Supplement to 4Q 2015 Earnings Release Merck & Co., Inc. Financial Highlights Package Fourth Quarter 2015 Table of Contents Table 1: GAAP P&L...1 Table 1a: GAAP P&L Current Year and Prior Year by Quarter...2 Table 2a: GAAP to Non-GAAP P&L Reconciliation 4Q15...3 Table 2b: GAAP to Non-GAAP P&L Reconciliation Dec YTD 15...4 Table 2c: GAAP to Non-GAAP P&L Reconciliation 4Q14...5 Table 2d: GAAP to Non-GAAP P&L Reconciliation Dec YTD 14...6 Table 3: Sales Current Year and Prior Year by Quarter...7 Table 3a: Sales U.S. / Ex- U.S. 4Q15...8 Table 3b: Sales U.S. / Ex- U.S. Dec YTD 15...9 Table 3c: Sales Pharmaceutical Geographic Split... 10 Table 4: Other (Income) Expense... 11
1 MERCK & CO., INC. CONSOLIDATED STATEMENT OF INCOME - GAAP (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) Table 1 GAAP GAAP 4Q15 4Q14 % Change Full Year 2015 Full Year 2014 % Change Sales $ 10,215 $ 10,482-3% $ 39,498 $ 42,237-6% Costs, Expenses and Other Materials and production (1) 3,850 3,749 3% 14,934 16,768-11% Marketing and administrative (1) 2,615 2,924-11% 10,313 11,606-11% Research and development (1) 1,797 2,283-21% 6,704 7,180-7% Restructuring costs (2) 233 349-33% 619 1,013-39% Other (income) expense, net (1) (3) 905 (10,634) * 1,527 (11,613) * Income Before Taxes 815 11,811-93% 5,401 17,283-69% Income Tax (Benefit) Provision (166) 4,484 942 5,349 Net Income 981 7,327-87% 4,459 11,934-63% Less: Net Income Attributable to Noncontrolling Interests 5 11 17 14 Net Income Attributable to Merck & Co., Inc. $ 976 $ 7,316-87% $ 4,442 $ 11,920-63% Earnings per Common Share Assuming Dilution $ 0.35 $ 2.54-86% $ 1.56 $ 4.07-62% Average Shares Outstanding Assuming Dilution 2,813 2,880 2,841 2,928 Tax Rate (4) -20.4% 38.0% 17.4% 30.9% * 100% or greater (1) Amounts include the impact of acquisition and divestiture-related costs, restructuring costs and certain other items. See accompanying tables for details. (2) Represents separation and other related costs associated with restructuring activities under the company's formal restructuring programs. (3) Other (income) expense, net in the fourth quarter and full year of 2015 includes a $680 million net charge to settle VIOXX shareholder class action litigation, as well as a $147 million gain on the divestiture of the company's remaining ophthalmics business in international markets. Other (income) expense, net in the fourth quarter and full year of 2015 includes foreign exchange losses of $161 million and $876 million, respectively, to revalue the company's net monetary assets in Venezuela. Other (income) expense, net for the full year of 2015 also includes a $250 million gain on the sale of certain migraine clinical development programs. Other (income) expense, net in the fourth quarter and full year of 2014 includes an $11.2 billion gain on the divestiture of Merck's Consumer Care business and a $628 million loss on the extinguishment of debt. Other (income) expense, net for the full year of 2014 also includes a gain of $741 million related to AstraZeneca's option exercise, a gain of $480 million on the divestiture of certain ophthalmic products in several international markets, and a gain of $204 million related to the divestiture of the company's Sirna Therapeutics, Inc. subsidiary, as well as a $93 million goodwill impairment charge related to the company's joint venture with Supera Farma Laboratorios S.A. Other (income) expense, net includes equity income from affiliates. Prior period amounts have been reclassified to conform to the current presentation. (4) The effective income tax rates for the fourth quarter and full year of 2015 reflect the impact of the net charge to settle VIOXX shareholder class action litigation being fully deductible at combined U.S. federal and state tax rates, as well as the favorable impact of tax legislation enacted in the fourth quarter of 2015, partially offset by the unfavorable impact of non-deductible foreign exchange losses recorded in connection with the revaluation of the company's net monetary assets in Venezuela. The effective income tax rates for the fourth quarter and full year of 2015 also reflect net benefits of $40 million and $410 million, respectively, related to the settlement of certain federal income tax issues. The effective income tax rates for the fourth quarter and full year of 2014 include the impact of the gain on the divestiture of Merck's Consumer Care business being taxed primarily at combined U.S. federal and state tax rates. The effective income tax rates for the fourth quarter and full year of 2014 also reflect the favorable impact of tax legislation enacted in the fourth quarter of 2014. In addition, the effective income tax rate for the full year of 2014 reflects a net benefit of $517 million recorded in connection with AstraZeneca's option exercise, as well as a benefit of approximately $300 million associated with a capital loss generated in the first quarter of 2014.
