Merck KGaA, a pharmaceutical and chemical company based in Germany, has registered a net sales growth of 6.3 per cent to Euro 7,202 million during the year ended December 2008 from Euro 6,775 million in the previous year. Its operating profit before tax and exceptional items, improved by 15.9 per cent to Euro 1,131 million from Euro 976 million. However, the net profit after tax and exceptional items declined sharply by 90 per cent to Euro 367 million from Euro 3,500 million. Due to sharp fall in net profit, its earnings per share nosedived to Euro 1.69 as against Euro 16.21 in the last period.
Merck's pharmaceutical revenue rose by 11 per cent o Euro 5,428 million mainly due to higher sales of Rebif and Erbitux products. Royalty income grew by 25 per cent to Euro 339 million. Full-year revenues for the Merck Serono division rose by 12 per cent to Euro 4,987 million compared to Euro 4,458 million. Worldwide sales of Rebif or the treatment of relapsing forms of multiple sclerosis increased by 9.3 per cent to Euro 1,331 million in 2008. Sales of Erbitux moved up by 20 per cent to Euro 565 million. Erbitux has marketing authorization in 76 countries.
Dr Karl-Ludwig Kley, chairman, said, "In spite of the recession that is gripping the global business community, Merck is pleased to report that we were able to meet the Group guidance for 2008 that we announced a year ago. These positive results in a difficult year - revenues increasing by 7 per cent and an operating result up 16 per cent - are a clear vindication of our business model that distributes risk across the two major business sectors of pharmaceuticals and chemicals."
Its R&D costs rose by 20 per cent to Euro 1,234 million, with the lion's share spent by the research-driven Merck Serono division. The company booked exceptional items of Euro 400 million in 2008 mainly for the Merck Serono division. The company written off Euro 195 million for the psoriasis drug Raptiva, Euro 43 million for Enbrel licensing rights, Euro 42 million for the goodwill for former subsidiary Lexigen following termination of relevant research projects. During the year 2007, exceptional items totalled at Euro 776 million and were related mainly to write-downs of inventories within the scope of the Serono purchases price allocation.