Merck CEO Announces Structure and Global Leadership Team for New Merck
New Structure to Capitalize on Growth Opportunities in Emerging Markets, Biologics, Vaccines, Animal Health and Consumer Health Care
Merger Planning on Track; Expected to Close in Fourth Quarter
New Merck Organized to Maximize Broader Product Portfolio With a Robust R&D Pipeline to Better Meet Patient Needs
WHITEHOUSE STATION, N.J., Aug. 31, 2009 -
Richard T. Clark, chairman, president and chief executive officer
of Merck & Co., Inc. (NYSE: MRK) today announced a new
organizational structure and named top management and senior
leaders for the new Merck effective upon completion of the merger
of Merck & Co., Inc. and Schering-Plough Corporation (NYSE:
SGP). Mr. Clark was named CEO of the combined company when
the merger agreement was signed in March.
The new structure will build on the combined strengths of Merck and
Schering-Plough to create a more customer-focused, innovative and
diversified global health care company positioned to capitalize on
the greatest opportunities for growth. Animal Health and
Consumer Health Care will operate as separate business units
reporting to Mr. Clark.
The new company will integrate across its divisions to take
advantage of the significant growth opportunities in three key
areas: emerging markets, biologics and vaccines. This
cross-divisional approach will ensure that the new Merck's
commercial, research and manufacturing divisions dedicate the focus
and resources necessary to become a leader in these
businesses.
The organizational structure for the new Merck is designed to
capture the opportunities in the broader and deeper in-line
pharmaceutical franchises that will be created through the
integration of Merck and Schering-Plough products. The
company also will create new franchises focused on Women's Health
and Endocrine, and Mature Brands.
The new Merck will benefit from the unparalleled industry
experience of senior leaders from both Schering-Plough and
Merck. The leaders named by Mr. Clark today will serve on the
company's new Executive Committee. They, in turn, named the
executives who will lead their divisional and functional teams at
the new Merck. About 40 percent of Schering-Plough's senior
leaders will be part of the newly combined company in executive
roles. As was indicated at the time of the merger
announcement last March, a substantial majority of Schering-Plough
employees will remain with the combined company.
“Today’s announcement is an important step in
establishing the new Merck as the leading global health care
company – one that will make a difference in the lives of
patients around the world,” said Mr. Clark. “The
combined company will draw upon the expertise of the people of both
Schering-Plough and Merck. Collectively, the new leadership
team has decades of industry experience and proven management track
records. To complement our joint talent, we will be adding
leaders from outside the two companies with specific experience in
key areas. I am confident that the new Merck will have the
right team in place to be able to deliver on the promise of this
strong combination with Schering-Plough.”
The new Merck will have five primary divisions: Global Human
Health; Animal Health; Consumer Health Care; Merck Research
Laboratories; and Merck Manufacturing. Each division and
global support function leader will be a member of the new Merck
Executive Committee and will report directly to Mr.
Clark.
Global Human Health
Kenneth C. Frazier, currently executive vice president and
president of Global Human Health (GHH), will lead the new GHH
organization.
The new GHH organization will include the company's prescription,
vaccines and biologics businesses. The combined GHH will have
a broad portfolio of innovative in-line medicines and vaccines
that, with the robust late-stage pipeline and an expanded global
presence, will enable GHH to drive the combined company's growth in
markets around the world.
A new Emerging Markets group will be part of the new GHH organization and charged with focusing on regions and markets around the world that represent significant new growth opportunities. These include China; Asia Pacific; Latin America; and Middle East/Africa/Eastern Europe, including Russia and Turkey.
The leadership team for GHH, which will be the new company's largest division, will include experienced executives from Merck and Schering-Plough.
Animal Health
Raul E. Kohan, currently senior vice president and president of
Intervet Schering-Plough Animal Health, will lead the new Merck's
animal health business. Mr. Kohan will report to Mr. Clark
and serve on the Executive Committee.
Schering-Plough's Animal Health business is a world leader with
market-leading products for a broad range of species and strong
growth potential. The division has more than 1,000 marketed
products and generates approximately $3 billion in revenues from
business operations in more than 140 countries.
Consumer Health Care
Stanley F. Barshay, currently chairman of Consumer Health Care at
Schering-Plough, will lead this business for the new Merck on an
interim basis while the company searches for a permanent
leader. Mr. Barshay will report to Mr. Clark and serve on the
new Merck Executive Committee.
Mr. Clark said the new company plans to place an increased emphasis on growing the consumer business, particularly in markets outside the United States. Schering-Plough's Consumer Health Care business currently includes a number of iconic global brands such as Claritin, Coppertone and Dr. Scholl's.
Merck Research Laboratories
The new Merck Research Laboratories (MRL) will be led by Peter S.
Kim, Ph.D., currently executive vice president and president of
MRL.
The new structure for MRL is designed to foster innovation while
instilling greater accountability at all stages of the R&D
process through two core functions: 1) discovery and
pre-clinical development, and, 2) clinical development and
regulatory affairs. In addition, a new central franchise
structure focused on portfolio management will be aligned with the
company's Global Human Health division. The new MRL will
continue its focus on pursuing the best science around the globe
through a Worldwide Licensing group.
The combined research organization will have three new areas of dedicated focus -- emerging markets, vaccines and biologics -- to build on the significant investment that both Merck and Schering-Plough have made in this area.
