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March 6, 2013

Merck’s profits more than double as Rebif demand rises

Merck's profits rose by 104% in the second quarter, helped by rising demand for MS drug Rebif and accelerated costs cuts.

By Nikitha Ladda

Merck

Merck’s profits rose by 104% in the second quarter, helped by rising demand for MS drug Rebif and accelerated costs cuts.

Net profit stands at €271.8m for final quarter of 2012, compared to €132.9m in the same period last year.

Merck’s largest single product, Rebif, for the treatment of relapsing MS, grew by 7.5% to €1.8bn, largely due to price increases for the drug in the US.

Profits were also boosted by the German pharmaceutical company’s restructuring programme, Fit for 2018, which contributed to €115m in net savings in 2012.

Merck is axing 10% of its workforce and closing facilities as part of the programme following previous set backs for key medicines,including Rebif, and declining sales of targeted cancer treatment Erbitux.

Two-thirds of the restructuring costs of €504m incurred in 2012 were reported in the Merck Serono division based in Geneva, where the workforce is set to halve and the headquarters will close.

The group plans to save €385m by 2018, up by € 20m from the previous estimate.

For the full year, revenues rose 8.7% to €11bn, while fourth quarter revenues were up 8% to €2.8bn. Earnings before interest increased by 8.9% to €2.9bn in 2012 and by 16% to €790m in the fourth quarter.


Image: Merck’s headquarters in Darmstadt, Germany. Photo: Courtesy of Merck.

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