Merck, Schering Shareholders OK Deal

TRENTON, New Jersey -- Shareholders of drugmakers Merck & Co. and Schering-Plough Corp. on Friday both overwhelmingly backed a $41.1 billion tie-up to create the world's No. 2 pharmaceutical company.

The acquisition of smaller Schering-Plough allows Merck, the world's eighth-biggest drugmaker by prescription medicine sales, to leapfrog to No. 2 worldwide, just behind Pfizer Inc. The new Merck would have about $42.4 billion in annual sales.

Merck and Schering-Plough already are partners on the blockbuster cholesterol drugs Vytorin and Zetia. The marriage will unite Merck's asthma and allergy treatment Singulair and cervical cancer vaccine Gardasil with Schering-Plough's allergy spray Nasonex and well-known consumer products including the Coppertone sun care line and Dr. Scholl's foot care items.

Buying No. 18 drugmaker Schering-Plough also boosts Merck's sagging pipeline of drugs in development, gives it a sizable biotech unit and creates a dominant player in vaccines as well as cholesterol, respiratory and women's drugs. And it allows the new company to slash costs -- including roughly 15,000 jobs -- to maintain profits as the industry deals with increasing generic competition and the unknown impact of health care reform.

Merck spokeswoman Amy Rose said 99.6 percent of the votes cast by Merck stockholders, or about 1.4 billion shares, supported the $41.1 billion purchase of Schering-Plough. The vote came at a special shareholders meeting Friday morning near Merck's headquarters in Whitehouse Station, New Jersey Hours later, Schering-Plough stockholders also approved the deal almost unanimously, with about 99.1 percent of votes cast, or about 1.26 billion shares, supporting the deal.