. Non-GAAP EPS of $0.85, Excluding Certain Items; GAAP EPS of $0.11, for the Quarter
. Strong Sales of Key Pharmaceutical Products; Solid Performance by Consumer Care and Animal Health Units
. New Product Launches and Progressing Pipeline Drive Business Momentum
. On Track to Meet Synergy Target of $3.5 Billion in Annual Savings by End of 2012
. Raised Lower End of 2010 Non-GAAP EPS Target Range Due to Solid Year-to-Date . Performance; Long-Term Non-GAAP EPS Growth Rate Target Reaffirmed
WHITEHOUSE STATION, N.J., Oct. 29, 2010 - Merck & Co., Inc. (NYSE: MRK) today announced financial results for the third quarter of 2010. The company reported non-GAAP (generally accepted accounting principles) earnings per share (EPS) for the third quarter of $0.85, which excludes purchase accounting adjustments, restructuring costs, merger-related expenses and a $950 million legal reserve. Third-quarter GAAP EPS was $0.11.

Worldwide sales for the third quarter of 2010 were $11.1 billion. Net income¹ for the third quarter was $342 million.

For the first nine months of 2010, worldwide sales were $33.9 billion and net income was $1.4 billion.

A reconciliation of EPS as reported in accordance with GAAP to EPS, excluding certain items, is provided in the table that follows. The third quarter and year-to-date 2009 results below reflect legacy Merck on a stand-alone basis.

¹ Net income attributable to Merck & Co., Inc.

"We are pleased with the third quarter as well as our overall execution during Merck's first year as a combined company following the merger," said Richard T. Clark, chairman and chief executive officer. "Our key products are performing well, and at the same time we are launching new products, advancing our robust R&D pipeline and achieving our important merger synergies. One year later, Merck is a much stronger, unified organization that is well-positioned for the future."

Select Business Highlights


New four-year data on odanacatib, the company's investigational treatment for osteoporosis in post-menopausal women, was presented last week at the American Society for Bone and Mineral Research annual meeting. Clinical and preclinical studies continue to provide data on the potential of odanacatib to increase bone density, cortical thickness and bone strength when treating osteoporosis.

Also, full data results for two pivotal late-stage studies for boceprevir, for the treatment of hepatitis C, will be presented Nov. 1 and 2 at the annual meeting of the American Association for the Study of Liver Disease.

Safety and efficacy data from the DEFINE study for anacetrapib for the treatment of atherosclerosis will be presented in a late-breaker presentation on Nov. 17, at the American Heart Association's Scientific Sessions.

In the quarter, the company also launched three new medicines: the intravenous (IV) formulation of BRINAVESS (vernakalant) for the treatment of atrial fibrillation in adults in the European Union (EU), Iceland and Norway; DULERA (mometasone furoate and formoterol fumarate dihydrate) for the treatment of asthma in the United States; and DAXAS (roflumilast) for the treatment of symptomatic COPD in Canada and certain European markets, through a partnership.

The company is making progress growing its business in emerging markets, with 18 percent of sales from human health pharmaceuticals and vaccines coming from these markets in the quarter.

Merck continues to secure strategic research and development collaborations, including agreements this quarter with Alectos Therapeutics and NicOx, to develop targeting technologies for new compounds. In addition, the company signed an agreement to allow Lundbeck to distribute SYCREST (asenapine), Merck's treatment for bipolar disorder, in all markets outside the United States, China and Japan.

Merck's subsidiary, Schering-Plough (Ireland) Company and Centocor Ortho Biotech Inc., a Johnson & Johnson subsidiary, have concluded the arbitration hearing regarding Remicade and Simponi, and will file post-hearing briefs and present arguments to the arbitration panel in late December. Merck anticipates a decision in 2011.

Financial Targets
For 2010, Merck raised the lower end of the non-GAAP EPS range and is now targeting a range of $3.31 to $3.39, excluding certain items, and a 2010 GAAP EPS range of $0.66 to $0.97. The 2010 non-GAAP range excludes purchase accounting adjustments, restructuring and merger-related costs, the first-quarter tax charge related to U.S. health care reform legislation, the second-quarter gain on AstraZeneca's asset option exercise, and the third-quarter $950 million legal reserve. EPS and other financial targets for 2010 assume that Merck will retain full rights to REMICADE and SIMPONI in the applicable markets.