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FOR IMMEDIATE RELEASE
|Media Contact:||Patrick Ryan||Investor Contacts:||Peter Dannenbaum|
|(973) 275-7075||(908) 740-1037|
Merck Announces Fourth-Quarter and Full-Year 2020 Financial Results
|·||Fourth-Quarter 2020 Worldwide Sales Were $12.5 Billion, an Increase of 5%|
|·||Fourth-Quarter 2020 GAAP Loss per Share Was $0.83, Reflecting Charges Related to Acquisitions and Intangible Asset Impairments; Fourth-Quarter Non-GAAP EPS Was $1.32|
|·||Full-Year 2020 Worldwide Sales Were $48.0 Billion, an Increase of 2%; Excluding the Impact from Foreign Exchange, Sales Grew 4%|
|o||KEYTRUDA 2020 Worldwide Sales Grew 30% to $14.4 Billion|
|o||BRIDION 2020 Worldwide Sales Grew 6% to $1.2 Billion; Excluding the Impact from Foreign Exchange, Sales Grew 7%|
|o||Animal Health 2020 Worldwide Sales Grew 7% to $4.7 Billion; Excluding the Impact from Foreign Exchange, Sales Grew 10%|
|·||Full-Year 2020 GAAP EPS Was $2.78, Reflecting Charges Related to Acquisitions, Collaborations and Intangible Asset Impairments; Full-Year Non-GAAP EPS Was $5.94|
|·||2021 Financial Outlook|
|o||Anticipates Full-Year 2021 Worldwide Sales to Be Between $51.8 Billion and $53.8 Billion, Including a Positive Impact from Foreign Exchange of Approximately 2%|
|o||Expects Full-Year 2021 GAAP EPS to Be Between $5.52 and $5.72; Expects Non-GAAP EPS to Be Between $6.48 and $6.68, Including a Positive Impact from Foreign Exchange of Approximately 3%|
|o||Changes to the Treatment of Certain Items for Purposes of Non-GAAP Reporting to Begin in 2021|
|·||Expects Organon & Co. Spinoff in Late Second-Quarter 2021|
KENILWORTH, N.J., Feb. 4, 2021 – Merck (NYSE: MRK), known as MSD outside the United States and Canada, today announced financial results for the fourth quarter and full year of 2020.
“Despite extraordinary challenges brought on by the COVID-19 pandemic, Merck achieved solid growth and made meaningful progress in our pipeline in 2020. We remain focused on our science-led strategy and are confident that this approach will continue to deliver value to patients and shareholders,” said Kenneth C. Frazier, chairman and chief executive officer, Merck. “Our scientists continue to advance our internal pipeline of promising medicines and vaccines, including in oncology, HIV, and pneumococcal disease, and, more recently, therapeutics for COVID-19. These pipeline developments provide us with increasing line-of-sight to significant potential growth drivers later this decade and into the next.”
|Fourth Quarter||Year Ended|
|$ in millions, except EPS amounts||2020||2019||Change||Change|
|GAAP net (loss) income1||(2,094||)||2,357||*||*||7,067||9,843||-28||%||-25||%|
|Non-GAAP net income that excludes certain items1,2**||3,350||2,978||12||%||16||%||15,082||13,382||13||%||16||%|
|Non-GAAP EPS that excludes certain items2**||1.32||1.16||14||%||17||%||5.94||5.19||14||%||17||%|
*Greater than 100%.
**Refer to table on page 12.
GAAP (generally accepted accounting principles) (loss) earnings per share assuming dilution (EPS) was $(0.83) for the fourth quarter and $2.78 for the full year of 2020. Non-GAAP EPS was $1.32 for the fourth quarter and $5.94 for the full year of 2020. GAAP EPS for the fourth quarter and full year of 2020 reflect a $2.7 billion charge for the acquisition of VelosBio Inc. (VelosBio). The fourth quarter and full year of 2020 also include a $1.6 billion pretax intangible asset impairment charge related to ZERBAXA (ceftolozane and tazobactam), resulting from a recall in December 2020 and a temporary suspension of sales which reduced expected future cash flows of this product. In addition, the full year of 2020 reflects pretax charges of $1.1 billion related to certain license and collaboration agreements. Non-GAAP EPS excludes the charges noted above, other acquisition- and divestiture-related costs, restructuring costs and certain other items. Refer to the GAAP to non-GAAP reconciliation table on page 12 for further details.
COVID-19 Research Highlights
Building on the company’s experience with antivirals, Merck advanced its scientific programs in an effort to help combat SARS-CoV-2, specifically:
|·||Molnupiravir (also known as MK-4482) – Merck continued the clinical development of molnupiravir, an orally available antiviral candidate for the treatment of COVID-19, in collaboration with Ridgeback Biotherapeutics LP. It is currently being evaluated in Phase 2/3 clinical trials in both the hospital and outpatient settings. The primary completion date for the Phase 2/3 studies is May 2021. The company anticipates interim efficacy data in the first quarter of 2021.|
1 Net (loss) income attributable to Merck & Co., Inc.
2 Merck is providing certain 2020 and 2019 non-GAAP information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors’ understanding of the company’s results and permits investors to understand how management assesses performance. Management uses these measures internally for planning and forecasting purposes and to measure the performance of the company along with other metrics. In addition, senior management’s annual compensation is derived in part using non-GAAP pretax income. This information should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP. For a description of the items, see Tables 2a and 2b attached to this release.
The following information was filed by Merck Co., Inc. (MRK) on Thursday, February 4, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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