Remarks of Peter S. Kim, Ph.D.,
President, Merck Research Laboratories
Merck & Co., Inc.
At the Annual Meeting of Stockholders
North Branch, NJ
April 22, 2008

Thank you, Dick.  It’s great to be here with everyone today.

Before I begin my presentation I’d like to take just a moment to mention that this year marks the 75th anniversary of the founding of Merck Research Labs.

I know that there are a number of MRL retirees in the audience today.

Every day, I am conscious of the legacy that they – and all of their colleagues through the years – have left to those of us who are entrusted with continuing MRL’s work.

We have the opportunity and the responsibility to build on the remarkable accomplishments of the talented and even legendary scientists and researchers who came before us.

This afternoon, I’d like to update you on the status and progress of our pipeline, focusing on programs in late-stage development.

Following that, I will also provide you with an overview of our entire pipeline.

As we go through our new products and investigational medicines today, I think you will agree that Merck’s pipeline is strong.

I hope you will also share our confidence that MRL will continue to contribute to the success of Merck’s Plan to Win, both through 2010 and in the years beyond.

Let’s begin by reviewing our late-stage pipeline.

Over the past 16 months, we’ve received FDA approval for three new products, as shown in the top left hand box. They are:

• JANUMET, a new medicine that combines sitagliptin, the active ingredient in JANUVIA, with metformin for the treatment of type 2 diabetes;
• ISENTRESS, a drug that uses a novel mechanism to treat patients with HIV for whom other antiretrovirals are no longer effective; and
• EMEND for INJECTION, which has given patients undergoing chemotherapy another option for the prevention of nausea and vomiting often caused by cancer treatment.

Currently, the FDA is reviewing our application for CORDAPTIVE, a new compound containing Merck-developed extended-release niacin and laropiprant, a novel flushing pathway inhibitor, for treating cholesterol.

And later this year, we expect to submit applications for FDA approval of two additional products, one for the treatment of atherosclerosis and another to treat obesity.

We are also expanding the use of some of our newest products by conducting studies to support new indications.

As shown in the lower left hand box, last year the FDA approved a new indication for JANUVIA, our DPP-4 inhibitor for the treatment of type 2 diabetes, as a first line treatment in combination with as many as two other medicines.

In addition, two new indications for GARDASIL, our vaccine to prevent cervical cancer, are currently under FDA review: one for the prevention of vaginal and vulvar cancer, and the second to expand the age group receiving GARDASIL from the current 9 to 26-year-olds to women up to the age of 45.

We also plan to seek FDA approval for a new indication for GARDASIL for males.

Men are also at risk for the development of HPV-related cancers and genital warts, and vaccination of males as well as females is expected to reduce the overall burden of HPV disease.

And for ISENTRESS, we plan to submit an application for use of this important new therapy in HIV-infected patients who have not yet been treated with antiretrovirals.

Now I would like to provide more information about these new products and our Phase III pipeline, which is shown on the right side of the slide.

I would like to begin with ISENTRESS, a novel, first-in-class medicine for the treatment of HIV infection in adults for whom other treatments are no longer effective.

ISENTRESS was approved by the FDA last October.

It works by inhibiting the HIV integrase enzyme, which is necessary to insert the viral DNA into a human cell.

ISENTRESS adds an important drug to the arsenal available to patients and physicians in treating those for whom at least one drug in each of three available classes of oral antiretroviral drugs has stopped working effectively.

We are currently conducting clinical studies with ISENTRESS in HIV patients who have not been treated previously with antiretroviral drugs and, based upon the favorable results observed, plan to file an FDA submission for a new indication in these treatment-naïve patients later this year.

CORDAPTIVE provides a novel approach to lipid management and contains Merck's own extended-release niacin and laropiprant, a novel flushing pathway inhibitor.

CORDAPTIVE is currently under FDA review.

Treatment with niacin has been shown to have a beneficial effect on cardiovascular risk, including a reduction in cardiovascular events and a decrease in plaque progression.

However, use of niacin has been limited because of a troublesome side effect called flushing.

The severity, frequency and duration of the flushing side effect of niacin often limits patients from staying on therapy and reaching the recommended dose.

In clinical studies, CORDAPTIVE increased levels of good cholesterol and decreased levels of bad cholesterol and triglycerides.

What’s more, patients using CORDAPTIVE in clinical studies experienced significantly less flushing than those using extended-release niacin alone.

A large cardiovascular outcomes study, HPS2-THRIVE, is underway.

This study will investigate whether CORDAPTIVE can further reduce the risk of serious heart attacks and strokes among people already taking statins to lower their bad cholesterol levels.

MK-0524B is an investigational compound that adds simvastatin to the two components in CORDAPTIVE, further expanding our approach to lipid management.

MK-0524B is in Phase III of development and we expect to file a New Drug Application with the FDA before the end of this year.

Next I’d like to tell you about taranabant, our investigational medicine for treating obesity.  
 
There is no doubt that a need exists for an effective, well-tolerated treatment for obesity.

Obesity has become a national epidemic.

According to the Centers for Disease Control, the prevalence of obesity among American adults more than doubled in the 25 years from 1980.

Today, nearly one-third of all Americans are obese, putting them at greater risk of developing a whole host of diseases, including coronary heart disease, type 2 diabetes, and stroke.

In our Phase II clinical study, patients taking taranabant achieved statistically significant dose-related reductions in both weight and waist circumference.

A dose-dependent increase in the incidence of clinical adverse experiences, including some psychiatric adverse events, was observed and we continue to further characterize the safety profile of taranabant.

Generally healthy patients, excluding patients with depression, were enrolled in the Phase II study.

Multiple doses of taranabant, up to and including two milligrams, are being evaluated in our ongoing Phase III program.

