MRK_CSR12_hdr_letterfromCEO

At Merck, corporate responsibility underscores our steadfast commitment to help the world be well.

Merck people share an unwavering commitment to our mission to save and improve lives around the world, and to uphold the highest standards of ethics and integrity.

We believe that innovative and productive research and development is the only sustainable way to create true and enduring value for all of our stakeholders, and we are focused on tackling some of healthcare’s most daunting challenges. By continuing to invest in the discovery and development of medicines and vaccines, we believe Merck can have a profound impact on people’s lives for years to come.

In addition, we are resolute in our promise to develop and reward our employees, protect the environment and support the communities in which we work and live. Furthermore, we are operating ethically and transparently in order to earn and retain the trust and confidence of our stakeholders. This report, which also serves as our annual Communication on Progress Report to the UN Global Compact, is one of the ways in which we increase our transparency.

We continue to deliver long-term returns by pursuing opportunities where the need is great and where we have unique capabilities to make a real difference in people’s lives.

But the challenges, too, are great. Of the seven billion people alive today, six billion live in emerging and developing markets. We believe we have an obligation, as well as an opportunity, to help meet their unmet health needs by advancing effective and safe medicines at affordable and sustainable prices.

In the developed world, the costs to treat chronic diseases are large and increasing. Today these costs represent approximately three-quarters of all healthcare expenses, and two-thirds of the increase in healthcare spending is due to the increased prevalence of treated chronic disease.

The global economy continues to be uncertain, an ongoing challenge to pharmaceutical companies that can invest a billion dollars or more over the 10 to 20 years it takes to bring a new drug to market.

But we are determined to advance our mission, and, in 2012, we made progress through a number of important initiatives:

  • Expanding our product portfolio, as well as our local development and distribution capacity, through important joint ventures
  • Developing new partnerships to reduce maternal mortality through Merck for Mothers, our 10-year, $500 million initiative that is applying the company’s scientific and business expertise—as well as its financial and human resources—to address this issue around the world
  • Celebrating the 25th anniversary of Merck’s MECTIZAN® (ivermectin) Donation Program and its success in contributing to the goals of eliminating river blindness and lymphatic filariasis
  • Strengthening the impact that Merck employees have on communities throughout the world, by recently increasing paid time off, from 20 to 40 hours per year, for employee volunteerism; throughout 2012, Merck employees volunteered through a variety of programs, resulting in more than 221,000 total volunteer hours
  • Emphasizing the importance of raising ethical and compliance-related concerns through an updated mandatory training program, which provides additional guidance on the Merck Code of Conduct
  • Identifying and implementing major projects to cut water use, protect water quality and reduce operating costs through improvements to water and wastewater infrastructure

We are proud of our progress, but remain focused on the work ahead. We have made progress in meeting the objectives identified in Merck’s Access to Health Guiding Principles, but we must address the ongoing challenge of creating a companywide strategy to expand access to our discoveries in both developed and developing markets while continuing to build a sustainable business.

To do this, I believe that healthcare companies, regulators, payers, governments, and other stakeholders must work collaboratively to bring safe, effective, affordable medicines and vaccines to the world’s people.

It is critical, therefore, that Merck continues to take a leadership role in the pharmaceutical industry, building partnerships with a wide range of stakeholders to advance R&D, enable access to medicines and vaccines, and help improve quality of life across the globe.

The world is changing, but Merck’s focus on pursuing the best science and building a sustainable business is steadfast, and even more important, our people remain deeply committed to our mission and our company.

Know that we take very seriously our special responsibility to provide genuine and enduring value to customers, patients, employees, communities and shareholders for generations to come.

Be well,

Kenneth C. Frazier
Chairman and Chief Executive Officer
July 2013

Last Updated November 25, 2013