Drugmaker Merck & Co. (NYSE:MRK) Friday posted a 2 per cent rise in third-quarter earnings as reduced spending on overheads offset lower sales caused by new generic competition for its key Singulair drug.
The company is the maker of the asthma and allergy pill Singulair as well as Januvia, used in the treatment of diabetes.
For the three months ended September 30, net income was $1.73 billion, or 56 cents per share, up from $1.69 billion, or 55 cents from a year earlier.
Excluding charges, net income was $2.93 billion, or 95 cents per share, 2 cents more than analysts expected.
Revenue was $11.5 billion, down 4 per cent. Analysts had expected revenue of $11.57 billion.
"Our strong global sales this quarter offset the impact of the Singulair patent expiry in the U.S.," said Merck chairman and CEO Kenneth C. Frazier said.
"We will continue to drive value for our customers and shareholders through Merck’s four-part strategy of executing on our core business, expanding geographically in high-growth markets, extending our complementary businesses and excelling at managing our costs while investing for growth.
"With our robust pipeline, we remain on target to submit multiple new products for marketing approval between now and the end of 2013, including suvorexant for insomnia, odanacatib for osteoporosis and Tredaptive for multiple lipid parameters."
As it came off patent, sales of asthma and allergy pill Singulair dropped 55 per cent to $602 million.
Januvia sales rose 15 per cent to $975 million. Sales of Gardasil, a vaccine against HPV, rose 31 per cent to $581 million.
Sales increased for cholesterol drug Zetia, diabetes drug Janumet, shingles vaccine Zostavax and HIV drug Isentress. Sales decined for anti-inflammatory drug Remicade, cholesterol drug Vytorin and hypertension drugs Cozaar and Hyzaar.
Merck's animal health revenues declined 1 per cent to $815 million and consumer care sales rose 7 per cent to $451 million.
As with other pharma companies, Merck is facing sales erosion from patent expirations for top-selling drugs.
The company also working to bring new products to the market to help offset revenue lost to expired patents. Merck recently presented positive results from clinical trials of experimental treatments for insomnia and osteoporosis.
Merck also narrowed its 2012 profit forecast, to a range of $2.08 to $2.24 per share, from its July forecast of $2.04 to $2.30.