...CASE 6-MERCK Problems The first problem is even before the drug was approved, some evidence cast doubt on the safety of Vioxx. The study found—as the company had expected—that Vioxx was easier on the stomach than naproxen. But it also found that the Vioxx group had nearly five times as many heart attacks. Some analysts criticized DTC advertising, saying that it put pressure on doctors to prescribe drugs that might not be best for the patient. Solutions Merck faced serious and terrible situation because its medicine caused patients’ deaths. According to the case, The Merck Inc.’s solution is that recalled all the Vioxx which cause the stock price decrease dramatically. But it is important to repair the company’s image and leave good impression to people. By apologizing to consumers through TV and taking responsible for the mistakes will help Merck Inc. retrieve their consumers. On the other hand, analyst argued that the methods DTC advertise their products are criticized. The reason is that analysts think that “when a patient comes in and wants something, there is a desire to serve them.” Because of the direct-to-consumer ad makes patients believe that all drugs are safe, it is not correct to leave such impression to consumers. Drugs are not safe at all, and doctor should examine all of them before recommending to patients. Recommendations I think the solution is a good symbol to help company’s development. As we all know, if they only cared about profit, not their patient’s...
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...Conflict and Change Harvard Case Study Professor: Robert Lazer PhD Team: Zerrin Hejazi, Mark Klabonski, Elizabeth Lamb, Hari Thenneti Pandurangamoorthi, & Hareshkumar Surani The History of Merck U.S. sales office opened in and George Merck, Heinrich’s grandson, was appointed head of the U.S. branch Friedrich Jacob Merck opened Merck in Germany 1668 1827 Heinrich E Merck transformed the business and Merck began manufacturing 1887 Merck merged with Philadelphia pharmacy Sharp & Dohme 1891 The renamed company Merck & Co. opens for business 1953 2009 Merck merged with ScheringPlough Corporation and Organon BioSciences Pharmaceutical Industry • The average drug development time is over fifteen years with an average R&D expenditure of $800 million. • The FDA requires three phases of testing to assess safety and effectiveness. o Test results dictate what is displayed on the drug’s label and how the doctor will prescribe it. • Follow-up studies (Phase 5) can be performed to assess the drug after market release (Phase 4) and amend the drug label for improved sales. Pharmaceutical Success • 1981 to 2001, Merck experienced an upward trend on several industry metrics. • Their Return on Sales (ROS) for their Human Pharma line peaked at just over 40% in 2001 with an average of 24% . • The early 1990’s exhibited a downward trend just prior to Gilmartin assuming the role of CEO. Pharmaceutical Success ...
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...Merck Josue Vazquez University of Phoenix Management - MGT/ 521 Dr. Hector Torres Perez February 19, 2014 Merck The history of Merck Company as one of the first pharmaceutical in the world dates all the way back to 1668 when Friedrich Jacob Merck acquired the Angel Pharmacy, which became the heart of Merck and is still owned by the Merck family today. In 1891 Merck in Germany became Merck KGAA or "German Merck" and a United States subsidiary called Merck & Co., Inc. was established in New Jersey. As a consequence of World War I, Merck lost its subsidiaries abroad in 1917, including its American subsidiary Merck & Co., which then became an independent U.S. company. But with the merger with Sharp &Dohme Inc. in 1953 Merck become the largest pharmaceutical producer in the United States. In 1987 Merck was named America’s most admired and most innovative company. In 2006 their vaccine against the Human Papiloma virus, Gardasil was approved by the FDA and is currently they only method of treatment against the HPV virus against the strands that can cause cervical cancer in women. They have also been responsible for the development of vaccines against measles and rubella virus. Merck Company employs an approximate of 51,000 employees in over 120 countries all over the world and owns 31 factories worldwide. It actively participates in charitable organizations, which since 1957...
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...would be a valuable asset. The insight it can give Merck and the access to the market to increase share and give insight to Merck’s drug treatments will be invaluable. MARKETING & SALES CONSIDERATIONS Currently Merck has to send out its own reps to doctors where Medco does the same to doctors and companies. This will eliminate that area for Merck and result in a $1 billion annual savings in redundant marketing costs by a reduction of Merck’s sales force by using the marketing strategies of Medco’s database and ideology of marketing to plan managers as opposed to doctors. OPERATERATIONAL CONSIDERATIONS Medco’s database that allows Merck to identify prescriptions that can be switched from competitors to their brand will help increase market share while weakening competition. Merck pharmacists will be able to suggest these switches to the patient’s doctor. FINANCIAL CONSIDERATIONS Medco has about 33 million customers in the United States and manages 95 million prescriptions a year for government, unions, insurance firms and companies. Revenues for Medco were $2.2 billion. OTHER FACTORS (REGULATORY ISSUES – HUMAN RESOURCES ISSUES – SYNERGY ISSUES) Synergy between Merck and Medco could be achieved by IT integration, non-duplication of efforts and using Medco’s approach of working with plan managers instead of doctors to reduce costs of marketing. Company Backgrounds Merck & Co., Inc. (NYSE: MRK), dba Merck Sharp & Dohme, MSD outside the...
