EX-99.2 3 tm2313695d1_ex99-2.htm EXHIBIT 99.2

Exhibit 99.2

Proprietary

MERCK & CO., INC.

CONSOLIDATED STATEMENT OF INCOME - GAAP

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table 1a

	2023			2022															% Change
	1Q			1Q			2Q			3Q			4Q			Full Year			1Q
Sales	$	14,487		$	15,901		$	14,593		$	14,959		$	13,830		$	59,283			-9	%

Costs, Expenses and Other
Cost of sales		3,926			5,380			4,216			3,934			3,881			17,411			-27	%
Selling, general and administrative		2,479			2,323			2,512			2,520			2,687			10,042			7	%
Research and development		4,276			2,576			2,798			4,399			3,775			13,548			66	%
Restructuring costs		67			53			142			94			49			337			26	%
Other (income) expense, net		89			708			438			429			(75	)		1,501			-87	%
Income Before Taxes		3,650			4,861			4,487			3,583			3,513			16,444			-25	%
Income Tax Provision		825			554			538			330			495			1,918
Net Income		2,825			4,307			3,949			3,253			3,018			14,526			-34	%
Less: Net Income (Loss) Attributable to Noncontrolling Interests		4			(3	)		5			5			1			7
Net Income Attributable to Merck & Co., Inc.	$	2,821		$	4,310		$	3,944		$	3,248		$	3,017		$	14,519			-35	%

Earnings per Common Share Assuming Dilution	$	1.11		$	1.70		$	1.55		$	1.28		$	1.18		$	5.71			-35	%

Average Shares Outstanding Assuming Dilution		2,551			2,537			2,540			2,542			2,548			2,542
Tax Rate		22.6	%		11.4	%		12.0	%		9.2	%		14.1	%		11.7	%

Sum of quarterly amounts may not equal year-to-date amounts due to rounding.

MERCK & CO., INC.

FIRST QUARTER 2022 GAAP TO NON-GAAP RECONCILIATION

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table 2b

	GAAP			Acquisition and Divestiture- Related Costs ⁽¹⁾			Restructuring Costs ⁽²⁾			(Income) Loss from Investments in Equity Securities			Adjustment Subtotal			Non-GAAP
First Quarter
Cost of sales	$	5,380			680			46						726		$	4,654
Selling, general and administrative		2,323			50			21						71			2,252
Research and development		2,576			22			7						29			2,547
Restructuring costs		53			-			53						53			-
Other (income) expense, net		708			(115	)					684			569			139
Income Before Taxes		4,861			(637	)		(127	)		(684	)		(1,448	)		6,309
Income Tax Provision (Benefit)		554			(155	)⁽³⁾		(22	)⁽³⁾		(152	)⁽³⁾		(329	)		883
Net Income		4,307			(482	)		(105	)		(532	)		(1,119	)		5,426
Net Income Attributable to Merck & Co., Inc.		4,310			(482	)		(105	)		(532	)		(1,119	)		5,429
Earnings per Common Share Assuming Dilution	$	1.70			(0.19	)		(0.04	)		(0.21	)		(0.44	)	$	2.14

Tax Rate		11.4	%														14.0	%

Only the line items that are affected by non-GAAP adjustments are shown.

Merck is providing certain 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 non-GAAP information enhances investors’ understanding of the company’s results because management uses non-GAAP measures to assess performance. Management uses non-GAAP measures internally for planning and forecasting purposes and to measure the performance of the company along with other metrics. In addition, senior management’s annual compensation is derived in part using a non-GAAP pretax income metric. The non-GAAP information presented should be considered in addition to, but not as a substitute for or superior to, information prepared in accordance with GAAP.

⁽¹⁾Amounts included in cost of sales primarily reflect expenses for the amortization of intangible assets. Amounts included in selling, general and administrative expenses reflect integration, transaction and certain other costs related to acquisitions and divestitures. Amounts included in other (income) expense, net, primarily reflect royalty income and a decrease in the estimated fair value measurement of liabilities for contingent consideration related to the prior termination of the Sanofi-Pasteur MSD joint venture.

⁽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⁾Represents the estimated tax impacts on the reconciling items based on applying the statutory rate of the originating territory of the non-GAAP adjustments.

MERCK & CO., INC.

