Merck 4Q powered by cancer treatment sales
Higher medicine sales and lower restructuring and other costs lifted drugmaker Merck to a $1.83 billion profit in the third quarter, as it edged past Wall Street expectations.
The maker of blockbuster cancer drug Keytruda and Januvia diabetes pills lost $1.05 billion a year earlier, when it had a $2.92 billion tax bill due to a federal tax overhaul.
The Kenilworth, New Jersey, drugmaker on Friday reported net income of 69 cents per share. Adjusted for costs related to mergers and acquisitions and other non-recurring costs, that amounted to $2.75 billion, or $1.04 per share, a penny better than expected, according to a survey by Zacks Investment Research
Revenue was $11 billion, slightly better than expected and up 5 percent from $10.43 billion in 2017’s last quarter.
Sales of prescription drugs totaled $9.83 billion, up 6 percent.
Keytruda, an immune-oncology that revs up the immune system to treat numerous cancer types, brought in $2.15 billion in the quarter, up 88 percent. It generated $7.17 billion in 2018, up by the same percentage, and now accounts for more than 20 percent of the company’s revenue.
Vaccine sales also rose, led by $835 million for Merck’s Gardasil 9 vaccine, which protects against a sexually transmitted virus that causes cancer.
But sales of Type 2 diabetes pills Januvia and Janumet, previously Merck’s top-selling franchise, dipped to $1.47 billion as insurers continue pressing for lower prices and competition increases in the huge diabetes drug market.
Animal health sales jumped 6 percent to $1.04 billion.
Merck & Co. said it expects full-year earnings in the range of $4.57 to $4.72 per share, with revenue in the range of $43.2 billion to $44.7 billion. Industry analysts had been projecting per-share earnings of $4.69, and revenue of $44.2 billion.
For all of 2018, Merck reported net income of $6.22 billion, or $2.32 per share — more than double its 2017 profit. Sales in 2018 totaled $42.29 billion, up 5 percent from 2017.
In premarket trading shares rose 3 percent to $75.65.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research.
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