Wednesday, July 23rd14.4°C
22714

Drugmaker Merck's Q4 profit, sales fall due to generic competition, unfavourable exchange rates

Merck & Co.'s fourth-quarter profit dropped 14 per cent, with its aggressive cost cutting not enough to offset restructuring charges, generic competition to former blockbuster medicines and unfavourable currency exchange rates.

Results just missed Wall Street expectations, and even though Merck said 2014 will be a "trough year" for revenue, shares briefly hit a six-year high of $55.20. That's because the world's third-biggest drugmaker separately announced new, potentially lucrative alliances.

Merck will collaborate with three other drugmakers to test its hot experimental cancer drug, called MK-3475, in combination with theirs. It's in a new class of cancer medicines meant to restore the immune system's natural ability to spot and target cancer cells.

In morning trading, Merck shares rose $1.05, or 2 per cent, to $54.56.

Merck reported net income of $781 million, or 26 cents per share, down from $908 million, or 30 cents per share, a year earlier.

The maker of the Type 2 diabetes pill Januvia said that excluding one-time items, net income was $2.6 billion, or 88 cents per share — a penny shy of analysts' expectations.

Revenue totalled $11.32 billion, down 4 per cent. Analysts expected $11.36 billion.

Sales were lower than expected for Januvia, HPV vaccine Gardasil and a few other products, but higher than expected for immune disorder drug Remicade, HIV drug Isentress and cholesterol pills Zetia and Vytorin.

Two issues dominated Merck's conference call with analysts. Asked about MK-3475's potential, as a solo treatment and combined with drugs from new partners Pfizer Inc., Amgen Inc. and Incyte Corp., Merck said it's too soon to tell.

Analysts also asked about Merck's strategic review of its animal health business, the world's second largest, and its consumer health business, which sells Coppertone sun care items and nonprescription Claritin allergy pills. CEO Kenneth Frazier said he's determining whether they'd be more valuable inside or outside of Merck and will decide by year's end.

Bernstein Research analyst Dr. Timothy Anderson wrote that he thinks Merck might keep animal health, which Frazier said he likes for a number of reasons, rather than consumer health, which is limited by small size. Swiss drugmaker Novartis AG reportedly is weighing deals including swapping its animal health business for Merck's consumer segment.

Merck, based in Whitehouse Station, N.J., forecast 2014 profit of $3.35 to $3.53 per share, excluding one-time items. Analysts are projecting $3.46 per share.

For all of 2013, Merck reported net income of $4.04 billion, or $1.47 per share, on revenue of $44.03 billion.

___

Follow Linda A. Johnson at http://twitter.com/LindaJ_onPharma

The Canadian Press


Read more Business News

22315


Recent Trending




Today's Market
S&P TSX15315.13+65.14
S&P CDNX1010.884.40
DJIA17113.5461.81
Nasdaq4456.016+31.312
S&P 5001983.53+9.90
CDN Dollar0.9323+0.0011
Gold1313.40+4.2001
Oil104.30-0.29
Lumber332.50+6.20
Natural Gas3.778+0.006

 
Okanagan Companies
Pacific Safety0.200.00
Knighthawk0.01-0.005
QHR Technologies Inc1.19+0.04
Cantex0.06+0.005
Anavex Life Sciences0.33-0.018
Metalex Ventures0.07+0.005
Russel Metals35.60+0.61
Copper Mountain Mining2.83+0.14
Colorado Resources0.215+0.015
ReliaBrand Inc0.10+0.019
Sunrise Resources Ltd0.025-0.005
Mission Ready Services0.19+0.01

 



22557

FEATURED Property
19809871515 Highland Drive
4 bedrooms 3 baths
$437,900
more details
image2image2image2
Click here to feature your property
Please wait... loading


Labour shortage in BC

The mainstream media are finally waking up to something unusual in British Columbia – a labour shortage. If the experience of Alberta is a guide to our own future, the highly skilled labour will...


Learn to delegate effectively

Photo: ContributedI have the pleasure of witnessing people delegate tasks quite often. Sometimes with tremendous success and sometimes with disastrous consequences. I have chaired a lot of committees...


Euro debt woes re-emerge

Big Picture Euro debt woes re-emerge Europe’s debt woes jumped back into the headlines this week trumping other economic, geopolitical and corporate developments. Word that one of Portugal&rsquo...

_








Member of BC Press Council


22707