Merck & Co., Inc. (NYSE:MRK) announced their quarterly results for the period ending on June 30th. The net income reported for this quarter amounted to $1.79 billion, or $0.58 per share, as compared to $2.02 billion, or $0.65 per share reported for the same period a year ago. Merck posted a profit of $1.05 a share, excluding acquisitions and restructuring costs, for this quarter. This beats the estimates of analysts polled by Bloomberg and Thomson Reuters. Merck has beaten analyst expectations on EPS for the last five quarters now.
The total sales for this quarter were up 1.3 percent and equaled $12.3 billion, a revenue of $12.2 billion was posted over the same quarter of 2011. Analysts’ forecast a revenue of $12.15 billion, so the sales exceed expectations by a slight 1%. Merck says that 18% of its sales have been contributed by new drugs, with diabetes medicines leading the market.
Merck has been facing decline in sales due to patent expirations.Novartis AG (NYSE:NVS), another drug major is facing similar issues. Merck & Co., Inc. (NYSE:MRK)’s showcase allergy and asthma medication, Singulair’s patent is expiring next month. The pharmaceutical giant is also facing rising competition from generic drugs that are sold at a much lower price. Pfizer Inc.‘s (NYSE:PFE) Lipitor, therapy for high cholesterol, has pitched major competition for Merck’s anticholesterol drug Vytorin. Another drug major, Bristol-Myers Squibb Co. (NYSE:BMY), is also facing similar declines in profit with its product, Plavix, taken for heart attacks and strokes. Nevertheless, the outlook for Merck’s second quarter is still better than its rivals and an increase in sales and profits is expected for the rest of the year. The company assures that it will achieve its preset target of $3.75 to $3.85 EPS for 2012.
“The company remains focused on translating cutting-edge science into medically important products,” Chief Executive Officer Kenneth Frazier said in a statement today. “We’re seeing significant progress in the pipeline this year, and we expect six major filings over the next 18 months.”
Sales are expected to rise, after Merck recieved positive results for clinical trials of its osteoporosis drug, Odanacatib, and treatment for insomnia, Suvorexant. These drugs are expected to enter the market next year, boosting further profits. Merck is also focusing on therapies for important infectious diseases, like Hepatitis C, which is a major health hazard in developing countries.
Merck is one of the largest pharmaceutical companies of the world. The stock value has increased 15 percent through the first half of this year. It is now trading at $44.72, up 3% since yesterday.