Shares of Pfizer's animal health business, Zoetis, are up 18 percent in their first day of trading after raising $2.2 billion in an initial public offering of stock.
Pfizer Inc., the world's largest drugmaker, is keeping an ownership stake of at least 80 percent in Zoetis Inc. after the IPO.
The New York company sold 86.1 million shares for $26 apiece, $1 above the top end of the range it estimated. That suggested healthy demand for Zoetis from investors.
The stock trades under the "ZTS" ticker symbol on the New York Stock Exchange. Shares are adding $4.60 to $30.60 in morning trading.
The company, which makes and sells animal health medicines and vaccines, will not receive any of the offering proceeds. Pfizer (PFE), the world's largest drugmaker, will retain about an 83 percent ownership stake in Zoetis and will own all of the company's outstanding Class B shares. The offering focused on Class A shares.
If the underwriters exercise their option in full, Pfizer's ownership stake will be reduced to about 80 percent.
Pfizer said Tuesday Zoetis revenue rose 6 percent to $1.17 billion in the fourth quarter.
Shares will trade on the New York Stock Exchange under the symbol "ZTS."
Merck & Co.'s (MRK) fourth-quarter profit fell 7 percent as generic competition slashed sales of its blockbuster allergy drug Singulair and the drugmaker took sizeable restructuring and acquisition charges. The company still beat Wall Street expectations.
The world's third-biggest drugmaker by revenue said Friday that net income was $1.4 billion, or 46 cents per share, down from $1.51 billion, or 49 cents per share, a year earlier.
Excluding one-time charges totaling $1.14 billion, net income was $2.54 billion, or 83 cents per share, 2 cents more than analysts polled by research provider FactSet were expecting.
The maker of Januvia and other diabetes pills says revenue totaled $11.74 billion, down 5 percent from 2011's fourth quarter. Analysts expected $11.47 billion.
"Merck overcame significant challenges last year and delivered strong results in 2012 by successfully growing our businesses, expanding geographically and reducing our expenses," CEO Kenneth Frazier said in a statement.
That pulled down total prescription drug sales by 6 percent, to $10.09 billion. Most of Merck's other big drugs produced higher sales, led by the Januvia Type 2 diabetes drug, up 18 percent to $1.13 billion, and Janumet, a diabetes combo pill, up 17 percent to $452 million.
Merck's smaller divisions saw increased sales, however. Veterinary medicine sales edged up 3 percent to $898 billion. Sales of consumer health products such as Dr. Scholl's foot care products climbed 9 percent to $395 million.
Merck, based in Whitehouse Station, N.J., forecast 2013 earnings per share of $3.60 to $3.70, excluding charges. Analysts were expecting $3.68 per share.
In premarket trading, Merck shares dipped 45 cents to $42.80.
For the full year, Merck reported net income of $6.66 billion, or $2.16 per share, up from $6.27 billion, or $2.02 per share. But sales in 2012 dipped nearly 2 percent, to $47.27 billion.