Merck & Co. 8K Results of Operations and Financial Condition | MRK 1 Feb 13

Exhibit 99.2

MERCK & CO., INC.

CONSOLIDATED STATEMENT OF OPERATIONS - GAAP

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table 1a


	2012															2011															% Change
	1Q			2Q			3Q			4Q			Full Year			1Q			2Q			3Q			4Q			Full Year			4Q		Full Year
Sales	$	11,731		$	12,311		$	11,488		$	11,738		$	47,267		$	11,580		$	12,151		$	12,022		$	12,294		$	48,047		-5	%	-2%
Costs, Expenses and Other
Materials and production	4,037			4,112			4,137			4,160			16,446			4,059			4,284			4,352			4,176			16,871			—		-3%
Marketing and administrative	3,074			3,249			3,063			3,390			12,776			3,164			3,525			3,340			3,704			13,733			-8	%	-7%
Research and development	1,862			2,165			1,918			2,224			8,168			2,158			1,936			1,954			2,419			8,467			-8	%	-4%
Restructuring costs	219			144			110			191			664			(14		)	668			119			533			1,306			-64	%	-49%
Equity income from affiliates	(110		)	(142		)	(158		)	(231		)	(642		)	(138		)	(55		)	(161		)	(257		)	(610		)	-10	%	5%
Other (income) expense, net	142			103			200			176			623			622			121			66			139			946			27	%	-34%

Income Before Taxes	2,507			2,680			2,218			1,828			9,232			1,729			1,672			2,352			1,580			7,334			16	%	26%
Income Tax Provision (Benefit)	740			860			455			385			2,440			658			(382		)	628			37			942
Net Income	1,767			1,820			1,763			1,443			6,792			1,071			2,054			1,724			1,543			6,392			-6	%	6%
Less: Net Income Attributable to Noncontrolling Interests	29			27			34			42			131			28			30			32			31			120
Net Income Attributable to Merck & Co., Inc.	$	1,738		$	1,793		$	1,729		$	1,401		$	6,661		$	1,043		$	2,024		$	1,692		$	1,512		$	6,272		-7	%	6%
Earnings per Common Share Assuming Dilution	$	0.56		$	0.58		$	0.56		$	0.46		$	2.16		$	0.34		$	0.65		$	0.55		$	0.49		$	2.02		-6	%	7%

Average Shares Outstanding Assuming Dilution	3,074			3,072			3,079			3,074			3,076			3,104			3,110			3,091			3,069			3,094
Tax Rate	29.5		%	32.1		%	20.5		%	21.1		%	26.4		%	38.1		%	-22.8		%	26.7		%	2.3		%	12.8		%

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

MERCK & CO., INC.

CONSOLIDATED STATEMENT OF OPERATIONS

GAAP TO NON-GAAP RECONCILIATION

FOURTH QUARTER 2011

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table 2c

	GAAP			Acquisition- Related Costs (1)		Restructuring Costs (2)		Certain Other Items		Adjustment Subtotal			Non-GAAP
Sales	$	12,294								$	—		$	12,294
Costs, Expenses and Other
Materials and production	4,176			1,212		68		7		1,287			2,889
Marketing and administrative	3,704			86		42				128			3,576
Research and development	2,419			244		49				293			2,126
Restructuring costs	533					533				533			—
Equity income from affiliates	(257		)							—			(257		)
Other (income) expense, net	139			(63	)			(1	)	(64		)	203
Income Before Taxes	1,580			(1,479	)	(692	)	(6	)	(2,177		)	3,757
Taxes on Income	37									(711		)(3)	748
Net Income	1,543									(1,466		)	3,009
Less: Net Income Attributable to Noncontrolling Interests	31									—			31
Net Income Attributable to Merck & Co., Inc.	$	1,512								$	(1,466	)	$	2,978
Earnings per Common Share Assuming Dilution	$	0.49											$	0.97	(4)
Average Shares Outstanding Assuming Dilution	3,069												3,069
Tax Rate	2.3		%										19.9		%

Merck is providing 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 this information enhances investors’ understanding of the company’s performance. This information should be considered in addition to, but not in lieu of, information prepared in accordance with GAAP.