MERCK & CO., INC. CONSOLIDATED STATEMENT OF INCOME - GAAP (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) Table 1a 2 2015 2014 % Change 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year 4Q Full Year. Sales $ 9,425 $ 9,785 $ 10,073 $ 10,215 $ 39,498 $ 10,264 $ 10,934 $ 10,557 $ 10,482 $ 42,237-3% -6% Costs, Expenses and Other Materials and production 3,569 3,754 3,761 3,850 14,934 3,903 4,893 4,223 3,749 16,768 3% -11% Marketing and administrative 2,601 2,624 2,472 2,615 10,313 2,734 2,973 2,975 2,924 11,606-11% -11% Research and development 1,737 1,670 1,500 1,797 6,704 1,574 1,664 1,659 2,283 7,180-21% -7% Restructuring costs 82 191 113 233 619 125 163 376 349 1,013-33% -39% Other (income) expense, net (1) 55 739 (170) 905 1,527 (163) (650) (166) (10,634) (11,613) * * Income Before Taxes 1,381 807 2,397 815 5,401 2,091 1,891 1,490 11,811 17,283-93% -69% Income Tax Provision (Benefit) 423 119 566 (166) 942 360 (142) 648 4,484 5,349 Net Income 958 688 1,831 981 4,459 1,731 2,033 842 7,327 11,934-87% -63% Less: Net Income (Loss) Attributable to Noncontrolling Interests 5 1 5 5 17 26 29 (53) 11 14 Net Income Attributable to Merck & Co., Inc. $ 953 $ 687 $ 1,826 $ 976 $ 4,442 $ 1,705 $ 2,004 $ 895 $ 7,316 $ 11,920-87% -63% Earnings per Common Share Assuming Dilution $ 0.33 $ 0.24 $ 0.64 $ 0.35 $ 1.56 $ 0.57 $ 0.68 $ 0.31 $ 2.54 $ 4.07-86% -62% Average Shares Outstanding Assuming Dilution 2,865 2,850 2,836 2,813 2,841 2,971 2,949 2,911 2,880 2,928 Tax Rate 30.6% 14.7% 23.6% -20.4% 17.4% 17.2% -7.5% 43.5% 38.0% 30.9% * 100% or greater Sum of quarterly amounts may not equal year-to-date amounts due to rounding. (1) Other (income) expense, net includes equity income from affiliates. Prior periods have been reclassified to conform to the current presentation.
3 MERCK & CO., INC. CONSOLIDATED STATEMENT OF INCOME GAAP TO NON-GAAP RECONCILIATION FOURTH QUARTER 2015 (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) Table 2a GAAP Acquisition and Divestiture-Related Costs (1) Restructuring Costs (2) Certain Other Items (3) Adjustment Subtotal Non-GAAP Sales $ 10,215 $ 10,215 Costs, Expenses and Other Materials and production 3,850 1,194 81 1,275 2,575 Marketing and administrative 2,615 47 8 55 2,560 Research and development 1,797 (24) 18 (6) 1,803 Restructuring costs 233 233 233 - Other (income) expense, net (4) 905 47 707 754 151 Income Before Taxes 815 (1,264) (340) (707) (2,311) 3,126 Income Tax (Benefit) Provision (166) (679) (5) 513 Net Income 981 (1,632) 2,613 Less: Net Income Attributable to Noncontrolling Interests 5 5 Net Income Attributable to Merck & Co., Inc. $ 976 (1,632) $ 2,608 Earnings per Common Share Assuming Dilution $ 0.35 $ 0.93 Average Shares Outstanding Assuming Dilution 2,813 2,813 Tax Rate -20.4% 16.4% Merck is providing non-gaap information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors' understanding of the company's performance. This information should be considered in addition to, but not in lieu of, information prepared in accordance with GAAP. (1) Amounts included in materials and production costs reflect $1.1 billion of expenses for the amortization of intangible assets recognized as a result of acquisitions, as well as $29 million of amortization of purchase accounting adjustments to inventories as a result of the Cubist acquisition, and $33 million of impairment charges on intangible assets. Amounts included in marketing and administrative expenses reflect integration, transaction and certain other costs related to business acquisitions, including severance costs which are not part of the company's formal restructuring programs, as well as transaction and certain other costs related to divestitures. Amounts included in research and development expenses primarily reflect income of $25 million resulting from a reduction in the estimated fair value of liabilities for contingent consideration. Amounts included in other (income) expense, net represent goodwill impairment charges related to certain of Merck's Healthcare Services businesses. (2) Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to activities under the company's formal restructuring programs. (3) Primarily reflects a $680 million net charge to settle VIOXX shareholder class action litigation, foreign exchange losses of $161 million to revalue the company's net monetary assets in Venezuela and a $147 million gain on the divestiture of the company's remaining ophthalmics business in international markets. (4) Other (income) expense, net includes equity income from affiliates. (5) Represents the estimated tax impact on the reconciling items, as well as a net benefit of $40 million on the settlement of certain federal income tax issues..
