February 23, 2024

Merck First-quarter revenue and adjusted earnings reported Thursday topped Wall Street expectations, even as sales of its Covid antiviral drug molnupiravir fell sharply.

Sales of molnupiravir plummeted to $392 million in the period, an 88% drop from the $3.2 billion reported in the first quarter of 2022. Merck said the decline was largely due to lower sales in the U.S., U.K., Japan and Australia.

The company reported total revenue of $14.5 billion for the quarter, down 9% year-over-year. But excluding Covid drugs, Merck said its revenue rose 11%.

This is Merck Report Compared with Wall Street expectations, according to a Refinitiv survey of analysts:

  • EPS: Adjusted $1.40 vs. $1.32 expected
  • income: $14.49 billion vs. $13.78 billion expected

Shares of Merck closed up more than 1% on Thursday. The stock is up more than 3% for the year, giving the company a market value of more than $292 billion.

The pharmaceutical giant reported net income of $2.82 billion, or $1.11 a share. That compares with $4.31 billion, or $1.70 a share, a year earlier.

Excluding certain items, Merck’s adjusted earnings per share were $1.40.This includes the impact of 52 cents from charges related to Merck get Cancer drug developer Imago BioSciences last year.

The Rahway, New Jersey-based company raised its sales forecast for 2023 to a range of $57.7 billion to $58.9 billion, slightly higher than the guidance of $5.72 billion to $58.7 billion it provided in early February. The raised guidance includes approximately $1 billion in molnupiravir sales.

The company also raised its full-year adjusted earnings forecast to $6.88 to $7.00 a share from a previous forecast of $6.80 to $6.95 a share.

The forecast does not reflect any financial impact of Merck’s proposed get The company noted that earlier this month, biotech firm Prometheus Biosciences. Merck said the deal is expected to close in the third quarter of 2023.

Merck’s Covid treatment molnupiravir hits market for first time after FDA authorized Birth control pills for some adults in December 2021.Merck, once hailed as game-changing Covid-19 treatment, signs on several contracts Provides millions of courses of medication to the U.S. government and other countries.

But Merck and drugmakers such as Pfizer, modern and Johnson & Johnson Covid-related sales will fall this year as the world emerges from the pandemic and reduces its reliance on blockbuster vaccines and treatments.

Molnupiravir was a drag on sales at Merck’s pharmaceutical business, which fell 10% to $12.7 billion compared with the first quarter of 2022. Excluding molnupiravir, drug sales rose 14%.

Merck said diabetes treatments also contributed to lower sales.Sales of sitagliptin and similar diabetes treatments fell 29% to $880 million, primarily due to generic competition in several international markets and lower U.S. demand and pricing

But sales were higher for Merck’s pharmaceutical unit Gardasil, Merck’s HPV cancer-prevention vaccine. Revenue from the vaccine rose 35% to $2 billion, reflecting strong demand outside the U.S., especially in China, the company said.

Sales of blockbuster antibody drug Keytruda also rose 20% in the quarter to $5.8 billion. Keytruda is used to treat many types of cancer, including certain types of breast cancer and skin cancer.

Merck Chief Financial Officer Caroline Litchfield said on Thursday’s company earnings call that the drugmaker continues to expect strong growth from Keytruda. But she noted that Keytruda’s pricing “is a growing headwind,” especially as Merck launches new indications for the drug in major European markets.

The company has been under pressure to reduce its reliance on Keytruda, which is expected to lose patent protection in 2028. On its earnings call, Merck highlighted some of its efforts to mitigate patent losses and expand its drug pipeline.

Dean Li, president of Merck Research Laboratories, mentioned the acquisition of Prometheus Biosciences. The deal, which will lead to promising experimental treatments for ulcerative colitis and Crohn’s disease, will strengthen Merck’s presence in immunology, he said.

“By combining Prometheus’ deep understanding of inflammatory bowel disease with Merck’s deep expertise in developing and implementing biomarkers, we hope to usher in a new era in immunology where patients receive the right treatment based on a precision medicine approach.” therapy,” Lee said during the call.