FRANCHISE / KEY PRODUCT SALES

FIRST QUARTER 2023

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3a

	Global						U.S.						International
	1Q 2023		1Q 2022		% Change		1Q 2023		1Q 2022		% Change		1Q 2023		1Q 2022		% Change
TOTAL SALES ⁽¹⁾	$	14,487	$	15,901		-9	$	6,659	$	7,339		-9	$	7,828	$	8,563		-9
PHARMACEUTICAL		12,721		14,107		-10		6,117		6,773		-10		6,604		7,334		-10
Oncology
Keytruda		5,795		4,809		20		3,485		2,779		25		2,310		2,030		14
Alliance Revenue – Lynparza ⁽²⁾		275		266		3		142		141		1		133		125		6
Alliance Revenue – Lenvima ⁽²⁾		232		227		2		153		156		-2		79		71		11
Alliance Revenue – Reblozyl ⁽³⁾		43		52		-19		30		27		11		12		25		-51
Welireg		42		18		128		41		18		122		1				-
Vaccines ⁽⁴⁾
Gardasil / Gardasil 9		1,972		1,460		35		416		418		-		1,556		1,042		49
ProQuad / M-M-R II / Varivax		528		470		12		421		371		14		107		99		8
RotaTeq		297		216		38		180		175		3		117		41		185
Vaxneuvance		106		5		*		94		5		*		13				*
Pneumovax 23		96		173		-44		40		118		-66		56		55		2
Vaqta		40		36		12		30		29		4		10		7		48
Hospital Acute Care
Bridion		487		395		23		276		195		41		210		199		6
Prevymis		129		94		38		54		40		37		75		54		39
Primaxin		80		58		37		4		1		*		76		58		32
Dificid		65		52		25		62		49		25		3		3		12
Noxafil		60		57		5		14		10		47		46		48		-3
Zerbaxa		50		30		66		27		18		49		23		12		92
Cardiovascular
Alliance Revenue - Adempas/Verquvo ⁽⁵⁾		99		72		38		83		71		17		16		1		*
Adempas ⁽⁶⁾		59		61		-3								59		61		-3
Virology
Lagevrio		392		3,247		-88		-2		1,523		-100		394		1,723		-77
Isentress / Isentress HD		123		158		-23		52		61		-16		71		97		-27
Neuroscience
Belsomra		56		69		-19		16		20		-21		40		48		-17
Immunology
Simponi		180		186		-3								180		186		-3
Remicade		51		61		-15								51		61		-15
Diabetes ⁽⁷⁾
Januvia		551		779		-29		271		325		-17		280		454		-38
Janumet		329		454		-28		56		63		-11		272		391		-30
Other Pharmaceutical ⁽⁸⁾		584		602		-3		172		160		8		414		443		-7
ANIMAL HEALTH		1,491		1,482		1		482		473		2		1,010		1,009		-
Livestock		849		832		2		174		171		2		676		660		2
Companion Animals		642		650		-1		308		302		2		334		349		-4
Other Revenues ⁽⁹⁾		275		312		-12		60		93		-35		214		220		-3

*200% or greater

Sum of U.S. plus international may not equal global due to rounding.

⁽¹⁾Only select products are shown.

⁽²⁾Alliance Revenue represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs.

⁽³⁾Alliance Revenue represents royalties and a milestone payment of $20 million received in the first quarter of 2022.

⁽⁴⁾Total Vaccines sales were $3,133 million in the first quarter of 2023 and $2,481 million in the first quarter of 2022.

⁽⁵⁾Alliance Revenue represents Merck's share of profits from sales in Bayer's marketing territories, which are product sales net of cost of sales and commercialization costs.

⁽⁶⁾Net product sales in Merck's marketing territories.

⁽⁷⁾Total Diabetes sales were $950 million in the first quarter of 2023 and $1,305 million in the first quarter of 2022.

⁽⁸⁾Includes Pharmaceutical products not individually shown above.

⁽⁹⁾Other Revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities. Other Revenues related to the receipt of upfront and milestone payments for out-licensed products were $51 million in the first quarter of 2023 and $114 million in the first quarter of 2022.

MERCK & CO., INC.

PHARMACEUTICAL GEOGRAPHIC SALES

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3b

	2023			2022															% Change
	1Q			1Q			2Q			3Q			4Q			Full Year			1Q
TOTAL PHARMACEUTICAL	$	12,721		$	14,107		$	12,756		$	12,963		$	12,180		$	52,005			-10

United States		6,117			6,773			5,726			6,620			5,871			24,989			-10
% Pharmaceutical Sales		48.1	%		48.0	%		44.9	%		51.1	%		48.2	%		48.1	%
Europe ⁽¹⁾		2,326			3,309			2,677			2,427			2,494			10,906			-30
% Pharmaceutical Sales		18.3	%		23.5	%		21.0	%		18.7	%		20.5	%		21.0	%
China		1,694			1,113			1,355			1,419			1,216			5,102			52
% Pharmaceutical Sales		13.3	%		7.9	%		10.6	%		10.9	%		10.0	%		9.8	%
Japan		737			965			1,092			653			832			3,542			-24
% Pharmaceutical Sales		5.8	%		6.8	%		8.6	%		5.0	%		6.8	%		6.8	%
Asia Pacific (other than China and Japan)		703			786			854			702			691			3,034			-11
% Pharmaceutical Sales		5.5	%		5.6	%		6.7	%		5.4	%		5.7	%		5.8	%
Latin America		470			435			453			511			472			1,871			8
% Pharmaceutical Sales		3.7	%		3.1	%		3.6	%		3.9	%		3.9	%		3.6	%
Eastern Europe/Middle East/Africa		381			450			339			360			320			1,469			-15
% Pharmaceutical Sales		3.0	%		3.2	%		2.7	%		2.8	%		2.6	%		2.8	%
Canada		141			189			166			166			158			678			-25
% Pharmaceutical Sales		1.1	%		1.3	%		1.3	%		1.3	%		1.3	%		1.3	%
Other		152			87			94			105			126			414			75
% Pharmaceutical Sales		1.2	%		0.6	%		0.6	%		0.9	%		1.0	%		0.8	%

Sum of quarterly amounts may not equal year-to-date amounts due to rounding.

⁽¹⁾Europe represents all European Union countries, the European Union accession markets and the United Kingdom.

MERCK & CO., INC.

OTHER (INCOME) EXPENSE, NET - GAAP

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 4

OTHER (INCOME) EXPENSE, NET

	1Q23			1Q22
Interest income	$	(112	)	$	(7	)
Interest expense		242			243
Exchange losses		61			39
(Income) loss from investments in equity securities, net ⁽¹⁾		(450	)		708
Net periodic defined benefit plan (credit) cost other than service cost		(115	)		(121	)
Other, net		463			(154	)
Total	$	89		$	708

⁽¹⁾Includes net realized and unrealized gains and losses from investments in equity securities either owned directly or through ownership interests in investment funds. Unrealized gains and losses from investments that are directly owned are determined at the end of the reporting period, while gains and losses from ownership interests in investment funds are accounted for on a one quarter lag.