Pharma giant Merck (MRK) reported a 6% increase in worldwide sales to $10 billion for the first quarter of 2018 compared to the prior year period. On a GAAP basis, net income fell 52% to $736 million or $0.27 per share, reflecting a $1.4 billion charge associated with the Eisai collaboration. Non-GAAP income was $2.8 billion or $1.05 per share. Merck shares inched down slightly when the market opened today.
Pharmaceutical sales grew 9% to $8.9 billion driven primarily by growth in oncology, hospital acute care and diabetes. This was partially offset by lower sales in virology and the loss of market exclusivity for several products. Oncology benefited from a 151% increase in Keytruda sales. Keytruda is anticipated to become a key drug in oncology treatments alongside Bristol-Myers Squibb’s (BMY) Opdivo.
Animal Health sales increased 13% to $1.1 billion fuelled by higher sales of livestock and companion animal products.
For the full year of 2018, Merck narrowed its revenue outlook to the range of $41.8 billion to $43 billion. GAAP EPS target is trimmed down to a range of $2.45 to $2.57 while non-GAAP EPS outlook is lifted to a range of $4.16 to $4.28.
Merck also announced positive results for its Phase 3 trial, which involves Keytruda drug for the treatment of a type of lung cancer. Also, Merck noted that the FDA would review the biologics application for Keytruda before September 23, 2018.
Meanwhile, Merck’s rival Pfizer (PFE) also reported its first-quarter results today. Sales missed Street’s estimates, hurt by lower than expected breast cancer drug sales. Despite a rise in the profit, Pfizer shares dipped about 3% in the first hour of the trading.