Statement with the problem

Companies that do business in medicine manufacturing sector like MERCK face various risks and uncertainties because of litigations against the company, regulations, competition, market changes, patent protection, a slow economic system, and the very high cost manufacturing because of an increase in R& D and selling and general expenditures. Objective

Merck needs a clear strategic decide to define its future business in the drug manufacturing business. Merck's shareholders and stakeholders on the whole expect constant growth and a better than average return on the expenditure. Areas of account


Global presence

Good industry standing

Robust launch portfolio with revenue growth

underscored by the commercialization of

Januvia and Gardasil

Substantial growth Zetia/Vytorin cardiovascular product franchise

Weak point:

Patent expiration for biggest selling product franchise Zocor (mid 2006) В Weak core stock portfolio (comprising essentially Zetia/Vytorin) underscored by growth and migration of key product dispenses into expiry portfolio В Blockbuster growth technique which strongly ties Merck's position in a few therapy market segments to just one or maybe more products Options:

Therapeutic diversification and enlargement into diabetes, oncology and infectious disorders segments Good potential growth from vaccines business, driven primarily (but not exclusively) by extremely innovative, first-to-market cervical tumor vaccine Gardasil Diversification into biologics market via purchases of Abmaxis and GlycoFi


Admittance of new competitors

Increasing obsolesce of technology

Competition via peers

Charges pressure caused by Health Care Insurance repayment structure and government rules in the United States and abroad. Significant litigation concerning Vioxx.

Doubt regarding cool product development in Biologics

Option course of action

In 2008, R& D come to a record level of $65. 2Billion R& D investment PER EMPLOYEE in the sector is eight...