To better understand the possible adverse psychiatric events, we also enrolled some patients whose depression was controlled by one anti-depressant medication.

We plan to submit a New Drug Application for taranabant with the FDA this year.

Now I’d like to review the five investigational medicines currently in Phase III of development.

The first is Rolofylline, a medicine for the treatment of acute heart failure, which is the leading cause of hospitalization in patients over 65 years of age.

Rolofylline was added to our pipeline through Merck’s purchase of NovaCardia last year as part of our strategic licensing and acquisition strategy.

Currently, patients experiencing acute heart failure are treated with diuretics administered intravenously.   However, this treatment is often associated with worsening kidney function.

In a small, dose-ranging clinical study, Rolofylline, in combination with diuretics, improved kidney function and reduced the incidence of shortness of breath as compared to a diuretic alone.

Our Phase III program is ongoing, and we anticipate submitting an NDA for Rolofylline in 2009.

Next, I would like to bring you up-to-date on the progress of MK-0974, our investigational drug for the treatment of migraine, which is being evaluated in ongoing Phase III clinical studies.

Migraine is a debilitating disease from which more than 29 million Americans suffer.  Research has shown that during both migraine and cluster headaches, a neuropeptide called CGRP is released and that blocking the release of this peptide can bring relief to the migraine sufferer.

In our Phase II study, MK-0974, which blocks the actions of CGRP, demonstrated significant relief of migraine pain within two hours after dosing, as well as relief of migraine-associated symptoms.

MK-0974 was generally well tolerated in the clinical study.

We expect to submit a New Drug Application for this promising treatment for migraine sufferers in 2009.

Now let’s look at Odanacatib, a Merck investigational medicine for the treatment of osteoporosis, a common condition that affects an estimated 75 million people in the United States, Europe, and Japan.

People with osteoporosis, especially older adults, are at increased risk for osteoporotic fractures, which carry serious consequences.

Odanacatib works by inhibiting a cysteine protease called Cathepsin-K.

Cathepsin-K is known to degrade the bone matrix, the intercellular substance of bone tissue.

Inhibiting this enzyme is expected to reduce the risk of fracture to patients with osteoporosis.

Our clinical studies to date have shown increases in bone mineral density at key fracture sites, with greater increases at higher doses.

The drug is easy to take – just once a week either with or without food.

Our Phase III program was initiated last year, with an expected submission to the FDA in 2012.

Next, I am pleased to tell you about a Phase III molecule for the treatment of cancer, Deforolimus.

This molecule, which we added to our pipeline as the result of a global collaboration with ARIAD Pharmaceuticals, holds real promise for inhibiting a protein that plays an essential role in the growth and division of cells, including cancer cells.

We entered into this collaboration with ARIAD last year, following the conclusion of its promising Phase I studies that demonstrated favorable activity with sarcoma, and its initial Phase II study that showed encouraging activity in treating metastatic endometrial cancer.

According to the National Cancer Institute, endometrial cancer is the most common gynecological malignancy in the United States, with more than 40,000 new cases diagnosed annually and nearly 7,500 women each year dying from it.

Phase III clinical studies are now underway, evaluating the use of Deforolimus in treating metastatic sarcomas.

Deforolimus has been given fast-track designation by the FDA for soft-tissue and bone sarcomas.

We expect to submit an application to the FDA in 2010.

The final potential product currently in Phase III of development is HEPLISAV, a novel Hepatitis B vaccine that we acquired under a license from Dynavax in November of last year.

Last month, the FDA placed a clinical hold on this investigational vaccine because of a serious adverse event that occurred in one subject who received HEPLISAV in a Phase III study being conducted outside the United States.

Working with Dynavax and other collaborators, including clinical investigators and leading experts, we are evaluating the medical history of the individual who experienced the serious adverse event to better understand the timing and onset of symptoms, including whether it was a preexisting condition or was related to the administration of the vaccine.

In addition, all of the subjects in this Phase III study will continue to be monitored.

This slide shows our current pipeline, from Phase I through Phase III, as well as those medicines currently under review and those that have been approved in the past 16 months.

I should point out that we are only showing in Phase I and II the most advanced candidate for a specific mechanism of action within a given therapeutic area.

We have not included any of our back-up candidates in any phase of development on this chart.

Neither have we included additional indications in the same therapeutic area or additional claims for in-line products, line extensions, or formulations.

I would also like to call your attention to those candidates that have a right-facing arrow next to them.

Each of these 26 candidates has progressed through the pipeline since February of 2007.

This chart shows clearly the strength and depth of Merck’s pipeline.

It reflects the remarkable work being done in our labs by our talented scientists and researchers as well as the strategic collaborations and acquisitions we have successfully pursued over the past several years.

I believe that our record in 2007, with two new product approvals, coupled with another approval already granted in 2008, shows that Merck is continuing to do what it has always done best – discover and develop new medicines and vaccines that address some of the most pressing unmet medical needs in the world.

Our robust late stage pipeline, combined with our strong early stage pipeline, is the platform on which Merck’s long-term growth will be constructed.

It is also the platform from which millions more, around the world, will build healthier, longer lives.

Thank you.

These remarks contain "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and involve risks and uncertainties, which may cause results to differ materially from those set forth in the statements. The forward-looking statements may include statements regarding product development, product potential or financial performance. No forward-looking statement can be guaranteed and actual results may differ materially from those projected. Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. Forward-looking statements in these remarks should be evaluated together with the many uncertainties that affect Merck's business, particularly those mentioned in the risk factors and cautionary statements in Item 1A of Merck's Form 10-K for the year ended Dec. 31, 2007, and in any risk factors or cautionary statements contained in the Company's periodic reports on Form 10-Q or current reports on Form 8-K, which the Company incorporates by reference.