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Merck & Co. (MRK) predicted first-quarter earnings that fell short of Wall Street's targets, citing the impact from fluctuating currencies, but backed its forecast for the full year.
The Whitehouse Station, N.J., drug maker reiterated expectations its 2012 sales will be flat or down, with currency impacts dinging the results. Merck faces the loss this year of U.S. patent protection for its top-selling drug, the asthma and allergy treatment Singulair.
The company, like its rivals, has been cutting costs and hopes to soften the hit from generic competition with sales growth for other drugs it still sells exclusively.
Tuesday, Merck predicted earnings of 95 cents to 98 cents a share for the current quarter, shy of the $1.01 per-share profit expected by analysts in a Thomson Reuters poll.
Shares slipped 1.5% to $37.86 in early-afternoon trading, roughly in line with a broader market sell-off amid readings of soft global economic growth.
The company said it expects currency fluctuations to reduce sales by 1% to 2% in the first quarter, based on an exchange rate of $1.31 per euro.
"Because [currency] moves around a lot, what's bad this quarter could be different next quarter," said Les Funtleyder, manager of the Miller Tabak Health Care Transformation Fund, which owns Merck shares.
Funtleyder said investors don't appear to be fretting over the current-quarter guidance and that he's more concerned with the outlook for Merck's pipeline.
-By Matt Jarzemsky and Mia Lamar, Dow Jones Newswires; 212-416-2240; firstname.lastname@example.org