4 MERCK & CO., INC. CONSOLIDATED STATEMENT OF INCOME GAAP TO NON-GAAP RECONCILIATION YEAR ENDED DECEMBER 31, 2015 (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) Table 2b GAAP Acquisition and Divestiture-Related Costs (1) Restructuring Costs (2) Certain Other Items (3) Adjustment Subtotal Non-GAAP Sales $ 39,498 $ 39,498 Costs, Expenses and Other Materials and production 14,934 4,869 361 5,230 9,704 Marketing and administrative 10,313 436 78 514 9,799 Research and development 6,704 39 52 91 6,613 Restructuring costs 619 619 619 - Other (income) expense, net (4) 1,527 54 1,125 1,179 348 Income Before Taxes 5,401 (5,398) (1,110) (1,125) (7,633) 13,034 Taxes on Income 942 (1,880) (5) 2,822 Net Income 4,459 (5,753) 10,212 Less: Net Income Attributable to Noncontrolling Interests 17 17 Net Income Attributable to Merck & Co., Inc. $ 4,442 (5,753) $ 10,195 Earnings per Common Share Assuming Dilution $ 1.56 $ 3.59 Average Shares Outstanding Assuming Dilution 2,841 2,841 Tax Rate 17.4% 21.7% Merck is providing non-gaap information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors' understanding of the company's performance. This information should be considered in addition to, but not in lieu of, information prepared in accordance with GAAP. (1) Amounts included in materials and production costs reflect $4.7 billion of expenses for the amortization of intangible assets recognized as a result of acquisitions, as well as $105 million of amortization of purchase accounting adjustments to inventories as a result of the Cubist acquisition, and $45 million of impairment charges on intangible assets. Amounts included in marketing and administrative expenses reflect integration, transaction and certain other costs related to business acquisitions, including severance costs which are not part of the company's formal restructuring programs, as well as transaction and certain other costs related to divestitures. Amounts included in research and development expenses reflect $63 million of in-process research and development (IPR&D) impairment charges and income of $24 million resulting from a reduction in the estimated fair value of liabilities for contingent consideration. Amounts included in other (income) expense, net represent goodwill impairment charges related to certain of Merck's Healthcare Services businesses. (2) Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to activities under the company's formal restructuring programs. (3) Primarily reflects foreign exchange losses of $876 million to revalue the company's net monetary assets in Venezuela, a $680 million net charge to settle VIOXX shareholder class action litigation, a $250 million gain on the divestiture of certain migraine clinical development programs and a $147 million gain on the divestiture of the company's remaining ophthalmics business in international markets. (4) Other (income) expense, net includes equity income from affiliates. (5) Represents the estimated tax impact on the reconciling items, as well as a net benefit of $410 million on the settlement of certain federal income tax issues.
