Merck

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Merck: Pricing Gardasil
Merck & Co. has developed a brand-new vaccine called Gardasil. Gardasil is the first vaccine in the world that helps prevent the cervical cancer and HPV. Allison Watkins, senior director of Merck's Vaccines Division, is faced with the decision of determining the price of Gardasil. An outside consulting firm had suggested a price of $120 per dose, or $360 per person. Watkins needs to make the final decision and apparently that she does not accept with that price. The best choice for Watkins and the Gardasil marketing team should be setting the Gardasil’s price at a higher price than the suggested $120 per dose.

The first reason that Watkins should price the Gardasil at a higher price is that it is the first vaccine for cervical cancer and HPV in the world. The cervical cancer is the second most common cancer for women worldwide which makes Gardasil a rather desirable vaccine. Though we have many Pap tests for women to take to detect the cancer or precancerous cells in early stage, less than half of women older than 18 are taking Pap test in United States yearly. Before the Gardasil had been developed, there was no known medicine that would help prevent the cervical cancer and HPV. Research has shown that Gardasil is able to prevent 100 percent of cancers related to HPV types 16 and 18 in women who are not previously exposed to the HPV virus as these two HPV types are the main viruses that cause cervical cancer. This data provides concrete evidence to show the cervical cancer can be prevented by Gardasil.

The second reason for pricing Gardasil at a higher price can be justified by the crisis Merck & Co. faces. Merck & Co. was the world’s most respected and top-ranked pharmaceutical company; it was proud of being a first or second research-driven company that developed drugs and vaccines in their class and market. However, after the unexpected incident of the Vioxx vaccine, Merck’s reputation dropped significantly and the company's...
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