Merck's 1Q profit beats on Keytruda boost
April 30 (Reuters) - Merck & Co Inc reported a higher-than-expected first-quarter profit on Tuesday and raised its earnings and sales forecasts for the year, boosted by its vaccines business and demand for its cancer immunotherapy Keytruda.
The company's shares were up 1.2 percent premarket after saying it now expects full-year adjusted earnings per share between $4.67 and $4.79, up from its prior forecast of $4.57 to $4.72.
Keytruda has driven much of Merck's recent growth as it maintains its lead as an initial treatment for advanced lung cancer, the most lucrative oncology market. Following positive data, the drug is also expected to become the standard-of-care for some advanced kidney cancer patients.
The drug's sales rose 55 percent to $2.27 billion, but were slightly below consensus estimates of about $2.33 billion, according to Credit Suisse.
Sales at the company's vaccine unit were driven by Gardasil, a vaccine for preventing cancers associated with human papillomavirus, which brought in $838 million in the quarter, an increase of 27 percent from a year earlier.
Sales of the company's measles, mumps and rubella virus and chickenpox vaccines rose 27 percent to $496 million, helped by government tenders in Latin America and higher demand in the U.S.
Measles cases in the United States have hit their highest level since the virus was declared eradicated in 2000, with a total of at least 705 confirmed cases so far and Merck is the sole provider of the measles-mumps-rubella vaccine.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MRK | MERCK & CO. INC. | 130.72 | +3.72 | +2.93% |
The company also said on Tuesday it plans a restructuring program to optimize its manufacturing and supply network and cut its real estate footprint, and expects charges of $500 million in 2019.
Merck's net income rose to $2.92 billion, or $1.12 per share, in the first quarter, from $736 million, or 27 cents per share, a year earlier.
On an adjusted basis, Merck earned $1.22 per share, beating the analysts' average estimates of $1.06 per share, according to IBES data from Refinitiv.
CLICK HERE TO GET THE FOX BUSINESS APP
Sales rose to $10.81 billion, beating analysts' average estimate of $10.48 billion.
The company had taken a $1.4 billion charge in the year-earlier quarter, related to a collaboration with Japan's Eisai Co Ltd.
It also raised its 2019 revenue forecast to $43.9 billion and $45.1 billion, from a prior forecasted range of $43.2 billion to $44.7 billion.
(Reporting by Manas Mishra in Bengaluru; Editing by Anil D'Silva, Saumyadeb Chakrabarty and Shounak Dasgupta)