Merck, which relies heavily on physician-administered products, is anticipating a revenue hit of $2.1 billion due to the COVID-19 pandemic, according to recently released financial documents.
For the full-year, Merck expects to lose out on $1.7 billion in sales of pharmaceutical products and $400 million in sales for animal health products. In addition, it expects a $750 million hit from currency exchange rates.
Most of the revenue hit is expected to come in the second quarter in the U.S., Merck said.
About two-thirds of Merck's pharmaceutical revenue comes from physician-administered products. The demand for these drugs is being affected by social distancing, delays in elective procedures and fewer wellness checks, the drugmaker said.
"These impacts, as well as prioritization of COVID-19 patients at healthcare providers, are resulting in reduced administration of many of our human health products, in particular for our vaccines, as well as Keytruda and Implanon/Nexplanon," Merck said. "The company anticipates reduced demand for its physician-administered products while pandemic-related access measures remain in place."
In response to the anticipated revenue hit, Merck has suspended its share repurchasing program.
In the first quarter of 2020, Merck said the pandemic didn't affect operations. Merck saw its revenue climb 11 percent year over year to $12.1 billion.
Its pharmaceutical sales drove most of the increase, with $10.7 billion reported in the first quarter.
Overall, Merck ended the first quarter of 2019 with net income of $3.22 billion, compared to $2.91 billion in the same period one year prior.