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...Caso Merck & Co: Evaluación de una oportunidad de licencias de medicamentos El caso está ambientada en el año 2000. Merck & Co. es una compañía global, impulsada por la investigación farmacéutica, investiga, desarrolla, fabrica y comercializa una amplia gama de productos para personas, así como productos de salud animal. Opera directamente a través de empresas conjuntas establecidas y prestas servicios de gestión de productos farmacéuticos (PBM). Durante los últimos 5 años, la compañía ha lanzado 15 nuevos productos de éxito, las drogas más populares han generado la cantidad de $5.7 mil millones en ventas en todo el mundo. Entre 1998 y 1999, un aumento del 20% en las ventas se observó. Merck posee las patentes de los medicamentos más populares, sin embargo, expirará en 2002. Una vez que las patentes han caducado, las ventas disminuirán por los medicamentos genéricos sustitutos y baratos en el mercado. La compañía tiene como objetivo mantener un buen camino en el desarrollo de fármacos, por constante renovación de su cartera, lo que impide la pérdida de ventas de medicamentos que van fuera del tiempo de la patente. Los nuevos fármacos son bien desarrollados por la investigación interna (la mayoría) mediante la colaboración con empresas de biotecnología. El producto: Davanrik Davarnik fue desarrollado por los productos farmacéuticos LAB, un producto farmacéutico pequeño y relativamente joven especializada con compuestos para el tratamiento de trastornos neurológicos. Originalmente...
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...Course Project: Merck Pharmaceutical Sydney Momoh Tanika Thomas PM587 Prof. Susan Orr June 9th, 2012 Table of Contents 1.0 Introduction of Merck Company………………………………………………………..…..3 2.0 Organization Strategic Plan………………………………………..…………………………3 • Sustainability of loyal customers and employees • Change to meet customers demand • Growth will strengthen the company through acquisitions ……………………….4 3.0 Strategic Capacity Plan………………………………………………………………………4 4.0 Portfolio Management Process……………………………………………………………...5 • Capital Structure of Merck Group…………………………………………………6 5.0 Portfolio Selection Criteria …………………………………………………………………7 • Serono • Millipore • Integrated Chemicals 6.0 Program Management Plan ………………………………………………………………...8 7.0 Plan to Identify and Resolve Conflict ……………………………………………………..10 8.0 Change Management Plan …………………………………………………………………11 9.0 Resource Utilization Plan ………………………………………………………………….11 10.0 Reference Page …………………………………………………………………………….12 Introduction: We found pharmaceutical companies to be better fit for our project. This industry touches each person on this planet in one form or another and the work they are conducting in search of making every ones live healthier and live longer than our fore fathers. When we stacked up all pharmaceutical companies, we found Merck Corporation to meet all of the criteria that we were looking for in a pharmaceutical industry. Merck have conducted many projects concurrently during drug developments...
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...Merck: Business Analysis Tamikiia Brown MGT521 July 11, 2011 Sharon Palmitier Merck: Business Analysis Merck is a flourishing research-driven pharmaceutical company, which discovers, develops, manufacturers, and promotes an extensive variety of human and animal health products. Although Merck is one of the biggest pharmaceutical companies of the world, they still come across problems today while striving to sustain a lead against its competition. Merck has achieved success with its lengthy history of breakthrough drugs and the development of three significant pharmaceutical products: antibiotics, vitamins, and hormones. Merck’s success relies heavily on its management and how they modify the business model in place to that of the ever-changing economy. Influence of Economic Trends The global pharmaceutical market is likely to undergo a wide variety of changes with new competition arising in India, China, Malaysia, South Korea, and Indonesia. This new competition has a growing economy and has made a difference between the product cost and disposable income of consumers. According to NASDAQ (2011),“ Global pharmaceutical market sales are expected to grow at a 4-7% through the year 2013 largely being driven by the growing access to health care in emerging economic regions” (para. 2-5). Short-term growth within this area is stimulated by the United States market, as it continues to be the largest pharmaceutical market in the world. A focal point on research and...
