Merck & Co has posted a healthy set of financials for the fourth quarter, despite suffering a slide in sales of its cholesterol drugs Vytorin and Zetia.

Net income came in at $1.6 billion, up from a loss of $1.6 billion in the like, year-earlier period when the company booked a $4.85 billion charge related to the settlement of lawsuits to do with the painkiller rofecoxib. Sales were down 3% to $6 billion but this was ahead of analyst forecasts.

Sales of Vytorin (ezetimibe plus simvastatin) and Zetia (ezetimibe) sank 26% to $1.1 billion, while sales of the asthma drug Singulair (montelukast) slipped 3% to $1.1 billion, due in part to concerns about a potential (yet unproven) link to suicidal behaviour. Revenues from the anti-hypertensives, Cozaar (losartan) and Hyzaar (losartan plus hydrochlorothiazide) were down 1% to $881 million, while sales of the osteoporosis drug Fosamax (alendronate) slumped 60% to $318 million, following the loss of patent protection in the USA.

On the plus side, the diabetes drug Januvia (sitagliptin) generated $413 million for the quarter, up 64%, while Janumet (sitagliptin plus metformin) brought in $120 million, up from $44 million last year. Turnover from the recently-launched HIV drug Isentress (raltegravir) reached $130 million, while the rotavirus vaccine Rotateg brought in $162 million, up 9%. However, sales of the cervical cancer jab Gardasil were down 16% to $286 million.

Merck reiterated its financial outlook for 2009 of earnings per share of $2.95-$3.17 on revenues of $23.7-$24.2 billion. Chief executive Richard Clark said that in 2008 “we improved efficiencies, managed through a dramatically changing industry environment and took actions designed to better position Merck for success”. He added that the firm will “pursue growth through initiatives such as Merck BioVentures and emerging markets as well as the right strategic opportunities”.

Speaking on a conference call, when asked about Merck’s acquisition strategy, he said “I wouldn’t rule anything out…I don’t think in today’s world, any CEO can categorically rule out any type of transaction”.