We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
Merck and Co Inc | NYSE:MRK | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.72 | -0.56% | 128.50 | 129.93 | 127.80 | 129.43 | 5,895,709 | 01:00:00 |
Merck (NYSE: MRK), known as MSD outside the United States and Canada, today announced financial results for the second quarter of 2020.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200731005100/en/
“Despite the impact COVID-19 had on patient access to health care providers, Merck continued to execute well with business momentum improving through the quarter. We remain confident that Merck will drive strong long-term growth based on underlying demand for our unique portfolio of innovative medicines, vaccines and animal health products. Our financial strength underpins our capital allocation priorities, including business development and the breakthrough research and development that creates value for society and our shareholders,” said Kenneth C. Frazier, chairman and chief executive officer, Merck. “In response to the SARS-CoV-2 pandemic, Merck is moving with urgency on three critical priorities: protecting the health and safety of our employees and their families, sustaining the supply of our medicines and vaccines to our patients and customers, and mobilizing our unique scientific expertise and experience to develop vaccines and antivirals that we believe may help save many lives.”
Financial Summary
$ in millions, except EPS amounts
Second Quarter
2020
2019
Change
Change Ex- Exchange
Sales
$10,872
$11,760
-8%
-5%
GAAP net income1
3,002
2,670
12%
17%
Non-GAAP net income that excludes certain items1,2*
3,484
3,356
4%
7%
GAAP EPS
1.18
1.03
15%
19%
Non-GAAP EPS that excludes certain items2*
1.37
1.30
6%
9%
*Refer to table on page 11.
GAAP (generally accepted accounting principles) earnings per share assuming dilution (EPS) was $1.18 for the second quarter of 2020. Non-GAAP EPS of $1.37 for the second quarter of 2020 excludes acquisition- and divestiture-related costs and restructuring costs. Year-to-date results can be found in the attached tables.
COVID-19 Research Highlights
Building on the company’s experience with antivirals and vaccines, Merck is accelerating two COVID-19 vaccine development efforts and a novel antiviral candidate, specifically,
“We are conscious of our abiding responsibility to help advance vaccine and antiviral efforts as part of the global response to SARS-CoV-2 and to ensure broad, equitable and affordable global access to any medicines and vaccines we bring forward,” Frazier said. “This pandemic underscores the essential role of Merck and the biopharmaceutical industry in addressing the world’s greatest health challenges and underscores the importance of a health care ecosystem that incentivizes risk-taking and innovation. Ultimately, scientific and medical knowledge will help overcome this ongoing global pandemic – and that is why we must continue to trust and invest in breakthrough science.”
Oncology Pipeline Highlights
Merck continued to advance the development programs for KEYTRUDA (pembrolizumab), the company’s anti-PD-1 therapy; Lynparza (olaparib), a PARP inhibitor being co-developed and co-commercialized with AstraZeneca; and Lenvima (lenvatinib mesylate), an orally available tyrosine kinase inhibitor being co-developed and co-commercialized with Eisai Co., Ltd. (Eisai), in addition to other notable developments as follows:
Vaccine Pipeline Highlights
Other Pipeline Highlights
Business Developments
Organon & Co.
Second-Quarter Financial Impact of COVID-19
In the second quarter, the estimated overall negative impact of the COVID-19 pandemic to Merck’s revenue was approximately $1.6 billion, consisting of approximately $1.5 billion for pharmaceuticals and approximately $100 million for Animal Health. As expected, within the company’s human health business, revenue was negatively impacted by reduced access to health care providers given social distancing measures and within Animal Health, by reduced veterinary visits and decreased protein and milk demand.
Operating expenses were positively impacted in the second quarter by approximately $325 million, primarily driven by lower promotional and selling costs as well as lower research and development (R&D) expenses.
Second-Quarter Revenue Performance
The following table reflects sales of the company’s top pharmaceutical products, as well as sales of animal health products.
