Fitch affirms Merck & Co.'s ratings; outlook stable

Fitch Ratings affirmed Merck & Co. Inc.'s A+ long-term issuer default rating and F1 short-term issuer default rating.

The outlook on the rating is stable.

The rating agency said it views Kenilworth, N.J.-based Merck's spinoff of its women's health assets as "strategically constructive," but the move would leave its product portfolio less diversified.

Fitch said it "believes the benefit of management's increased focus on innovation-intensive efforts will more than offset the resulting near- to intermediate-term revenue concentration."

Fitch noted the drugmaker's leverage of 1.4x at Sept. 20, 2020, is relatively strong for the A+ rating, and considers leverage of 1.7x or below to be consistent with that rating.