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Segment Reporting
 9 Months Ended
Sep. 30, 2022
Segment Reporting [Abstract]  
Segment Reporting Segment Reporting
The Company’s operations are principally managed on a product basis and include two operating segments, which are the Pharmaceutical and Animal Health segments, both of which are reportable segments.
The Pharmaceutical segment includes human health pharmaceutical and vaccine products. Human health pharmaceutical products consist of therapeutic and preventive agents, generally sold by prescription, for the treatment of human disorders. The Company sells these human health pharmaceutical products primarily to drug wholesalers and retailers, hospitals, government agencies and managed health care providers such as health maintenance organizations, pharmacy benefit managers and other institutions. Human health vaccine products consist of preventive pediatric, adolescent and adult vaccines. The Company sells these human health vaccines primarily to physicians, wholesalers, physician distributors and government entities. A large component of pediatric and adolescent vaccine sales are made to the U.S. Centers for Disease Control and Prevention Vaccines for Children program, which is funded by the U.S. government. Additionally, the Company sells vaccines to the Federal government for placement into vaccine stockpiles.
The Animal Health segment discovers, develops, manufactures and markets a wide range of veterinary pharmaceutical and vaccine products, as well as health management solutions and services, for the prevention, treatment and control of disease in all major livestock and companion animal species. The Company also offers an extensive suite of digitally connected identification, traceability and monitoring products. The Company sells its products to veterinarians, distributors and animal producers.
Sales of the Company’s products were as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
 ($ in millions)U.S.Int’lTotalU.S.Int’lTotalU.S.Int’lTotalU.S.Int’lTotal
Pharmaceutical:
Oncology
Keytruda$3,331 $2,095 $5,426 $2,580 $1,954 $4,534 $9,307 $6,180 $15,487 $7,108 $5,501 $12,609 
Alliance revenue-Lynparza (1)
144 140 284 129 117 246 427 397 825 371 350 721 
Alliance revenue-Lenvima (1)
142 60 202 114 74 188 426 235 660 287 211 498 
Alliance revenue-Reblozyl (2)
32 7 39 — — — 87 37 124 — — — 
Vaccines
Gardasil/Gardasil 9
957 1,337 2,294 839 1,154 1,993 1,803 3,624 5,428 1,605 2,539 4,144 
ProQuad/M-M-R II/Varivax
532 136 668 537 125 661 1,337 379 1,716 1,255 371 1,626 
RotaTeq154 102 256 135 92 227 427 218 644 364 229 593 
Pneumovax 23
68 63 131 181 97 277 280 177 457 354 247 600 
Vaqta27 36 64 32 16 48 72 62 134 80 58 138 
Hospital Acute Care
Bridion233 190 423 181 188 369 665 579 1,244 545 551 1,096 
Prevymis49 64 114 39 57 96 136 174 310 111 159 270 
Dificid72 6 77 52 2 54 184 12 196 108 7 115 
Primaxin— 63 63 — 69 70 1 185 185 — 194 194 
Noxafil13 49 62 19 45 64 39 141 180 48 149 197 
Invanz2 48 50 (2)55 53 4 144 148 (2)159 157 
Cancidas1 42 43 1 56 56 5 133 138 4 164 168 
Zerbaxa24 19 43 (1)(1)(2)64 55 120 (5)(6)(11)
Cardiovascular
Alliance revenue-Adempas/Verquvo (3)
85 3 88 73 27 100 244 14 258 222 26 248 
Adempas— 57 57 — 59 59 — 181 181 — 188 188 
Virology
Lagevrio— 436 436 — — — 1,523 3,336 4,859 — — — 
Isentress/Isentress HD
68 93 161 77 112 189 196 270 466 222 368 590 
Neuroscience
Belsomra20 42 62 23 58 81 60 139 199 56 183 238 
Immunology
Simponi— 173 173 — 203 203 — 540 540 — 619 619 
Remicade— 49 49 — 73 73 — 163 163 — 233 233 
Diabetes
Januvia332 385 717 365 487 852 958 1,294 2,252 997 1,448 2,445 
Janumet90 327 417 86 401 487 258 1,089 1,347 244 1,205 1,449 
Other pharmaceutical (4)
244 321 564 210 306 518 616 949 1,565 637 950 1,589 
Total Pharmaceutical segment sales6,620 6,343 12,963 5,670 5,826 11,496 19,119 20,707 39,826 14,611 16,103 30,714 
Animal Health:
Livestock186 643 829 190 675 864 521 1,965 2,486 508 1,996 2,503 
Companion Animals289 253 542 277 276 553 904 929 1,834 855 948 1,804 
Total Animal Health segment sales475 896 1,371 467 951 1,417 1,425 2,894 4,320 1,363 2,944 4,307 
Total segment sales7,095 7,239 14,334 6,137 6,777 12,913 20,544 23,601 44,146 15,974 19,047 35,021 
Other (5)
227 398 625 139 101 241 383 925 1,307 192 (30)162 
 $7,322 $7,637 $14,959 $6,276 $6,878 $13,154 $20,927 $24,526 $45,453 $16,166 $19,017 $35,183 
U.S. plus international may not equal total due to rounding.
