One of the reasons investors look to Big Pharma stocks is their ability to handle the setbacks that their smaller competitors can't. But even Merck (NYSE: MRK), whose roster of blockbuster drugs numbered 11 last year, can only handle so many setbacks. And there's been no shortage of them for the Dow component lately, pressuring shares over the past three months while the Dow Jones Industrial Average and its blue-chip pharmaceutical peers have risen around 10%.

However, positive news emerged today to break Merck out of this holding pattern. Are the gains setting investors up for more disappointment? In the following video, Brenton Flynn outlines the news behind today's move and some historical context that explains the reaction.

Can Merck beat the patent cliff?
This titan of the pharmaceutical industry stumbled into 2013 and continues to battle patent expirations and pipeline problems. Is Merck still a solid dividend play, or should investors be looking elsewhere? In a new premium research report on Merck, The Fool tackles all of the company's moving parts, its major market opportunities, and reasons to both buy and sell. To find out more click here to claim your copy today.


Brenton Flynn and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.