$ in millionsSecond Quarter
2020
2019
Change
Change Ex- Exchange
Total Sales
$10,872
$11,760
-8%
-5%
Pharmaceutical
9,679
10,460
-7%
-6%
KEYTRUDA
3,388
2,634
29%
31%
JANUVIA / JANUMET
1,344
1,441
-7%
-5%
GARDASIL / GARDASIL 9
656
886
-26%
-24%
PROQUAD, M-M-R II and
VARIVAX
378
675
-44%
-43%
BRIDION
224
278
-19%
-18%
ISENTRESS / ISENTRESS HD
196
247
-21%
-17%
SIMPONI
191
214
-11%
-8%
Lynparza*
178
111
61%
62%
ZETIA / VYTORIN
175
232
-24%
-23%
ROTATEQ
168
172
-2%
-1%
Lenvima*
151
97
57%
57%
Animal Health
1,101
1,124
-2%
3%
Livestock
648
671
-3%
3%
Companion Animals
453
453
0%
3%
Other Revenues
92
176
-47%
-23%
*Alliance revenue for these products represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs.
Pharmaceutical Revenue
Second-quarter pharmaceutical sales decreased by $780 million, or 7%, to $9.7 billion; excluding the unfavorable effect from foreign exchange, sales declined by 6%. The decrease was driven primarily by the negative impact of the COVID-19 pandemic on vaccines and hospital acute care products and the ongoing impacts of the loss of market exclusivity for several products, partially offset by growth in oncology.
The decline in vaccine sales was primarily driven by GARDASIL (Human Papillomavirus Quadrivalent [Types 6,11,16 and 18] Vaccine, Recombinant)/GARDASIL 9, vaccines to prevent certain cancers and other diseases caused by HPV, largely due to lower demand in the U.S. and Hong Kong, SAR, PRC attributable to the COVID-19 pandemic, partially offset by higher demand in China.
Also contributing to the decline in vaccine sales were pediatric vaccines PROQUAD (Measles, Mumps, Rubella and Varicella Virus Vaccine Live), a combination vaccine to help protect against measles, mumps, rubella and varicella; M-M-R II (Measles, Mumps and Rubella Virus Vaccine Live), a vaccine to help prevent measles, mumps and rubella; and VARIVAX (Varicella Virus Vaccine Live), a vaccine to help prevent chickenpox, primarily attributable to lower demand in the U.S. related to the COVID-19 pandemic. Lower demand for M-M-R II in the U.S. due to fewer measles outbreaks and the timing of government tenders in Latin America for VARIVAX also contributed to the sales declines.
Sales of PNEUMOVAX 23 (pneumococcal vaccine polyvalent), a vaccine to help prevent pneumococcal disease, declined in the second quarter, primarily reflecting lower demand in the U.S. related to the COVID-19 pandemic, partially offset by higher volumes in Europe attributable in part to increased demand for pneumococcal vaccination during the COVID-19 pandemic.
Performance in hospital acute care reflects lower demand globally for BRIDION (sugammadex), a medicine for the reversal of neuromuscular blockade induced by rocuronium bromide or vecuronium bromide in adults undergoing surgery, driven by reductions in elective surgeries due to the COVID-19 pandemic, partially offset by the ongoing launch of PREVYMIS (letermovir), a medicine for prophylaxis (prevention) of cytomegalovirus (CMV) infection and disease in adult CMV-seropositive recipients of an allogeneic hematopoietic stem cell transplant.
Pharmaceutical sales performance for the quarter also was negatively affected by the ongoing impacts from the loss of market exclusivity, including for NUVARING (etonogestrel/ethinyl estradiol vaginal ring), NOXAFIL (posaconazole), EMEND (aprepitant)/EMEND (fosaprepitant dimeglumine) for Injection, VYTORIN (ezetimibe/simvastatin), CUBICIN (daptomycin) and REMICADE (infliximab). In addition, the decline in sales of JANUVIA (sitagliptin) and JANUMET (sitagliptin and metformin HCI) reflects continued pricing pressure in the U.S.
Growth in oncology partially offset the decline in pharmaceutical revenue, largely driven by higher sales of KEYTRUDA, which grew 29% to $3.4 billion for the quarter. Continued strong momentum from the NSCLC indications as well as continued uptake in other indications, including adjuvant melanoma, renal cell carcinoma (RCC), bladder, head and neck squamous cell carcinoma (HNSCC) and microsatellite instability-high (MSI-H) cancers, was partially offset by the negative impacts of the COVID-19 pandemic globally. Also contributing to growth in oncology was higher alliance revenue related to Lynparza and Lenvima reflecting continued uptake in approved indications in the U.S., Europe and China.