MERCK & CO., INC. CONSOLIDATED STATEMENT OF INCOME GAAP TO NON-GAAP RECONCILIATION FOURTH QUARTER 2014 (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) Table 2c 5 GAAP Acquisition and Divestiture- Related Costs (1) Restructuring Costs (2) Certain Other Items (3) Adjustment Subtotal Non-GAAP Sales $ 10,482 $ 10,482 Costs, Expenses and Other Materials and production 3,749 984 105 1,089 2,660 Marketing and administrative 2,924 81 57 138 2,786 Research and development 2,283 329 108 437 1,846 Restructuring costs 349 349 349 - Other (income) expense, net (4) (10,634) (10,679) (10,679) 45 Income Before Taxes 11,811 (1,394) (619) 10,679 8,666 3,145 Taxes on Income 4,484 3,854 (5) 630 Net Income 7,327 4,812 2,515 Less: Net Income Attributable to Noncontrolling Interests 11 11 Net Income Attributable to Merck & Co., Inc. $ 7,316 4,812 $ 2,504 Earnings per Common Share Assuming Dilution $ 2.54 $ 0.87 Average Shares Outstanding Assuming Dilution 2,880 2,880 Tax Rate 38.0% 20.0% Merck is providing non-gaap information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors' understanding of the company's performance. This information should be considered in addition to, but not in lieu of, information prepared in accordance with GAAP. (1) Amounts included in materials and production costs reflect expenses for the amortization of intangible assets recognized as a result of acquisitions. Amounts included in marketing and administrative expenses reflect integration, transaction and certain other costs related to business acquisitions, including severance costs which are not part of the company's formal restructuring programs, as well as transaction and certain other costs related to divestitures. Amounts included in research and development expenses reflect a $316 million charge resulting from an increase in the estimated fair value of a liability for contingent consideration, as well as in-process research and development (IPR&D) impairment charges of $13 million. (2) Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to actions under the company's formal restructuring programs. (3) Included in other (income) expense, net is an $11.2 billion gain on the divestiture of Merck's Consumer Care business, an additional gain of $84 million on the divestiture of certain ophthalmic products in several international markets and a $628 million loss on the extinguishment of debt. (4) Other (income) expense, net includes equity income from affiliates. (5) Represents the estimated tax impact on the reconciling items.
MERCK & CO., INC. CONSOLIDATED STATEMENT OF INCOME GAAP TO NON-GAAP RECONCILIATION YEAR ENDED DECEMBER 31, 2014 (AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES) Table 2d 6 GAAP Acquisition and Divestiture- Related Costs (1) Restructuring Costs (2) Certain Other Items (3) Adjustment Subtotal Non-GAAP Sales $ 42,237 $ 42,237 Costs, Expenses and Other Materials and production 16,768 5,254 482 5,736 11,032 Marketing and administrative 11,606 234 200 193 627 10,979 Research and development 7,180 365 283 648 6,532 Restructuring costs 1,013 1,013 1,013 - Other (income) expense, net (4) (11,613) 93 (11,811) (11,718) 105 Income Before Taxes 17,283 (5,946) (1,978) 11,618 3,694 13,589 Taxes on Income 5,349 2,045 (5) 3,304 Net Income 11,934 1,649 10,285 Less: Net Income Attributable to Noncontrolling 14 (56) (56) 70 Interests Net Income Attributable to Merck & Co., Inc. $ 11,920 1,705 $ 10,215 Earnings per Common Share Assuming Dilution $ 4.07 $ 3.49 Average Shares Outstanding Assuming Dilution 2,928 2,928 Tax Rate 30.9% 24.3% Merck is providing non-gaap information that excludes certain items because of the nature of these items and the impact they have on the analysis of underlying business performance and trends. Management believes that providing this information enhances investors' understanding of the company's performance. This information should be considered in addition to, but not in lieu of, information prepared in accordance with GAAP. (1) Amounts included in materials and production costs reflect expenses of $4.2 billion for the amortization of intangible assets recognized as a result of acquisitions, as well as $1.1 billion of impairment charges on product intangibles. Amounts included in marketing and administrative expenses reflect integration, transaction and certain other costs related to business acquisitions, including severance costs which are not part of the company's formal restructuring programs, as well as transaction and certain other costs related to divestitures. Amounts included in research and development expenses reflect a charge of $316 million resulting from an increase in the estimated fair value of a liability for contingent consideration, as well as in-process research and development (IPR&D) impairment charges of $49 million primarily related to the company's joint venture with Supera Farma Laboratorios S.A. (Supera). Amount included in other (income) expense, net represents a goodwill impairment charge related to the joint venture with Supera. Amount included in net income attributable to noncontrolling interests represents the portion of intangible asset and goodwill impairment charges related to the joint venture with Supera that are attributable to noncontrolling interests. (2) Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to actions under the company's formal restructuring programs. (3) Amount included in marketing and administrative expenses represents an additional year of expense related to the healthcare reform fee in accordance with final regulations issued in the third quarter by the Internal Revenue Service. Included in other (income) expense, net is an $11.2 billion gain on the divestiture of Merck's Consumer Care business, a $741 million gain related to AstraZeneca's option exercise, a gain of $480 million on the divestiture of certain ophthalmic products in several international markets and a $628 million loss on the extinguishment of debt. (4) Other (income) expense, net includes equity income from affiliates. (5) Represents the estimated tax impact on the reconciling items, including a net benefit of $517 million recorded in connection with AstraZeneca's option exercise, as well as a benefit of approximately $300 million associated with a capital loss generated in the first quarter.
