Merck and Company

Merck and Company is a worldwide organization engaged in the business of discovering, developing, producing and marketing products and services for the healthcare industry. It is the world's largest ethical drug manufacturer, producing both human and animal pharmaceuticals. An international organization, the company has grown both through acquisition, internal growth and through joint ventures with other organizations. This research explores the mergers and acquisition strategy that Merck has followed recently, and explores the ramifications of that strategy both for the company and for the nation as a whole.

The 1980s were a particularly active period for Merck in terms of mergers and acquisitions. The company acquired or increased its ownership position in ten companies during the 1980 - 1989 period, while selling its interest in only four companies during the same time (Moody's Investors Services, 5973). Some of the acquisitions made during this time were related to the pharmaceutical industry, such as the acquisition of Torii & Company, which manufactured and distributed pharmaceuticals, Abello, S.A., a Spanish pharmaceutical company, and Neopharmed, an Italian pharmaceutical company. In addition to increasing Merck's presence in the pharmaceutical industry, these companies also increased the company's standing on a worldwide basis.

However, other acquisitions made during the 1980s were outside the company's primary business. These included Rotary Drilling Servic

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ited States by the company, which feeds them into the business and economic environment. There is also the question of ethical drug development being a strategic issue for the United States, although the company's mix of business interests supports additional strategic theories. There is some merit to the argument that a nation's healthcare system is at the core of its success, and that Merck's position as a leader in the healthcare industry benefits the United States in that research and development and distribution help keep state of the art pharmaceutical products available to Americans. In addition, drugs that are manufactured in the United States are shipped to other countries, increasing the foreign trade opportunities and trade options for the nation. Other business lines, such as oil drilling, while distant from the core business of pharmaceuticals, also provide needed foreign exchange for the United States. A company as large as Merck (1993 sales of $10 billion) is of strategic importance to the United States because of the large volume of transactions and exchanges that take place around the world. It is in the nation's best interest to encourage the free trade of pharmaceuticals, and to enable the company to compe

Category: Business - M