Merck: Is Merck’s Medicine Working?

Spurred by the Vioxx fiasco, CEO Clark is trying to revamp the drug giant's culture

Richard Clark was flustered and unprepared when he was thrust into the CEO job at Merck & Co. (MRK) on May 5, 2005. It was the darkest hour in the pharmaceutical giant's 114-year history. Merck was drowning in liability suits stemming from Vioxx, its $2.5 billion-a-year arthritis drug, which it had to pull from the market because of a link to heart attacks and strokes. Two other blockbusters worth a combined $7 billion in annual sales were facing patent expirations. And Merck's labs, which other companies once hailed as a bastion of scientific innovation, were crippled by a culture that buried good ideas under layers of bureaucracy. But in the morass, Clark saw opportunity. "A crisis is a terrible thing to waste," says the CEO.

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