Barclays Initiates Merck Coverage with Overweight Rating on 2026 Drug Pipeline

Barclays initiated coverage on Merck & Co. (NYSE:MRK) with an overweight rating and a price target of $140, citing expected product launches and clinical trial results in 2026.

The anticipated launch of enlicitide, the first oral PCSK9 inhibitor, is expected to receive swift FDA review following the grant of a Commissioner's National Priority Review voucher. The firm also pointed to pivotal readouts expected this year, including tulisokibart's ATLAS-UC readout, which represents the first registrational study for the emerging TL1A class in inflammatory bowel disease.

Barclays noted that Merck trades at a near-five year discount to the S&P 500 Health Care sector on two-year forward price-to-earnings ratio. The firm sees potential for both earnings upside and multiple expansion for the pharmaceutical company.

In other recent developments, Merck has announced a significant collaboration with Mayo Clinic to enhance drug discovery using artificial intelligence and advanced analytics. This partnership aims to integrate Mayo Clinic's clinical insights and genomic datasets with Merck's AI capabilities to improve early drug development processes.

The U.S. Food and Drug Administration (FDA) has approved Merck's Keytruda for the treatment of certain ovarian cancer patients, expanding its application to those with platinum-resistant epithelial ovarian, fallopian tube, or primary peritoneal carcinoma expressing PD-L1.