Merck topped Wall Street's first-quarter forecasts Thursday while Bristol Myers Squibb delivered a mixed performance. Merck stock swung to a gain while and BMY stock toppled.
Cancer treatments Keytruda and Opdivo helped drive growth for Merck and Bristol, respectively. Keytruda sales continued to dominate, surging 20% to nearly $5.8 billion, while Opdivo sales popped 15% to $2.2 billion. Both drugs easily beat analyst views.
The Merck beat also came on the back of Gardasil, a human papillomavirus vaccine that brought in $1.97 billion in sales, rocketing 35%. Meanwhile, the bestselling drug from Bristol Myers was Eliquis, a blood thinner that generated $3.42 billion. Eliquis sales increased 7%.
Both companies also had steep declines to overcome. Sales from Merck's Covid pill Lagevrio and Bristol's cancer treatment Revlimid experienced double-digit declines. Lagevrio is struggling as Covid cases reported to the Centers for Disease Control and Prevention peaked in January and have since trended lower. Revlimid is facing new generic competition.
On today's stock market, Merck stock turned deficit into gain and ended the trading session up 1.5% at 115.16. BMY stock finished a fraction lower at 67.61.
Merck Stock: Lighter Declines
Overall, Merck's adjusted profit skidded 35% to $1.40 per share and sales toppled 9% to $14.49 billion. Excluding the impact of exchange rates, earnings fell 30% while sales dipped 5%.
But Merck stock analysts expected much steeper declines to adjusted earnings of $1.32 a share and $13.79 billion in sales, according to FactSet. Further, excluding the impact of Covid pill Lagevrio and exchange rates, sales grew 15%.
Lagevrio sales took a tumble, down 88% to $392 million. This "painfully (underscores) the transition to a post-pandemic environment," said Lee Brown, global sector lead for health care at research firm Third Bridge, in a note to clients.
Merck isn't the only company feeling the Covid decline. On Wednesday, GSK and Roche posted first-quarter declines for their Covid-related products after Covid cases reported in the U.S. dropped early in the quarter.
In addition to the Lagevrio decline, sales of Merck's diabetes drug Januvia slumped 29% to $880 million. Sales missed forecasts for $923 million. Merck noted it's facing competition in diabetes abroad, particularly in Europe. Revenue also fell due to lower demand and pricing in the U.S.
Merck raised its outlook for the year and now expects $57.7 billion to $58.9 billion in sales, in line with Merck stock analyst calls for $58.33 billion. The company also raised its adjusted profit prediction to $6.88-$7 per share. The midpoint of Merck's outlook beat forecasts for $6.91.
Merck stock recently broke out of a consolidation with a buy point at 115.59, MarketSmith.com shows.
BMY Stock: 'Rather Lackluster' Report
Bristol Myers is struggling to overcome sales declines for its generics-facing medicines, Revlimid and fellow cancer drug Abraxane, Brown said in a separate note.
"Bristol's overall performance across its portfolio unfortunately felt rather lackluster, despite management's characterization as a solid showing, as many product lines fell short of expectations with the notable exception of Eliquis and Opdivo, where results were essentially in line," he said.
Across all products, Bristol's sales sank 3% to $11.34 billion. BMY stock analysts expected slightly higher sales at $11.5 billion, according to FactSet. Adjusted earnings rose 5% to $2.05 per share, and topped forecasts for $1.97.
But Revlimid sales plummeted 37% to $1.75 billion, while Abraxane revenue climbed 12% to $239 million.
Bristol Myers retained its guidance for the year and expects sales to increase 2%. The company also projects adjusted profit of $7.95-$8.25 per share. BMY stock analysts forecast $46.86 billion in sales, up 1.5%, and $8.05 in adjusted earnings per share.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
