Caroline Litchfield
Executive Vice President and Chief Financial Officer at Merck & Co., Inc.
Thank you, Rob. Good morning. As Rob noted, we had another year of strong growth, reflecting continued robust demand for our innovative portfolio and demonstrating the importance of our products to the patients we serve. Growth was driven by oncology, animal health and new product launches, which more than offset the headwinds in China. These results demonstrate the strength of our business and give us confidence in our outlook. Our commercial and operational execution enables us to deliver value in the short-term while we invest in new innovations and deliver our pipeline for the long-term.
Now turning to our 4th-quarter results. Total company revenues were $15.6 billion, an increase of 7% or 9% excluding the impact of foreign-exchange. The following revenue comments will be on an ex-exchange basis. Our Human Health business sustained its momentum with sales increasing 8%, driven primarily by oncology. Our Animal Health business also delivered strong performance with sales growth of 13%.
Turning to the performance of our key brands. In oncology, sales of KEYTRUDA grew 21% to $7.8 billion, driven by continued robust global demand from metastatic indications and increased uptake from earlier-stage cancers. In the US, KEYTRUDA grew across all key tumor types. In metastatic disease, we saw increased uptake for KEYTRUDA in combination with PADCEF in first-line locally advanced urothelial cancer, supported by the strong results from Keynote A39, as well as KEYTRUDA in combination with chemotherapy in first-line endometrial cancer based on the compelling data from Keynote 868.
In the earlier-stage setting, growth was driven by increased use in non-small cell lung cancer as well as triple-negative breast cancer. Outside the US, growth was driven by increased uptake in earlier-stage cancers, including high-risk early-stage triple-negative breast cancer as well as continued demand in metastatic disease. Inflation-related price increases consistent with market practice in Argentina also contributed to growth. Our broader oncology portfolio achieved strong growth, including WELIREG with sales more than doubling to $160 million, driven by increased uptake in certain patients with previously treated advanced renal cell carcinoma in the US. In vaccines, sales were $1.6 billion, a decrease of 18% due to lower demand in China. In the US, sales benefited from price and demand, partially offset by CDC purchasing patterns.
Outside the US and China, double-digit sales growth was driven by higher overall demand, including the catch-up cohort in Japan. In pneumococcal, capfaxid sales were $50 million, driven by demand from the retail pharmacy channel. We have made great progress in achieving the commercial milestones necessary to ensure a successful launch and are well-positioned to help protect adults from invasive pneumococcal disease. Sales decreased 9% as growth from launches in international markets was more than offset by competitive pressures in the US.
In cardiovascular, we are seeing steady growth from the ongoing launch of, which contributed $200 million of sales, predominantly in the US, where we saw some impact to prescription volumes due to the holiday season. Approximately 1,500 new patients in the US received a prescription, bringing the total number of new patients prescribed to approximately 5,200 since launch. Access remains strong and our experience continues to indicate that approximately 80% of those patients who receive a prescription will receive commercial product. Notably, we continue to see the vast majority of patients remain on treatment. The breadth of physicians and depth at which they prescribe continues to grow. We are also seeing an increase in the percentage of prescriptions for patients not on prostacyclin background therapy. Outside the US, initial launches are progressing well.
In summary, we remain confident in our growth expectations for as we look-forward to positively impacting more patients with pulmonary arterial hypertension. Our Animal Health business delivered another quarter of strong growth with sales increasing 13%. Livestock growth reflects higher demand for poultry, sales from the recently-acquired Aqua portfolio from Elanco and price. Companion animal sales growth reflects price.
I will now walk you through the remainder of our P&L and my comments will be on a non-GAAP basis. Gross margin was 80.8%, an increase of 3.6 percentage points driven by reduced royalty rates for KEYTRUDA and as well as favorable product mix. Operating expenses decreased to $7.4 billion. Charges of $700 million related to the license agreements with Lenova and Henso Pharma this quarter were lower than the charge of $5.5 billion a year-ago related to the collaboration with Daiichi Sankyo. Excluding these charges, operating expenses grew 10%, reflecting strategic investments in support of our robust early and late phase pipeline and key growth drivers. Other expense was $5 million. Our tax-rate was 16.2%. Taken together, earnings per share were $1.72.
Now turning to our 2025 non-GAAP guidance. We expect revenue to be between $64.1 billion and $65.6 billion, representing growth of 2% to 4%, excluding a negative impact from foreign-exchange of approximately 2% using mid-January rates. For in China, our guidance assumes no further shipments at the low-end and less than $1 billion at the high-end. Excluding sales of Gardasil in China in both 2024 and 2025 and the negative impact from foreign-exchange, total company growth is expected to be 7% to 9%. Our gross margin assumption is approximately 82.5%.
Operating expenses are assumed to be between $25.4 billion and $26.4 billion. This range includes a $300 million payment-related to the license agreement with Lenova, which will be recognized upon completion of the technology transfer for MK 2010. As a reminder, our guidance does not assume additional significant potential business development transactions. Other expense is expected to be between $300 million and $400 million. We assume a full-year tax-rate between 16% and 17%. We assume approximately 2.53 billion shares outstanding. Taken together, we expect EPS of $8.88 to $9.03. This range includes approximately $0.09 related to the expected payment to Lenova and a negative impact from foreign-exchange of approximately $0.35 using mid-January rates.
As you consider your models, there are a few items to keep in mind. In 2025, we are expecting to see the benefit of a more diverse commercial portfolio with continued strength in oncology and animal health as well as contributions from new product launches. During the first-half of the year, we expect roughly flat year-over-year revenues as the headwind in China is offset by high single-digit growth across the rest of our business. During the second-half, we expect strong year-over-year growth.
Looking at longer-term, while we believe there continues to be a path to the $11 billion, we feel it is prudent to withdraw this target given uncertain timing of an economic recovery in China. Our growth expectations outside of China for this important vaccine remain unchanged and we are well-positioned to protect more lives and drive strong growth beyond 2025. For KEYTRUDA, US sales benefited from approximately $200 million of wholesaler inventory buy-in during the 4th-quarter, which we expect to reverse in the first-quarter. We expect Medicare Part-D redesign to have a negative impact to sales of approximately $400 million, primarily affecting and our portfolio of small-molecule oncology products, including, and Lynvima.
At the beginning of 2025, we lowered the list prices of the Genuvia family of products in the US to more closely align them with net prices. The lower list price will reduce the rebate amount Merck pays to Medicaid and as a result, we expect higher net sales for these products in 2025.
Now turning to capital allocation, where our strategy remains unchanged. We will prioritize investments in our business to drive near and long-term growth. We will continue to make disciplined investments in our key growth drivers and expansive pipeline. We remain committed to our dividend with the goal of continuing to increase it over-time. Business development remains a priority and we are well-positioned to pursue additional science-driven value-enhancing transactions.
We recently increased our authorization for share repurchases by $10 billion to $12 billion in total. Given the opportunities to invest in our business and augment our pipeline through business development, we expect to maintain a modest level of share repurchases this year. We remain committed to not having excess cash build-on our balance sheet and the higher authorization provides flexibility to increase share repurchases if appropriate.
To conclude, we enter 2025 with confidence in the outlook for our business, driven by global demand for our innovative medicines and vaccines as well as our exceptional pipeline, our long-standing commitment to leverage leading-edge science to improve the lives of patients has put us in a position of financial and operational strength. With investment in innovation and our ongoing focus on execution, we are well-positioned to deliver value to patients, customers and shareholders now and well into the future.
With that, I'd now like to turn the call over to Dean.