(1) Amounts included in materials and production costs reflect expenses for the amortization of intangible assets and the amortization of purchase accounting adjustments to inventories recognized as a result of mergers and acquisitions. Amounts included in marketing and administrative expenses reflect integration costs, as well as other costs associated with mergers and acquisitions, such as severance costs which are not part of the company’s formal restructuring programs. Amounts included in research and development expenses represent in-process research and development (“IPR&D”) impairment charges. Amounts included in other (income) expense, net reflect the favorable resolution of certain reserves assumed in conjunction with mergers and acquisitions.

(2) Amounts primarily include employee separation costs and accelerated depreciation associated with facilities to be closed or divested related to actions under the company’s formal restructuring programs.

(3) Includes the favorable impact of certain state tax rate changes that resulted in a net $40 million reduction of deferred tax liabilities on intangibles established in purchase accounting, as well as the estimated tax impact on the reconciling items.

(4) The company calculates earnings per share pursuant to the two-class method which requires the allocation of net income between common shareholders and participating security holders. Net income attributable to Merck & Co., Inc. common shareholders used to calculate non-GAAP earnings per common share assuming dilution was $2,973 million for the fourth quarter of 2011.

MERCK & CO., INC.

CONSOLIDATED STATEMENT OF OPERATIONS

GAAP TO NON-GAAP RECONCILIATION

FULL YEAR 2011

(AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES)

(UNAUDITED)

Table 2d

	GAAP			Acquisition- Related Costs (1)		Restructuring Costs (2)		Certain Other Items (3)		Adjustment Subtotal			Non-GAAP
Sales	$	48,047								$	—		$	48,047
Costs, Expenses and Other
Materials and production	16,871			5,137		348		7		5,492			11,379
Marketing and administrative	13,733			278		119				397			13,336
Research and development	8,467			587		138				725			7,742
Restructuring costs	1,306					1,306				1,306			—
Equity income from affiliates	(610		)							—			(610		)
Other (income) expense, net	946			(63	)			235		172			774
Income Before Taxes	7,334			(5,939	)	(1,911	)	(242	)	(8,092		)	15,426
Taxes on Income	942									(2,667		)(4)	3,609
Net Income	6,392									(5,425		)	11,817
Less: Net Income Attributable to Noncontrolling Interests	120									—			120
Net Income Attributable to Merck & Co., Inc.	$	6,272								$	(5,425	)	$	11,697
Earnings per Common Share Assuming Dilution	$	2.02											$	3.77	(5)
Average Shares Outstanding Assuming Dilution	3,094												3,094
Tax Rate	12.8		%										23.4		%

(1) Amounts included in materials and production costs reflect expenses of $5.0 billion for the amortization of intangible assets and the amortization of purchase accounting adjustments to inventories recognized as a result of mergers and acquisitions, as well as $118 million of impairment charges on product intangibles. Amounts included in marketing and administrative expenses reflect integration costs, as well as other costs associated with mergers and acquisitions, such as severance costs which are not part of the company’s formal restructuring programs. Amounts included in research and development expenses represent in-process research and development (“IPR&D”) impairment charges. Amounts included in other (income) expense, net reflect the favorable resolution of certain reserves assumed in conjunction with mergers and acquisitions.

(3) Included in other (income) expense, net is a $500 million charge related to the resolution of the arbitration proceeding with Johnson & Johnson, a $136 million gain on the divestiture of the company’s interest in the Johnson & JohnsonºMerck Consumer Pharmaceuticals Company joint venture and a $127 million gain on the sale of certain manufacturing facilities and related assets.

(4) Includes a net benefit of approximately $700 million relating to the settlement of the company’s 2002-2005 federal income tax audit, the favorable impact of certain foreign and state tax rate changes that resulted in a net $270 million reduction of deferred tax liabilities on intangibles established in purchase accounting, as well as the estimated tax impact on the reconciling items.

(5) The company calculates earnings per share pursuant to the two-class method which requires the allocation of net income between common shareholders and participating security holders. Net income attributable to Merck & Co., Inc. common shareholders used to calculate non-GAAP earnings per common share assuming dilution was $11,670 million for the full year of 2011.

MERCK & CO., INC.

