Merck KGaA has posted a strong set of figures for the first quarter, driven by sales of its multiple sclerosis blockbuster Rebif and cost cutting.
The Darmstadt, Germany-based group noted that net income leapt 54.1% to 266.0 million euros, while revenues increased 4.4% to 2.76 billion euros. Sales at the Merck Serono drugs unit rose 3.5% to 1.55 billion euros, driven by Rebif (interferon beta-1a) which climbed 6.0% (in terms of organic growth) to 454 million euros, helped by price hikes in North America and increased volume in Europe.
The colorectal/head and neck cancer drug Erbitux (cetuximab) rose 6.6% to 222 million euros, while the fertility drug Gonal-f (follitropin) decreased 4.4% to 145 million euros. Merck's Glucophage (metformin) diabetes products leapt 25.0% to 104 million euros, while the beta blocker Concor (bisoprolol) franchise fell 4.9% to 92 million euros. The growth hormone treatment Saizen (somatropin) was down 8.5% to 54 million euros.
In geographic terms, Merck Serono fared well in the emerging markets (+8.3%) and North America (+5.1), but Europe inched up just 0.7%. The firm said this was a result of "the strained budget situations in several European countries and the resulting health care cost-containment measures [which] left their mark on the business".
The company is undergoing a major reorganisation, most notably with its controversial decision to shut down Merck Serono's Geneva headquarters, and Merck says its 'Fit for 2018' efficiency programme is progressing faster than planned. For 2013, it expects to achieve further savings of around 165 million euros compared to 2012 while incurring related expenses of about 230 million euros.
As such, Merck assumes that guidance for 2014 issued in May 2012 will be achieved this year, ie one year earlier than expected. For 2013, it expects sales of 10.7-10.9 billion euros and earnings before intererest, taxes, depreciation and amortisation of 3.1-3.2 billion euros.