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Merck & Co., Inc. (SWOT Analysis)

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“SWOT is an acronym for the internal Strengths and Weaknesses of a firm and the environmental Opportunities and Threats facing that firm. SWOT analysis is a widely used technique through which managers create a quick overview of a company’s strategic situation. The technique is based on the assumption that an effective strategy derives from a sound “fit” between a firm’s internal resources (strengths and weaknesses) and its external situation (opportunities and threats). A good fit maximizes a firm’s strengths and opportunities and minimizes its weaknesses and threats. Accurately applied, this simple assumption has powerful implications for the design of a successful strategy.”

Merck & Co., Inc.

Merck & Co. which signed the $41.1 billion merger deal with Schering-Plough, is one of the research driven Big Pharma companies. The company is engaged in research, manufacturing and marketing of drugs and pharmaceuticals. The company's products include therapeutic and preventive agents, and vaccines. Merck & Co. is headquartered in Whitehouse Station, New Jersey and employed 55,200 people as of December 2008.

Strengths, Weaknesses, Opportunities and Threats (SWOT)

Location of Factor






  • Strong recent record in terms of new product launches and first-to-market products, exemplified by the Januvia/Janumet and Isentress brands
  • Leading position in global vaccine market, supported by comprehensive roll-out of new products including Gardasil


  • Exposure of revenue base to significant generic erosion threat, underscored by Merck & Co.’s close adherence to a blockbuster-centric strategy
  • Weakened commercial outlook for Zetia and Vytorin franchises following publication of ENHANCE clinical trial data



  • Merger with Schering-Plough would diversify product portfolio further
  • Ability to improve operating performance over 2007-13 via restructuring strategies and cost cutting initiatives
  • Therapy area diversification with concerted movement towards diabetes and oncology markets already in evidence
  • Movement into the biologics/RNAi segments via recent M&A activity


  • The uncertainty over the Schering-Plough and J&J’s Remicade partnership
  • Impending patent expiration for key blockbuster brands Fosamax, Cozaar/Hyzaar and Singulair over 2007-13
  • Further setbacks to compounds in late stage R&D pipeline, mirroring regulatory delays currently impacting MK-0524A and MK-0524B
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