Merck and Company, Inc.: SWOT Analysis and Stakeholder Evaluation
Merck and Company, Inc., a.k.a. Merck, is a leading worldwide pharmaceutical company that engages in manufacturing and marketing medicines, animal products, vaccines, and consumer health products. As most companies, Merck desires to continue their success as one of the top health care innovators in the world. Conducting a SWOT analysis can give them insight into internal strengths and weaknesses as well as external opportunities and threats. By way of the analysis, the company can obtain a clearer understanding of where it needs to improve and grow, and anticipate future threats to react effectively. Further, this valuable information is used by managers within the organization to satisfy needs of stakeholders as well as provide investors with sound information to help make informed decisions regarding their willingness to invest in the company.
Ranking as the second largest healthcare company in the world, after the merger with Schering-Plough, Merck has set the standard for what it means to be an industry leader. Deriving from their company website, their vision is to “make a difference in the lives of people globally through…innovative medicines, vaccines, and consumer health and animal products” (“The New Merck,” 2010). Merck’s mission is to create distinctive products and services that will save and improve lives and satisfy customer needs. They seek to gain recognition as possessing an exceptional working environment, and offer investors a superior rate of return (“The New Merck,” 2010). Finally, they stand for “excellence in science and healthcare innovation, with an emphasis on addressing unmet medical needs; focus[ing] on patients and anticipating customers’ needs; and commitment to expand access to...[their] medicines and vaccines, and to improve global health” (“The New Merck,” 2010). A SWOT analysis is a useful tool to stay committed to the vision and mission prescribed above. This analysis evaluates an organizations strengths, weaknesses, opportunities, and threats as it pertains to a specific objective. Strengths and weaknesses are typically internal factors which are more easily fixed, whereas opportunities and threats are external factors that cannot always be anticipated (Robbins & Judge, 2011, p. 183). Conducting a SWOT analysis on Merck will shed light on its position within the pharmaceutical manufacturing industry. After the merger with Schering-Plough in November 2009, Merck became the second largest drug manufacturing company in the world generating $45,987.00 million in revenue for December 31, 2010 fiscal year, according to Business & Company database. The merger also expands Merck’s product portfolio, including areas of research and development in which Merck is lacking (“Merck and Schering-Plough mega-merger will create a company greater than the sum of its parts,” 2009). Gains in sales growth will occur with its new product launches such as Cozaar and Hyzaar for cardiovascular treatment, Dulera for respiratory therapy, and Simponi as an immunology drug. In addition, Merck’s already active product line such as Januvia for diabetes, Gardasil for the human papillomavirus, and Isentress for HIV will also add to Merck’s long-term sales growth (Hoover’s Inc., 2011). According to Hoover’s Inc. in-depth analysis of Merck & Co. Inc., “The acquisition of Schering enables Merck to potentially achieve $3.5 billion in annual cost-saving synergies by 2011” (Hoover’s Inc., 2011). Merck has also decided to expand its market outreach to India, and hope to encompass other countries such as China, South Korea, Russia, Brazil, Mexico, and Turkey. By expanding to global emerging markets, Merck can expect to obtain a growth in pharmaceutical sales over the next few years (“Closing the Gap,” 2010). With an immense competitive environment success is not without its drawbacks. Merck was forced to pull their blockbuster arthritis medication, Vioxx,...
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