Merck CEO on upbeat guidance: ‘our COVID pill will make a meaningful difference’

Merck & Co Inc (NYSE: MRK) reported its financial results for the third quarter on Thursday that beat Wall Street estimates. Shares of the pharmaceutical company were up 2.0% in premarket trading on upbeat guidance for the full year.

Highlights from CEO Davis’ interview with CNBC’s ‘Squawk Box’

On CNBC’s “Squawk Box”, CEO Robert Davis agreed that the pandemic situation was improving but reiterated that he saw opportunity in Merck’s COVID-19 pill.

While some of the numbers around COVID-19 are improving, it’s still having a grievous impact globally. So, we believe that our antiviral drug will make a meaningful difference. We’re working with the FDA to get the approval as quickly as possible.

The FDA advisory committee is scheduled to meet in late November to decide on Merck’s COVID-19 pill. Upon approval, Davis disclosed, Merck is in a position to deliver 10 million courses of the oral drug by the end of 2021 and over 20 million next year.

Full-year guidance

For fiscal 2021, Merck forecasts up to $5.70 of adjusted EPS on $47.4 billion to $47.9 billion in revenue, as per the earnings press release.

In comparison, analysts are calling for $5.63 of adjusted per-share earnings on $47.60 billion in sales.

Q3 financial performance

Merck said its net income printed at $4.57 billion that translates to $1.80 per share. In the same quarter last year, its net income was capped at $2.94 billion or $1.16 per share. Adjusted for one-time items, the drugmaker earned $1.75 a share.

The American multinational generated $13.15 billion in sales that represents an annualised growth of 20.4%. According to FactSet, experts had forecast $1.55 of adjusted EPS on $12.32 billion in sales.

Merck saw a sharp recovery in all of its businesses, with pharmaceutical sales up 18.3%, Keytruda sales up 22%, animal health sales up 16.1%, and the vaccine business up 68% in Q3.