Merck & Co., Inc. (NYSE:MRK) Chairman and CEO Kenneth Frazier spoke with FOX Business Network’s (FBN) Maria Bartiromo during Opening Bell with Maria Bartiromo about Merck selling its Consumer Care unit to Bayer for $14 billion saying, “we think it’s important for us to look at those areas within our portfolio where we think we can play a leadership role” and that “we’ve always acknowledged that our consumer business didn’t have global scale and it wasn’t really a leader within its segment.” Frazier went on to talk about Merck’s growth and said, “we’re never satisfied with our internal growth and internal pipeline. We always want to augment it with the best science from the outside.”
Merck & Co. CEO on Merck selling the Consumer Care business:
“As we’ve said for a great deal of time now, we think it’s important for us to look at those areas within our portfolio where we think we can play a leadership role. We have a great consumer business. I give a lot of credit to my Merck colleagues, who built those tremendous brands. But we’ve always acknowledged that our consumer business didn’t have global scale and it wasn’t really a leader within its segment. I think for Bayer, which is committed to this business, to buy this business and combine it with theirs, they now have a strong business in the U.S. and North America to be combined with their existing strong business in Europe and they’re now a leader. So it makes sense for them. What is exciting at Merck right now is what’s coming through the pipeline. And we can now provide more focus on that pipeline growth.
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Merck & Co. CEO on Merck’s growth:
“We are very, very pleased with the products that are coming in our pipeline that we’re announcing today and cancer and Hepatitis C and HPV and HIV and Osteoporosis, but we’re never satisfied with our internal growth and internal pipeline. We always want to augment it with the best science from the outside.”
Merck & Co. CEO on whether this deal today will open up Merck to buy more biotech companies in the future:
“I think indeed. That’s what we are trying to do. We are trying to bring much more focus to prioritization and a big part of our strategy is to find the best external signs, whether it’s in biotech or academic partnerships and so yes, I think this actually does help us ensure that we can put the resources behind finding the next generation of important therapy’s.”
Merck & Co. CEO on whether he will be able to find biotech companies at a reasonable price:
“If you actually look I think you will see the pharmaceutical multiples are now starting to converge with the biotech multiples and so without being specific we are always in the hunt for great asset, medically important assets and we also are disciplined financially we want to make sure that we get those assets at a price where we can create value for our shareholders.”
Merck & Co. CEO on whether he thinks these biotech products exist in the market:
“I believe they do exist. They’re not easy to find, they’re often bidding wars, but we’re able to do these deals and we will continue to do them particularly at early stages, but we’re not adverse to doing deals for companies that have established products in the market or pipeline products that are coming to the market.”
Merck & Co. CEO on the fight against cancer:
“I think after many, many years of some skepticism and concern, we’re now on the verge of brand new ways of fighting cancer. Our anti-PD1 drug works very differently from other drugs. It actually stimulates the body’s own T cells to attack the tumor, so, it’s a natural way of fighting the tumor by helping the body’s own natural defenses. And what we’ve seen are incredible results in the early stage testing. And I think the world is very excited because we’ve seen it in advanced malignant melanoma. We’re studying the drug for non-small cell lung cancer, for head and neck, for bladder cancer. We’re studying it for 32 tumor types. So this as model therapy and combination therapy heralds a whole new era in the fight against cancer, which of course is still the leading cause of death in the world.”