As filed with the Securities and Exchange Commission on February 28, 2012
`UNITED STATES
`SECURITIES AND EXCHANGE COMMISSION
`WASHINGTON, D. C. 20549
`FORM 10-K
`Annual Report Pursuant to Section 13 or 15(d)
`of the Securities Exchange Act of 1934
`For the Fiscal Year Ended December 31, 2011
`
`or
`Transition Report Pursuant to Section 13 or 15(d)
`of the Securities Exchange Act of 1934
`For the transition period from
`to
`Commission File No. 1-6571
`
`(MARK ONE)
`Í
`
`‘
`
`Merck & Co., Inc.
`
`One Merck Drive
`Whitehouse Station, N. J. 08889-0100
`(908) 423-1000
`
`Incorporated in New Jersey
`
`I.R.S. Employer
`Identification No. 22-1918501
`Securities Registered pursuant to Section 12(b) of the Act:
`Name of Each Exchange
`on which Registered
`
`Title of Each Class
`
`the registrant
`
`is a well-known seasoned issuer, as defined in Rule 405 of
`
`the Securities
`
`the registrant
`
`is not
`
`required to file reports pursuant
`
`to Section 13 or Section 15(d) of
`
`the
`
`New York Stock Exchange
`Common Stock ($0.50 par value)
`Number of shares of Common Stock ($0.50 par value) outstanding as of January 31, 2012: 3,044,008,396.
`Aggregate market value of Common Stock ($0.50 par value) held by non-affiliates on June 30, 2011 based on closing price on June 30,
`2011: $108,759,000,000.
`Indicate by check mark if
`Act. Yes Í No ‘
`Indicate by check mark if
`Act. Yes ‘ No Í
`Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
`Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has
`been subject to such filing requirements for the past 90 days. Yes Í No ‘
`Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
`Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or
`for such shorter period that the registrant was required to submit and post such files). Yes Í No ‘
`Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and
`will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this
`Form 10-K or any amendment to this Form 10-K. ‘
`Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
`reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
`Exchange Act. (Check One):
`Í
`Large accelerated filer
`
`Accelerated filer
`
`‘
`
`‘
`Non-accelerated filer
`(Do not check if a smaller reporting company)
`Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ‘ No Í
`Documents Incorporated by Reference:
`
`Smaller reporting company ‘
`
`Document
`
`Proxy Statement for the Annual Meeting of
`Shareholders to be held May 22, 2012, to be filed with the
`Securities and Exchange Commission within 120 days after the
`close of the fiscal year covered by this report
`
`Part of Form 10-K
`
`Part III
`
`MYLAN - EXHIBIT 1055
`Mylan et al. v. AstraZeneca
`IPR2015-01340
`
`

`
`Table of Contents
`
`Part I
`Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 1.
`Item 1A. Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Cautionary Factors that May Affect Future Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 1B. Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 2.
`Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 3.
`Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 4. Mine Safety Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Executive Officers of the Registrant
`. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`
`Part II
`Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases
`of Equity Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 6.
`Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations . . . . . . .
`Item 7A. Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 8.
`Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`(a) Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Notes to Consolidated Financial Statements
`. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . .
`(b) Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Changes in and Disagreements with Accountants on Accounting and Financial Disclosure . . . . . . .
`Item 9.
`Item 9A. Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Management’s Report
`. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 9B. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`
`Part III
`Item 10. Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 11. Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 12. Security Ownership of Certain Beneficial Owners and Management and Related
`Stockholder Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Item 13. Certain Relationships and Related Transactions, and Director Independence . . . . . . . . . . . . . . . . . .
`Item 14. Principal Accountant Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`
`Part IV
`Item 15. Exhibits and Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`Consent of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
`
`Page
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`34
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`42
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`83
`83
`87
`147
`148
`149
`149
`149
`150
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`151
`151
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`151
`151
`152
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`152
`158
`159
`
`

`
`Item 1. Business.
`
`PART I
`
`Merck & Co., Inc. (“Merck” or the “Company”) is a global health care company that delivers innovative
`health solutions through its prescription medicines, vaccines, biologic therapies, animal health, and consumer care
`products, which it markets directly and through its joint ventures. The Company’s operations are principally
`managed on a products basis and are comprised of four operating segments, which are the Pharmaceutical, Animal
`Health, Consumer Care and Alliances segments, and one reportable segment, which is the Pharmaceutical segment.