Animal Health Revenue
Animal Health sales totaled $1.1 billion for the second quarter of 2020, a decrease of 2% compared with the second quarter of 2019; excluding the unfavorable effect from foreign exchange, Animal Health sales grew 3%. Performance in livestock products reflects lower demand driven by reduced protein and milk demand due to restaurant and school closures resulting from the COVID-19 pandemic, partially offset by an additional month of sales included in the current quarter related to the 2019 acquisition of Antelliq Corporation. Performance in companion animal products was driven largely by lower demand in companion animal vaccines due to reduced veterinary access resulting from the COVID-19 pandemic, offset by higher demand for the BRAVECTO (fluralaner) line of products for parasitic control.
Second-Quarter Expense, EPS and Related Information
The tables below present selected expense information.
$ in millions
Second-Quarter 2020
GAAP
Acquisition- and Divestiture- Related Costs3
Restructuring Costs
Certain Other Items
Non-GAAP2
Cost of sales
$3,159
$282
$25
$−
$2,852
Selling, general and administrative
2,378
163
11
−
2,204
Research and development
2,123
(65)
31
−
2,157
Restructuring costs
83
−
83
−
−
Other (income) expense, net
(390)
63
−
(16)
(437)
Second-Quarter 2019
Cost of sales
$3,401
$447
$65
$−
$2,889
Selling, general and administrative
2,712
61
32
−
2,619
Research and development
2,189
4
3
−
2,182
Restructuring costs
59
−
59
−
−
Other (income) expense, net
140
148
–
48
(56)
GAAP Expense, EPS and Related Information
Gross margin was 70.9% for the second quarter of 2020 compared to 71.1% for the second quarter of 2019. The decrease reflects higher amortization of intangible assets related to collaborations and unfavorable manufacturing variances, partially offset by the favorable effects of foreign exchange, product mix and lower acquisition- and divestiture-related costs.
Selling, general and administrative expenses were $2.4 billion in the second quarter of 2020, a decrease of 12% compared to the second quarter of 2019. The decrease primarily reflects lower promotion, selling and administrative costs, including less travel and meeting expenses, due in part to the COVID-19 pandemic, and the favorable effects of foreign exchange, partially offset by higher acquisition- and divestiture-related costs, including costs related to the company’s planned spinoff of Organon.
Research and development expenses were $2.1 billion in the second quarter of 2020, a decrease of 3% compared with the second quarter of 2019. The decrease was primarily driven by lower acquisition- and divestiture-related costs and lower laboratory, travel and meeting expenses due to the COVID-19 pandemic, partially offset by higher expenses related to clinical development and increased investment in discovery research and early drug development.
Other (income) expense, net, was $390 million of income in the second quarter of 2020 compared to $140 million of expense in the second quarter of 2019, primarily due to higher income from investments in equity securities, net, which was $551 million in 2020 compared with $58 million in 2019, largely from the recognition of unrealized gains on securities.
The effective income tax rate was 14.5% for the second quarter of 2020 compared to 18.9% in the second quarter of 2019, reflecting the favorable impact of earnings mix.
GAAP EPS was $1.18 for the second quarter of 2020 compared with $1.03 for the second quarter of 2019.
Non-GAAP Expense, EPS and Related Information
Non-GAAP gross margin was 73.8% for the second quarter of 2020 compared to 75.4% for the second quarter of 2019. The decrease in non-GAAP gross margin reflects higher amortization of intangible assets related to collaborations and unfavorable manufacturing variances, partially offset by the favorable effects of foreign exchange and product mix.
Non-GAAP selling, general and administrative expenses were $2.2 billion in the second quarter of 2020, a decrease of 16% compared to the second quarter of 2019. The decrease primarily reflects lower promotion, selling and administrative costs, including less travel and meeting expenses, due in part to the COVID-19 pandemic and the favorable effects of foreign exchange.
