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Pharma Earnings: Q4 Hits and Misses in a Post-COVID-19 World

Pharmaceutical majors Merck & Co (NYSE:MRK), Bristol-Myers Squibb (NYSE:BMY), and Eli Lilly & Co (NYSE:LLY) have reported fourth-quarter numbers at a time when the world is finally beginning to see COVID-19 in the rearview mirror.

Merck’s Q4 revenue increased 2.1% year-over-year to $13.8 billion, outperforming estimates by $140 million. EPS at $1.62 too came in ahead of expectations by $0.09. While Keytruda continues to deliver, Lagevrio (for COVID-19) sales declined in double digits.

For the full-year 2023, the company sees revenue hovering between $57.2 billion and $58.7 billion.EPS is expected to land between $6.80 and $6.95. The outlook came in lower than what investors were hoping for and consequently, MRK shares are taking a beating in the trade today.

Shares of Revlimid maker BMY, on the other hand, are in the green today after the company’s Q4 numbers came in better than expectations and its guidance for 2023 impressed investors.

The company’s fourth-quarter revenue declined by 5% year-over-year to $11.4 billion but still landed ahead of expectations by $200 million. EPS at $1.82 comfortably cruised past expectations by $0.09.

While the loss of product exclusivity impacted the topline, Eliquis, Opdivo, and new product introductions partly offset this impact. Looking ahead, the company sees the 2023 top line expanding by 2% and EPS hovering between $7.95 and $8.25.

We round off our list with Eli Lilly. Shares of the company are trending lower today after a big fourth-quarter miss. Falling bebtelovimab (for COVID-19) sales continue to hurt LLY’s topline which fell 8.8% year-over-year to $7.3 billion. The figure also came in lower than expectations by $90 million. EPS at $2.09 though managed to beat estimates by $0.21.

For 2023, the company sees revenue landing between $30.3 billion and $30.8 billion. EPS is anticipated to range between $8.35 and $8.55.

Healthcare names continue to see revenue impact in a post-COVID-19 world as demand for therapies falls rapidly worldwide. Additionally, the loss of exclusivity for blockbuster drugs also remains a key trend to keep an eye on.

Despite these challenges, all three companies have delivered double-digit gains for investors over the past year and the Street continues to see further gains in them with LLY offering the highest potential upside at 24%.

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