MERCK & CO., INC. FRANCHISE / KEY PRODUCT SALES (AMOUNTS IN MILLIONS) Table 3 7 1Q 2Q 3Q 4Q 2015 2014 % Change Full Year 1Q 2Q 3Q 4Q TOTAL SALES (1) $ 9,425 $ 9,785 $ 10,073 $ 10,215 $ 39,498 $ 10,264 $ 10,934 $ 10,557 $ 10,482 $ 42,237-3 -6 PHARMACEUTICAL 8,266 8,564 8,925 9,027 34,782 8,451 9,087 9,134 9,370 36,042-4 -3 Primary Care & Women's Health Cardiovascular Zetia 568 635 633 691 2,526 611 717 660 662 2,650 4-5 Vytorin 320 320 302 308 1,251 361 417 369 370 1,516-17 -17 Diabetes Januvia 884 1,044 1,014 921 3,863 858 1,058 933 1,082 3,931-15 -2 Janumet 509 554 562 526 2,151 476 519 505 570 2,071-8 4 General Medicine & Women's Health NuvaRing 166 182 190 193 732 168 178 186 191 723 1 1 Implanon / Nexplanon 137 124 176 151 588 102 119 158 123 502 23 17 Dulera 130 120 133 153 536 102 103 124 132 460 16 16 Follistim AQ 82 111 95 95 383 110 102 97 102 412-7 -7 Hospital and Specialty Hepatitis PegIntron 56 52 40 34 182 112 103 84 81 381-58 -52 HIV Isentress 385 375 377 374 1,511 390 453 412 418 1,673-11 -10 Hospital Acute Care Cubicin (2) 187 293 325 322 1,127 5 6 7 7 25 * * Cancidas 163 134 139 137 573 166 156 183 175 681-22 -16 Invanz 132 139 153 144 569 114 134 141 139 529 4 8 Noxafil 111 117 132 128 487 74 98 107 122 402 4 21 Bridion 85 87 89 92 353 73 82 90 95 340-3 4 Primaxin 65 88 75 86 313 71 81 91 86 329 0-5 Immunology Remicade 501 455 442 396 1,794 604 607 604 557 2,372-29 -24 Simponi 158 169 178 185 690 157 174 170 188 689-2 0 Oncology Keytruda 83 110 159 214 566 0 0 4 50 55 * * Emend 122 134 141 139 535 122 144 136 151 553-8 -3 Temodar 74 80 83 75 312 83 93 88 86 350-14 -11 Diversified Brands Respiratory Singulair 245 212 201 273 931 271 284 218 319 1,092-14 -15 Nasonex 289 215 121 231 858 312 258 261 268 1,099-14 -22 Clarinex 51 55 39 42 187 62 69 49 52 232-20 -20 Other Cozaar / Hyzaar 185 189 150 143 667 205 214 195 192 806-25 -17 Arcoxia 123 115 123 110 471 128 141 132 118 519-7 -9 Fosamax 94 96 86 82 359 123 121 114 112 470-27 -24 Zocor 49 63 56 49 217 64 69 61 64 258-22 -16 Propecia 53 39 41 50 183 74 58 66 67 264-26 -31 Vaccines Gardasil / Gardasil 9 359 427 625 497 1,908 383 409 590 356 1,738 40 10 ProQuad, M-M-R II and Varivax 348 358 390 409 1,505 280 326 421 366 1,394 12 8 Zostavax 175 149 179 246 749 142 156 181 285 765-14 -2 RotaTeq 192 89 160 169 610 169 147 174 169 659 0-7 Pneumovax 23 110 106 138 188 542 101 102 197 346 746-46 -27 Other Pharmaceutical (3) 1,075 1,128 1,178 1,174 4,553 1,378 1,389 1,326 1,269 5,356-7 -15 ANIMAL HEALTH 829 840 825 830 3,324 813 872 885 885 3,454-6 -4 CONSUMER CARE (4) 2 0 0 0 3 546 583 401 16 1,547 * * Other Revenues (5) 328 381 323 358 1,389 454 392 137 211 1,194 69 16 * 100% or greater Sum of quarterly amounts may not equal year-to-date amounts due to rounding. (1) Only select products are shown. (2) Cubicin results for the first quarter 2015 represent sales for the two months following Merck's acquisition of Cubist. Cubicin sales for 2014 represent the previous licensing agreement in Japan prior to the acquisition. Full Year 4Q Full Year (3) Includes Pharmaceutical products not individually shown above. Other Vaccines sales included in Other Pharmaceutical were $78 million, $76 million, $99 million, and $148 million for the first, second, third, and fourth quarters of 2015, respectively. Other Vaccines sales included in Other Pharmaceutical were $98 million, $76 million, $116 million and $88 million for the first, second, third and fourth quarters of 2014, respectively. (4) On October 1, 2014, the company divested the Consumer Care business. (5) Other revenues are comprised primarily of alliance revenue, third-party manufacturing sales and miscellaneous corporate revenues, including revenue hedging activities. On June 30, 2014, AstraZeneca exercised its option to buy Merck's interest in a subsidiary and through it, Merck's interest in Nexium and Prilosec. As a result, the company no longer records supply sales for these products. Other revenues in the first quarter 2014 include $232 million of revenue recognized in connection with the sale of U.S. Saphris rights.