Non-GAAP R&D expenses were $2.2 billion in the second quarter of 2020, a 1% decrease compared to the second quarter of 2019. The decrease was primarily driven by lower laboratory, travel and meetings expenses due to the COVID-19 pandemic, partially offset by higher expenses related to clinical development and increased investment in discovery research and early drug development.
Non-GAAP other (income) expense, net, was $437 million of income in the second quarter of 2020 compared to $56 million of income in the second quarter of 2019, primarily due to income from investments in equity securities, net, which was $541 million in 2020 compared with $58 million in 2019, largely from the recognition of unrealized gains on securities.
The non-GAAP effective income tax rate was 14.7% for the second quarter of 2020 compared to 18.4% for the second quarter of 2019, reflecting the favorable impact of earnings mix.
Non-GAAP EPS was $1.37 for the second quarter of 2020 compared with $1.30 for the second quarter of 2019.
A reconciliation of GAAP to non-GAAP net income and EPS is provided in the table that follows.
$ in millions, except EPS amountsSecond Quarter
2020
2019
EPS
GAAP EPS
$1.18
$1.03
Difference
0.19
0.27
Non-GAAP EPS that excludes items listed below2
$1.37
$1.30
Net Income
GAAP net income1
$3,002
$2,670
Difference
482
686
Non-GAAP net income that excludes items listed below1,2
$3,484
$3,356
Decrease (Increase) in Net Income Due to Excluded Items:
Acquisition- and divestiture-related costs3
$443
$660
Restructuring costs
150
159
Other
(16)
48
Net decrease (increase) in income before taxes
577
867
Income tax (benefit) expense4
(95)
(145)
Acquisition- and divestiture-related costs attributable to noncontrolling interests
−
(36)
Decrease (increase) in net income
$482
$686
Financial Outlook
The full-year updated guidance that Merck is providing below includes its current assumption of the impact from the COVID-19 pandemic, which is expected to be partially offset by favorability from continued underlying business strength. While the company continues to expect to rely on governmental authorities to determine when operations can return to normal and is cognizant that the duration, spread and severity of the outbreak will be critical determinants, for the purposes of the full-year 2020 guidance estimates, the company has assumed the majority of the negative impact occurred during the second quarter, with a gradual recovery having commenced late in the second quarter and extending through the third quarter, with a return to normal operating levels in the fourth quarter.
For the full-year 2020, Merck now expects an unfavorable impact to revenue of approximately $1.95 billion (excluding the impact of foreign exchange) due to the COVID-19 pandemic, comprised of approximately $1.8 billion for pharmaceuticals and approximately $150 million for Animal Health, including the impacts in the first half of the year.
For the full-year 2020, Merck continues to expect a net favorable impact to operating expenses of approximately $400 million, reflecting the favorable impact of lower spending due to the COVID-19 pandemic, largely reflected in the first half of 2020, partially offset by anticipated spending on recently-initiated COVID-19-related vaccine and antiviral research programs.
Merck narrowed and raised its full-year 2020 revenue range to be between $47.2 billion and $48.7 billion, including a negative impact from foreign exchange of approximately 2% at mid-July exchange rates.
Merck narrowed and raised its full-year 2020 GAAP EPS to be between $4.58 and $4.73. Merck narrowed and raised its full-year 2020 non-GAAP EPS to be between $5.63 and $5.78, including a negative impact from foreign exchange of approximately 3% at mid-July exchange rates. The non-GAAP range excludes acquisition- and divestiture-related costs and costs related to restructuring programs.
The following table summarizes the company’s full-year 2020 financial guidance.
GAAP
Non-GAAP2
Revenue
$47.2 to $48.7 billion
$47.2 to $48.7 billion*
Operating expenses
Lower than 2019 by a low-single-digit rate
Roughly in line with 2019
Effective tax rate
15.0% to 15.5%
16.0% to 16.5%
EPS**
$4.58 to $4.73
$5.63 to $5.78
*The company does not have any non-GAAP adjustments to revenue.
**EPS guidance for 2020 assumes a share count (assuming dilution) of approximately 2.54 billion shares.
A reconciliation of anticipated 2020 GAAP EPS to non-GAAP EPS and the items excluded from non-GAAP EPS are provided in the table below.
