Drug maker Merck & Co Inc. (NYSE: MRK) reported better-than-expected fiscal second-quarter earnings on Friday, driven mainly by strong sales of vaccines and treatments for both HIV and diabetes, offsetting the impact of rising U.S. dollar.
The company also attributed increase in earnings to a $260mn fall in both marketing and advertising expenses
The results have also raised investors’ faith on the company as its flagship drug Singulair (asthma drug) will face competition from generics, next month onwards.
Post earnings announcement, shares of Merck climbed 3.4%, having earlier touched a 52 week high.
The company reported that for the quarter, earnings stood at $1.79 billion, or 58 cents per share, against earnings of $2.02 billion, or 65 cents per share, posted during the same quarter, in the last year earlier.
After omitting for onetime expenses and special items, the company earned $1.05 per share. Analysts polled by Reuters estimated earnings of $1.01 a share.
Sales increased 1 percent to $12.31 billion, surpassing analysts’ estimates of $12.15 billion. The company said that its sales growth would have increased by 5% had stronger dollar not impacted its revenue from oversees market.
Notwithstanding the negative impact of foreign exchange market, Merck maintained its full-year earnings forecast of $3.75 to $3.85 per share, (excluding special items).
In the last fiscal year earnings per share was at $3.77.
Among its drugs, Singulair sales climbed 6 percent in the quarter to $1.43 billion. Sales of Januvia, Merck’s best performing product in last few years, leaped 36 percent to $1.06 billion, even as a related treatment referred to as “ Janumet” rose 28 percent to $411 million.
Sales of HIV treatment Isentress increased 18 percent to $398 million; nevertheless, sales of blood pressure treatment Cozaar, which in recent times lost patent protection, slumped 17 percent to $337 million.
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