`The Pharmaceutical segment includes human health pharmaceutical and vaccine products marketed either directly
`by the Company or through joint ventures. Human health pharmaceutical products consist of therapeutic and
`preventive agents, generally sold by prescription, for the treatment of human disorders. The Company sells these
`human health pharmaceutical products primarily to drug wholesalers and retailers, hospitals, government agencies
`and managed health care providers such as health maintenance organizations, pharmacy benefit managers and other
`institutions. Vaccine products consist of preventive pediatric, adolescent and adult vaccines, primarily administered
`at physician offices. The Company sells these human health vaccines primarily to physicians, wholesalers,
`physician distributors and government entities. The Company also has animal health operations that discover,
`develop, manufacture and market animal health products,
`including vaccines, which the Company sells to
`veterinarians, distributors and animal producers. Additionally, the Company has consumer care operations that
`develop, manufacture and market over-the-counter, foot care and sun care products, which are sold through
`wholesale and retail drug, food chain and mass merchandiser outlets.
`
`the Pharmaceutical segment, see Item 7.
`information and other information about
`For financial
`“Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Item 8. “Financial
`Statements and Supplementary Data” below.
`
`All product or service marks appearing in type form different from that of the surrounding text are
`trademarks or service marks owned, licensed to, promoted or distributed by Merck, its subsidiaries or affiliates,
`except as noted. All other trademarks or services marks are those of their respective owners.
`
`Overview
`
`During 2011, the Company focused on accelerating revenue growth, reducing costs to drive efficiencies,
`allocating resources to drive future growth by making strategic investments in product launches, as well as in the
`emerging markets, and advancing and augmenting its research and development pipeline.
`
`Worldwide sales totaled $48.0 billion in 2011, an increase of 4% compared with $46.0 billion in 2010.
`Foreign exchange favorably affected global sales performance by 2%. The revenue increase was driven largely by
`growth in Januvia (sitagliptin) and Janumet (sitagliptin/metformin hydrochloride HCI), treatments for type 2
`diabetes, Singulair (montelukast sodium), a medicine for the chronic treatment of asthma and the relief of
`symptoms of allergic rhinitis, Isentress (raltegravir), an antiretroviral therapy for use in combination therapy for the
`treatment of HIV-1 infection, Gardasil [human papillomavirus quadrivalent (types 6, 11, 16 and 18) vaccine,
`recombinant], a vaccine to help prevent certain diseases caused by four types of human papillomavirus (“HPV”),
`Simponi (golimumab), a treatment for inflammatory diseases, RotaTeq [Rotavirus Vaccine, Live, Oral, Pentavalent],
`a vaccine to help protect against rotavirus gastroenteritis in infants and children, Zetia (ezetimibe), a cholesterol
`absorption inhibitor, Pneumovax [pneumococcal vaccine polyvalent], a vaccine to help prevent pneumococcal
`disease, and Bridion (sugammadex), for the reversal of certain muscle relaxants used during surgery. In addition,
`revenue in 2011 benefited from higher sales of the Company’s animal health products and from the launch of
`Victrelis (boceprevir), a treatment for chronic hepatitis C. These increases were partially offset by lower sales of
`Cozaar (losartan potassium) and Hyzaar (losartan potassium and hydrochlorothiazide), treatments for hypertension,
`which lost patent protection in the United States in April 2010 and in a number of major European markets in
`March 2010, as well as by lower sales of Caelyx, Subutex and Suboxone as the Company no longer has marketing
`rights to these products. Revenue was also negatively affected by lower sales of Vytorin (ezetimibe/simvastatin), a
`cholesterol modifying medicine, Temodar (temozolomide), a treatment for certain types of brain tumors, ProQuad
`[Measles, Mumps, Rubella and Varicella Virus Vaccine Live], a pediatric combination vaccine to help protect
`against measles, mumps, rubella and varicella, and Varivax [Varicella Virus Vaccine Live], a vaccine to help
`
`1
`
`

`
`prevent chickenpox (varicella). In addition, as discussed below, the ongoing implementation of certain provisions of
`U.S. health care reform legislation during 2011 resulted in further increases in Medicaid rebates and other impacts
`that reduced revenues. Additionally, many countries in the European Union (the “EU”) have undertaken austerity
`measures aimed at reducing costs in health care and have implemented pricing actions that negatively impacted
`sales in 2011.