$ in millions, except EPS amountsFull-Year 2020
GAAP EPS
$4.58 to $4.73
Difference
1.05
Non-GAAP EPS that excludes items listed below2
$5.63 to $5.78
Acquisition- and divestiture-related costs
$2,500
Restructuring costs
800
Net decrease (increase) in income before taxes
3,300
Estimated income tax (benefit) expense
(640)
Decrease (increase) in net income
$2,660
Earnings Conference Call
Investors, journalists and the general public may access a live audio webcast of the call today at 8:00 a.m. EDT on Merck’s website at https://investors.merck.com/events-and-presentations/default.aspx. Institutional investors and analysts can participate in the call (833) 353-0277 or toll free (469) 886-1947 and using ID code number 2753878. Members of the media are invited to monitor the call by dialing (833) 353-0277 or toll free (469) 886-1947 and using ID code number 2753878. Journalists who wish to ask questions are requested to contact a member of Merck’s Media Relations team at the conclusion of the call.
About Merck
For more than 125 years, Merck, known as MSD outside of the United States and Canada, has been inventing for life, bringing forward medicines and vaccines for many of the world’s most challenging diseases in pursuit of our mission to save and improve lives. We demonstrate our commitment to patients and population health by increasing access to health care through far-reaching policies, programs and partnerships. Today, Merck continues to be at the forefront of research to prevent and treat diseases that threaten people and animals – including cancer, infectious diseases such as HIV and Ebola, and emerging animal diseases – as we aspire to be the premier research-intensive biopharmaceutical company in the world. For more information, visit www.merck.com and connect with us on Twitter, Facebook, Instagram, YouTube and LinkedIn.
Forward-Looking Statement of Merck & Co., Inc., Kenilworth, N.J., USA
This news release of Merck & Co., Inc., Kenilworth, N.J., USA (the “company”) includes “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based upon the current beliefs and expectations of the company’s management and are subject to significant risks and uncertainties. There can be no guarantees with respect to pipeline products that the products will receive the necessary regulatory approvals or that they will prove to be commercially successful. If underlying assumptions prove inaccurate or risks or uncertainties materialize, actual results may differ materially from those set forth in the forward-looking statements.
Risks and uncertainties include but are not limited to, general industry conditions and competition; general economic factors, including interest rate and currency exchange rate fluctuations; the impact of the recent global outbreak of novel coronavirus disease (COVID-19); the impact of pharmaceutical industry regulation and health care legislation in the United States and internationally; global trends toward health care cost containment; technological advances, new products and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approval; the company’s ability to accurately predict future market conditions; manufacturing difficulties or delays; financial instability of international economies and sovereign risk; dependence on the effectiveness of the company’s patents and other protections for innovative products; and the exposure to litigation, including patent litigation, and/or regulatory actions.
The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the company’s 2019 Annual Report on Form 10-K and the company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site (www.sec.gov).
______________1
Net income attributable to Merck & Co., Inc.
2
Merck is providing certain 2020 and 2019 non-GAAP information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors’ understanding of the company’s results and permits investors to understand how management assesses performance. Management uses these measures internally for planning and forecasting purposes and to measure the performance of the company along with other metrics. In addition, senior management’s annual compensation is derived in part using non-GAAP pretax income. This information should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP. For a description of the items, see Table 2a attached to this release.
3
Includes expenses for the amortization of intangible assets and purchase accounting adjustments to inventories recognized as a result of acquisitions, intangible asset impairment charges, and expense or income related to changes in the estimated fair value measurement of liabilities for contingent consideration. Also includes integration, transaction and certain other costs related to business acquisitions and divestitures.
4
Includes the estimated tax impact on the reconciling items.
