A pill with the Merck logo is shown on screen in the background in this illustration taken in Poland on October 4, 2021.
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Merck on Thursday reported a 9% drop in first-quarter revenue year-on-year, largely due to a sharp drop in sales of the Covid antiviral drug molnupiravir.
Sales of molnupiravir fell to $392 million during the period, down 88% year-on-year. 3.2 billion USD reported in the first quarter of 2022. Merck said the drop was mainly due to lower sales in the US, UK, Japan and Australia.
The company reported total revenue of $14.5 billion for the quarter, down nearly $1.5 billion from the same period a year earlier. But excluding Covid drugs, Merck said its revenue rose 11%.
This is what Merck report compared to Wall Street expectations, based on a survey of analysts by Refinitiv:
- Earnings per share: $1.40 adjusted, vs. $1.32 expected
- Revenue: 14.49 billion USD, compared to 13.78 billion USD expected
The pharmaceutical giant posted net income of $2.82 billion, or $1.11 per share. That compares with net income of $4.31 billion, or $1.70 per share, for the same period a year ago. Excluding certain items, Merck’s adjusted earnings per share was $1.40 for the period.
The Rahway, New Jersey-based company now forecasts 2023 revenue of $57.7 billion to $58.9 billion, slightly above the $57.2 to $58.7 billion forecast given in early February. The lifted guidance included about $1 billion in molnupiravir sales.
The company also raised its full-year adjusted earnings outlook to $6.88 to $7.00 per share, from its previous forecast of $6.80 to $6.95 per share.
The forecast does not reflect any financial impact from the Merck proposal redemption by biotech company Prometheus Biosciences earlier this month, the company noted. Merck said the deal is expected to close in the third quarter of 2023.
Merck’s molnupiravir treatment entered the market for the first time after the Food and Drug Administration authority the pill for certain adults in December 2021. Once hailed as a game-changing treatment for Covid-19, Merck signed some contract to supply millions of batches of drugs to the US government and other countries.
But Merck and drug makers like Pfizer, modern And Johnson & Johnson has been bracing for a drop in Covid-related sales this year as the world emerges from the pandemic and becomes less reliant on blockbuster vaccines and treatments.
Molnupiravir impacted sales of Merck’s pharmaceutical business, which fell 10% to $12.7 billion from the first quarter of 2022. Excluding molnupiravir, pharmaceutical sales rose 14%.
Merck says diabetes treatments are also driving down sales. Sales of sitagliptin and a similar diabetes treatment fell 29% to $880 million in the quarter, mainly due to general competition in several international markets as well as demand and low prices. than in the United States
But Merck’s pharmaceutical unit saw higher sales of the blockbuster antibody treatment Keytruda, up 20% to $5.8 billion in the quarter. Keytruda is used to fight certain types of cancer, including some types of breast cancer and skin cancer.
Gardasil, Merck’s HPV vaccine, also increased 35% to $2 billion. The company said this growth reflects strong demand outside of the United States, particularly in China.
