Merck’s Propecia business

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HIGHLIGHTS
  • Estimated Propecia revenue from 1999–2015: $5.2 billion
  • Rough estimate of operating profit from Propecia: $4.2 billion

Merck received FDA approval for Propecia (finasteride 1 mg/day) in December 1997. Sales in the first year of marketing were reported to be $76 million. The peak years were 2010–2011, when Merck reported $447 million in Propecia sales in each year. In total, Merck booked an estimated $5.2 billion in sales of Propecia.

We can roughly estimate Merck’s operating profit from Propecia. The New York Times reported in 1998 that Propecia development costs were $450 million. Ad Age reported an advertising campaign of $50–$60 million in 1998, the first year of marketing in the U.S. An average marketing spend of $30 million per year over 18 years would total $540 million. This implies total estimated research and marketing costs of $1 billion and an estimated profit of $4.2 billion from 1998–2015.

To learn more about the marketing of Propecia, see news stories from 1997 to the early 2000s.

YearRevenue ($MM)
199876
1999E109
2000E141
2001E174
2002E206
2003239
2004270
2005292
2006352
2007405
2008429
2009440
2010447
2011447
2012424
2013283
2014264
2015183
TOTAL5,181
1999–2002 data are estimated, assuming linear growth between 1998–2003

Revenue data sources: 1998 data reported in Advertising Age, 1999 Sep 27;70(40). 2003–2015 data from Merck 10-K and 11-K SEC filings. E = estimate. Missing data is estimated assuming linear growth from 1998 to 2003. Propecia sales were not reported after 2015.

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