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April 15, 2011 6:01 am ET

WHITEHOUSE STATION, N.J.–(BUSINESS WIRE)–Following the Merck and Johnson & Johnson settlement announcement today, Merck (NYSE: MRK) said that it continues to expect 2011 non-GAAP earnings per share (EPS) to be in the range of $3.64 to $3.76, excluding certain items. The 2011 non-GAAP EPS target range excludes the $500 million one-time payment to Centocor as well as related tax impacts of the arbitration resolution, purchase accounting adjustments, restructuring costs and merger-related expenses. The 2011 GAAP EPS target range includes the entire impact of the arbitration settlement and is now expected to be in the range of $1.89 to $2.17. A reconciliation of anticipated 2011 EPS as reported in accordance with GAAP to non-GAAP EPS that excludes certain items is provided in the table below.

Merck also continues to expect full year 2011 revenue to grow in the low to mid-single digit percent range from the base of $46.0 billion in the full year of 2010.

“We are pleased that the purposeful and focused steps we have taken in the first half of 2011 will allow us to maintain our prior 2011 non-GAAP financial targets – including revenue and EPS – while absorbing the ongoing impact of the settlement during the remainder of the year,” said Kenneth C. Frazier, president and chief executive officer of Merck. “Looking ahead, the ongoing and future launches of Simponi in countries across Europe give us additional opportunities.”

About Merck

Today’s Merck is a global healthcare leader working to help the world be well. Merck is known as MSD outside the United States and Canada. Through our prescription medicines, vaccines, biologic therapies, and consumer care and animal health products, we work with customers and operate in more than 140 countries to deliver innovative health solutions. We also demonstrate our commitment to increasing access to healthcare through far-reaching policies, programs and partnerships that donate and deliver our products to the people who need them. For more information, visit www.merck.com.

Forward-Looking Statement

This news release includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, statements about the benefits of the merger between Merck and Schering-Plough, including future financial and operating results, the combined company’s plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Merck’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the possibility that the expected synergies from the merger of Merck and Schering-Plough will not be realized, or will not be realized within the expected time period; the impact of pharmaceutical industry regulation and health care legislation; the risk that the businesses will not be integrated successfully; disruption from the merger making it more difficult to maintain business and operational relationships; Merck’s ability to accurately predict future market conditions; dependence on the effectiveness of Merck’s patents and other protections for innovative products; the risk of new and changing regulation and health policies in the U.S. and internationally and the exposure to litigation and/or regulatory actions.

Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in Merck’s 2010 Annual Report on Form 10-K and the company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site (www.sec.gov).

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¹ Represents the difference between calculated GAAP EPS and calculated non-GAAP EPS, which may be different than the amount calculated by dividing the impact of the excluded items by the weighted average shares.

² Represents an estimated income tax (benefit) expense relating to the reconciling items.

Merck
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