(1)    Alliance revenue for Lynparza and Lenvima represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs (see Note 4).
(2)    Alliance revenue for Reblozyl represents royalties and, for the year-to-date period, a payment received related to the achievement of a regulatory milestone (see Note 4).
(3)    Alliance revenue for Adempas/Verquvo represents Merck’s share of profits from sales in Bayer’s marketing territories, which are product sales net of cost of sales and commercialization costs (see Note 4).
(4)    Other pharmaceutical primarily reflects sales of other human health pharmaceutical products, including products within the franchises not listed separately.
(5)    Other is primarily comprised of miscellaneous corporate revenue, including revenue hedging activities, as well as revenue from third-party manufacturing arrangements (including sales to Organon). Other for the nine months ended September 30, 2022 and 2021 also includes $156 million and $191 million, respectively, related to upfront and milestone payments received by Merck for out-licensing arrangements.
Product sales are recorded net of the provision for discounts, including chargebacks, which are customer discounts that occur when a contracted customer purchases through an intermediary wholesale purchaser, and rebates that are owed based upon definitive contractual agreements or legal requirements with private sector and public sector (Medicaid and Medicare Part D) benefit providers, after the final dispensing of the product by a pharmacy to a benefit plan participant. These discounts, in the aggregate, reduced U.S. sales by $3.3 billion and $3.1 billion for the three months ended September 30, 2022 and 2021, respectively, and $9.1 billion for both the nine months ended September 30, 2022 and 2021.
Consolidated sales by geographic area where derived are as follows:
Three Months Ended
September 30,		Nine Months Ended
September 30,
($ in millions)2022202120222021
United States$7,322 $6,276 $20,927 $16,166 
Europe, Middle East and Africa3,286 3,342 11,228 9,912 
China1,442 1,307 3,957 3,004 
Japan673 638 2,776 1,929 
Asia Pacific (other than China and Japan)854 613 2,792 1,782 
Latin America684 599 1,933 1,631 
Other698 379 1,840 759 
 $14,959 $13,154 $45,453 $35,183 
A reconciliation of segment profits to Income from Continuing Operations Before Taxes is as follows:
 Three Months Ended
September 30,		Nine Months Ended
September 30,
($ in millions)2022202120222021
Segment profits:
Pharmaceutical segment$9,590 $8,606 $28,263 $22,450 
Animal Health segment515 505 1,672 1,629 
Total segment profits10,105 9,111 29,935 24,079 
Other profits377 141 831 29 
Unallocated:
Interest income40 7 62 27 
Interest expense(244)(196)(727)(597)
Amortization(460)(360)(1,623)(1,231)
Depreciation(448)(358)(1,257)(1,031)
Research and development(4,277)(2,312)(9,374)(8,775)
Restructuring costs(94)(107)(288)(487)
Other unallocated, net(1,416)(660)(4,628)(2,044)
 $3,583 $5,266 $12,931 $9,970 
Pharmaceutical segment profits are comprised of segment sales less standard costs, as well as selling, general and administrative expenses directly incurred by the segment. Animal Health segment profits are comprised of segment sales, less all cost of sales, as well as selling, general and administrative expenses and research and development costs directly incurred by the segment. For internal management reporting presented to the chief operating decision maker, Merck does not allocate the remaining cost of sales not included in segment profits as described above, research and development expenses incurred in Merck Research Laboratories, the Company’s research and development division that focuses on human health-related activities, or general and administrative expenses, nor the cost of financing these activities. Separate divisions maintain responsibility for monitoring and managing these costs, including depreciation related to fixed assets utilized by these divisions and, therefore, they are not included in segment profits. In addition, costs related to restructuring activities, as well as the amortization of intangible assets and purchase accounting adjustments are not allocated to segments.
Other profits are primarily comprised of miscellaneous corporate profits, as well as operating profits related to third-party manufacturing arrangements.
Other unallocated, net, includes expenses from corporate and manufacturing cost centers, goodwill and other intangible asset impairment charges, gains or losses on sales of businesses, expense or income related to changes in the estimated fair value measurement of liabilities for contingent consideration, and other miscellaneous income or expense items.