Merck released earnings, and cut its forecasts. No wonder. Its Q1 numbers were atrocious.

Revenue  for the first quarter of 2009 was $5.4 billion, a decrease of 8%compared to the first quarter of 2008. Net income for the period was $1.4 Billion, compared with $3.3 billion in the first quarter of 2008.

Merck is showing the effects of being part of the Big Pharma world where nothing is likely to go right over the next few years, as drugs go off patent and have to compete with generics. Recent R&D efforts have not yielding results to offset that.

As part of the grim report the loss of U.S. marketing exclusivity of FOSAMAX  negatively affected sales performance by 3% in the quarter.  Merck’s blockbusters showed real signs of age. Combined global sales of ZETIA and VYTORIN , as reported by the Merck/Schering-Plough partnership, were $945 million for the first quarter of 2009, representing a 23 percent decline compared with the first quarter of 2008.  Global sales of Merck’s antihypertensive medicines, COZAAR  and HYZAAR²  were $839 million for the first quarter of 2009, representing a 1% decrease. And Merck’s cervical cancer vaccine, GARDASIL (HPV) drug posted total sales as recorded of $262 million for the first quarter of 2009, a 33% decline from the same quarter in 2008.

The major Merck drugs are showing tremendous wear and tear.

Merck said it is reducing its guidance for full-year 2009 revenue to $23.2 billion to $23.7 billion. The firm added that all of the 2009 guidance provided excludes contributions from Schering-Plough that would result from the merger and any costs incurred upon closing of the merger, which is expected to occur in the fourth quarter.

The light at the end of the company’s tunnel has burned out.

Douglas A. McIntyre

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