Drugmaker Merck said Tuesday it swung to a sizable fourth-quarter profit, after a year-ago loss due to a whopping charge, and-- despite lower sales of key products-- beat Wall Street expectations.
The maker of vaccines, cholesterol drugs and asthma treatment Singulair reported a profit of $1.64 billion, or 78 cents per share. A year ago, Merck posted a loss of $1.63 billion, or 75 cents per share, mainly due to a $4.85 billion charge for a settlement to end most of the patient lawsuits over its withdrawn painkiller Vioxx.
Excluding charges of $204 million, or 9 cents per share, for restructuring, the world's No. 8 drugmaker by revenue reported earnings per share of 87 cents.
Fourth-quarter revenue declined 3 percent, to $6 billion.
Analysts surveyed by Thomson Financial were expecting, on average, earnings per share of 74 cents and revenue of $5.98 billion.
Sales of osteoporosis treatment Fosamax plunged due to generic competition, and revenue from Merck's partnership with Schering-Plough Corp. on cholesterol drugs also fell. Those drugs, Vytorin and Zetia, have been hurt by reports over the past year questioning their effectiveness and safety, and their combined global revenue plunged 26 percent from the year-ago quarter, to $1.1 billion.
Fosamax sales were down 60 percent, to $318 million. Sales of companion blood pressure medicines Cozaar and Hyzaar also were down, just 1 percent, at $881 million, and revenue for Gardasil, a vaccine to prevent cervical cancer and other sexually transmitted diseases, dropped 16 percent to $286 million.
Other top vaccines, including Zostavax for shingles and RotaTeq for rotavirus, saw sales increase. Revenue jumped 64 percent to $413 for diabetes pill Januvia and nearly tripled for a second diabetes drug, Janumet, to $120 million.
Merck reaffirmed its 2009 financial forecasts, saying it expects earnings per share of $2.95 to $3.17, excluding up to about 20 cents' worth of one-time items, and revenue between $23.7 million and $24.2 billion.
For all of 2008, Merck reported net income of $7.8 billion, or $3.64 per share. That was up 138 percent from income of $3.28 billion, or $1.49 per share, in 2007 -- results that were weighed down by the charge to settle roughly 50,000 Vioxx product liability suits. Merck also reported a $2.2 billion gain earlier in 2007 from its partnership with British drugmaker AstraZeneca LP.
Revenue for the full year totaled $23.85 billion, down 1 percent from $24.2 billion in 2007.
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