Merck Announces Merger; Enforces Corporate Responsibility

March 17, 2009

Earlier this month, Merck & Co. Inc. and Schering-Plough announced that the two companies will combine in a stock and cash transaction valued at approximately $41.1 billion. Both companies’ boards  have unanimously approved the deal.

The merged company would keep the name Merck, and Richard T. Clark, Merck’s chairman and chief executive, will lead it.

Merck is a pharmaceutical manufacturer based in Whitehouse Station, N.J., particularly noted for its hypertension and cholesterol combating drugs, as well as vaccines for conditions such as measles and mumps. The company was established in 1891.

“We are creating a strong, global health-care leader built for sustainable growth and success,” Clark said in a statement. “The combined company will benefit from a formidable research and development pipeline, a significantly broader portfolio of medicines and an expanded presence in key international markets, particularly in high-growth emerging markets. The efficiencies we gain will allow us to invest in strategic opportunities, while creating meaningful value for shareholders.”

The two companies boast complementary products and pipelines and a shared focus on important therapeutic areas, including cardiovascular, respiratory, oncology, neuroscience, infectious disease, immunology and women’s health.  They each have nine potential medicines in Phase III development.

Additionally, the merger will introduce a more geographically diverse mix of business  with more than 50% of the  combined company’s revenue expected to come from outside the United States.

March is proving to be a busy month for Merck. Indeed, on March 5, the company signed on to the United Nation's Global Compact, the world's largest and most widely embraced corporate citizenship initiative.  By signing on, Merck confirms its commitment to support the Compact's 10 principles in the areas of human rights, labor, environment and anti-corruption.

"The Global Compact recognizes that, because of the wealth that business creates, businesses are part of the solution to world peace and security and to achieving a decent standard of living and quality of life in those societies that have not yet benefited fully from globalization," said Clark in his letter to Secretary-General of the United Nations Ban Ki-moon.  "I am pleased to confirm that Merck supports the 10 principles of the Global Compact…[and] We express our intent to support and advance those principles within our company and entities controlled by it."

In addition to supporting human rights, labor, environment and anti-corruption, Merck also is dedicated to helping reduce diabetes.

The Merck Co. Foundation, the philanthropic arm of Merck & Co., recently launched a five-year effort to help reduce diabetes among at-risk populations.

The Alliance to Reduce Disparities in Diabetes is a new initiative designed to improve health-care delivery among those populations most at risk for diabetes – African-American, Hispanic and Native American adults.  The U.S. Department of Health and Human Services' Centers for Disease Control and Prevention (CDC) and the Office of Minority Health joined the Foundation in support of the Alliance's goal to mobilize community-based partners and enhance the delivery of proven, collaborative approaches that can close gaps in diabetes care.

"We cannot and should not ignore the growing physical and economic toll of inadequate health care on the lives of many individuals in the United States," said Clark.  "Innovative, community-based programs are making real progress reducing the critical gaps in care that are so difficult for many low-income and vulnerable individuals.  The Alliance aims to support that progress by becoming a mobilizing force in improving outcomes for those who are underserved by current health-care models and at the most serious risk for diabetes."

The Merck Co. Foundation has committed $15 million to support programs through the Alliance to improve prevention and management services.  Funding will support efforts by Alliance community health partners in Camden, N.J., Chicago, Dallas, Fort Washakie, Wyo., and Memphis, Tenn., to demonstrate that improvements in health-care delivery and an increased focus on patient needs can significantly improve health outcomes. 

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