Merck & Co., Inc. Quarterly Report for Q1 Ended Mar 31, 2013

Summary

Merck & Co., Inc. reported first-quarter 2013 sales of $10.7 billion, a 9% decrease year-over-year, primarily due to the loss of market exclusivity for its blockbuster drug Singulair in both the U.S. and major European markets. This decline was partially offset by growth in key products such as Gardasil, Januvia, and Isentress, as well as contributions from its Animal Health and Consumer Care segments. The company's R&D efforts are progressing, with notable advancements in allergy immunotherapy and a collaboration with Pfizer for a diabetes drug. Financially, Merck maintained a strong liquidity position with $24.0 billion in cash and investments. The company also announced a significant new share repurchase authorization of up to $15 billion, signaling confidence in its future performance and a commitment to returning capital to shareholders. Despite ongoing pressures from healthcare cost containment and generic competition, Merck is strategically managing its product portfolio and investing in its pipeline to drive future growth.

Key Highlights

• 1Total sales decreased by 9% to $10.7 billion in Q1 2013 compared to Q1 2012, largely due to Singulair patent expiries.
• 2Net income attributable to Merck & Co., Inc. was $1.59 billion in Q1 2013, a decrease from $1.74 billion in Q1 2012.
• 3Diluted Earnings Per Share (EPS) decreased to $0.52 in Q1 2013 from $0.56 in Q1 2012.
• 4The company experienced strong sales growth in Gardasil (+37%), Zostavax, Remicade, and Isentress.
• 5Merck announced a new share repurchase program of up to $15 billion.
• 6Restructuring costs totaled $119 million in Q1 2013, related to integration efforts following the Schering-Plough merger.
• 7The company continues to invest in R&D, with new advancements in allergy immunotherapy and a collaboration with Pfizer for a diabetes treatment.

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