MERCK & CO., INC. CONSOLIDATED STATEMENT OF INCOME - GAAP (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) (UNAUDITED) Table 1 GAAP % Change GAAP % Change
2Q20
2Q19
June YTD2020 June YTD2019 Sales
$
10,872
$
11,760
-8
%
$
22,929
$
22,575
2
%
Costs, Expenses and Other Cost of sales (1)
3,159
3,401
-7
%
6,471
6,453
0
%
Selling, general and administrative (1)
2,378
2,712
-12
%
4,933
5,138
-4
%
Research and development (1)
2,123
2,189
-3
%
4,331
4,119
5
%
Restructuring costs (2)
83
59
41
%
155
212
-27
%
Other (income) expense, net (1)
(390
)
140
*
(318
)
327
* Income Before Taxes
3,519
3,259
8
%
7,357
6,326
16
%
Taxes on Income (1)
509
615
1,128
820
Net Income
3,010
2,644
14
%
6,229
5,506
13
%
Less: Net Income (Loss) Attributable to Noncontrolling Interests (1)
8
(26
)
8
(79
)
Net Income Attributable to Merck & Co., Inc.$
3,002
$
2,670
12
%
$
6,221
$
5,585
11
%
Earnings per Common Share Assuming Dilution$
1.18
$
1.03
15
%
$
2.45
$
2.15
14
%
Average Shares Outstanding Assuming Dilution
2,536
2,588
2,542
2,596
Tax Rate (3)
14.5
%
18.9
%
15.3
%
13.0
%
* 100% or greater (1) Amounts include the impact of acquisition and divestiture-related costs, restructuring costs and certain other items. See accompanying tables for details. (2) Represents separation and other related costs associated with restructuring activities under the company's formal restructuring programs. (3) The effective income tax rate for the first six months of 2019 reflects a net tax benefit of $360 million related to the settlement of certain federal income tax matters. MERCK & CO., INC. GAAP TO NON-GAAP RECONCILIATION SECOND QUARTER 2020 (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) (UNAUDITED) Table 2a GAAP Acquisition andDivestiture-RelatedCosts (1) RestructuringCosts (2) Certain OtherItems AdjustmentSubtotal Non-GAAP Cost of sales$
3,159
282
25
307
$
2,852
Selling, general and administrative
2,378
163
11
174
2,204
Research and development
2,123
(65
)
31
(34
)
2,157
Restructuring costs
83
83
83
-
Other (income) expense, net
(390
)
63
(16
)
47
(437
)
Income Before Taxes
3,519
(443
)
(150
)
16
(577
)
4,096
Income Tax Provision (Benefit)
509
(73
)
(3)
(27
)
(3)
5
(3)
(95
)
604
Net Income
3,010
(370
)
(123
)
11
(482
)
3,492
Less: Net Income Attributable to Noncontrolling Interests
8
-
8
Net Income Attributable to Merck & Co., Inc.
3,002
(370
)
(123
)
11
(482
)
3,484
Earnings per Common Share Assuming Dilution
$
1.18
(0.14
)
(0.05
)
-
(0.19
)
$
1.37
Tax Rate
14.5
%
14.7
%
Only the line items that are affected by non-GAAP adjustments are shown. Merck is providing certain non-GAAP information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors’ understanding of the company’s results as it permits investors to understand how management assesses performance. Management uses these measures internally for planning and forecasting purposes and to measure the performance of the company along with other metrics. In addition, senior management’s annual compensation is derived in part using non-GAAP pretax income. This information should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP. (1) Amounts included in cost of sales primarily reflect expenses for the amortization of intangible assets recognized as a result of business acquisitions. Amounts included in selling, general and administrative expenses reflect $119 million of expenses related to the company's planned spin-off of Organon & Co., and other acquisition and divestiture-related costs. Amounts included in research and development expenses primarily reflect a reduction in expenses related to a decrease in the estimated fair value measurement of liabilities for contingent consideration. Amounts included in other (income) expense, net, primarily reflect an increase in the estimated fair value measurement of liabilities for contingent consideration related to the termination of the Sanofi-Pasteur MSD joint venture. (2) Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to activities under the company's formal restructuring programs. (3) Represents the estimated tax impact on the reconciling items based on applying the statutory rate of the originating territory of the non-GAAP adjustments. MERCK & CO., INC. GAAP TO NON-GAAP RECONCILIATION SIX MONTHS ENDED JUNE 30, 2020 (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) (UNAUDITED) Table 2b GAAP Acquisition andDivestiture-RelatedCosts (1) RestructuringCosts (2) Certain OtherItems AdjustmentSubtotal Non-GAAP Cost of sales$
6,471
578
93
671
$
5,800
Selling, general and administrative
4,933
441
22
463
4,470
Research and development
4,331
(28
)
48
20
4,311
Restructuring costs
155
155
155
-
Other (income) expense, net
(318
)
52
(16
)
36
(354
)
Income Before Taxes
7,357
(1,043
)
(318
)
16
(1,345
)
8,702
Income Tax Provision (Benefit)
1,128
(231
)
(3)
(34
)
(3)
5
(3)
(260
)
1,388
Net Income
6,229
(812
)
(284
)
11
(1,085
)
7,314
Less: Net Income Attributable to Noncontrolling Interests
8
-
8
Net Income Attributable to Merck & Co., Inc.
