Struggling drug maker

Schering-Plough

reported Tuesday first quarter earnings of $564 million, or 38 cents per share, a 10% drop compared to the year-ago period.

Results could have been worse. In February, the drug giant warned that a probe into its manufacturing operations by the

U.S. Food and Drug Administration

would cut first quarter sales and earnings by approximately 15%.

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Analysts were expecting the Kenilworth, N.J-based company to post earnings of 36 cents per share, according to consensus figures compiled by

Thomson Financial/First Call

.

Schering-Plough posted first quarter sales of $2.3 billion, lower by 3% compared to the first quarter of last year. Global pharmaceutical sales totaled $1.9 billion during the first quarter, a decline of 3% from the year-ago period.

"Schering-Plough is moving aggressively and deliberately to resolve the manufacturing issues that affected our performance in the first quarter," said company chairman and CEO Richard Jay Kogan, in a statement.

Schering-Plough shares closed Monday at $36.45.