Merck headquarters in Rahway, New Jersey, on Tuesday, April 18, 2023.
Christopher Occhicone | Bloomberg | Getty Images
Merck on Thursday reported third-quarter revenue and adjusted profit that beat expectations on strong sales of its blockbuster cancer drug Keytruda, HPV vaccine Gardasil and, surprisingly, its Covid drug Lagevrio.
The pharmaceutical giant also raised its full-year revenue forecast to $59.7 billion to $60.2 billion, slightly higher than the $58.6 billion to $59.6 billion forecast given in August.
Merck lowered its adjusted earnings forecast to $1.38 per share from $1.33, compared to a previous forecast of $2.95 to $3.05 per share. But that updated outlook reflects a $5.5 billion upfront payment, or $1.70 per share, related to its recent drug collaboration deal with Daiichi Sankyo.
This guidance also includes previously announced one-time charges related to the company’s acquisitions of Prometheus Biosciences and Imago BioSciences, along with another upfront payment related to a collaboration agreement with Kelun-Biotech.
Here’s what Merck reported for the third quarter, compared to what Wall Street expected, based on a survey of analysts by LSEG, formerly known as Refinitiv:
- Profit per share: $2.13 adjusted versus $1.95 expected
- Gain: $15.96 billion versus $15.32 billion expected
Merck shares are down nearly 7% this year. It has a market value of approximately $263 billion, making it one of the largest pharmaceutical companies in the US
Merck posted revenue of $15.96 billion this quarter, up 7% from the same period a year ago.
The company posted net income of $4.75 billion, or $1.86 per share. That compares with $3.25 billion, or $1.28 per share, for the same period a year ago.
Excluding certain items, Merck’s adjusted earnings per share were $2.13 for the period.
Merck’s pharmaceutical division, which develops a wide range of drugs for various disease areas, posted sales of $14.26 billion this quarter. That is 10% more than in the same period a year ago.
Excluding Lagevrio, pharmaceutical sales grew by 9%. The antiviral treatment against Covid-19 delivered sales of $640 million this quarter, up 47% from the third quarter of 2022. Merck said the growth was driven by higher demand in Japan, partially offset by the lower demand in Australia and lack of sales in the United States. Britain
Analysts had expected the drug to generate just $140.8 million in sales, according to FactSet estimates. Lagevrio’s turnover is surprising since the turnover of Covid products from companies such as Pfizer And Modern have plummeted this year as the world emerges from the pandemic and relies less on vaccines and treatments for protection.
Merck’s popular antibody treatment Keytruda, used to treat several types of cancer, posted sales of $6.34 billion, up 17% from the year-ago quarter. Analysts had expected Keytruda sales of $6.20 billion, according to FactSet estimates.
The company is under pressure to reduce its dependence on Keytruda, which is expected to lose patent protection in 2028. But Merck is trying to defend its patent lead over Keytruda by developing new formulations of the drug, such as a version that can be injected. under the skin.
Merck’s pharmaceutical business also saw an increase in sales of Gardasil, a vaccine that prevents cancer caused by HPV, the most common sexually transmitted infection in the US.
Gardasil generated revenue of $2.59 billion, up 13% from the third quarter of 2022. Analysts had expected revenue of $2.64 billion, according to FactSet estimates.
The company’s animal health division, which develops vaccines and medicines for dogs, cats and cattle, posted sales of $1.40 billion, up 2% from the same period a year ago.
Merck will hold a conference call Thursday at 9 a.m. ET.
Correction: Merck has acquired Imago BioSciences. In an earlier version, a company name was mentioned incorrectly.
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