Merck&co. Case Analysis

In the case of Merck, Dr. William Campbell's discovery that ivermectin was effective against horses' Onchocerca cervicalis and could possibly be adapted for human use against River Blindness, a disease that affected millions of people in some developing countries, confronted the company with an ethical dilemma: should it develop the human formulation of ivermectin or not?

Pursuing a corporate philosophy of "Medicine is for the people, not for profits; the profits follow", Merck encouraged its employees to "think of their work as a quest to alleviate human disease and suffering world-wide." Following this philosophy, Dr. Willian Campbell felt obliged to proceed to find the formulation for human use. His proposal was well justified, not only by its alignment with Merck's philosophy of people first and the social responsibilities of the company, but also by its feasibility - based on the success of ivermectin in animals.

As Roy Vagelos, I would proceed to invest in the program, although several pros and cons would have to be weighed carefully beforehand.

Milton Friedman said "There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits as long as it stays within the rules of the game". Although this is not entirely true, it states that a company should be responsible to its shareholders by making profits. For a new medicine to be produced, it required 12 years and a 200 million dollar investment. Moreover, there were further pitfalls, such as the uncertainty of the program's success, the nil profits even if it was successful, and the distribution efforts needed due to the societal situations in those developing countries.

While the prevailing view on Corporate Social Responsibility is that a company's philanthropic acts towards society only represent a cost to a business,