No doubt this is good news — Merck broke the $90-, $100-,and $110-million/quarter barriers, worldwide. However, it seems that Merck is still benefitting from inventory stock-ups on the drug, while most of that has already washed through Vertex’s Incivek® numbers presented last night. The current quarter split, then is about 78-22 in favor of Vertex. That may widen, in later quarters as the stock-up flows out of Merck’s reported sales, here. [Last night, Vertex indicated that it sees about 2.3 weeks of inventory at present in most US locations, but Vertex is still seeing strong growth in scrips. Merck didn’t get into that level of detail on the call this morning.]
Currencies hurt Merck by 3 percent in Q1 2012 (at current rates), not 2 percent — but Merck sees it as a 1 percent item, due to current expectations on hedging decisions. That is slightly good news, but could be just deferring the currency effects into later quarters. Moreover, Merck expects mid-single digit pressure on its pharma prices through all of 2012 — as earlier expected.
Also on a non-GAAP basis, Merck beat at the EPS line by a penny. But I put almost no stock in non-GAAP beats of this sort. It is encouraging that sales were $11.7 billion, but that was about $100 million below the $11.8 billion consensus expectations. Carry-on.