Please ensure Javascript is enabled for purposes of website accessibility

Can Merck Beat Pfizer in This Multibillion-Dollar Vaccine Market?

By Keith Speights – Aug 1, 2021 at 11:31AM

Key Points

  • Merck and Pfizer are poised to go head-to-head in a vaccine market that Pfizer has dominated for a while.
  • Pfizer has a new vaccine that should enable it to prevail over Merck in the adult market.
  • But Merck has a head start over Pfizer in the large pediatric vaccine market.

Motley Fool Issues Rare “All In” Buy Alert

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Hint: It's not COVID-19.

Merck (MRK 0.64%) recently won U.S. Food and Drug Administration approval for its pneumococcal vaccine. Pfizer (PFE 0.74%) currently dominates the pneumococcal vaccine market, with its Prevenar 13 generating nearly $6 billion in sales last year. In this Motley Fool Live video recorded on July 21, healthcare and cannabis bureau editor-analyst Olivia Zitkus and Motley Fool contributor Keith Speights discuss whether or not Merck can beat Pfizer in this multibillion-dollar vaccine market.

10 stocks we like better than Pfizer
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

They just revealed what they believe are the ten best stocks for investors to buy right now... and Pfizer wasn't one of them! That's right -- they think these 10 stocks are even better buys.

See the 10 stocks


*Stock Advisor returns as of June 7, 2021


Olivia Zitkus: We'll go back to Pfizer and I want to talk about Pfizer and Merck and move away from COVID for just a moment. Pfizer obviously gets a lot of attention for its COVID vaccine, but the company actually makes billions of dollars every year from its pneumococcal vaccine, Prevnar 13.

It recently won FDA approval for the successor to Prevnar 13, Prevnar 20, very original. Merck also just won FDA approval for its pneumococcal vaccine, Vaxneuvance, which is previously V114.

This only came a month after Pfizer's approval. Do you think that Merck could beat Pfizer in this multi-billion-dollar market? It looks like they're shaping up to compete, but what are your thoughts here?

Keith Speights: Yeah, I think this is an interesting competition here. Merck's vaccine addresses 15 pneumococcal strains and that's two more than Pfizer's Prevnar 13. The numbers come from the number of strains that they address, Prevnar 13 addresses 13, Merck's vaccine addresses 15. But Pfizer's new Prevnar 20, surprise, surprise, targets 20 strains [laughs] and so it has broader coverage.

Those additional seven strains that Prevnar 20 addresses versus Prevnar 13, accounts for around 40% of all of the pneumococcal disease cases and deaths in the United States. Those extra seven strains for Prevnar 20 are quite significant. Keep in mind this, one of the additional strains that Merck's vaccine covers compared to Prevnar 13, is the top cause of pneumococcal disease in adults in the U.S., so Merck has a distinct advantage over Prevnar 13.

How is this going to shake out? My view is that, Pfizer has the upper hand in the adult market simply because its vaccine provides more protection than Merck's vaccine does. I think you're going to see Pfizer win out over Merck in that space.

Where Merck could win is in the pediatric market. The company expects to file for FDA approval of its pneumococcal vaccine in kids by the end of this year. Pfizer doesn't even expect to report its late-stage data for pediatric use until 2022. I think there is a really good chance that Merck is going to have at least a couple of years, but close to it, on the market in the pediatric indication by itself, so Merck really could beat Pfizer in that particular part of this market.

Zitkus: Awesome. Children make up to, I think, close to 80% of that market opportunity. That could be huge. I know that Pfizer received a big bump when Prevnar was approved for use for adults 65 and older, which is the other main target group of this vaccine, back in 2014, but children do make up the majority of the market, so that could be big for Merck.

Speights: Right. Merck's advantage could only be short lived, because again, Prevnar 20 has more coverage. Assuming Pfizer does come along and win approval in the pediatric indication, it could then become the big player in that market as well. Both of these companies will probably have success with these vaccines.

Zitkus: OK, Great. Something to watch as they battle it out already.

Olivia Zitkus has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Pfizer Stock Quote
$49.21 (0.74%) $0.36
Merck & Co. Stock Quote
Merck & Co.
$107.50 (0.64%) $0.68

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 11/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.