6,221
(812
)
(284
)
11
(1,085
)
7,306
Earnings per Common Share Assuming Dilution
$
2.45
(0.32
)
(0.10
)
-
(0.42
)
$
2.87
Tax Rate
15.3
%
16.0
%
Only the line items that are affected by non-GAAP adjustments are shown. Merck is providing certain non-GAAP information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors’ understanding of the company’s results as it permits investors to understand how management assesses performance. Management uses these measures internally for planning and forecasting purposes and to measure the performance of the company along with other metrics. In addition, senior management’s annual compensation is derived in part using non-GAAP pretax income. This information should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP. (1) Amounts included in cost of sales primarily reflect expenses for the amortization of intangible assets recognized as a result of business acquisitions. Amounts included in selling, general and administrative expenses reflect $284 million of expenses related to the company's planned spin-off of Organon & Co., approximately $95 million of costs related to the acquisition of ArQule, Inc., and other acquisition and divestiture-related costs. Amounts included in research and development expenses primarily reflect a reduction in expenses related to a decrease in the estimated fair value measurement of liabilities for contingent consideration. Amounts included in other (income) expense, net, primarily reflect an increase in the estimated fair value measurement of liabilities for contingent consideration related to the termination of the Sanofi-Pasteur MSD joint venture, partially offset by royalty income. (2) Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to activities under the company's formal restructuring programs. (3) Represents the estimated tax impact on the reconciling items based on applying the statutory rate of the originating territory of the non-GAAP adjustments. MERCK & CO., INC. FRANCHISE / KEY PRODUCT SALES (AMOUNTS IN MILLIONS) (UNAUDITED) Table 32020
2019
2Q June YTD 1Q 2Q June YTD 1Q 2Q June YTD 3Q 4Q Full Year Nom % Ex-Exch % Nom % Ex-Exch % TOTAL SALES (1)$12,057
$10,872
$22,929
$10,816
$11,760
$22,575
$12,397
$11,868
$46,840
-8
-5
2
4
PHARMACEUTICAL10,655
9,679
20,334
9,663
10,460
20,123
11,095
10,533
41,751
-7
-6
1
3
Oncology Keytruda3,284
3,388
6,672
2,269
2,634
4,903
3,070
3,111
11,084
29
31
36
38
Alliance Revenue – Lynparza (2)145
178
323
79
111
190
123
132
444
61
62
70
72
Alliance Revenue – Lenvima (2)128
151
279
74
97
171
109
124
404
57
57
63
64
Emend43
33
76
117
121
237
98
53
388
-72
-71
-68
-67
Vaccines (3) Gardasil / Gardasil 91,097
656
1,753
838
886
1,724
1,320
693
3,737
-26
-24
2
4
ProQuad / M-M-R II / Varivax435
378
813
496
675
1,171
623
481
2,275
-44
-43
-31
-30
RotaTeq222
168
391
211
172
383
180
227
791
-2
-1
2
3
Pneumovax 23256
117
373
185
170
355
237
334
926
-31
-29
5
7
Vaqta60
28
88
47
58
105
62
71
238
-52
-51
-17
-14
Hospital Acute Care Bridion299
224
524
255
278
533
284
313
1,131
-19
-18
-2
Noxafil94
73
168
190
193
383
177
103
662
-62
-60
-56
-55
Prevymis60
63
123
32
38
70
45
50
165
66
67
76
78
Primaxin51
64
115
59
71
130
77
67
273
-10
-6
-11
-8
Invanz64
43
108
72
78
150
57