FRANCHISE / KEY PRODUCT SALES

FOURTH QUARTER 2012

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3a

	Global					U.S.					International
	4Q12		4Q11		% Change	4Q12		4Q11		% Change	4Q12		4Q11		% Change
TOTAL SALES (1)	$	11,738	$	12,294	-5	$	4,716	$	5,296	-11	$	7,022	$	6,998	—

PHARMACEUTICAL	10,085		10,755		-6	3,915		4,606		-15	6,170		6,149		—

Primary Care and Women’s Health

Cardiovascular
Zetia	676		640		6	345		327		5	331		313		6
Vytorin	435		475		-8	186		213		-13	249		262		-5

Diabetes & Obesity
Januvia	1,134		960		18	565		503		13	568		457		24
Janumet	452		386		17	237		193		23	215		193		12

Respiratory
Singulair	480		1,461		-67	25		957		-97	456		504		-10
Nasonex	308		325		-5	138		163		-16	169		161		5
Dulera	67		37		83	64		36		79	2		1		*
Clarinex	56		129		-57	4		51		-93	52		78		-33
Asmanex	44		57		-23	38		51		-24	5		6		-10

Women’s Health & Endocrine
NuvaRing	164		168		-2	99		102		-3	66		66		—
Fosamax	154		211		-27	6		8		-24	148		204		-27
Follistim AQ	116		126		-8	42		42		-1	75		84		-11
Implanon	94		74		27	35		33		4	59		40		46
Cerazette	68		69		-1						68		69		-1

Other
Maxalt	162		178		-9	128		132		-3	34		46		-27
Arcoxia	115		110		5						115		110		5
Avelox	55		95		-42	52		86		-40	3		9		-68

Hospital and Specialty
Immunology
Remicade	549		511		8						549		511		8
Simponi	95		61		56						95		61		56

Infectious Disease
Isentress	381		387		-2	214		193		11	167		194		-14
Cancidas	145		164		-11	9		12		-24	136		152		-10
PegIntron	143		175		-18	8		25		-67	134		150		-10
Invanz	116		110		6	61		55		10	55		54		2
Victrelis	115		87		32	52		58		-10	63		29		*
Primaxin	83		119		-30	4		14		-73	80		104		-24
Noxafil	68		59		15	20		16		24	47		42		12

Oncology
Temodar	229		230		-1	101		99		3	128		132		-3
Emend	131		114		16	74		68		9	57		46		25

Other
Cosopt / Trusopt	113		117		-3	3		4		-10	110		113		-3
Bridion	75		60		26						75		60		26
Integrilin	51		57		-11	46		50		-9	5		7		-26

Diversified Brands
Cozaar / Hyzaar	315		427		-26	12		20		-40	303		407		-25
Propecia	112		117		-4	29		36		-18	83		81		2
Zocor	98		111		-12	7		8		-11	90		103		-12
Claritin Rx	63		74		-15						63		74		-15
Remeron	57		59		-4	1		1		-10	56		58		-4
Proscar	56		52		7	2		1		24	54		51		7
Vasotec / Vaseretic	48		58		-17						48		58		-17

Vaccines
Gardasil	442		274		61	304		202		51	138		72		91
ProQuad, M-M-R II and Varivax	306		276		11	283		243		16	22		33		-33
Zostavax	225		78		*	211		73		*	14		5		*
Pneumovax	208		222		-7	165		137		21	43		86		-50
RotaTeq	168		195		-14	136		162		-16	32		33		-1

Other Pharmaceutical (2)	1,113		1,064		5	209		232		-10	904		832		9

ANIMAL HEALTH	898		868		3	236		192		23	662		676		-2

CONSUMER CARE	395		361		9	250		225		11	145		136		6
Claritin OTC	100		92		9	68		59		15	32		33		-2

Other Revenues (3)	360		310		16	315		274		15	45		37		21
Astra	251		256		-2	251		256		-2

* 100% or greater

(1) Only select products are shown.

(2) Includes Pharmaceutical products not individually shown above. Other Vaccines sales included in Other Pharmaceutical were $69 million and $62 million on a global basis for fourth quarter 2012 and 2011, respectively.

(3) Other revenues are primarily comprised of alliance revenue, miscellaneous corporate revenues and third party manufacturing sales.

MERCK & CO., INC.

