Merck has decided to stay true to consumer healthcare. The company had been flirting with the idea of selling off the consumer health business it acquired in its merger with Schering-Plough. As the Wall Street Journal reports, CEO Ken Frazier (photo) publicly wondered back in January whether that business could pull its weight at the company over the long term.
After all, consumer health accounted for just over half a billion of Merck's $11.6 billion in first-quarter sales, or less than five percent. But during the earnings call with analysts, Frazier deemed the consumer health business a "great asset," the WSJ notes. That unit and animal health are both "very complementary to what we are doing," Frazier said. "We're very pleased to have these businesses."
Sounds as if Merck is convinced that consumer health does have a long-term role at the company. And one reason is that consumer health products tend to be popular in emerging markets where Merck is aiming to grow.
Next up will be some consumer healthcare acquisitions, probably internationally, the WSJ predicts. When Frazier questioned the business' long-term role back in January, he also said that the unit would need to be expanded. "[I]t's not global enough from our standpoint," he said. "We don't have the scale outside the U.S. that we would like."
- see the WSJ Health Blog post