Merck posts better-than-expected results on Keytruda sales jump By Reuters

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© Reuters. FILE PHOTO: The logo for Merck & Co. is displayed on a screen at the New York Stock Exchange (NYSE) in New York City, New York, U.S., November 17, 2021. REUTERS/Andrew Kelly/File Photo

By Michael Erman

(Reuters) -Merck & Co reported better-than-expected fourth-quarter results on Thursday on strong sales of its cancer immunotherapy Keytruda, now the world’s biggest selling prescription medicine.

Keytruda sales rose 21% to $6.6 billion as the company was able to increase use of the drug in earlier stage cancers, topping analyst forecasts of $6.5 billion. For the full year, Keytruda generated $25 billion, surpassing sales of AbbVie (NYSE:)’s blockbuster arthritis drug Humira at its peak.

Merck reported adjusted earnings of 3 cents a share in the quarter, despite taking a charge of $1.69 a share to account for a $5.5 billion payout to Japan’s Daiichi Sankyo for the right to co-develop three cancer drugs. Analysts, on average, had expected a loss of 11 cents a share, according to LSEG data.

Revenue for the quarter rose 6% to $14.6 billion, compared with estimates of $14.5 billion.

Merck’s shares were up 1.2% in premarket trading.

The drugmaker also said it has launched a restructuring program to optimize its manufacturing operations related to human and animal health, and expects to complete it by the end of 2031.

Merck expects to record about $4 billion in cumulative pre-tax costs to implement the program. The company recorded a $190 million charge related to the program in the fourth quarter.

The company forecast 2024 sales between $62.7 billion and $64.2 billion. Analysts, on average, are estimating 2024 sales of $63.5 billion.

Merck raised its forecast for adjusted annual sales for oncology products to more than $20 billion from over $10 billion by mid-2030s, and for cardiometabolic products to about $15 billion from more than $10 billion.

The New Jersey-based drugmaker expects 2024 earnings of $8.44 to $8.59 per share, above Wall Street estimates of $8.42.

Including costs from deals other than the Daiichi transaction and restructuring costs, the company reported a quarterly net loss of 48 cents per share.

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