FRANCHISE / KEY PRODUCT SALES

FULL YEAR 2012

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3b

	Global					U.S.					International
	Full Year 2012		Full Year 2011		% Change	Full Year 2012		Full Year 2011		% Change	Full Year 2012		Full Year 2011		% Change
TOTAL SALES (1)	$	47,267	$	48,047	-2	$	20,392	$	20,495	-1	$	26,875	$	27,552	-2

PHARMACEUTICAL	40,601		41,289		-2	17,041		17,117		—	23,560		24,172		-3

Primary Care and Women’s Health

Cardiovascular
Zetia	2,567		2,428		6	1,332		1,223		9	1,235		1,205		2
Vytorin	1,747		1,882		-7	764		888		-14	983		994		-1

Diabetes & Obesity
Januvia	4,086		3,324		23	2,136		1,824		17	1,950		1,499		30
Janumet	1,659		1,363		22	865		712		21	795		651		22

Respiratory
Singulair	3,853		5,479		-30	2,152		3,536		-39	1,701		1,942		-12
Nasonex	1,268		1,286		-1	597		604		-1	671		682		-2
Clarinex	393		621		-37	126		197		-36	267		424		-37
Dulera	207		96		*	199		94		*	8		2		*
Asmanex	185		206		-10	166		185		-10	19		21		-11

Women’s Health & Endocrine
Fosamax	676		855		-21	28		45		-38	648		810		-20
NuvaRing	623		623		—	366		369		-1	257		254		1
Follistim AQ	468		530		-12	165		163		1	303		367		-17
Implanon	348		294		18	139		126		11	209		169		24
Cerazette	271		268		1						271		268		1

Other
Maxalt	638		639		—	491		451		9	146		187		-22
Arcoxia	453		431		5						453		431		5
Avelox	201		322		-37	192		288		-33	9		34		-72

Hospital and Specialty
Immunology
Remicade	2,076		2,667		-22						2,076		2,667		-22
Simponi	331		264		25						331		264		25

Infectious Disease
Isentress	1,515		1,359		11	822		681		21	692		678		2
PegIntron	653		657		-1	87		71		22	565		586		-3
Cancidas	619		640		-3	32		44		-28	587		595		-1
Victrelis	502		140		*	267		98		*	234		43		*
Invanz	445		406		10	227		205		11	218		200		9
Primaxin	384		515		-25	21		87		-76	363		429		-15
Noxafil	258		230		13	75		61		23	184		169		9

Oncology
Temodar	917		935		-2	423		396		7	494		538		-8
Emend	489		419		17	276		239		16	213		180		18

Other
Cosopt / Trusopt	444		477		-7	14		16		-16	430		461		-7
Bridion	261		201		30						261		201		30
Integrilin	211		230		-8	193		208		-7	18		22		-16

Diversified Brands
Cozaar / Hyzaar	1,284		1,663		-23	28		107		-74	1,256		1,555		-19
Propecia	424		447		-5	124		134		-7	300		313		-4
Zocor	383		456		-16	27		32		-17	356		423		-16
Claritin Rx	244		314		-22						244		314		-22
Remeron	232		241		-4	5		6		-21	227		234		-3
Proscar	217		223		-3	5		5		-13	212		218		-3
Vasotec / Vaseretic	192		231		-17						192		231		-17

Vaccines
Gardasil	1,631		1,209		35	1,113		880		26	517		329		57
ProQuad, M-M-R II and Varivax	1,273		1,202		6	1,164		1,108		5	109		93		17
Zostavax	651		332		96	607		320		90	44		12		*
RotaTeq	601		651		-8	453		522		-13	148		129		15
Pneumovax	580		498		17	461		350		32	118		148		-20

Other Pharmaceutical (2)	4,141		4,035		3	899		839		7	3,244		3,198		1

ANIMAL HEALTH	3,399		3,253		4	879		711		24	2,520		2,542		-1

CONSUMER CARE	1,952		1,840		6	1,306		1,210		8	646		630		3
Claritin OTC	532		511		4	386		363		6	147		147		-1

Other Revenues (3)	1,315		1,666		-21	1,166		1,457		-20	149		208		-28
Astra	915		1,184		-23	915		1,184		-23

* 100% or greater

(1) Only select products are shown.

(2) Includes Pharmaceutical products not individually shown above. Other Vaccines sales included in Other Pharmaceutical were $319 million and $283 million on a global basis for full year 2012 and 2011, respectively.

(3) Other revenues are primarily comprised of alliance revenue, miscellaneous corporate revenues and third party manufacturing sales.

MERCK & CO., INC.

