Zeev's Turnips Patch-No Politics (ZEEV)

[marketmaven]

MRK- $3B Ouch, Q3 Guidance "Retracted" - New Way to Miss BIG

Merck announces voluntary worldwide withdrawal of Vioxx based on new 3-yr data (MRK) 45.07: Study of 2,600 patients noted increased risk of heart attack and stroke after 18 mos, which did not show up in first 18 mos of study. Worldwide sales of Vioxx in 2003 were $2.5 bln. Co expects EPS to be negatively affected by $0.50-$0.60 in 2004 (previous 2004 EPS guidance was $3.11-$3.17) due to foregone sales, inventory writeoffs, customer returns. Co says foregone Q4 sales are expected to be $700-$750 mln. Co retracts previous Q3 guidance, says it's not sure whether it'll record costs in Q3 or Q4. Co to report Q3 on Oct 21.