Advocating For and Disclosing Public Policies

We work to monitor policy developments and contribute to debates on a broad set of issues at the local, national, regional and global levels. We engage with numerous stakeholders—including governments, payers, international organizations, nongovernmental organizations and other third parties—to explain our views, provide analyses of the issues at stake, and share information that can help clarify complex topics and dispel misconceptions. In doing so, we seek to remain consistent and transparent about the policies for which we advocate, while also recognizing the complexity and sophistication of a policy landscape that often does not lend itself to simple explanations.

Merck’s advocacy approach supports the mission of our business, is conducted in accordance with our Code of Conduct, and is focused on the following key areas:

Improving patient access to medicines and vaccines based on the principles of innovation, competition and consumer choice;
Protection of intellectual property rights as a core component of our ability to innovate;
Creating and maintaining a fair, predictable and evidence-based system of research and product regulation; and
Establishing global operating climates that are transparent and conducive to free trade and free-market principles.

"The credibility of [the pharmaceutical] industry, and in fact, of much of science and medicine, is being called into question. We must restore trust in order to be respected voices in health care policy. We must do this not only for our sake, but for the good of the patients we serve." —Richard T. Clark, Merck Chairman, President and CEO, Merck & Co., Inc., Health Affairs Policy Summit , Washington, D.C., November 1, 2007

"Health care is about partnership. No single stakeholder in the field of health care can set the agenda in isolation anymore. For it to be successful, health care must be a joint endeavor among all components of society. For example, patients must play an increasing role in setting the research agenda. Governments must develop a better understanding of what it takes to develop new medicines. We, as a pharmaceutical company, are ready to join forces and expertise with other stakeholders to ensure we achieve better outcomes through partnership."— Stefan J. Oschmann, President, Human Health, Europe, Middle East, Africa, Canada, Opening of Merck’s Munich Regional Headquarters, November 29, 2007

Global Policy Network/Organization

The Merck Executive Committee has overall governing responsibility for Merck's public policy program, as guided by the Board Committee on Public Policy and Social Responsibility.

Merck's Global Public Policy Network includes internal business leaders, policy practitioners and other employees with responsibility for external affairs for Merck and our subsidiary organizations around the world. Policy priorities are set by senior management, including regional Human Health presidents. Merck's Global Public Policy Leadership Team, headed by the Vice President of Global Public Policy, leads the development and communication of policy positions on major issues based on input from internal business leaders and external stakeholders. Position statements summarizing Merck's position on key public policy issues are posted on our public policy page.

Merck's Federal Policy and Government Relations office in Washington, D.C., is responsible for advocacy activities with the U.S. Congress and the federal government. Advocacy at the U.S. state level is managed by Merck's State Government Affairs and Policy organization. Outside the United States, stakeholder engagement and advocacy activities are managed at the regional, country or local level, with active involvement by Human Health presidents in the regions, country managing directors, and both regional and country policy staff.

Ensuring Ethical Interactions with
Government Officials Worldwide

Merck's standards for governing interactions with government officials include guidelines concerning the U.S. Foreign Corrupt Practices Act to ensure employees strictly adhere to Company policies and procedures, local laws and U.S. laws when interacting with government officials, their family members and their representatives. The standards state:....
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Code of Conduct

All Merck employees must abide by our Code of Conduct, which applies to our interactions with government officials and advocacy activities on public policy issues. As outlined in our corporate policy on ethical business practices, all Merck employees are required to adhere to Merck's high standards and act with integrity when interacting with government agents or engaging in any conduct related to governmental health care programs. This includes ensuring that all information provided to governmental entities is complete and accurate to the best of the employee's knowledge and belief. The policy also makes clear that no illegal payments of any kind (monetary or otherwise) are to be offered or made to an individual or entity including a local, state or Federal government or political party official or candidate in the United States, to a government or political party official or candidate of any other nation, or to officials of public international organizations, at any time or under any circumstances.

