2012, which primarily reflects the performance of AZLP and Sanofi
Other (income) expense, net was $200 million of expense in the third quarter of 2012, compared to $66 million of expense in the third quarter of 2011. The third quarter of 2011 reflects a $136 million gain on the divestiture of the company's interest in the Johnson & JohnsonÂ°Merck Consumer Pharmaceuticals Company joint venture.
The GAAP effective tax rate of 20.5 percent for the third quarter of 2012 reflects the impact of acquisition-related costs and restructuring costs. The non-GAAP effective tax rate, which excludes these items, was 20.3 percent for the quarter. Both the GAAP and non-GAAP effective tax rates reflect the favorable impacts of a settlement with a foreign tax authority and the realization of foreign tax credits.
The company noted the following developments:
In October, entered into an exclusive worldwide licensing agreement for AiCuris' late-stage antiviral candidate for the treatment and prevention of human cytomegalovirus infection in transplant recipients;
Completed a study of sugammadex, a neuromuscular blocker reversal agent, to assess bleeding risk when co-administered with anticoagulants in a surgical setting. The company remains on track to resubmit sugammadex to the FDA this year;
Announced results from a Phase II trial for odanacatib, an investigational cathepsin K inhibitor in development for the treatment of osteoporosis in post-menopausal women. In that Phase II trial, odanacatib significantly increased bone mineral density over a two-year period in patients previously treated with alendronate;
Presented Phase IIb data for MK-3102, the company's investigational once-weekly DPP-4 inhibitor in development for the treatment of type 2 diabetes. MK-3102 significantly lowered blood sugar in this 12-week study compared with placebo, with an incidence of symptomatic hypoglycemia that was similar to placebo, in patients with type 2 diabetes. The company has initiated the Phase III clinical program;
Presented new clinical data for suvorexant that showed patients who had been taking suvorexant for 12 months and were then switched to placebo for two months saw their insomnia return, but clinically meaningful withdrawal symptoms and rebound insomnia did not emerge;
Announced plans to file applications for vorapaxar, an investigational anti-thrombotic medicine, in the United States and Europe in 2013. The company will seek an indication for the prevention of cardiovascular events in patients with a history of heart attack and no history of transient ischemic attack or stroke.
Merck narrows the range of full-year 2012 non-GAAP EPS to be between $3.78 and $3.82 and the 2012 GAAP EPS range to be $2.08 to $2.24. The 2012 non-GAAP range excludes acquisition-related costs and costs related to restructuring programs.
Merck continues to expect full-year 2012 revenues to be at or near 2011 levels on a constant currency basis. At current exchange rates, sales would be affected unfavorably by approximately 1 percent for the fourth quarter and more than 2 percent for the full year.
In addition, the company expects full-year 2012 non-GAAP R&D expenses to be higher than the 2011 level. The company continues to expect the full-year 2012 non-GAAP tax rate to be approximately 25 percent.
As of Sept. 30, 2012, Merck had approximately 84,000 employees worldwide.
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