybe. but I think MRK is mostly communicating it they way it does because the primary endpoint was "Percentage of participants who are hospitalized and/or die".
@SU211 It was 8 deaths vs. 0 in a small study. This is way too small from which to draw such grand conclusions.
Supercharged222 profile picture
Merck learned from the Vioxx disaster and they will not risk their name again, they know the value of a name and are okay playing the LONG GAME. However, with tiered pricing, ie: developed countries paying the most and 3rd world countries paying very little I am unsure how much $ this will actually generate as most developed countries are already highly vaccinated.
Matthias Schwarzer profile picture
@Supercharged222 I think it will depend on sales volumes. prices will surely come down. but as long as remdesivir treatment costs are in the thousands of dollars area (not speaking about personnel expenses - infusions need professionals) and there is no foreseeable competition on the market, I believe MRK would have a pretty good bargaining power.
I herd that the cost of treatment was around 700.00$
retiredpharma profile picture
Been long MRK for decades...Im selling slowly above 85 on this latest news.

Flawed hyopthesis if you ask me. People will only take the drug if tested positive for Covid. Positively tested individuals will simply get a script for this drug with the positive test results. There will be no need for everyone to have this at home. At least over here in Germany, it takes 5 minutes to get a drug after you have been at a doctor's surgery, so why would you keep this at home?
Matthias Schwarzer profile picture
@Florian Steinberg my hypothesis was based on the assumption that there might be an orally available effective antiviral, with neglectable side effects, that needs to be taken early after an infection. I don't know if it turns out correctly, but I don't see a flaw in the hypothesis. and keep in mind, not all countries have such a luxurious health system as both our countries do.
CPA Bob profile picture
@Matthias Schwarzer - What if the efficacy period is only say 1-2 years? Who will want to shell out $700 for it just to keep it in your medicine cabinet if there's a short shelf life?

But, more importantly, if you need it, why not (a friend or family member) just run over to the drug store and pick up the pills?
Matthias Schwarzer profile picture
@CPA Bob @ Florian Steinberg It's the same with tamiflu - still lots of people had it ready at home a few years back when there was the Swine and Chicken flu - scare. but of course, one could change the hypothesis from "people" to "governments/drugstores" who want it in their drawers. I understand both your arguments! the point being, one has to take it quickly.
04 Oct. 2021
Could be huge...until someone else comes out with a better drug. Either way we are all better off for their heroic efforts. I know certain soccor players who think kicking a ball around in the grass makes them god's gift to mankind. I will take Merck and Moderna employees over pop culture turds with crap for brains any day.
Say What? profile picture
@APB > I will take Merck and Moderna employees over pop culture turds with crap for brains any day. < wtf???
As I see it, how this will play out is all pretty much speculation at this point. We will know more as better information becomes available. But I agree that this could be huge for MRK (and for people who find themselves in need of a drug like this). Place your bets.
Discolsure: I am long MRK.
Geloo profile picture
There are quite a few hurdles between a company news release and FDA approval. I hope it works out, but there is much unknown.
careful investor 1 profile picture
I guess you didn't read the trial parameters.
I agree. Merck is a double... at least.
ndardick profile picture
@simonthecat If you believe this you should buy long term out of the money calls. Investigate cost of LEAPs. I am not recommending this strategy, however, because I don’t envision a double any time soon enough to buy LEAPs.
and they have DECENT DIVIDEND
Great article. Danke schön! :)
Matthias Schwarzer profile picture
@JohnnyDangerously61 Thank you! or: "bittesehr"
Well, I wouldn't pay $700 for that pill even if I can easily spare it and if it was side effect free. C19 is just too little of a threat. No way most people on earth could spend $700 on it.
IMO a sell-the-news chance to get out of a chronic under-deliverer.
Matthias Schwarzer profile picture
@UUII The price will probably come down quite a bit. But that is just a guess.
ndardick profile picture
@UUII Why wouldn’t the cost be covered by Medicare or other health insurance?
Matthias Schwarzer profile picture
@ndardick I mentioned it in the article. In most of Europe it would be paid for sure, in the USA I have my doubts. will at least cause many discussions.
Long Time Running profile picture
There are too many (2.1 billion) Facebook scientists for this pill ever to be successful.
@Long Time Running They don't care about any of that If they get seriously sick though
Mutagens are scary! MRK is a small holding for us (2% of the portfolio). So far the Covid winner in mega cap biopharma is PFE. History says someone will come up with a 1 shot formula or an oral. We'll see. Happy to hold and collect divs in the mean time
WSLegend profile picture
I bought Moderna for $16.50 in 2019 before I ever heard of COVID.
Bought Pfizer for $33.75 months later in 2020 after Pandemic became widespread
Way to many risks of defects being caused by Merck's molnupiravir pill.


Not much for ZeroHedge, but this link is interesting. The defects included animals skulls and teeth, plus other potential defects.

Beware the hype and do your due diligence concerning Mercks molnupiravir pill.
As I would expect more news to be released on the aforementioned potential defects.
Matthias Schwarzer profile picture
@Novavax Op Warp Speed Thanks for pointing that out! I discussed it in the article though, too. I'm also more on the cautious side. But as I believe the company's fair value ex-molnupiravir is about 90$ currently, I think it is a decent bet to be taken.
@Matthias Schwarzer
Merck is still a viable investment, but I'd anticipate a drop in pps when the data is released by peer review. But I wouldn't be buying shrs myself at this time.
Patience is your best friend and ally, a virtue which many do not posses.
Matthias Schwarzer profile picture
@Novavax Op Warp Speed true, there are about $8 to lose from here with MRK if final results flop, and on the (dreamy) best case upside about $80 to be made. so, an asymmetric bet on top of a safe and healthy-yielding company, that not too long ago was called "bond-equivalent". sounds not too bad for me. still, I regret having sold in June, got back into a position today, though.
Havent taken into account potential competitor like avir, apprently without the gene mutation side effect
Matthias Schwarzer profile picture
@sumsiu competitors like avir and remdesivir unfortunately are the ones I mentioned in my article as having high hepatological risks. (risk of liver damage)
Michael Sheikh profile picture
@sumsiu My bet is on the Tollovid drug by Todos Medical (TOMDF). They really have their act together.
@Matthias Schwarzer What about the Chinese knockoffs?
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