Working with Industry and Trade Associations

Merck is a member of numerous industry and trade groups, including:

Global

International Federation of Pharmaceutical Manufacturers and Associations (IFPMA), Business Council for International Understanding (BCIU), Global Business Dialogue, U.S. Council on International Business (USCIB), World Economic Forum, Transparency International and the International Pharmaceutical Privacy Consortium (IPPC).

Regional and National

AmCham EU, Asia-Pacific Economic Cooperation (APEC), Association of the British Pharmaceutical Industry (ABPI), Canada's Research-Based Pharmaceutical Companies (Rx&D), Corporate Council on Africa, European Federation of Pharmaceutical Industries and Associations (EFPIA), Farmaindustria (Spain), Farmindustria (Italy), Federation of Pharmaceutical Manufacturers of Japan (FPMAJ), Interfarma (Brazilian Research-based Pharmaceutical Manufacturers Association), Japan Pharmaceutical Manufacturers Association (JPMA), Japan Business Federation (Nippon Keidanren), Japan Association of Corporate Executives (Keizai Doyoukai), American Chamber of Commerce in Japan (ACCJ), Les Entreprises du médicament (The French Pharmaceutical Companies Association), Medicines Australia, U.S.-ASEAN Business Council, Asia Society, U.S.-China Business Council, National Committee on U.S.-China Relations, Mexican Association of Pharmaceutical Research (AMIIF), , Business Action for Africa, , Business-Industry Advisory Committee (BIAC), TransAtlantic Business Dialogue (TABD) and Verband Forschender Arzneimittelhersteller (German Association of Research-Based Pharmaceutical Companies).We also are members of national pharmaceutical industry associations in many other countries in which we operate.

United States

Alliance for Health Reform, Biotechnology Industry Organization (BIO), Business Roundtable (U.S.), Conference Board (U.S.), Council on Competitiveness, Healthcare Leadership Council (U.S.), National Association of Manufacturers (U.S.), National Health Council, Pharmaceutical Research and Manufacturers of America (PhRMA), and the U.S. Chamber of Commerce. Merck is also a member of chambers of commerce and pharmaceutical and biotechnology-related trade associations in numerous key states.

We work with these groups because they represent the pharmaceutical industry and/or business community in debates led by governments and other stakeholders, and because they are important in helping to reach industry consensus on policy issues. However, at times, we may not share the views of our peers or associations. Merck representatives on the boards and committees of industry groups and associations ensure that we voice questions or concerns we may have about policy or related activities. We may even recuse ourselves from related association and industry group activities.

In April 2008, Merck Chairman Richard T. Clark was elected board chairman of the PhRMA, and will serve a one-year term.

For more information on our trade association memberships, please click here.

See below for information on disclosure of trade association dues used for advocacy and/or political activities.

Role of Merck Government Affairs Professionals

To assist with our advocacy and policy analysis work, Merck and our affiliates have full-time employees responsible for issue advocacy in most countries where we conduct our business, including in Washington, D.C., and in state capitols. Where required, these individuals become registered under applicable laws. Merck and our affiliates also contract with private firms specializing in government affairs advocacy. These firms employ government affairs consultants with particular expertise on issue areas important to the Company. In the case of issue advocacy, these firms are also important in ensuring that Merck is able to comment on proposed legislation affecting the Company in all jurisdictions as legislative sessions can often be short and very dynamic. These lobbyists are required to abide by the same code of conduct as Merck employees. In addition, Merck government affairs personnel, and those who are registered to lobby on our behalf, must comply with all applicable laws and regulations regarding disclosure and reporting of lobbying activities.

Political Contributions and Spending

Merck has been working with the Center for Political Accountability (CPA) in the past year to inform discussions on best practices related to spending for political activities. We believe we are generally compliant in all material respects with all major provisions of the guidelines.

