Strong sales of drugs, vaccines, propel Merck in 3rd quarter

Surging sales of cancer medicines and reduced spending helped Merck overcome a big hit from the coronavirus pandemic and increase its profit 12% in the second quarter.  PHOTO CREDIT: Seth Wenig

KENILWORTH, N.J. — Drugmaker Merck boosted its third-quarter profit by 55% and blew past Wall Street expectations, due to slightly higher sales, restrained spending and a small, one-time gain.

The company said it’s making progress on three efforts to combat the coronavirus pandemic: two different vaccines and an antiviral drug.

The maker of cancer blockbuster Keytruda today reported net income of $2.94 billion, or $1.16 per share, up from $1.9 billion, or 74 cents per share, a year earlier.

Earnings, adjusted for non-recurring costs and costs related to mergers and acquisitions, came to $1.74 per share. Analysts only expected $1.44 per share, according to a survey by Zacks Investment Research.

Merck reported revenue of $12.55 billion, also easily beating analyst projections for $12.26 billion.

Sales of prescription drugs totaled $11.32 billion, up 2%. Keytruda brought in nearly one-third of that at $3.72 billion, up 21% from a year ago. Januvia and Janumet diabetes pills brought in $1.33 billion, up 1%.

Sales of its pneumonia vaccine, Pneumovax 23, jumped 58% to $375 million, because people concerned about catching COVID-19 and suffering complications have been getting flu and pneumonia shots to help protect themselves.

Merck narrowed and raised its full-year profit forecast. It now expects full-year earnings in the range of $5.91 to $6.01 per share, with revenue in the range of $47.6 billion to $48.6 billion.

Merck shares have dropped 13% since the beginning of the year, while the S&P 500 index has climbed slightly more than 5%. The stock has declined 4.5% in the past 12 months.