Sustainable business success depends on making quality products that people value through sound financial stewardship and responsible governance that ensures we are meeting customers' needs ethically and transparently.

Globalization and the expanding reach of firms during the past decades have escalated expectations for multinational enterprises to create more social value beyond compliance with regulations, philanthropy. Corporate responsibility has emerged as an important element of the private sector's response to these expectations and demands. While it can be seen as a way to improve one’s reputation, or simply as a response to a moral imperative to do good, at Merck we believe that corporate responsibility is critical to our business success and can provide us with new opportunities to create shared value.

Our principal economic contribution to society is made through the discovery, development, manufacturing and marketing of our products, which directly improve and maintain the health of individuals and communities around the world, helping them to lead more productive lives.

During the past year, we made significant progress in strengthening and transforming Merck. We are competing amid a fast-changing healthcare environment and a complex global economy. Our underlying product portfolio is among the broadest in the healthcare industry. Through continued emphasis on growing the core of our business and successfully launching new products coming out of our late-stage pipeline, Merck's pharmaceutical sales increased 5 percent in 2011. For more information on our sales in 2011, click here.

Merck's research pipeline illustrates the progress of our discovery efforts. The company currently has a number of candidates under regulatory review in the United States and internationally. An update on Research and Development can be found in the company's Form 10-K.

During 2011, the company continued the advancement of drug candidates through its pipeline. VICTRELIS™ (boceprevir), the company’s innovative oral medicine for the treatment of chronic hepatitis C genotype 1, was approved by the FDA and the European Commission (EC). The FDA also approved JUVISYNC™ (sitagliptin and simvastatin), a new treatment for type 2 diabetes that combines the active ingredient in the glucose-lowering medication JANUVIA^® (sitagliptin) with the cholesterol-lowering medication ZOCOR^® (simvastatin). In addition, the EC approved ZOELY™ (nomegestrol acetate/17ß-estradiol), a monophasic combined oral contraceptive tablet for use by women to prevent pregnancy. CUBICIN^® (daptomycin for injection), an antibacterial agent with activity against methicillin-resistant Staphylococcus aureus (“MRSA”) for which the company has licensed development and distribution rights in Japan, was approved for use in that country.

During 2011, the company also received additional indications for several of its existing products. The FDA approved an expanded age indication for ZOSTAVAX^® (Zoster Vaccine Live), a vaccine to help prevent shingles (herpes zoster), to include adults ages 50 to 59. SYLATRON™ (peginterferon alfa-2b) was also approved for the adjuvant treatment of melanoma in patients with microscopic or gross nodal involvement. Also, SIMPONI^® (golimumab), which Merck co-markets in the EU, received an indication in the EU for use in combination with methotrexate in adults with severe, active and progressive rheumatoid arthritis not previously treated with methotrexate, having been shown to reduce the rate of progression of joint damage as measured by X-ray and to improve physical function.

In addition, we continue to return value to shareholders in the form of dividends and share repurchases. For additional information about our business and economic impact, please see our Form 10-K for the year ended December 31, 2011.