Mr. Clark is taking a number of steps to ensure that the
combined company will deliver on the science behind the
merger. Four of the top leaders from Schering-Plough Research
Institute (SPRI) will hold leadership positions in the new MRL in
senior preclinical, clinical and licensing roles. Most of the basic
research heads for SPRI's research sites will remain in their roles
following the merger. The new Merck is preparing for the
broad integration of MRL and SPRI employees, and plans to maintain
the continuity of key late stage development programs from
Schering-Plough including, TRA (thrombin receptor antagonist),
Simponi®, Saphris®, boceprevir, Bridion®, and
IMPROVE-IT.
Merck Manufacturing
The new Merck Manufacturing division (MMD) will be led by Willie A.
Deese, currently executive vice president and president of
MMD.
MMD will create a strong, interdependent global supply chain fully focused on the needs of the combined company's customers. It will include new units for consumer health and animal health, and expanded technological capabilities for vaccines and biologics.
Global Support Functions
The new Merck Executive Committee will also include leaders of the
following global support functions: Mirian Graddick-Weir,
executive vice president, Human Resources; Peter N. Kellogg,
executive vice president and chief financial officer; Bruce N.
Kuhlik, executive vice president and general counsel; and, J. Chris
Scalet, executive vice president, Global Services and chief
information officer.
Mr. Clark said that Richard S. Bowles III, Ph.D., currently senior vice president of Global Quality Operations at Schering-Plough, will serve as chief compliance officer at the new Merck. Mr. Bowles will help ensure that the new Merck leads on ethics and compliance through central leadership and management of these activities. He will report directly to Mr. Clark and serve on the Executive Committee.
As part of new Merck's commitment to ensuring the well being of patients worldwide, the company will appoint a chief medical officer following an internal and external search of candidates. This person will report directly to Mr. Clark and serve on the Executive Committee.
Smooth Integration
Integration teams from Merck and Schering-Plough are continuing to
work together to ensure that following the completion of the merger
the combined company is well equipped to begin its first day of
business. Adam Schechter will continue leading the
integration effort for the new company, reporting to Mr. Clark in
this role, and will also lead the combined company's U.S.
market. Brent Saunders, who has been leading
Schering-Plough's integration team, also will continue to support
the integration process following the merger's
close.
Mr. Clark said, “Our integration teams have been busy laying the groundwork for the combined company and, thanks to their hard work and dedication, our integration planning is proceeding smoothly and on schedule.”
Merck and Schering-Plough continue to expect the transaction to close in the fourth quarter of 2009. Until that time, Merck and Schering-Plough will continue to operate as separate companies.
As previously announced, shareholders of both companies voted overwhelmingly to approve the proposed merger. The transaction remains subject to the satisfaction of customary closing conditions and regulatory approvals, including expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, as well as clearance by the European Commission under the EC Merger Regulation and certain other foreign jurisdictions.
About Merck
Merck & Co., Inc. is a global research-driven pharmaceutical
company dedicated to putting patients first. Established in 1891,
Merck currently discovers, develops, manufactures and markets
vaccines and medicines to address unmet medical needs. The Company
devotes extensive efforts to increase access to medicines through
far-reaching programs that not only donate Merck medicines but help
deliver them to the people who need them. Merck also publishes
unbiased health information as a not-for-profit service. For more
information, visit www.merck.com.
About Schering-Plough
Schering-Plough is an innovation-driven, science-centered global
health care company. Through its own biopharmaceutical research and
collaborations with partners, Schering-Plough creates therapies
that help save and improve lives around the world. The company
applies its research-and-development platform to human
prescription, animal health and consumer health care products.
Schering-Plough's vision is to "Earn Trust, Every Day" with the
doctors, patients, customers and other stakeholders served by its
colleagues around the world. The company is based in Kenilworth,
N.J., and its Web site is www.schering-plough.com.
Forward Looking Statement
This communication also includes “forward-looking
statements” within the meaning of the safe harbor provisions
of the United States Private Securities Litigation Reform Act of
1995. Such statements may include, but are not limited to,
statements about the benefits of the proposed merger between Merck
and Schering-Plough, including future financial and operating
results, the combined company’s plans, objectives,
expectations and intentions and other statements that are not
historical facts. Such statements are based upon the current
beliefs and expectations of Merck’s and
Schering-Plough’s management and are subject to significant
risks and uncertainties. Actual results may differ from those set
forth in the forward-looking statements.
The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the possibility that the expected synergies from the proposed merger of Merck and Schering-Plough will not be realized, or will not be realized within the expected time period, due to, among other things, the impact of pharmaceutical industry regulation and pending legislation that could affect the pharmaceutical industry; the ability to obtain governmental and self-regulatory organization approvals of the merger on the proposed terms and schedule; the actual terms of the financing required for the merger and/or the failure to obtain such financing; the failure of Schering-Plough or Merck stockholders to approve the merger; the risk that the businesses will not be integrated successfully; disruption from the merger making it more difficult to maintain business and operational relationships; the possibility that the merger does not close, including, but not limited to, due to the failure to satisfy the closing conditions; Merck’s ability to accurately predict future market conditions; dependence on the effectiveness of Merck’s patents and other protections for innovative products; the risk of new and changing regulation and health policies in the U.S. and internationally and the exposure to litigation and/or regulatory actions. Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in Merck’s 2008 Annual Report on Form 10-K, Current Report on Form 8-K filed on June 22, 2009, Merck's other filings with the Securities and Exchange Commission (the “SEC”) available at the SEC’s Internet site (www.sec.gov).
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Posted: August 2009