`In April 2011, Merck and Johnson & Johnson (“J&J”) reached an agreement to amend the agreement
`governing the distribution rights to Remicade (infliximab) and Simponi. This agreement concluded the arbitration
`proceeding J&J initiated in May 2009. Under the terms of the amended distribution agreement, Merck relinquished
`marketing rights for Remicade and Simponi to J&J in territories including Canada, Central and South America, the
`Middle East, Africa and Asia Pacific effective July 1, 2011. Merck retained exclusive marketing rights throughout
`Europe, Russia and Turkey (the “Retained Territories”). The Retained Territories represented approximately 70% of
`Merck’s 2010 revenue of $2.8 billion from Remicade and Simponi. In addition, beginning July 1, 2011, all profits
`derived from Merck’s exclusive distribution of the two products in the Retained Territories are being equally
`divided between Merck and J&J. J&J also received a one-time payment from Merck of $500 million in April 2011.
`During 2011, the Company continued the advancement of drug candidates through its pipeline. Victrelis,
`the Company’s innovative oral medicine for the treatment of chronic hepatitis C, was approved by the U.S. Food
`and Drug Administration (the “FDA”) and the European Commission (the “EC”). The FDA also approved Juvisync
`(sitagliptin and simvastatin), a new treatment for type 2 diabetes that combines the active ingredient in the glucose-
`lowering medication Januvia with the cholesterol-lowering medication Zocor (simvastatin). In addition, the EC
`approved Zoely (NOMAC/E2), a monophasic combined oral contraceptive tablet for use by women to prevent
`pregnancy. Cubicin, an antibacterial agent with activity against methicillin-resistant Staphylococcus aureus
`(“MRSA”), for which the Company has licensed development and distribution rights in Japan, was approved for use
`in that country.
`In February 2012, the FDA approved Janumet XR (sitagliptin and metformin HCI extended-release), a
`new treatment for type 2 diabetes that combines sitagliptin, which is the active component of Januvia, with
`extended-release metformin in a once-daily formulation; Cosopt PF (dorzolamide hydrochloride-timolol maleate
`ophthalmic solution) 2.0%/0.5%, Merck’s preservative-free formulation of Cosopt, indicated for the reduction of
`elevated intraocular pressure in appropriate patients with open-angle glaucoma or ocular hypertension; and Zioptan
`(tafluprost ophthalmic solution), a preservative-free prostaglandin analogue ophthalmic solution.
`The Company also received additional indications for several of its existing products. During 2011, the
`FDA approved an expanded age indication for Zostavax [Zoster Vaccine Live], a vaccine to help prevent shingles
`(herpes zoster), to include adults ages 50 to 59. In addition, the FDA approved Sylatron (peginterferon alfa-2b) for
`Injection for the adjuvant treatment of melanoma in patients with microscopic or gross nodal involvement. Also,
`Simponi received an indication in the EU for use in combination with methotrexate in adults with severe, active and
`progressive rheumatoid arthritis not previously treated with methotrexate, having been shown to reduce the rate of
`progression of joint damage as measured by X-ray and to improve physical function. In January 2012, the FDA
`approved the use of Isentress, in combination with other antiretroviral medicines, for the treatment of HIV-1
`infection in pediatric patients two years of age and older and weighing at least 10 kg.
`The Company currently has two candidates under review with the FDA: MK-8669, ridaforolimus, for the
`treatment of metastatic soft-tissue or bone sarcomas in patients who had a favorable response to chemotherapy and
`MK-0653C, Zetia combined with atorvastatin for the treatment of primary or mixed hyperlipidemia. MK-8669 is
`also under review in the EU.
