Tuesday, November 14, 2006
Article in the Wall Street Journal -- Merck's Chief Leads a Revival,But Will It Last?, by John Carreyrou:
In a bid to restore the public's faith in Merck, which has been battered by allegations that the company knew Vioxx had serious cardiovascular side effects long before it withdrew it, the media-shy executive endured numerous takes during the filming of a TV commercial with the slogan "Putting Patients First."
Mr. Clark, 60 years old, has also raised morale among employees who have suffered from the company's Vioxx-related vilification. Shedding the aloof manner of many CEOs, he mingles with employees in the company cafeteria and holds meetings with groups of randomly selected employees once a month. During the meetings, Mr. Clark shares with employees a score card he keeps to chart progress toward the goals he has set, and encourages them to speak their minds. "The Merck culture had become too polite," he says.
Moreoever, a big reason for the rebound in Merck's stock is that investors have gone from obsessing about the company's Vioxx liability to largely discounting it. That is because Merck's strategy of fighting each case one by one has yielded some victories (Merck has won five cases and lost four) and dragged out the litigation process. The company has spent $610 million in legal fees. But Merck adopted that strategy before Mr. Clark's appointment. Mr. Clark says he has put "a fence around Vioxx mentally" and gets updates on the litigation from Ken Frazier, Merck's general counsel, only once a week.