Lower sales for multiple medicines and a whopping charge for a big collaboration in cancer drugs drove Merck & Co. to a third-quarter loss of $56 million.
But the Kenilworth, New Jersey, company beat Wall Street’s muted expectations and it also narrowed, and raised, its outlook for the year.
Merck on Friday reported a loss of 2 cents per share, after posting a profit of $2.18 billion, or 78 cents per share, in 2016’s third quarter.
Adjusted for non-recurring costs, earnings amounted to $1.11 per share. That’s 8 cents better than industry analysts had forecast, according to a survey by Zacks Investment Research.
Merck reported revenue of $10.33 billion in the quarter, down 2 percent from $10.54 a year earlier.
Keytruda sales nearly tripled in the quarter versus a year earlier, hitting $1.05 billion, and sales of hepatitis C-curing Zepatier jumped 185 percent to $468 million. But for Merck’s top-selling portfolio, Type 2 diabetes drugs Januvia and Janumet, sales declined 2 percent to $1.53 billion due to pricing pressure, and the Gardasil vaccine against cancer-causing human papillomavirus had a sales drop of 22 percent, to $675 million. Recent generic competition to former blockbuster cholesterol drugs Zetia and Vytorin halved their sales, to a combined $462 million.
Veterinary medicines brought in $1 billion, up 15 percent.
The latest results included a one-time charge of $2.35 billion for a new partnership with Britain’s AstraZeneca PLC to market their existing cancer drugs and develop new ones.
Merck’s key medicine portfolio revolves around Keytruda, an immuno-oncology drug approved for treating several cancer types that works by enabling the immune system to better spot and kill cancer cells. Merck will now help sell AstraZeneca’s Lynparza, a cancer drug from the new class called PARP inhibitors that’s approved for treating ovarian and fallopian tube cancer. The companies will test those drugs and an unapproved one from AstraZeneca called selumetinib against various cancer types, separately and in combination.
Merck said it now expects full-year earnings in the range of $1.78 to $1.84 including one-time items, up from its prior forecast of $1.60 to $1.72 per share. It expects revenue in the range of $40 billion to $40.5 billion, up from $39.4 billion to $40.4 billion.