MERCK & CO., INC. FRANCHISE / KEY PRODUCT SALES FOURTH QUARTER 2015 (AMOUNTS IN MILLIONS) Table 3a 8 Global U.S. International 4Q 2015 4Q 2014 % Change 4Q 2015 4Q 2014 % Change 4Q 2015 4Q 2014 % Change TOTAL SALES (1) $10,215 $10,482-3 $4,612 $4,088 13 $5,603 $6,394-12 PHARMACEUTICAL 9,027 9,370-4 4,285 3,786 13 4,742 5,584-15 Primary Care and Women's Health Cardiovascular Zetia 691 662 4 452 382 18 239 281-15 Vytorin 308 370-17 123 145-15 185 225-18 Diabetes Januvia 921 1,082-15 486 570-15 435 512-15 Janumet 526 570-8 227 255-11 299 315-5 General Medicine & Women's Health NuvaRing 193 191 1 142 127 12 51 64-20 Dulera 153 132 16 146 125 17 7 7 3 Implanon / Nexplanon 151 123 23 102 71 44 49 52-6 Follistim AQ 95 102-7 37 38-4 58 64-8 Hospital and Specialty Hepatitis PegIntron 34 81-58 (1) 2 * 35 79-56 HIV Isentress 374 418-11 194 218-11 180 201-10 Hospital Acute Care Cubicin (2) 322 7 * 308 - * 14 7 * Invanz 144 139 4 87 70 24 57 69-17 Cancidas 137 175-22 5 8-29 132 168-21 Noxafil 128 122 4 56 54 4 72 69 4 Bridion 92 95-3 0-92 95-3 Primaxin 86 86 3 2 50 83 84-2 Immunology Remicade 396 557-29 0-396 557-29 Simponi 185 188-2 0-185 188-2 Oncology Keytruda 214 50 * 132 44 * 82 6 * Emend 139 151-8 80 84-4 59 67-11 Temodar 75 86-14 1 3-81 74 83-11 Diversified Brands Respiratory Singulair 273 319-14 14 21-37 259 298-13 Nasonex 231 268-14 140 148-5 91 120-24 Clarinex 42 52-20 5 6-22 37 46-19 Other Cozaar / Hyzaar 143 192-25 6 8-18 137 184-26 Arcoxia 110 118-7 0-110 118-7 Fosamax 82 112-27 2 4-32 80 108-26 Propecia 50 67-26 4 5-18 46 62-26 Zocor 49 64-22 5 6-15 44 58-25 Vaccines Gardasil / Gardasil 9 497 356 40 361 244 48 136 112 21 ProQuad, M-M-R II and Varivax 409 366 12 354 296 19 55 70-21 Zostavax 246 285-14 190 225-16 56 60-6 Pneumovax 23 188 346-46 128 199-36 60 148-59 RotaTeq 169 169 126 119 6 43 51-14 Other Pharmaceutical (3) 1,174 1,269-7 370 307 21 804 959-16 ANIMAL HEALTH 830 885-6 237 211 12 593 674-12 CONSUMER CARE (4) 0 16 * 0 0 0 16 * Other Revenues (5) 358 211 69 90 92-2 267 119 * * 100% or greater (1) Only select products are shown. (2) Cubicin sales for 2014 represent the previous licensing agreement in Japan prior to the acquisition. (3) Includes Pharmaceutical products not individually shown above. Other Vaccines sales included in Other Pharmaceutical were $148 million and $88 million on a global basis for fourth quarter 2015 and 2014, respectively. (4) On October 1, 2014, the company divested the Consumer Care business. (5) Other revenues are comprised primarily of alliance revenue, third-party manufacturing sales and miscellaneous corporate revenues, including revenue hedging activities. On June 30, 2014, AstraZeneca exercised its option to buy Merck's interest in a subsidiary and through it, Merck's interest in Nexium and Prilosec. As a result, the company no longer records supply sales for these products.
