Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Merck sees $2.1 billion coronavirus hit to 2020 sales

Stock Markets Apr 28, 2020 11:26AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: The Merck logo is seen at a gate to the Merck & Co campus in Linden, New Jersey

By Manas Mishra

(Reuters) - Merck & Co Inc (N:MRK) said on Tuesday it expects the coronavirus pandemic to reduce 2020 sales by more than $2 billion, and the U.S. drugmaker lowered its profit forecast as a big drop in doctors' office visits during the outbreak will take a hefty toll, sending its shares down more than 3%.

Many of Merck's top-selling products, including blockbuster cancer drug Keytruda, are administered by physicians.

Rival drugmakers Pfizer Inc (N:PFE) on Tuesday stuck to its forecasts, and Eli Lilly and Co (N:LLY) raised the top end of its 2020 profit outlook last week.

But Merck is particularly vulnerable to stay-at-home efforts to curb the spread of the coronavirus and people avoiding doctors and hospitals over fear of becoming infected.

"Two-thirds of our products are physician administered, and that is probably somewhat unique and is causing the impact," Chief Financial Officer Robert Davis said on a conference call.

Davis said he expected most of the hit to Merck's business in the second quarter, with a potential for recovery by the end of the year as restrictions imposed due to the pandemic abate.

The company, which also suspended its share buyback program, now expects full-year adjusted profit of $5.17 to $5.37 per share, down from its prior view of $5.62 to $5.77.

Johnson & Johnson (N:JNJ), whose large medical device business will be hurt by delayed elective surgeries during the pandemic, also lowered its 2020 profit forecast this month.

"Strong underlying demand for Merck's products will lead to a sales rebound in 2021 as the pandemic eventually ebbs," said Michael Levesque, senior vice president of Moody's (NYSE:MCO).

Merck beat analysts' first-quarter profit and sales estimates on increased demand for Keytruda, largely before the coronavirus epidemic put most of the country under stay-at-home orders.

Keytruda sales jumped 45% to $3.28 billion. Total sales grew 11.5% to $12.06 billion, beating estimates of $11.46 billion, according to IBES data from Refinitiv.

Merck said it saw a slight benefit as customers stocked up on some of its products, including animal health drugs and its Gardasil vaccine to prevent cancers associated with the human papillomavirus.

Merck said it was working on a coronavirus vaccine, and was in discussions with multiple groups regarding three separate potential viral vaccine platforms. It said it would announce the details of those collaborations once they are finalized.

Excluding items, Merck earned $1.50 per share, beating analysts' average estimate by 16 cents.

Merck shares were down 3.4% at $81.12.

Merck sees $2.1 billion coronavirus hit to 2020 sales

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email