	Center for Political Accountability Model Code of Conduct for Corporate Political Spending	Is Merck in compliance?
1.	Political spending shall reflect the company’s interests and not those of its individual officers or directors.	Yes
2.	The company will disclose publicly all expenditures of corporate funds on political activities. The disclosure will include regular reports on the company's website.	Yes
3.	The company will disclose dues and other payments made to trade associations and other tax-exempt organizations that are or that it anticipates will be used for political expenditures. The disclosures shall describe the political activities undertaken. In the case of trade association payments, the disclosures will involve some element of pro-rating of the company’s payments that are or will be used for political purposes.	Yes*
4.	Company disclosure of political expenditures shall include direct and indirect political contributions (including in-kind contributions) to candidates, political parties or political organizations; independent expenditures; electioneering communications on behalf of a federal, state or local candidate; and the use of company time and resources for political activity.	Yes
5.	The board of directors or a committee of the board shall monitor the company’s political spending, receive regular reports from corporate officers responsible for the spending, supervise policies and procedures regulating the spending, and review the purpose and benefits of the expenditures.	Yes **
6.	All corporate political expenditures must receive prior written approval from the General Counsel or Legal Department, and the company shall identify all senior management officials responsible for approving corporate political expenditures.	Yes***
7.	In general, the company will follow a preferred policy of making its political expenditures directly rather than through third party groups. In the event that the company is unable to exercise direct control, the company will monitor the use of its dues or payments to other organizations for political purposes to assure consistency with the company’s stated policies, practices, values and long-term interests.	Yes
8.	No contribution will be given in anticipation of, in recognition of, or in return for an official act.	Yes
9.	Employees will not be reimbursed directly or through compensation increases for personal political contributions or expenses.	Yes
10.	The company will not pressure or coerce employees to make personal political expenditures or take any retaliatory action against employees who do not.	Yes
11.	The company shall report annually on its website on its adherence to its code for corporate political spending.	Future target

The Merck Board of Directors recognizes that the use of Company resources in the political process is an important issue for shareholders. We closely monitor our contributions to political candidates in accordance with corporate policy, seek approval by the Company’s General Counsel and report our spending regularly to the Board. For more information, click here.

Our contributions reflect the Company's interests in critical policy areas, not those of our individual officers or directors. Additionally, employees are not reimbursed directly or through compensation increases for personal political contributions. In making our contributions, Merck complies with all disclosure requirements as prescribed by federal and state law and Generally Accepted Accounting Principles. To improve access to information about Merck's corporate political contributions in the United States, Merck annually posts on our website the Company's contributions categorized by state, candidate and amount. Merck also discloses any contributions to committees known as 527 organizations. Merck's corporate political contributions for 2007 are listed here.

In 2008, we began to disclose the portion of dues that major U.S.-based trade associations report to us as being used for advocacy and/or political activities. For details, click here.

Merck Action Network and Merck Employees Political Action Committee

The Merck Action Network seeks to inform Merck's U.S.-based employees and retirees about important legislative issues and to serve as a vehicle for them to communicate with their members of Congress. For example, as a result of a "Call to Action" by the Merck Action Network in 2007, employees and retirees sent nearly 5,000 letters to their U.S. Senators in opposition to legislation that would legalize the importation of pharmaceuticals from certain industrialized countries that impose price controls on medicines. The Merck Employees Political Action Committee (PAC) gives eligible employees an opportunity to help elect candidates in the United States—both at the federal and state levels—who share Merck's goals of improving patient access to medicine and vaccines, encouraging innovation, and promoting a competitive business environment. By law, the only way that Merck can directly support federal and certain state candidates for political office is through voluntary contributions our eligible employees give to the Merck PAC. The Merck PAC is non-partisan and supports legislators from both sides of the aisle who understand and appreciate the work Merck does to discover and develop medicines and ensure they get to the patients who need them. Activity by the Merck PAC is federally regulated and all contributions are publicly disclosed in reports filed with the Federal Election Commission. For more information, please visit our public policy page.

The content on this page was last modified on October 24, 2008.

^*Disclosure of dues for advocacy purposes for major U.S. national and regional associations where dues are > $50,000. Links on our website to these organizations provide information on political activities undertaken.
^**Merck has been providing annual reports on its corporate political spending globally (where allowed by law) to its Board of Directors since 1996; starting in 1Q 2009, we will begin to report to the Board the portion of dues that major U.S.-based trade associations report to us as being used for advocacy and/or political activities.
^*** Excluding trade association funds. Merck lists titles of senior management officials on our website.