Merck, Schering Plough Merger Creates Another Pharma Giant


Pharmaceutical companies Merck and Schering Plough are merging to create another pharmaceutical giant (a la Wyeth and Pfizer in late January). MarketWatch has the details:

Pharmaceutical giant Merck & Co., Inc on Monday said it will buy rival Schering-Plough for $41.1 billion in cash and shares to expand its presence in emerging markets and bolster its pipeline of potential new medicines. The combined company will be called Merck and led by Merck Chief Executive Richard Clark.

The two companies, which announced significant job cuts last fall, already are partners on the cholesterol drugs Zetia and Vytorin. But sales of the drugs fell more than 20% in the fourth quarter on concerns about their effectiveness.

Schering-Plough generates about 70% of its revenue outside the U.S., including more than $2 billion from emerging markets. The combined company is expected to draw more than 50% of its revenue from outside of the U.S.

The strategy is one of survival: Merge and slim down, or fail. Big pharma may become too big to fail, especially if a large portion of its business remains outside of the United States.

Written by Drea Knufken

Drea Knufken

Currently, I create and execute content- and PR strategies for clients, including thought leadership and messaging. I also ghostwrite and produce press releases, white papers, case studies and other collateral.