A history of… Merck & Co

After delving into the history of the oldest pharmaceutical company in the world, Merck KGaA, this month we take a look at the now-independently-owned Merck & Co.

Last month’s ‘A history of…’ article looked into the origins of the oldest pharmaceutical company in the world: Merck. But what’s Merck & Co? Is it the same company? Is it separate? Read on to find out…

  • 1668 – Friedrich Jacob Merck acquires the Angel Pharmacy, which became the heart of Merck (and is still owned by the Merck family today).
  • 1891 – Merck in Germany became Merck KGaA or “German Merck” and a United States subsidiary called Merck & Co., Inc. was established in New Jersey.
  • 1917 – As a consequence of World War I, Merck lost its subsidiaries abroad, including its American subsidiary Merck & Co., which then became an independent U.S. company.
  • 2013 – Today, Merck KGaA and Merck & Co are two separate companies. Merck & Co. holds exclusive rights to the name Merck in North America (and is known as MSD outside of America and Canada), while Merck KGaA in Germany holds the same rights in the rest of the world (and is known as EMD Chemicals in the US).

So after that brief overview of the differentiation between Merck KGaA and Merck & Co, it’s now time to find out the direction Merck & Co took after becoming independent in 1917. Please read “A history of Merck KGaA” to find out what happened to Merck KGaA after World War 1.

Just before its independence, Merck & Co began to publish medical reference books called The Merck Manuals – the first one dates back to 1899 and is called Merck’s Manual of the Materia Medica. These books covered a wide range of medical topics, including disorders, diagnoses and drugs.

 

“Just before its independence, Merck & Co began to publish medical reference books called The Merck Manuals…”

 

In 1965, Merck acquired the Montreal-based company Charles E. Frosst Ltd and created the Canadian subsidiary and pharmaceutical research company, Merck-Frosst Canada Inc. This facility closed in July 2010 and the company was renamed as Merck Canada in 2011.

Vioxx

It’s impossible to write the history of Merck & Co without mentioning Vioxx.

The US FDA approved Vioxx (rofecoxib) in May 1999 – the drug had been evaluated in eight clinical trials involving 5,400 subjects.

In September 2004, the media began reporting that “drug company Merck has removed its arthritis painkiller Vioxx because of data showing an increased risk of heart attack and stroke.”1 Results from a three-year trial showed an increased cardiovascular risk in patients 18 months after taking Vioxx treatment1.

In 2005, Merck voluntarily withdrew Vioxx. The same year, Merck & Co’s CEO at the time, Raymond Gilmartin, retired.

Merck & Co’s significant mergers

The reason why Merck & Co is known as MSD outside of the US and Canada is because in 1953, the company merged with Philadelphia-based pharma company, Sharp & Dohme. The merger combined Merck’s scientific research and chemical manufacturing strengths with Sharp & Dohme’s sales and marketing expertise.

The second significant merger was in 2009, when Merck announced it was entering into a US $41 billion deal with competitor Schering-Plough. On paper, the move was structured as a “reverse merger”, in which the “old” Merck was renamed Merck Sharpe & Dohme and Schering-Plough was renamed as “Merck & Co”.

Several pharmaceutical drugs have been manufactured by Schering-Plough and are now available through Merck & Co. The most well-known of which are allergy drugs Claritin and Clarinex, plus the anti-cholesterol drug Vytorin and brain tumour drug Temodar.

 

“By the 1980s, Merck & Co was the largest producer of drugs for the United States, Europe and Japan.”

 

By the 1980s, Merck & Co was the largest producer of drugs for the United States, Europe and Japan.

Merck & Co in 2013

Today, Merck & Co is one of the largest pharmaceutical companies in the world. Headquartered in New Jersey, Merck & Co now employs approximately 82,000 staff worldwide.

The company is split into five main focus areas:

• Pharmaceuticals
• Alliances
• Consumer Care
• Animal Health
• Vaccines

As of May 6th 2013, Merck’s drug pipeline had 23 products in phase 2 clinical trials, 15 in phase 3 clinical trials and 6 under review for regulatory approval2.

The current CEO, President and Chairman of the Board is Kenneth C. Frazier, who has been in the role since January 1st 2011, but has worked for the company since 1992. Peter N. Kellogg is the Executive Vice President and Chief Financial Officer and has been since August 2007.

Merck & Co has fully embraced the social media bandwagon – when Creation Healthcare’s Daniel Ghinn investigated the Facebook strategies for the top 15 pharma companies in the world, Merck & Co came out on top. The list was drawn up in order of engagement – with over 7,000 “Likes” and nearly 400 people “talking about the company” on Facebook (at the time of publication), Merck & Co’s engagement score came out at 5%. Today the company has nearly 9000 Facebook “Likes”. Merck’s official Twitter page has over 11,000 followers and the company regularly “tweets” about the company’s latest news, as well as promoting charity awareness days and partnerships.

The company also launched a free online health resource called Merck Engage in 2011, which enables patients around the world to take “steps towards better health”. These steps include help managing health conditions, healthy eating ideas and ways to better communicate with healthcare professionals.

 

“Merck & Co has fully embraced the social media bandwagon…”

 

Financial results for the full-year 2012 reported that total worldwide sales decreased by 2% to US $47.3 billion, largely impacted by the loss of market exclusivity on Merck & Co’s asthma medication Singulair in the United States. However, a strong sales growth of key products, such as type 2 diabetes drug Januvia and HPV vaccine Gardasil, helped to offset this impact.

“Merck overcame significant challenges last year and delivered strong results in 2012 by successfully growing our businesses; expanding geographically and reducing our expenses. As we begin 2013; we are well-positioned to further execute on our business strategy.”

Kenneth C. Frazier, CEO of Merck & Co.

pharmaphorum recently spoke with Bruno Strigini, who is the President of Europe / Canada for MSD (the name used for Merck & Co outside of the US and Canada). Watch our video interview to hear Bruno’s views on why Europe remains competitive in the global pharma market and how MSD is rising to the challenges of healthcare cost containment whilst still delivering innovation.

What’s next for Merck & Co, nobody knows. But what we can be sure of is that the company’s corporate responsibility will continue its commitment towards “discovering smart, sustainable ways to expand global access to healthcare“.

References

1. Arthritis drug removed for safety (BBC News)
2. http://www.merck.com/research/pipeline/home.html (Merck’s product pipeline, as of 6th May 2013)

General references

http://www.merckgroup.com/en/company/history/history.html
http://www.merck.com/about/our-history/home.html
http://www.ehow.com/about_5147039_history-merck-pharmaceuticals.html

Previous ‘A history of…’ articles include:

A history of Bayer
A history of Novo Nordisk
A history of Pfizer

The next ‘A history of…’ article will be published on the 27th June.

About the author:

Hannah joined pharmaphorum in early 2012, after graduating with a degree in Magazine Journalism & Feature Writing in 2011, and leads our news coverage, in addition to liaising with new and existing feature authors. With over three years’ experience working within the journalism industry alongside university, Hannah has written for a number of different print and online publications, within the women’s lifestyle, travel and celebrity sectors. Now focussed on the pharma sector with her role at pharmaphorum, Hannah is embracing the challenges of working within a fast growing media organisation in this rapidly changing industry sector.

For any queries or contribution suggestions, please contact her here or via Twitter @Hannah_Blake2.

Will Merck & Co (MSD) enter any significant M&As in the next decade?