BIG PHARMA EARNINGS WATCH: MERCK, NOVARTIS & PFIZER
Big Pharma Giants Continue to Outpace Expectations After Hiking Prices
New first quarter earnings reports released this week from Big Pharma giants Merck, Novartis and Pfizer demonstrate yet again that price hikes continue to support cushy profits for brand name drug companies. All three pharmaceutical manufacturers beat Wall Street expectations for the first quarter of 2020.
Merck reported sky-high sales this week, beating Wall Street expectations.
- This quarter, Merck reported a sales bump of 11.5 percent to $12.06 billion – beating expectations.
- Strong sales were driven by cancer drug Keytruda which jumped 45 percent in Q1 to $3.28 billion.
- Net income rose to $3.22 billion, up from $2.92 billion a year earlier.
Novartis also kept the good times rolling by growing sales this quarter.
- The brand name company saw sales ‘climb’ this quarter to $12.3 billion.
- The drug maker also saw core net income rise a whopping 34 percent to $3.55 billion.
- Novartis’ boasted sales were driven by block buster drugs, skin and arthritis drug Cosentyx, Zolgensma and heart drug Enresto.
- Cosentyx, Novartis’ biggest drug, contributed $930 million, Entresto contributed $569 million and Zolgensma contributed $170 million.
Pfizer also reported strong earnings.
- Pfizer reported adjusted earnings of $4.51 billion – topping analysts’ expectations.
- The brand name drug company posted $12.03 billion in Q1 sales, also beating analysts’ expectations.
- Sales of Pfizer’s patent-protected medicines increased 11 percent to $10 billion.
- Top-selling blood-thinner drug Eliquis posted a 29% increase in Q1 sales.
And while price-gouging American patients is keeping profits high for Pfizer, the introduction of a generic version to the company’s block buster pain medication Lyrica demonstrates how increased competition in the marketplace is working elsewhere to lower prices.
Sales of Lyrica dipped 37 percent this quarter after the drug began facing generic competition last year — providing patients with more affordable alternatives.
The strong earnings reports come as all three companies have continued to hike prices on their prescription drugs.
- Already this year Merck has jacked up prices 45 times, including on diabetes medicines Januvia and Janumet and block-buster cancer drug Keytruda.
- In November, Merck had jacked-up the price of five drugs – including Keytruda and Gardasil – in a move that was described as “a critical part of pharma’s business models.”
- The brand name company also raised the price of HIV therapy treatment Insentress this past summer by five percent.
- Novartis rang in 2020 by hiking the prices 17 times an average of 6.2 percent. And in 2019, the company increased the price of a whopping 58 drugs.
- The company hiked the price of its blockbuster drug Cosentyx in 2019 by a staggering 10 percent.
- And Novartis increased the price of Entresto in 2019 three times by an average of 10 percent.
- Meanwhile, Zolgensma, a drug used to treat spinal muscular atrophy is the world’s most expensive drug, at $2.13 million per patient.
- Pfizer has already hiked the prices of 126 drugs this year.
- Breakout drug Vyndaqel is estimated to “become among the most costly cardiovascular treatments ever,” according to the Institute for Clinical and Economic Review (ICER).
- Pfizer has already hiked the price of Eliquis by 6 percent, Ibrance by 5 and Xeljanz by 5 percent this year.
- Price hikes on Lyrica were not supported by new clinical evidence and accounted for an unnecessary increase in U.S. drug spending of nearly $700 million from 2017-2018 according to ICER.
See how other brand name drug makers Sanofi, Eli Lilly, Roche and Johnson & Johnson beat Wall Street expectations after hiking prices on American patients HERE, HERE, HERE and HERE.
Stay tuned this week as we continue to monitor Q1 earnings announcements from brand name drug companies.