MRK Merck and Co Inc

Merck & Co. posted a revenue decline as generic competition and currency fluctuations hurt its results.

Merck said it expects 2016 adjusted earnings per share of between $3.65 and $3.77, compared with its previous projection of $3.60 to $3.75. It expects revenue to be between $39 billion and $40.2 billion, raising the lower end of its guidance by $300 million. Analysts polled by Thomson Reuters had expected earnings of $3.71 a share on revenue of $39.85 billion.

The change in the earnings-per-share expectations reflects favorable exchange rates, which were partially offset by an earlier-than-anticipated entry of a generic competitor to allergy-symptom treatment Nasonex.

Nasonex sales fell 21% in the first quarter from the year prior. A generic version of the treatment became available in the U.S. in March, and the company said it expects significant losses in future sales.

Sales of Remicade, a treatment for inflammatory diseases, decreased 30% because of a loss of exclusivity and the accelerating impact of competition by biosimilar drugs.

The quarter's pharmaceutical revenue declined 2% to $8.1 billion, including an 4% negative impact from currency fluctuations. The constant-currency growth was driven by growth in cancer treatments, hospital acute care and diabetes treatments.

Combined sales of Type 2 diabetes treatments Januvia and Janumet increased 4% on a constant-currency basis.

Cancer drug Keytruda posted sales of $249 million in the most recent quarter compared with $83 million in the same quarter last year. Merck is continuing to develop and launch the drug for different types of cancers and its development program includes 30 tumor types across more than 250 clinical trials.

In January, the U.S. Food and Drug Administration approved Merck's new treatment, Zepatier, for hepatitis C, the latest entrant in a booming market for drugs for the viral infection—a market now dominated by Gilead Sciences Inc. Merck had initial sales of $50 million for Zepatier in the first quarter.

The company posted a profit of $1.13 billion, or 40 cents a share, up from $953 million, or 33 cents a share, a year prior. Excluding restructuring and acquisition-related costs, per-share earnings rose to 89 cents from 85 cents. Sales slipped 1.2% to $9.31 billion.

Analysts had forecast per-share earnings of 85 cents a share on revenue of $9.46 billion.

Shares, which have grown 11% in the last three months, were inactive in premarket trading.

Write to Austen Hufford at austen.hufford@wsj.com

(END) Dow Jones Newswires

May 05, 2016 08:05 ET (12:05 GMT)

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