Merck swings to loss as it books charge on $10.8 billion acquisition of Prometheus Biosciences

Excluding that charge, the company’s adjusted loss per share was $2.06, narrower than the loss of $2.18 forecast by FactSet analysts.

Sales rose 3% to $15.035 billion from $14.593 billion a year ago, also ahead of the $14.442 billion FactSet consensus.

Earnings were hit by a slump in sales of the company’s COVID antiviral Lagevrio, which fell 83% to $203 million, as the world has increasingly moved on from the pandemic. Lagevrio is an oral antiviral authorized for treatment of mild to moderate COVID.

Pfizer Inc.
PFE,
-1.25%
also got hit in the quarter by a slump in demand for its COVID products — its vaccine and its antiviral Paxlovid.

Sales of Merck’s Keytruda cancer treatment rose 19% to $6.3 billion, while sales of the human papillomavirus vaccine Gardasil rose 47% to $2.5 billion.

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Overall, pharmaceutical sales rose 6% to $13.5 billion, while animal-health revenue fell 1% to $1.46 billion.

The company is expecting the acquisition of Prometheus to accelerate its presence in immunology and diversify its pipeline.

Prometheus is a clinical-stage biotechnology company focusing on autoimmune treatments, such as PRA023, a treatment under development for illnesses such as ulcerative colitis and Crohn’s disease.

Merck is now expecting full-year sales of $58.6 billion to $59.6 billion, while FactSet analysts expect $58.7 billion. Merck expects its full-year adjusted EPS to range from $2.95 to $3.05, compared with a FactSet consensus of $2.90.

The stock is down 3.9% in the year to date, while the S&P 500
SPX,
-0.27%
has gained 19.5%.

Also see: Moderna, Merck combo cancer-vaccine treatment shows ‘significant’ promise