57
263
-45
-39
-28
-24
Cancidas55
43
98
61
67
129
62
58
249
-36
-33
-23
-21
Cubicin46
32
78
88
67
155
52
50
257
-53
-51
-50
-48
Zerbaxa37
32
69
26
27
53
35
32
121
19
23
30
33
Immunology Simponi215
191
406
208
214
422
203
205
830
-11
-8
-4
-1
Remicade88
73
160
123
98
221
101
89
411
-26
-25
-28
-26
Neuroscience Belsomra79
84
163
67
76
143
80
83
306
10
8
14
13
Virology Isentress / Isentress HD245
196
441
255
247
502
250
223
975
-21
-17
-12
-9
Zepatier55
39
94
114
108
221
83
66
370
-63
-62
-57
-56
Cardiovascular Zetia145
137
282
140
156
296
147
146
590
-12
-12
-5
-4
Vytorin53
39
92
97
76
174
57
54
285
-49
-46
-47
-45
Atozet122
115
238
94
92
186
97
108
391
25
28
28
31
Alliance Revenue - Adempas (4)53
79
133
42
51
94
50
60
204
54
54
41
41
Adempas (5)56
57
113
48
53
100
57
57
215
8
9
12
14
Diabetes (6) Januvia774
854
1,628
824
908
1,732
807
943
3,482
-6
-5
-6
-5
Janumet503
490
993
530
533
1,063
503
475
2,041
-8
-5
-7
-4
Women's Health Implanon / Nexplanon195
132
326
199
183
382
199
206
787
-28
-26
-15
-13
NuvaRing63
63
126
219
240
459
241
179
879
-74
-73
-73
-72
Diversified Brands Singulair155
100
255
191
160
352
152
195
698
-38
-37
-27
-26
Cozaar / Hyzaar102
98
200
103
109
213
116
113
442
-10
-7
-6
-3
Arcoxia70
65
135
75
75
149
72
67
288
-13
-9
-9
-7
Nasonex71
49
120
96
72
168
58
67
293
-32
-28
-29
-26
Follistim AQ41
44
85
57
63
121
62
58
241
-31
-30
-29
-28
Other Pharmaceutical (7)1,194
1,103
2,293
1,082
1,203
2,283
1,149
1,183
4,615
-8
-6
2
ANIMAL HEALTH1,214
1,101
2,314
1,025
1,124
2,149
1,122
1,122
4,393
-2
3
8
12
Livestock739
648
1,386
611
671
1,282
726
777
2,784
-3
3
8
13
Companion Animals475
453
928
414
453
867
396
345
1,609
3
7
9
Other Revenues (8)188
92
281
128
176
303
180
213
696
-47
-23
-8
Sum of quarterly amounts may not equal year-to-date amounts due to rounding. (1) Only select products are shown. (2) Alliance Revenue represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs. (3) Total Vaccines sales were $2,155 million and $1,418 million in the first and second quarters of 2020 and $1,887 million, $2,037 million, $2,517 million and $1,928 million for the first, second, third and fourth quarters of 2019, respectively. (4) Alliance Revenue represents Merck's share of profits from sales in Bayer's marketing territories, which are product sales net of cost of sales and commercialization costs. (5) Net product sales in Merck's marketing territories. (6) Total Diabetes sales were $1,353 million and $1,418 million in the first and second quarters of 2020 and $1,402 million, $1,480 million, $1,360 million and $1,472 million for the first, second, third and fourth quarters of 2019, respectively. (7) Includes Pharmaceutical products not individually shown above. (8) Other Revenues are comprised primarily of Healthcare Services segment revenues, third-party manufacturing sales and miscellaneous corporate revenues, including revenue hedging activities.
View source version on businesswire.com: https://www.businesswire.com/news/home/20200731005100/en/
Media:
Pamela Eisele (267) 305-3558 Patrick Ryan (201) 452-2409
Investors:
Peter Dannenbaum (908) 740-1037 Michael DeCarbo (908) 740-1807
1 Year Merck Chart |
1 Month Merck Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions