Germany's Merck KGaA Reports 'Best Ever' Annual Result

Germany-based drug major Merck KGaA has announced its strongest ever annual result and a return to profit in the final quarter of 2004. The company reported that full year post-tax profit tripled to EUR672mn (US$876.35mn), while operating profit in the fourth quarter increased 14.7% to EUR137.1mn (US$178.82mn). Much of the fourth-quarter improvement was attributed to a milestone payment from US drug producer Eli Lilly for the insomnia compound EMD 281014.

The company noted that the annual result was favoured by exceptional items, such as disposals totalling more than EUR300mn (US$391.23mn), against one-off charges totalling EUR66mn (US$86.01mn). The disposals notably included laboratory business VWR.

Revenue from pharmaceuticals was level, growing 4.5% in the year to EUR391mn (US$509.98mn). The company is especially bullish on its new cancer treatment Erbitux, developed jointly with US drugmakers ImClone Systems and Bristol-Myers Squibb. The product's sales were well above expectations at EUR 77 million (US$100.44mn), and it is hoped that the product will support the company's shift into cancer therapies. Merck KGaA's other leading products in the year were the Concor beta-blockers, diabetes medicine Glucophage and its thyroid product line. The company also reported that its generics division performed well, with sales growth on DuoNeb and EpiPen continuing.