MERCK & CO., INC. FRANCHISE / KEY PRODUCT SALES DECEMBER YEAR-TO-DATE 2015 (AMOUNTS IN MILLIONS) Table 3b 9 Global U.S. International Full Year 2015 Full Year 2014 % Change Full Year 2015 Full Year 2014 % Change Full Year 2015 Full Year 2014 % Change TOTAL SALES (1) $39,498 $42,237-6 $17,519 $17,071 3 $21,979 $25,166-13 PHARMACEUTICAL 34,782 36,042-3 16,238 14,214 14 18,544 21,827-15 Primary Care and Women's Health Cardiovascular Zetia 2,526 2,650-5 1,612 1,475 9 914 1,175-22 Vytorin 1,251 1,516-17 479 555-14 771 961-20 Diabetes Januvia 3,863 3,931-2 2,263 2,123 7 1,601 1,809-12 Janumet 2,151 2,071 4 976 931 5 1,175 1,140 3 General Medicine & Women's Health NuvaRing 732 723 1 515 461 12 216 262-17 Implanon / Nexplanon 588 502 17 367 291 26 221 211 5 Dulera 536 460 16 515 437 18 21 24-10 Follistim AQ 383 412-7 160 142 13 223 270-17 Hospital and Specialty Hepatitis PegIntron 182 381-52 (4) 18 * 186 363-49 HIV Isentress 1,511 1,673-10 797 843-5 714 830-14 Hospital Acute Care Cubicin (2) 1,127 25 * 1,030-97 25 * Cancidas 573 681-16 24 22 8 548 659-17 Invanz 569 529 8 322 265 21 247 263-6 Noxafil 487 402 21 212 148 43 275 254 9 Bridion 353 340 4 0-353 340 4 Primaxin 313 329-5 8 6 46 305 323-6 Immunology Remicade 1,794 2,372-24 0-1,794 2,372-24 Simponi 690 689 0-690 689 Oncology Keytruda 566 55 * 393 48 * 173 7 * Emend 535 553-3 326 312 4 209 240-13 Temodar 312 350-11 7 8-17 306 342-11 Diversified Brands Respiratory Singulair 931 1,092-15 39 39 892 1,053-15 Nasonex 858 1,099-22 449 577-22 409 522-22 Clarinex 187 232-20 22 24-11 165 208-21 Other Cozaar / Hyzaar 667 806-17 30 28 5 637 778-18 Arcoxia 471 519-9 0-471 519-9 Fosamax 359 470-24 12 16-25 347 454-24 Zocor 217 258-16 20 21-3 197 237-17 Propecia 183 264-31 15 19-18 168 245-32 Vaccines Gardasil / Gardasil 9 1,908 1,738 10 1,520 1,319 15 388 419-7 ProQuad, M-M-R II and Varivax 1,505 1,394 8 1,290 1,191 8 214 203 6 Zostavax 749 765-2 592 619-4 157 146 8 RotaTeq 610 659-7 447 476-6 163 183-11 Pneumovax 23 542 746-27 378 516-27 164 230-29 Other Pharmaceutical (3) 4,553 5,356-15 1,422 1,284 11 3,133 4,071-23 ANIMAL HEALTH 3,324 3,454-4 880 788 12 2,444 2,666-8 CONSUMER CARE (4) 3 1,547 * 0 1,058 * 3 489 * Other Revenues (5) 1,389 1,194 16 401 1,011-60 988 183 * * 100% or greater (1) Only select products are shown. (2) Cubicin results for the December YTD 2015 period represent sales for the eleven months following Merck's acquisition of Cubist. Cubicin sales for 2014 represent the previous licensing agreement in Japan prior to the acquisition. (3) Includes Pharmaceutical products not individually shown above. Other Vaccines sales included in Other Pharmaceutical were $401 million and $379 million on a global basis for December YTD 2015 and 2014, respectively. (4) On October 1, 2014, the company divested the Consumer Care business. (5) Other revenues are comprised primarily of alliance revenue, third-party manufacturing sales and miscellaneous corporate revenues, including revenue hedging activities. Other revenues in 2014 include $232 million of revenue recognized in connection with the sale of U.S. Saphris rights. On June 30, 2014, AstraZeneca exercised its option to buy Merck's interest in a subsidiary and through it, Merck's interest in Nexium and Prilosec. As a result, the company no longer records supply sales for these products.
