Merck & Co Inc (NYSE:MRK) saw strong sales during the second quarter for its cancer drug Keytruda and HPV vaccine Gardasil, leading the pharmaceutical company to raise its full-year guidance.
Keytruda's sales rose by 19% from the previous year, reaching $6.27 billion, while Gardasil saw a significant 47% increase in quarterly sales, driven by higher demand in China.
As a result, Merck raised its full-year sales guidance range to $58.6 billion to $59.6 billion from the previous range of $58.9 billion.
But despite the impressive sales performance, Merck's earnings outlook was impacted by costs related to its acquisition of Prometheus Biosciences Inc, resulting in a reduction of its annual forecast for earnings excluding some items.
The company now expects earnings in the range of $2.95 to $3.05 per share, significantly lower than the previous prediction of $6.88 to $7 per share. Merck bought Prometheus to bolster its drug pipeline ahead of Keytruda's loss of market exclusivity.
Additionally, the company has applied for US approval of sotatercept, a treatment for pulmonary arterial hypertension, which is expected to help offset Keytruda's upcoming patent cliff.
Despite the earnings outlook cut, Merck's strong sales performance for Keytruda and Gardasil has buoyed investor confidence, with the company's shares gaining 1.7% in early trading.
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