`The Company currently has 19 candidates in Phase III development and anticipates filing a New Drug
`Application (“NDA”) with the FDA with respect to certain of these candidates in 2012 including MK-4305,
`suvorexant, an investigational treatment for insomnia; MK-8616, Bridion, a medication for the reversal of certain
`muscle relaxants used during surgery; and V503, a nine-valent HPV vaccine. The Company also anticipates filings
`in 2013 for, among others, MK-0822, odanacatib, an investigational treatment for osteoporosis, and MK-0524A,
`Tredaptive (extended-release niacin/laropiprant/simvastatin), which is under development for the treatment of
`atherosclerosis.
`Merck continues to pursue opportunities that have the potential to drive both near- and long-term growth.
`During 2011,
`the Company completed a variety of
`transactions
`including the acquisition of
`Inspire
`
`2
`
`

`
`Pharmaceuticals, Inc., a specialty pharmaceutical company focused on developing and commercializing ophthalmic
`products. Additionally, the Company entered into transactions designed to strengthen its presence in emerging
`markets in the longer term.
`
`Merck continues to realize cost savings across all areas of the Company. These savings result from
`various actions, including the Merger Restructuring Program discussed below, previously announced ongoing cost
`reduction activities, as well as from non-restructuring-related activities. As of the end of 2011, the Company has
`realized approximately $2.9 billion in annual net cost savings from these activities since the merger of legacy
`Merck & Co., Inc. and Schering-Plough Corporation (“Schering-Plough”) on November 3, 2009 (the “Merger”).
`
`In July 2011, the Company announced the latest phase of its global restructuring program (the “Merger
`Restructuring Program”) that was initiated in conjunction with the integration of the legacy Merck and legacy
`Schering-Plough businesses. This Merger Restructuring Program is intended to optimize the cost structure of the
`combined company. As part of this latest phase, the Company expects to reduce its workforce measured at the time
`of the Merger by an additional 12% to 13% across the Company worldwide. A majority of the workforce reductions
`in this phase of
`the Merger Restructuring Program relate to manufacturing (including Animal Health),
`administrative and headquarters organizations. Previously announced workforce reductions of approximately 17%
`in earlier phases of the program primarily reflect
`the elimination of positions in sales, administrative and
`headquarters organizations, as well as from the sale or closure of certain manufacturing and research and
`development sites and the consolidation of office facilities. The Company will continue to hire employees in
`strategic growth areas of the business as necessary. The Company will continue to pursue productivity efficiencies
`and evaluate its manufacturing supply chain capabilities on an ongoing basis which may result
`in future
`restructuring actions. The Company recorded total pretax restructuring costs of $1.8 billion in 2011, $1.8 billion in
`2010 and $1.5 billion in 2009 related to this program. The restructuring actions under the Merger Restructuring
`Program are expected to be substantially completed by the end of 2013, with the exception of certain actions,
`principally manufacturing-related, which are expected to be substantially completed by 2015, with the total
`cumulative pretax costs estimated to be approximately $5.8 billion to $6.6 billion. The Company estimates that
`approximately two-thirds of the cumulative pretax costs relate to cash outlays, primarily related to employee
`separation expense. Approximately one-third of the cumulative pretax costs are non-cash, relating primarily to the
`accelerated depreciation of facilities to be closed or divested. The Company expects the Merger Restructuring
`Program to yield annual savings by the end of 2013 of approximately $3.5 billion to $4.0 billion and annual savings
`upon completion of the program of approximately $4.0 billion to $4.6 billion.
`
`During 2011, the Company continued to be affected by the U.S. health care reform legislation that was
`enacted in 2010 as additional provisions went into effect. Beginning in 2011, the law requires pharmaceutical
`manufacturers to pay a 50% discount to Medicare Part D beneficiaries when they are in the Medicare Part D
`coverage gap (i.e., the so-called “donut hole”). Approximately $150 million was recorded as a reduction to revenue
`in 2011 related to the estimated impact of this provision of health care reform. Also, the Company recorded $162
`million of expenses for the annual health care reform fee, which the Company was required to pay beginning in
`2011. The law also increased mandated Medicaid rebates, which reduced revenues by approximately $179 million
`and $170 million in 2011 and 2010, respectively.
