Merck & Co has received setback during the fourth quarter ended December 2012 and its net profit declined by 7.3 per cent to $1,401 million from $1,512 million in the corresponding period of last year. Its sales also declined by 4.5 per cent to $11,738 million from $12,292 million. Fourth-quarter pharmaceutical sales declined by 6 per cent to $10,085 million from $10,755 million.
Strong sales growth for Januvia (sitagliptin), Gardasil, Zostavax (zoster vaccine live) and Janumet (sitagliptin/metformin hydrochloride) partially offset the expected declines in sales of Singulair, Cozaar (losartan potassium) and Hyzaar (losartan potassium and hydrochlorothiazide). Its sales of Singulair declined sharply 67 per cent to $480 million from $1,461 million and that of Cozaar declined by 26 per cent to $315 million from $427 million.
Full-year 2012 worldwide sales were $47.3 billion, a decrease of 2 per cent, which includes a 3 per cent negative impact from foreign exchange, compared to full-year 2011 sales of $48 billion. Strong sales growth of key products helped offset the impact of the August 2012 loss of market exclusivity for Singulair in the United States.
Research and development (R&D) expenses, on a non-GAAP basis, were $2.2 billion in the fourth quarter of 2012, an increase from $2.1 billion in the fourth quarter of 2011. The increase reflects an upfront payment related to a worldwide licensing agreement for AiCuris' novel portfolio of investigational medicines targeting human cytomegalovirus.
"Merck overcame significant challenges last year and delivered strong results in 2012 by successfully growing our businesses, expanding geographically and reducing our expenses. As we begin 2013, we are well-positioned to further execute on our business strategy,” said Kenneth C Frazier, chairman and chief executive officer of Merck. “We remain committed to investing for future growth and innovation to deliver value over the long term. Merck is rapidly advancing many compounds that are potentially first-in-class or best-in-class. Additionally, we will continue to pursue external opportunities that have the potential to deliver value to the company and its shareholders.”
Merck is on track to file five products for regulatory approval in 2013. The company also recently started several key clinical trials including: Phase III trials of MK-3102, an investigational once-weekly DPP-4 inhibitor in development for treatment of type 2 diabetes; a Phase III study of MK-3222, an investigational biologic therapy for treatment of psoriasis; a phase II/III trial of MK-8931, an investigational ß-amyloid precursor protein site-cleaving enzyme (BACE) inhibitor, to evaluate safety and efficacy in patients with mild-to-moderate Alzheimer's disease; and a phase II study of MK-3475, an investigational therapy for the treatment of patients with advanced melanoma.
Merck expects full-year 2013 non-GAAP EPS to be between $3.60 and $3.70, and the 2013 GAAP EPS range to be $2.03 to $2.26. The 2013 non-GAAP range excludes acquisition-related costs and costs related to restructuring programmes. Merck expects full-year 2013 revenues to be near 2012 levels on a constant currency basis. At current exchange rates, sales would be affected unfavorably by approximately 1 to 2 per cent for the full year.