Merck KGaA has posted a rise in revenue for the third quarter as it looks to move on from a poor 2011.
The firm has struggled over the past year given the fallout from cladribine, an investigational oral multiple sclerosis drug that was set to become a blockbuster, but was pulled by Merck in June last year after regulators queried its efficacy.
Merck had to pay a $28 million fine at the time and write off the cost of bringing the drug into late-stage trials, whilst also preparing for a future without the blockbuster revenues expected from the treatment. The firm cut around 500 jobs from its pharmaceutical unit in Switzerland in April and 10% of its workforce from Germany, in order to help offset the loss of cladribine, and posted a series of poor quarterly results.
But the firm now appears to be back on track after posting an increase of 12.2% in revenue for the third quarter, with sales reaching 2.84 billion euros. Organic sales growth was just under 6%, with the rest coming from favourable exchange rates and divestments.
Its pharmaceutical unit, Merck Serono, was primarily responsible for the quarter’s growth, and saw its own sales rise by 10.5% to 1.62 billion euros. Again, favourable exchange rates played their part, but organic sales growth was a healthy 5.3 per cent.
Global sales of Merck’s largest single product Rebif, for the treatment of relapsing forms of multiple sclerosis, rose 10.2% organically to 499 million euros in the third quarter driven, by US price increases and slight volume and sales increases in Europe.
But sales of the targeted cancer treatment Erbitux, its second biggest selling treatment, remained flat on an organic basis at 224 million euros.
Karl-Ludwig Kley, chairman of the executive board of Merck, said: “Even in these tough economic times and while in the midst of our own business transformation, Merck is performing well operationally.
“We are especially pleased with the excellent results from our Merck Serono and Performance Materials divisions. We are on track to have a solid year of financial performance in 2012, while making our profitability levels more competitive with our peers.”