Merck reports mixed Q3 results: profit up, sales down

Hannah Blake

pharmaphorum

Merck has reported mixed financial results for the third quarter of 2012. The company’s profit increased 2.2% this quarter, while pharmaceutical sales declined 5% to $9.9 billion.

The decline in sales was partly attributed by the patent expiry in the United States of Merck’s allergies and asthma product, Singulair (montelukast sodium), back in August 2012. Singulair is expected to continue triggering low-priced generic competition as it is due to lose patent protection in major European countries in February 2013. However, strong sales growth for type 2 diabetes medication Januvia (sitagliptin), shingles vaccine Zostavax (zoster vaccine live) and chronic Hepatitis C treatment Victrelis (boceprevir) offset the expected declines in sales from patent expiries.

Sales in emerging markets accounted for approximately 20% of pharmaceutical sales in Q3, driven by primary care, women’s health and vaccines. China continued to be a key driver in this quarter, with 19% growth.

"Our strong global sales this quarter offset the impact of the SINGULAIR patent expiry in the U.S. We will continue to drive value for our customers and shareholders through Merck’s four-part strategy of executing on our core business, expanding geographically in high-growth markets, extending our complementary businesses and excelling at managing our costs while investing for growth. With our robust pipeline, we remain on target to submit multiple new products for marketing approval between now and the end of 2013, including suvorexant for insomnia, odanacatib for osteoporosis and TREDAPTIVE for multiple lipid parameters."

Kenneth C. Frazier, chairman and chief executive officer of Merck.

Following its Q3 financial results, Merck has tightened its full-year profit forecast to between $3.78 and $3.82 per share, from its earlier view of $3.75 to $3.85 per share. Analysts have predicted that Merck will earn $3.81 per share in 2012, excluding items, on revenue of $47.14 billion. In 2011, Merck posted revenue of $48.05 billion for the full-year.

By the end of 2013, Merck plans to seek regulatory approval for six major new products, including potential treatments for osteoporosis and insomnia. The company has also been focusing on areas such as Hepatitis C and diabetes.

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