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...Executive Summary Merck & Co., Inc. is one of the largest pharmaceutical firms in the world. The company is known for its discovery, development, production, and marketing of products and services that are geared towards the maintenance and restoration of health. The company’s business focuses on two areas: human and animal health products and Services and Specialty Chemical products. Medco Containment Services, Inc. is one of the largest pharmacy benefits manager (PBM). The company was mainly responsible for the management of drug benefits for more than 65 million Americans whose prescriptions were filled at retail drug stores or the company’s mail order business. Merck’s acquisition of Medco was one of the largest health care industry mergers, as well as one the largest U.S. corporate unions in the early 1990’s (Olmos, 1993). In addition the merger provided Merck with access to Medco’s technology and information. With the merger they acquired more than 1,000 pharmacists who decided or advised physicians on how prescriptions should be filled (Tanouye, 1993). This merger allowed Merck to increase its pharmaceutical sales through the use of patient information from Medco’s database. The merger was expected to solidify Merck’s presence in the pharmaceutical industry by giving it direct access to the healthcare providers that had influence over the type and price of prescription drugs (Olmos, 1993). Merck acquired all of the outstanding shares of Merck for approximately...
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...Merck 1. What products has Merck developed and introduced recently? On the Merck website they have developed a product pipeline. This is a very helpful tool for those who want to follow their progress. This pipeline allows for people to see what phase each developing medication is in. These phases include phase II, phase III, and under review. The pipeline also shows the medication category, therapeutic area, and whether or not the medication has advanced. According to the product pipeline medications that Merck have developed that are recently under review are Zerbaxa, Omarigliptin, Grazoprevir/Elbasvir, Bridion, and Keytruda. Two of these medications have been introduced and moved forward including Grazoprevir and Keytruda. Medications included on the phase III list include Verubecestat, Anacetrapib, Keytruda, Letermovir, Ertugliflozin, Omarigliptin, Zerbaxa, and Doravirine. Medications included on the product pipeline list for phase II include Relbactam, Keytruda, Vericiguat, and Grazoprevir. 2. What role does research play in Merck's success? How...
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...Case Study: Merck and the Vioxx Recall Kelvin Gabel Benedictine University Case Study: Merck and the Vioxx Recall According to Lawrence and Weber (2014), former Merck CEO George W. Merck implied a corporate vision of social responsibility for Merck & Co., Inc. (Merck) when he stated in 1950 that medicine was for the people and that loyalty to that concept would lead to greater profits. On the surface, it appears Merck has historically lived its declared mission of putting people first. This is demonstrated by the company forfeiting patent and profits from the antibiotic streptomycin and the drug Mectizan (Lawrence, 2014). Merck was well rewarded for its people first philosophy. Though it was ranked fifth in asset and market value, it ranked first in profits. Additionally the company had a stellar reputation of being perceived as the most ethical and socially responsible of the major drug companies (Lawrence, 2014). Today Merck Pharmaceutical’s mission statement is “to discover, develop and provide innovative products and services that save and improve lives around the world (Merck, 2015).” Reading Merck’s current mission statement lacks both the compassion of placing people first and the implied social responsibility of Mr. Merck’s statement in 1950. To be contextually correct historically in forming a view of Merck and the Vioxx recall issue, I sought to find a corporate mission statement from the period of the recall which was in 2006. According to Culp...
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...Merck – Business Analysis MGMT 521 October 17, 2011 Dr. Patrick E. Murray Merck – Business Analysis A mutual fund manager invests in many securities. Experiences and success open new opportunities to future investments. Merck is one of the largest and well-known pharmaceutical companies in the world. The decision to invest is determent on many factors. This includes a SWOT analysis of Merck and taking information from this analysis to decide whether to invest. Internal and external stakeholders along with their wants and needs are identified. Finally, an explanation of Merck's handling current and future stakeholder needs is determined. This research helps in making the decision to invest or not with Merck. SWOT Analysis |Strengths |Weaknesses | | | | |A diversified product portfolio |Reduction in OTC (over-the-counter) products | | | | |Global efforts to decrease maternity mortality |Possible reduction in workforce | |ration | | | | | ...
