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Merck Misses Q4 Earnings Forecast; Says CEO Ken Frazier to Retire In June

Merck said its longtime CEO Ken Frazier will retire later this year and posted weaker-than-expected fourth quarter earnings.

Merck & Co. Inc.  (MRK) posted weaker-than-expected fourth quarter earnings Thursday and said longtime CEO Ken Frazier will retire later this year.

Merck said adjusted earnings for the three months ending in December were pegged at $1.32, up 13.7% from the same period last year but 6 cents shy of the Street consensus forecast. Group revenues, Merck said, rose 5% to $12.5 billion but again missed analysts' estimates of a $12.68 billion tally. Sales for Keytruda, Merck's blockbuster cancer treatment, rose 28.4% to just under $4 billion, 

Looking into the 2021 financial year, Merck said it sees worldwide sales of between $51.8 billion and $53.8 billion, with the coronavirus pandemic trimming around 2% from its overall top line. Non-GAAP earnings, the company said, should come in between $6.48 and $6.68 per share.

Merck shares were marked 1.3% lower in early trading  following the earnings release to change hands at $76.35 each.

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Merck tapped CFO Robert Davis as Frazier's replacement, adding the longtime CEO will remain in his role until June when he will transition to executive chairman of the company's board. 

"On behalf of the entire Merck board, I thank Ken for his strong and highly principled leadership and his commitment to the company’s core values of scientific excellence, business integrity, patient focus and respect for all people," said Merck board director Les Brun. "Ken’s vision and courage to make difficult changes within Merck, while steadfastly investing in research and development, have positioned Merck well for sustainable future growth."

"Under Ken’s leadership, Merck has delivered many innovative lifesaving medicines and vaccines, including Keytruda, Gardasil 9, and Bridon, and also focused on other key growth drivers, such as Lynparza, Lenvima, and animal health to create long-term value for its shareholders and other stakeholders," he added.