`
`Effective December 1, 2011, Richard T. Clark, chairman, retired from the Company and the Merck
`Board of Directors. Kenneth C. Frazier, Merck’s president and chief executive officer, was elected by the Board to
`serve as chairman following Mr. Clark’s retirement.
`
`In November 2011, Merck’s Board of Directors raised the Company’s quarterly dividend to $0.42 per
`share from $0.38 per share.
`
`Earnings per common share assuming dilution attributable to common shareholders (“EPS”) for 2011
`were $2.02, which reflect a net unfavorable impact resulting from acquisition-related costs, restructuring costs, as
`well as the charge related to the settlement of the arbitration proceeding with J&J discussed above, partially offset
`by the favorable impact of certain tax items and gains on the disposition of the Company’s interest in the Johnson &
`Johnson°Merck Consumer Pharmaceuticals Company joint venture and the sale of certain manufacturing facilities
`and related assets. Non-GAAP EPS in 2011 were $3.77 excluding these items (see “Non-GAAP Income and
`Non-GAAP EPS” below).
`
`3
`
`

`
`Product Sales
`
`Sales(1) of the Company’s products were as follows:
`Years Ended December 31
`
`Pharmaceutical:
`Cardiovascular
`Zetia
`Vytorin
`Integrilin
`Diabetes and Obesity
`Januvia
`Janumet
`Diversified Brands
`Cozaar/Hyzaar
`Zocor
`Propecia
`Claritin Rx
`Remeron
`Vasotec/Vaseretic
`Proscar
`Infectious Disease
`Isentress
`PegIntron
`Cancidas
`Primaxin
`Invanz
`Avelox
`Noxafil
`Crixivan/Stocrin
`Rebetol
`Victrelis
`Neurosciences and Ophthalmology
`Maxalt
`Cosopt/Trusopt
`Oncology
`Temodar
`Emend
`Intron A
`Respiratory and Immunology
`Singulair
`Remicade
`Nasonex
`Clarinex
`Arcoxia
`Simponi
`Asmanex
`Proventil
`Dulera
`Vaccines(2)
`Gardasil
`ProQuad/M-M-R II/Varivax
`RotaTeq
`Pneumovax
`Zostavax
`Women’s Health and Endocrine
`Fosamax
`NuvaRing
`Follistim AQ
`Implanon
`Cerazette
`Other pharmaceutical(3)
`Total Pharmaceutical segment sales
`Other segment sales(4)
`Total segment sales
`Other(5)
`
`2011
`
`2010
`
`2009
`
`$ 2,428
`1,882
`230
`
`$ 2,297
`2,014
`266
`
`$
`
`3,324
`1,363
`
`1,663
`456
`447
`314
`241
`231
`223
`
`1,359
`657
`640
`515
`406
`322
`230
`192
`174
`140
`
`639
`477
`
`935
`419
`194
`
`5,479
`2,667
`1,286
`621
`431
`264
`206
`155
`96
`
`1,209
`1,202
`651
`498
`332
`
`2,385
`954
`
`2,104
`468
`447
`296
`223
`255
`216
`
`1,090
`737
`611
`610
`362
`316
`198
`206
`221
`—
`
`550
`484
`
`1,065
`378
`209
`
`4,987
`2,714
`1,219
`623
`398
`97
`208
`210
`8
`
`988
`1,378
`519
`376
`243
`
`403
`441
`46
`
`1,922
`658
`
`3,561
`558
`440
`71
`38
`311
`291
`
`752
`149
`617
`689
`293
`66
`34
`206
`36
`—
`
`575
`503
`
`188
`317
`38
`
`4,660
`431
`165
`101
`358
`4
`37
`26
`—
`
`1,118
`1,369
`522
`346
`277
`
`855
`623
`530
`294
`268
`3,521
`41,289
`6,327
`47,616
`431
`$48,047
`
`926
`559
`528
`236
`209
`3,879
`39,267
`6,059
`45,326
`661
`$45,987
`
`1,100
`88
`96
`37
`35
`1,263
`25,236
`2,114
`27,350
`78
`$27,428
`
`(1) Sales of legacy Schering-Plough products in 2009 are included only for the post-Merger period. In addition, prior to the Merger, substantially all sales of
`Zetia and Vytorin were recognized by the MSP Partnership and the results of Merck’s interest in the MSP Partnership were recorded in Equity income
`from affiliates. As a result of the Merger, the MSP Partnership became wholly owned by the Company; accordingly, all sales of MSP Partnership
`products after the Merger are reflected in the table above. Sales of Zetia and Vytorin in 2009 reflect Merck’s sales of these products in Latin America
`which was not part of the MSP Partnership, as well as sales of these products for the post-Merger period in 2009.
