Merck & Co., Inc.

Good morning. My name is Gerald, and I will be your conference operator today. At this time, I would like to welcome everyone to the Merck & Company First Quarter Sales and Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, Simply press star, then the number one on your telephone keypad. So we draw your questions, press the pound key. Thank you. I would now like to turn the call over to Peter Donenbaum, Vice President of Investor Relations. Please go ahead.

Thank you, Jerome. Good morning. Welcome to Merck's first quarter 2020 conference call. Today I'm joined by Ken Frazier, our Chairman and Chief Executive Officer. Rob Davis, our Chief Financial Officer. Dr. Roger Perlmutter, President of Merck Research Labs, Frank Clyburn, our Chief Commercial Officer, and Mike Nally, our Chief Marketing Officer. Before I turn the call over to Ken, I'd like to point out a few items. You will see that we have items in our GAAP results such as acquisition related charges, restructuring costs, and certain other items. You should note that we have excluded these from our non-GAAP results and provide a reconciliation in our press release. We've also provided a table in our press release to help you understand the sales in the quarter for the business units and products. I would like to remind you that some of the statements we make during today's call may be considered forward-looking statements within the meaning of the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. Such statements are made based on the current beliefs of Merck's management and are subject to significant risks and uncertainties. If our underlying assumptions prove inaccurate or uncertainties materialize, actual results may differ materially from those set forth in the forward-looking statements. Our SEC filing concluding item 1A and the 2019 10K identify certain risk factors and cautionary statements that could cause the company's actual results to differ materially from those projected in any of our forward-looking statements made this morning. Merck undertakes no obligation to publicly update any forward-looking statements. Our SEC filings, today's earnings release, and an investor presentation with some highlights of our results are all posted on merck.com. With that, I'd like to turn the call over to Ken.

Thank you, Peter. Good morning, and thank you all for joining today's call. In this challenging and unprecedented time, our first quarter performance reflects strong demand for our portfolio of innovative products, continued commercial and clinical execution, and the dedication and resilience of our employees around the world. The fundamentals of our business remain strong. The COVID-19 global pandemic poses extraordinary challenges to all of us, including serious threats to the health of people, businesses, and economies around the world. Without question, our industry and our company have a unique ability and responsibility to help the world respond to this global pandemic by working collaboratively to deliver solutions to coronavirus infections, while also maintaining the supply of medically important products to those who need them. Amidst this crisis, We at Merck are focused on protecting the health and safety of our employees and their families, while also ensuring that our essential medicines and vaccines continue to reach the patients we serve. Importantly, the majority of Merck's manufacturing plants and clinical supply sites remain fully operational. We have seen little impact to the production, supply, or distribution of our medicines, vaccines, and animal health products. In many markets around the world, including the U.S., while our offices and laboratories remain open, our colleagues are primarily working from home. And for patients currently enrolled in our clinical trials, we are making every effort to ensure that patients in affected areas are able to continue their treatment and receive appropriate care and monitoring. Conditions are fluid and evolving, but as conditions allow, we are enrolling patients in ongoing studies and we're starting new studies. Of course, there is great interest in what we're doing to address COVID-19 from a scientific perspective. Roger Perlmutter will speak to the totality of our efforts in more detail, but I will mention that we have deep scientific experience and expertise in both antivirals and vaccines, and our research colleagues are actively engaged in efforts to combat COVID-19. We have teams of scientists researching COVID-19 itself and assessing antiviral and vaccine candidates for their potential to impact the disease. In addition, we've been working extensively with the broader scientific community to assess different assets and have been engaging with a range of research organizations on collaborative efforts. We know from our experience with viral epidemics like HIV and Ebola that scientific collaborations are essential to develop medicines and vaccines in a global public health emergency like the one we are facing now. We also know that the path to a new medicine or vaccine is rarely short, nor is it easy. But we are optimistic that our industry's efforts will create new tools to combat this coronavirus. And Merck is committed to playing its part in response to this global pandemic for the patients that depend on our medicines and vaccines, the global community, and those directly impacted by COVID-19. The underlying demand for our innovative portfolio of products remains strong, and our business remains fundamentally sound. However, the pandemic is impacting patients' ability to access hospitals and physician offices, particularly for many of our products, which require physician administration. And social distancing measures are also impacting customer access and demand for our animal health products. Rob and Frank will speak to the near-term impact to our business in a minute. But on a longer-term basis, we remain confident in our outlook for strong growth once people adjust and find ways to address the needs of health and healthcare beyond COVID-19. Importantly, our financial strength and strong balance sheet allow us to continue with our capital allocation priorities, including investing in R&D and in our growth drivers, investing in manufacturing capacity expense expansion, paying our dividend, and continuing our search for value-enhancing business development, which remains a top priority. We also remain fully committed to our spinoff transaction, and we believe we are on track for completion in the first half of 2021. We completed several important milestones in the quarter, including the naming of the new company Organon & Co. Inc., a name which has strong grant equity and engenders trust among healthcare professionals, for its dedication and innovation in women's health. We've also named several members of the Organon leadership team. We continue to believe that two more focused companies will allow us to reach more patients, drive stronger growth, and unlock longer-term value for shareholders. To conclude, we recognize now more than ever the importance of our investment in R&D and the value of our science-based approach. We remain dedicated to our mission to save and improve lives through the discovery of innovative new medicines and vaccines to treat and protect patients in the midst of the pandemic and in the future. With that, I'll now pass it over to Rob Davis to review the details of our performance and output.