PHARMACEUTICAL GEOGRAPHIC SALES

(AMOUNTS IN MILLIONS)

(UNAUDITED)

Table 3c

	1Q12			2Q12			3Q12		��	4Q12			Full Year			1Q11			2Q11			3Q11			4Q11			Full Year			% Change 4Q	% Change FY

TOTAL PHARMACEUTICAL	$	10,082		$	10,560		$	9,875		$	10,085		$	40,601		$	9,820		$	10,360		$	10,354		$	10,755		$	41,289		-6	-2

United States	4,189			4,633			4,304			3,915			17,041			3,907			4,088			4,515			4,606			17,117			-15	—
% Pharmaceutical Sales	41.6		%	43.9		%	43.6		%	38.8		%	42.0		%	39.8		%	39.5		%	43.6		%	42.8		%	41.5		%

Europe (1)	2,558			2,540			2,210			2,441			9,750			2,587			2,827			2,588			2,621			10,623			-7	-8
% Pharmaceutical Sales	25.4		%	24.1		%	22.4		%	24.2		%	24.0		%	26.3		%	27.3		%	25.0		%	24.4		%	25.7		%

Japan	1,267			1,199			1,124			1,388			4,978			1,164			1,104			1,114			1,327			4,709			5	6
% Pharmaceutical Sales	12.6		%	11.4		%	11.4		%	13.8		%	12.3		%	11.8		%	10.7		%	10.8		%	12.3		%	11.4		%

Latin America	627			668			715			742			2,752			700			743			667			747			2,857			-1	-4
% Pharmaceutical Sales	6.2		%	6.3		%	7.2		%	7.4		%	6.8		%	7.1		%	7.2		%	6.4		%	6.9		%	6.9		%

Asia Pacific	762			787			846			864			3,259			699			779			763			736			2,977			18	9
% Pharmaceutical Sales	7.6		%	7.4		%	8.6		%	8.6		%	8.0		%	7.1		%	7.5		%	7.4		%	6.8		%	7.2		%

China	221			262			262			298			1,044			187			206			220			221			834			35	25

Eastern Europe/Middle East Africa	361			441			366			416			1,584			358			369			371			378			1,476			10	7
% Pharmaceutical Sales	3.6		%	4.2		%	3.7		%	4.1		%	3.9		%	3.6		%	3.6		%	3.6		%	3.5		%	3.6		%

Canada	264			236			257			276			1,034			360			399			285			279			1,323			-1	-22
% Pharmaceutical Sales	2.6		%	2.2		%	2.6		%	2.7		%	2.5		%	3.7		%	3.9		%	2.8		%	2.6		%	3.2		%

Other	53			56			52			42			203			45			51			51			61			208			-30	-2
% Pharmaceutical Sales	0.5		%	0.5		%	0.5		%	0.4		%	0.5		%	0.5		%	0.5		%	0.5		%	0.6		%	0.5		%

(1) Europe primarily represents all European Union countries and the European Union accession markets.

MERCK & CO., INC.

EQUITY INCOME / JV SALES / OTHER (INCOME) EXPENSE - GAAP

FOURTH QUARTER 2012

(UNAUDITED)

Table 4

EQUITY INCOME FROM AFFILIATES (millions of dollars)

	4Q12			4Q11		Full Year 2012		Full Year 2011
ASTRAZENECA LP	$	233		$	256	$	621	$	574
Other (1)	(2		)	1		21		36
TOTAL	$	231		$	257	$	642	$	610

(1) Includes results for Sanofi Pasteur MSD.

SANOFI PASTEUR MSD JOINT VENTURE SALES DETAIL (millions of dollars)

All sales reported here are end-market JV sales, presented on a “NET” basis.

	4Q12		4Q11		Full Year 2012		Full Year 2011
GARDASIL	$	67	$	70	$	264	$	253
FLU VACCINES	79		54		161		183
OTHER VIRAL VACCINES	26		28		107		105
ROTATEQ	12		12		47		44
HEPATITIS VACCINES	7		10		31		39
Other Vaccines	122		131		474		486
TOTAL SANOFI PASTEUR MSD SALES	$	313	$	305	$	1,084	$	1,110

OTHER (INCOME) EXPENSE, NET (millions of dollars)

	4Q12			4Q11			Full Year 2012			Full Year 2011
INTEREST INCOME (1)	$	(55	)	$	(43	)	$	(232	)	$	(145	)
INTEREST EXPENSE (1)	190			174			714			695
EXCHANGE LOSSES	55			41			185			143
Other, net (2)	(14		)	(33		)	(44		)	253
TOTAL	$	176		$	139		$	623		$	946

(1) Prior period amounts reflect reclassifications to conform to the current period presentation.

(2) Other, net for the full year of 2011 includes a charge of $500 million related to the resolution of the arbitration proceeding with Johnson & Johnson.

Merck & Co. (MRK) 8-KResults of Operations and Financial Condition