`(2) These amounts do not reflect sales of vaccines sold in most major European markets through the Company’s joint venture, Sanofi Pasteur MSD, the
`results of which are reflected in Equity income from affiliates. These amounts do, however, reflect supply sales to Sanofi Pasteur MSD.
`(3) Other pharmaceutical primarily reflects sales of other human health pharmaceutical products, including products within the franchises not listed
`separately.
`(4) Reflects other non-reportable segments, including Animal Health and Consumer Care, and revenue from the Company’s relationship with AZLP primarily
`relating to sales of Nexium, as well as Prilosec. Revenue from AZLP was $1.2 billion, $1.3 billion and $1.4 billion in 2011, 2010 and 2009, respectively.
`(5) Other revenues are primarily comprised of miscellaneous corporate revenues, third-party manufacturing sales, sales related to divested products or
`businesses and other supply sales not included in segment results.
`
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`Pharmaceutical
`The Company’s pharmaceutical products include therapeutic and preventive agents, generally sold by
`prescription, for the treatment of human disorders. Certain of the products within the Company’s franchises are as
`follows:
`
`Cardiovascular: Zetia (marketed as Ezetrol outside the United States); Vytorin (marketed as Inegy
`outside the United States); and Integrilin (eptifibatide) Injection, a treatment for patients with acute coronary
`syndrome.
`
`Diabetes and Obesity:
`
`Januvia and Janumet for the treatment of type 2 diabetes.
`
`Diversified Brands: Cozaar; Hyzaar; Zocor; Propecia (finasteride), a product for the treatment of male
`pattern hair loss; Claritin Rx (loratadine) for treatment of seasonal outdoor allergies and year-round indoor
`allergies; Remeron (mirtazapine), an antidepressant; Vasotec (enalapril maleate) and Vaseretic (enalapril maleate-
`hydrochlorothiazide), hypertension and/or heart failure products; and Proscar (finasteride), a urology product for
`the treatment of symptomatic benign prostate enlargement.
`
`Isentress; PegIntron (peginterferon alpha-2b), a treatment for chronic hepatitis C;
`Infectious Disease:
`Cancidas (caspofungin acetate), an anti-fungal product; Primaxin (imipenem and cilastatin sodium), an anti-
`bacterial product; Invanz (ertapenem sodium) for the treatment of certain infections; Avelox (moxifloxacin), which
`the Company only markets in the United States, a broad-spectrum fluoroquinolone antibiotic for certain respiratory
`and skin infections; Noxafil (posaconazole) for the prevention of invasive fungal infections; Crixivan (indinavir
`sulfate) and Stocrin (efavirenz), antiretroviral therapies for the treatment of HIV infection; Rebetol (ribavirin, USP)
`Capsules and Oral Solution for use in combination with PegIntron or Intron A (interferon alpha-2b, recombinant)
`for treating chronic hepatitis C; and Victrelis.
`
`Neurosciences and Ophthalmology: Maxalt (rizatriptan benzoate), a product for acute treatment of
`migraine; and Cosopt and Trusopt (dorzolamide hydrochloride ophthalmic solution), ophthalmic products.
`
`Oncology: Temodar (marketed as Temodal outside the United States); Emend (aprepitant) for the
`prevention of chemotherapy-induced and post-operative nausea and vomiting; and Intron A for Injection, marketed
`for chronic hepatitis B and C and numerous anticancer indications worldwide, including as adjuvant therapy for
`malignant melanoma.
