NEW YORK (CNN/Money) -
Merck & Co., which makes the cholesterol drug Zocor and the arthritis treatment Vioxx, reported a slight drop in second-quarter earnings Friday that met estimates and said it expects to top Wall Street profit forecasts for the rest of the year.
Shares of Merck (MRK: up $0.29 to $42.29, Research, Estimates) were the only Dow Jones industrial average component to rise Friday.
The drugmaker posted net income of $1.75 billion, or 77 cents a share, in line with the consensus analyst forecast from earnings tracker First Call but down from $1.82 billion, or 78 cents a share, in the year-earlier period.
Revenue rose to $12.8 billion from $11.89 billion a year earlier, edging First Call's forecast of $12.75 billion. The company said sales rose 14 percent for its five key drugs, helping it to overcome the effect of some patent expirations during the quarter.
Looking ahead, the company repeated earlier guidance that it expects earnings per share for the year to meet 2001's EPS of $3.14. The First Call forecast calls for 2002 EPS of $3.12.
Merck also said it is comfortable with the First Call range of analyst EPS estimates for the third quarter of 81 to 85 cents. The consensus third-quarter forecast is for EPS of 83 cents.
The company has faced criticism recently over it counting prescription co-payments paid by clients of its prescription benefits management subsidiary Merck-Medco as revenue, even though the money was retained by member pharmacies instead of reaching the company. The company defended the practice again Friday, saying it had been approved by the Securities and Exchange Commission as it reviewed filings for a planned initial public offering of the unit.
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Merck has delayed the Medco IPO, but said that was due to market conditions, not questions about its accounting. It said it remains committed to the IPO within a year.