Merck KGaA attributes 1st-qtr loss to Serono buy

German drug major Merck KGaA says that its 8.3 million euro ($11.3 million) loss for the first quarter of 2007 , down from the 180.8 million euro profit it reported in the comparable period last year, was largely due to costs associated with its acquisition of Swiss biotechnology group Serono (Marketletter January 1 & 8). The deficit did not match the predictions of analysts questioned in surveys conducted by both Dow Jones Newswires and Bloomberg, who had forecast profits of 5.0 million euros and 24.5 million euros, respectively.

Michael Roemer, chairman of Merck's executive board, commented that, "with the integration of Serono, Merck has positioned itself to build upon its research leadership with competencies in both biotech and chemical pharmaceuticals." He added that the purchase, which was originally valued at 10.6 billion euros but has fallen to 10.2 billion euros due to current favorable exchange rates, would have a strong influence on the company's revenue and profits in 2007, and that it had increased the level of turnover derived from pharmaceuticals to 75%.

Revenue climbs 37% to 2.17 billion euros