Merck & Co. (NYSE:MRK), the New Jersey drugmaker behind blockbuster therapies like Keytruda, is facing fresh scrutiny in Washington after a bipartisan group of lawmakers opened national security investigations into its clinical trial work in China. Shares slipped 0.68% to 128.50 dollars on the news, keeping the stock just below its 52 week high.
At a Glance
- Merck trades at 128.50 dollars, down 0.68% on the day
- 52 week range spans 107.90 to 130.29 dollars
- Market capitalization stands at 317.77 billion dollars
- P/E ratio of 35.99 with dividend yield of 2.65%
- RSI reading of 68.01 suggests strong recent momentum
| Price | 128.5 USD |
|---|---|
| Day change | -0.88 (-0.68%) |
| 52-week range | 107.9 – 130.29 |
| Market cap | $317.77B |
| P/E ratio | 35.99 |
| EPS (ttm) | 3.57 |
| Dividend yield | 2.65% |
| RSI (14) | 68.01 |
| Volume | 11,837,218 |
What Congress Is Asking
Rep. John Moolenaar, the Michigan Republican who leads the House Select Committee on China, sent letters dated Monday to both Merck and AbbVie demanding answers by July 17. The requests focus on how each company screens trial sites, safeguards patient data, and maintains safety oversight, with particular attention paid to facilities in Xinjiang and hospitals tied to China's military.
Committee findings tie Merck to 224 clinical studies conducted in China since 2005. Of those, at least 31 took place in Xinjiang and 40 occurred at sites connected to the Chinese military. AbbVie's tally since 2007 runs past 100 studies, including 17 in Xinjiang and 16 at military linked centers. Lawmakers wrote that running trials inside PRC military hospitals could expose American biotechnology intellectual property to transfer risk, though the letters stop short of accusing either company of breaking any law.
The letters, sent to Merck CEO Robert Davis and AbbVie CEO Robert Michael, also reference Xinjiang as the site of what lawmakers call genocide against Uyghur and other minority populations, pointing to documented gaps in obtaining informed consent from trial participants there. Merck responded that patient safety and ethical conduct remain central to its research program and that it adheres to global clinical guidelines. China's embassy in Washington dismissed the committee's claims as lacking credibility and accused the U.S. of politicizing trade and technology matters.
What the Numbers Say
Merck's valuation sits on the richer side for a pharmaceutical major, with a P/E of 35.99 reflecting investor confidence in its pipeline even as the political backdrop grows noisier. The RSI of 68.01 points to momentum that is approaching overbought territory, meaning the recent climb toward the 130.29 dollar high has been fairly aggressive without yet tipping into extreme conditions. Income focused holders still get a 2.65% dividend yield, a steady if unspectacular payout for a company of this size.
The bull case rests on Merck's broad drug portfolio and its position near the top of its 52 week range despite geopolitical noise. Bears point to the elevated P/E and the risk that a prolonged congressional inquiry, or any finding that intellectual property protections were compromised in China, could weigh on sentiment even without evidence of wrongdoing.
Bigger Picture on China Trials
The scrutiny lands amid broader U.S. anxiety over China's expanding footprint in drug development. Industry data cited in the committee's inquiry shows China's share of global early stage drug development jumped from 8% in 2015 to more than 32% by 2024, while the U.S. share fell from 48% to roughly 37% over the same stretch. That shift has fueled legislative moves like the Biosecure Act, signed into law last year, which limits federal agencies from doing business with non U.S. biotech firms.
AbbVie, whose newer immunology drugs Skyrizi and Rinvoq have offset declining Humira sales, has not commented directly on the investigation. For Merck, the coming weeks will test how it balances transparency with lawmakers against protecting its ongoing global trial operations, a dynamic investors are likely to watch closely given the stock's proximity to record territory.
Where Merck Stands Now
Merck's stock has held up despite the political overhang, trading near the top of its yearly range with a market cap approaching 318 billion dollars. Whether the congressional inquiry becomes a lasting overhang or fades as a procedural matter will likely hinge on what Merck discloses by the July 17 deadline and how regulators respond afterward.