Merck & Co has reported net profit growth of 7 per cent during the first quarter ended March 2014 to $1,705 million from $1,593 million in the corresponding period of last year due to lower R&D expenditure and other costs. Its net sales, however, declined by 4 per cent to $10,264 million from $10,671 million due to patent expiration and adverse foreign exchange rates. EPS for the quarter worked out $0.57 as compared to $0.52 in the last period.
R&D expenditure declined by 17 per cent to $1,574 million from $1,907 million and its marketing and administrative expenses declined by 8 per cent to $2,734 million from $2,987 million. R&D expenditure declined due to targeted reductions and lower clinical development spending as a result of portfolio prioritization and increased focus on the key therapeutic opportunities. The US FDA approved Grastek and Ragwitek and accepted a biologics license application for V503, a 9-valent HPV vaccine candidate, in February.
Kenneth C Frazier, chairman and CEO, said, “Investing in the best opportunities for growth while being disciplined in managing our costs enabled us to deliver bottom-line performance. This is an exciting time as we prepare to commercialize the next wave of innovation coming out of Merck's research labs over the next few years.”
Its pharmaceutical sales declined by 5 per cent to $8,451 million from $8,891 million in the similar quarter of last year. Though the sales of Januvia/Janumet improved by 3 per cent to $1,334 million from $1,293 million, the sales of Zetia/Vytorin declined by 5 per cent to $972 million from $1,023 million. The sales of Remicade improved by 10 per cent to $604 million and that of Isentress moved up by 8 per cent to $390 million from $362 million. The sales of Gardasil, Nasonex and Singulair were under pressure.
The company expects full year EPS to be between $3.35 and $3.53 and the full year revenues to be between $42.4 billion and $43.2 billion.