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...3. Should Merck bid to license Davanrik? How much should they pay? Our team will recommend Merck bid to license Davanrik given the following reasons: 1. One of the major advantage of the company is its patents of new drugs. According to the case, we know that four drugs will expire by 2002 and those drugs are regarded as the so-called star-products of the company. According to the company’s financial statement, we learn that Merck’s net income margin has declined from 19.52% to 18% and the research and development cost has been decreased in terms of percentage of sales. So we believe that Merck should increase its expenditure on research. On the expiration of the drugs, the sales will decreased dramatically as competition emerges. So in order to maintain its competition edge, the company need to develop new drugs. 2. Even though the company used to develop new compounds primarily through internal research, we believe that working with LAB Pharmaceuticals will give Merck a synergy effect to obtain a better result. Given LAB Pharmaceuticals’ performance in the past, we believe that Merck’s plentiful experience will sure to make to most of the pre-clinical development of Davanrik. 3. According to the balance sheet, we can learn that Merck has sufficient cash to support the licensing process and we believe the company has the ability to absorb the potential loss on failure. So the risk is tolerable for Merck. So we will suggest Merck bid to license Davanrik. As for the bid...
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...Yes, Merck should develop Mectizan Intangible Gains: Merck would benefit from many intangible features by associating its brand with such sensitive public cause. Consumers: The initiative of distributing the drug for free would position Merck in the top of mind for consumers since the company is seen not anymore as a “just-for-profit” company but actually an organization that is really committed in improving the healthy of the people around the world. Consumers are also benefited by the fact that competitors may try to imitate Merck and similar initiatives may be deployed in the future. This program also helps to set up new and better standards for public health campaigns. Public Relations: It is important to highlight that although this program would run in Africa, where the consumer market in terms or revenues is not as big as in the developed countries, this program was able to generate huge traction among several important media companies around the world and millions of people would be “impacted” by the program features. Competitors: another intangible benefit for Merck is that this program helps the company to distinguish itself from the other big multinational pharmaceutical companies, leveraging also the relationship with suppliers and clients due to this uniqueness. It also signalize to competitors that Merck has very “deep pockets” for sustaining such a program and this may deter the competitors of entering in markets / products where Merck is established...
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...Introduction Merck was established in the U.S. in 1891, but its roots trace back to Friedrich Jacob Merck’s purchase of a German drug store in 1668. Today the company is a top tier global entity, a “research-driven” pharmaceutical company “dedicated to putting patients first.” Merck’s mission is to “provide society with superior products that improve the quality of life and satisfy customer needs, provide employees with meaningful work and investors with a superior rate of return.” As a long time player in the U.S. pharmaceutical industry, Merck has had extensive experience in assigning and dividing complex tasks among its many specialized departments. Specialization allows Merck to operate efficiently and bring new drugs to American patients. On May 20, 1999, the FDA approved Merck’s application to market Vioxx, a new arthritis pain-reliever. The effort to create a successful drug at Merck was no small task, not only did the company need to develop, test, and receive approval for a new product. It also needed to make sure the drug was successfully marketed to the right consumers. By the end of 1999, over 5 million prescriptions had been written for Vioxx and it had been launched in 47 countries. The Vioxx launch went particularly well, and Merck splashed its success across the front page of its Annual Report with the lead, “Vioxx: Our biggest, fastest and best launch ever.” New Vioxx sales came at an important time for Merck. The exclusive patents to four major drugs were...
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...9-201-023 REV: MARCH 25, 2003 RICHARD S. RUBACK Merck & Company: Evaluating a Drug Licensing Opportunity Rich Kender, Vice President of Financial Evaluation & Analysis at Merck, was working with his team to decide whether his company should license Davanrik, a new drug with the potential to treat both depression and obesity. The small pharmaceutical concern that developed the drug, LAB Pharmaceuticals, lacked the resources to complete the lengthy approval process, manufacture the compound, and market the drug. LAB had approached Merck with an offer to license the compound. Under this agreement, Merck would be responsible for the approval of Davanrik, its manufacture, and its marketing. The company would pay LAB an initial fee, a royalty on all sales, and make additional payments as Davanrik completed each stage of the approval process. Merck In 2000, Merck & Co., Inc. was a global research-driven pharmaceutical company that discovers, develops, manufactures and markets a broad range of human and animal health products, directly and through its joint ventures, and provides pharmaceutical benefit management services (PBM) through Merck-Medco Managed Care. Since 1995, Merck had launched 15 new products including Vioxx™ for the treatment of osteoarthritis, Fosamax™ for the treatment of osteoporosis and Singulair™ for treating asthma. The Company earned $5.9 billion on 1999 sales1 of $32.7 billion, about a 20% increase from 1998. Exhibits 1 and 2 contain Merck’s Income...
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