Ahead of a keenly-awaited R&D meeting for investors next week, Merck & Co has been spelling out its sales and earnings forecasts for this year and 2007, which are sound but unspectacular.
For 2006, earnings per share are expected to be $2.48-$2.52, rising next year to $2.51-$2.59 excluding restructuring charges, a forecast that analysts had predicted. However, the company noted that the guidance does not reflect reserves for any potential liability relating to Vioxx (rofecoxib) litigation or any acquired research expense connected to the acquisition of Sirna Therapeutics.
The rise in earnings for next year will be driven by “continued growth in newer franchises,” including the vaccines Gardasil for cervical cancer, Rotateq for preventing childhood diarrhoea and Zostavax, which targets the
virus that causes shingles, and its new diabetes drug Januvia (sitagliptin).
The company also released 2007 sales predictions for some better-established products: $3.7-$4 billion for asthma drug Singulair (montelukast); $3.1-$3.4 billion for the antihypertensive Cozaar/Hyzaar (losartan); and $2.6-$2.9 billion for the osteoporosis drug Fosamax (alendronate).
In the longer-term, chief executive Richard Clark said that the present portfolio of drugs, along with “anticipated new product introductions and cost-savings initiatives, will help position us to deliver compound annual double-digit earnings growth, excluding charges and one-time items, by 2010.”
Merck also noted that, as part of a restructuring programme announced in November 2005, it remains on track to eliminate 7,000 jobs by the end of 2008, and that around 3,900 positions have already been eliminated.
* A long-term follow-up study published in the online edition of the British Journal of Cancer shows that Gardasil prevented 100% of pre-cancerous cervical lesions and genital warts related to human papillomavirus types 6, 11, 16 and 18 for up to five years, compared to placebo.