Merck has suffered heavy setback during the first quarter ended March 2015 and its net profit declined sharply by 44.7 per cent to $958 million from $1,731 million in the corresponding period of last year due to adverse impact of acquisitions and divestitures and negative impact of foreign exchange rates. Its sales declined by 8.2 per cent to $9,425 million from $10,264 million. EPS moved down to $0.33 from $0.57 in the last period. Its R&D expenditure increased by 10.4 per cent to $1,737 million from $1,574 million.
The sales of major brands like Zetia, Vytorin, Remicade and Isentress declined during first quarter of 2015. The sales of Zetia declined by 7 per cent to $568 million and that of Vytorin went down by 11 per cent to $320 million. Remicade sales declined by 17 per cent to $501 million from $604 million. However sales of Januvia increased by 3 per cent to $884 million and that of Janumet improved by 7 per cent to $509 million from $476 million. Sales of Gradasil declined by 6 per cent to $359 million.
Excluding the impact of exchange, growth was driven by the our core therapeutic areas – diabetes, vaccines, hospital acute care and oncology. The increase in hospital acute care was driven by strong sales growth of inline brands, as well as the addition of $208 million of Cubist product sales following Merck's acquisition of Cubist in late January.
Kenneth Frazier, chairman and CEO, said, “Our strong performance this quarter demonstrates that our scientific and business strategies, together with our focused investments, are paying off. We remain focused on bringing forward the best scientific and medical innovations. By capitalizing on the exciting scientific and clinical opportunities that lie ahead, Merck is poised to play a major role in transforming healthcare for patients, as well as payers and shareholders.”
The company has lowered its full year 2015 EPS range to be between $1.58 and $1.85. The change in the EPS range primarily reflects the incorporation of updated estimated Cubist intangible amortization expenses. It anticipate revenues to be between $38.3 billion and $39.8 billion. As at the end of March 2015, Merck had approximately 70,000 employees worldwide.