We all knew that losing patent protection on Fosamax would cut into Merck's sales next year. We just didn't know how much. Now we do, or at least we know Merck's best estimate: about $1.8 billion. The drug maker issued its initial earnings outlook for 2008 today, and in it specifies Fosamax sales at $1.1 billion to $1.4 billion, down from $2.9 billion to $3.1 billion in 2007.
But Merck expects overall sales to grow by 4 percent to 6 percent through 2010, with a gross margin in 2008 of 77 percent to 78 percent. What drugs will account for this growth? Singulair, for one, and Cozaar/Hyzaar blood pressure meds for another. Vaccines will also contribute to growth. Analysts weren't thrilled with the numbers, though; overall, the forecast fell below market expectations.
Meanwhile, the drug maker is paying $670 million to settle claims that it sold drugs to Medicaid at inflated prices. At issue is "nominal pricing," in which Merck gave big discounts to hospitals that helped grow market share on certain drugs--but didn't give the same discounts to Medicaid as it's required to do.
- see the release from Merck
- read the Wall Street Journal story
- get more on Merck's nominal pricing in the Wall Street Journal's Health Blog
ALSO: Take a look at Merck's pipeline. Report