For investors lucky enough to have jumped into Merck (NYSE:MRK) in 2009 at the tail end of the Great Recession you've seen an appreciation in your shares of near 100%. However, for longer-term shareholders Merck has been a source of great frustration.

Sure, its dividend provides an ample source of income for retirees looking to extend the life of their next egg, and young adults looking to use time and compound gains to their advantage, but patent exclusivity losses and unimpressive new drug replacement of those losses on exclusivity have left Merck's share price down more than a third from its all-time high in Dec. 2000.

MRK Chart

MRK data by YCharts

Merck's latest quarterly results speak to the company's ongoing attempt to regain its footing. For the quarter, Merck's sales fell by less than 1% as its adjusted earnings per share expanded by $0.01 to $0.85.

And it would appear there are genuine catalysts on the horizon that could push its stock higher. However, you aren't going to find them within the company's earnings release. You need to be willing to dig deeper and discover what the true growth drivers are for the company, which is exactly what we're going to do today.

But, before we dive into what could send Merck's shares higher we should first address that an outcome where its share price falls from its current levels is just as possible as its share price heading higher. The stock market is a two-way street, and a number of internal and external factors could just as easily weigh on Merck's share price. So as you're reading this bullish thesis of why Merck stock could move up, keep in mind that this is no guarantee that its stock will actually rise.

Hepatitis C pipeline
Hepatitis C treatment is a key potential growth driver for Merck stock.

Source: Sergei Golyshev, Flickr.

Some of you might be skeptical of Merck's optimism surrounding hepatitis C considering that Gilead Sciences (NASDAQ: GILD) handily beat everyone to market with its next-generation oral drug Sovaldi, which can be taken without interferon in select genotypes. Sovaldi's considerably improved sustained virologic response (i.e., elimination of detectable levels of HCV) and favorable lack of treatment side effects, as well as $5.75 billion in sales through its first two quarters on pharmacy shelves, could give investors the impression that this market is already played out. The possible addition of AbbVie's direct-acting antiviral combo drug to the field, which is under review by the Food and Drug Administration, might further solidify this thesis.

But, Merck made a number of key points recently which shed light on its incredible HCV market opportunity. Merck's two primary points are that this is a global disease where many HCV-positive patients may be unaware they have the disease, thus leaving strong long-term treatment opportunity, and that you can't simply treat all HCV patients at once. This drawn-out treatment process should give Merck plenty of time to develop its internal HCV combo of MK-5172 and MK-8742 and still capture substantial market share.

Also, keep in mind that Merck spent big bucks -- $3.85 billion to be exact – to acquire Idenix Pharmaceuticals whose portfolio of nucleotide inhibitors should work as a complement to its existing HCV portfolio.

Either as an internal combo or in combination with other HCV drugs Merck anticipates that MK-5172 and MK-8742 will be wildly successful. In April, Merck reported an SVR of 98% with its combo, implying that it could very well garner a good chunk of what's expected to be a greater than $20 billion market by 2018. That provides a very viable catalyst for Merck's stock moving forward. 

Pembro profits
While we're on the subject of individual drug prospects, how about we focus on a more near-term catalyst in pembrolizumab (formerly known as lambrolizumab).

Pembrolizumab, or pembro for short, is an experimental anti-PD-1 antibody, which improves the body's immune system to recognize cancer cells and attack them without harming healthy cells.

Source: Merck.

What's so particularly exciting about pembro, which is currently under review by the Food and Drug Administration as a treatment for metastatic melanoma, is that it could be one of the world's first anti-PD-1 drugs approved. There's a lot of excitement surrounding this class of drugs, which also includes Bristol-Myers Squibb's nivolumab (also known as Opdivo), as both therapies delivered impressive response rates in advanced melanoma patients prior to the 2013 American Society of Clinical Oncology's annual meeting.

Granted the breakthrough designation from the FDA in April 2013, Merck was able to file a rolling new drug application with the FDA and expects a decision by October 28th.

With overall survival pegged at just over 81% at one year in November (no small figure given that many patients had tried a number of previous therapies) , I'd suggest pembro has blockbuster potential for Merck -- so investors should be watching the FDA very closely on October 28th.

Acquisition and collaboration activity
Lastly, even though Merck has been reluctant to go after large deals, noting in its conference call that it's instead looking for "bolt-on acquisitions," I wouldn't discount the idea that these modest acquisitions and the potential for future collaborations won't fuel Merck's stock price higher.

Source: Merck.

At the moment, Merck has more than 50 ongoing collaborations under way, encompassing a number of therapeutic areas of focus. Using the baseball analogy here, Merck is swinging for the fences with every pitch; but the more pitches it's thrown, the more chances it has to hit a home run. While its pipeline is fairly deep, even it has room to look outside of the big pharma realm toward smaller biotech firms where unique technologies and therapies may exist that'll complement its existing portfolio.

The Idenix acquisition was a good representation of this. Purchasing Idenix wasn't an implication to Wall Street that it wasn't confident in its existing HCV combo, but merely represents a way for the company to test new combinations of HCV-fighting drugs considering that Idenix's nucleotide compounds were shown to have few adverse effects in its initial studies.

Tying everything together
With a rapidly expanding oncology and HCV pipeline Merck might soon be able to leave its image as a stodgy big pharma in the rearview mirror. Investors looking for a solid dividend and a company with therapeutic focuses in high-growth fields might be wise to keep a close eye on Merck.