`
`Singulair; Remicade; Nasonex (mometasone furoate monohydrate), an
`Respiratory and Immunology:
`inhaled nasal corticosteroid for the treatment of nasal allergy symptoms; Clarinex (desloratadine), a non-sedating
`antihistamine; Arcoxia (etoricoxib) for the treatment of arthritis and pain; Simponi; Asmanex Twisthaler
`(mometasone furoate inhalation powder), an oral dry-powder corticosteroid inhaler for first-line maintenance
`treatment of asthma in patients 4 and older; Proventil HFA (albuterol sulfate) inhalation aerosol for the relief of
`bronchospasm in patients 12 years or older; and Dulera Inhalation Aerosol (mometasone furoate/formoterol
`fumarate dihydrate), a fixed-dose combination asthma treatment in patients 12 years of age or older.
`
`Vaccines: Gardasil; ProQuad; M-M-R II [Measles, Mumps and Rubella Virus Vaccine Live], a
`vaccine to help prevent measles, mumps and rubella; Varivax; RotaTeq; Pneumovax; and Zostavax, a vaccine to
`help prevent shingles (herpes zoster) in patients aged 50 and older.
`
`Women’s Health and Endocrine: Fosamax (alendronate sodium) for the treatment and prevention of
`osteoporosis; NuvaRing (etonogestrel/ethinyl estradiol vaginal ring), a vaginal contraceptive ring; Follistim AQ
`(follitropin beta injection), a biological fertility treatment; Implanon (etonogestrel implant), a single-rod subdermal
`contraceptive implant; and Cerazette (desogestrel), a progestin only oral contraceptive.
`
`Animal Health
`The Animal Health segment discovers, develops, manufactures and markets animal health products,
`including vaccines. Principal marketed products in this segment include:
`
`Livestock Products: Nuflor antibiotic range for use in cattle and swine; Bovilis/Vista vaccine lines for
`infectious diseases in cattle; Banamine bovine and swine anti-inflammatory; Estrumate for the treatment of fertility
`disorders in cattle; Regumate/Matrix fertility management for swine and horses; Resflor combination broad-
`spectrum antibiotic and non-steroidal anti-inflammatory drug for bovine respiratory disease; Zilmax and Revalor to
`
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`improve production efficiencies in beef cattle; M+Pac swine pneumonia vaccine; and Porcilis vaccine line for
`infectious diseases in swine.
`
`Poultry Products: Nobilis/Innovax, vaccine lines for poultry; and Paracox and Coccivac coccidiosis
`
`vaccines.
`
`Companion Animal Products: Nobivac/Continuum vaccine lines for flexible dog and cat vaccination;
`Otomax/Mometamax/Posatex ear ointments for acute and chronic otitis; Caninsulin/Vetsulin diabetes mellitus
`treatment for dogs and cats; Panacur/Safeguard broad-spectrum anthelmintic (de-wormer) for use in many animals;
`and Scalibor/Exspot for protecting against bites from fleas, ticks, mosquitoes and sandflies.
`
`Slice parasiticide for sea lice in salmon; Aquavac/Norvax vaccines against
`Aquaculture Products:
`bacterial and viral disease in fish; Compact PD vaccine for salmon; and Aquaflor antibiotic for farm-raised fish.
`
`Consumer Care
`The Consumer Care segment develops, manufactures and markets over-the-counter, foot care and sun
`care products. Principal products in this segment include:
`
`Over-the-Counter Products: Claritin non-drowsy antihistamines; MiraLAX treatment for occasional
`constipation; Coricidin HBP decongestant-free cold/flu medicine for people with high blood pressure; Afrin nasal
`decongestant spray; and Zegerid OTC treatment for frequent heartburn.
`
`Foot Care: Dr. Scholl’s foot care products; Lotrimin topical antifungal products; and Tinactin topical
`antifungal products and foot and sneaker odor/wetness products.
`
`Sun Care: Coppertone sun care lotions, sprays and dry oils.
`
`For a further discussion of sales of the Company’s products, see Item 7. “Management’s Discussion and
`Analysis of Financial Condition and Results of Operations” below.
`
`Product Approvals
`
`In February 2012, the FDA approved Zioptan (tafluprost), a preservative-free prostaglandin analog
`ophthalmic solution for reducing elevated intraocular pressure in patients with open-angle glaucoma or ocular
`hypertension. Merck has exclusive commercial rights to tafluprost in Western Europe (excluding Germany), North
`America, South Ameri