10 MERCK & CO., INC. PHARMACEUTICAL GEOGRAPHIC SALES (AMOUNTS IN MILLIONS) Table 3c 2015 2014 1Q 2Q 3Q Q4 Full Year 1Q 2Q 3Q 4Q Full Year % Change 4Q % Change Full Year TOTAL PHARMACEUTICAL $8,266 $8,564 $8,925 $9,027 $34,782 $8,451 $9,087 $9,134 $9,370 $36,042-4 -3 United States 3,637 3,934 4,382 4,285 16,238 3,130 3,462 3,837 3,786 14,214 13 14 % Pharmaceutical Sales 44.0% 45.9% 49.1% 47.5% 46.7% 37.0% 38.1% 42.0% 40.4% 39.4% Europe (1) 2,024 1,896 1,920 1,873 7,714 2,478 2,537 2,297 2,269 9,581-17 -19 % Pharmaceutical Sales 24.5% 22.1% 21.5% 20.8% 22.2% 29.3% 27.9% 25.2% 24.2% 26.6% Japan 627 629 564 785 2,605 835 859 730 965 3,389-19 -23 % Pharmaceutical Sales 7.6% 7.3% 6.3% 8.7% 7.5% 9.9% 9.5% 8.0% 10.3% 9.4% Asia Pacific 809 822 854 946 3,431 809 840 878 910 3,438 4 0 % Pharmaceutical Sales 9.8% 9.6% 9.6% 10.5% 9.9% 9.6% 9.2% 9.6% 9.7% 9.5% China 318 335 353 339 1,344 282 309 318 332 1,242 2 8 Latin America 630 676 585 512 2,403 538 668 673 678 2,557-24 -6 % Pharmaceutical Sales 7.6% 7.9% 6.5% 5.7% 6.9% 6.4% 7.3% 7.4% 7.2% 7.1% Eastern Europe/Middle East Africa 321 372 380 402 1,476 415 459 443 500 1,817-19 -19 % Pharmaceutical Sales 3.9% 4.3% 4.3% 4.5% 4.2% 4.9% 5.1% 4.9% 5.3% 5.0% Canada 170 167 159 172 668 200 218 218 218 854-21 -22 % Pharmaceutical Sales 2.1% 2.0% 1.8% 1.9% 1.9% 2.4% 2.4% 2.4% 2.3% 2.4% Other 48 68 81 52 247 46 44 58 44 192 18 29 % Pharmaceutical Sales 0.6% 0.8% 0.9% 0.6% 0.7% 0.5% 0.5% 0.6% 0.5% 0.5% (1) Europe primarily represents all European Union countries and the European Union accession markets.
11 MERCK & CO., INC. FOURTH QUARTER AND FULL YEAR 2015 OTHER (INCOME) EXPENSE, NET - GAAP (AMOUNTS IN MILLIONS) Table 4 OTHER (INCOME) EXPENSE, NET 4Q15 4Q14 Full Year 2015 Full Year 2014 INTEREST INCOME $ (75) $ (76) $ (289) $ (266) INTEREST EXPENSE 169 164 672 732 EXCHANGE LOSSES (1) 239 65 1,277 180 EQUITY LOSS (INCOME) FROM AFFILIATES (2) 5 (16) (205) (257) Other, net (3) 567 (10,771) 72 (12,002) TOTAL $ 905 $ (10,634) $ 1,527 $ (11,613) (1) Fourth quarter and full year of 2015 include foreign exchange losses of $161 million and $876 million, respectively, recorded in connection with the revaluation of the company's net monetary assets in Venezuela. (2) Includes the performance of the company s joint ventures and other equity method affiliates, including the Sanofi Pasteur MSD partnership, certain investment funds, as well as AstraZeneca LP until the termination of that relationship on June 30, 2014. Equity income from AstraZeneca LP was $192 million in 2014. (3) Other, net in the fourth quarter and full year of 2015 includes a $680 million charge to settle VIOXX shareholder class action litigation, as well as a $147 million gain on the divestiture of the company's remaining ophthalmics business in international markets. Other, net for the full year of 2015 also includes a $250 million gain on the divestiture of certain migraine clinical development programs. Other, net in the fourth quarter and full year of 2014 includes an $11.2 billion gain on the divestiture of Merck's Consumer Care business and a $628 million loss on the extinguishment of debt. Other, net for the full year of 2014 also includes a $741 million gain on AstraZeneca's option exercise and a gain of $480 million on the divestiture of certain ophthalmic products in several international markets.