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Merck & Co.'s (MRK) report of improved second-quarter earnings was overshadowed Monday by a new study raising questions about its cholesterol drugs, while the quarterly numbers confirmed fears of a slowdown in sales of cervical-cancer vaccine Gardasil.

Merck shares dropped $2.35, or 6%, to $35.33 in 4 p.m. trading on concerns about the newly released study of cholesterol drugs Vytorin and Zetia, which are marketed by a joint venture of Merck and Schering-Plough Corp. (SGP).

Another key area of concern has been Merck's Gardasil cervical-cancer vaccine. The vaccine, which went on sale in 2006, had strong growth for much of 2007. But second-quarter sales fell 9% to $326 million. Investors have been concerned about Gardasil's sales growth particularly since July 7 when a UBS analyst predicted second-quarter sales weakness and downgraded the stock.

Merck blamed the sales slowdown partly on a deceleration among use of Gardasil by girls and women ages 13 to 18, as well as a lower-than-expected uptake by women ages 19 to 26. Gardasil is approved for use by females aged 9 to 26.