Pharmaceutical Executive Digest Europe - April 1, 2009 - (Page 5) Executive Profile (over 200), when much of the industry is doing the opposite. So I ask Schnee the question I have routinely asked pharma leaders since the middle of last year: is his company recession-proof? Of course, the answer is dependent on the duration of the crisis. But Schnee has already expressed that some of Merck KGaA’s other industry areas are by nature to be hit; the liquid crystals business, for example, is suffering as sales of expensive flatscreen TVs recede. Closer to home, the fertility business that Serono brought to the merger could also be impacted, as half the costs are paid by those couples receiving the treatment. “There are of course worries if the crisis extends to the mid-term,” Schnee says, “but, as I tell people, we are one of the few stable businesses in the economy. We haven’t fired anyone; we are still increasing employment.” And he points out that there are even opportunities to be seized: “Assets can be picked up, and a good management team can show its strength when times are hard. It’s like sailing. Sailing in fine weather isn’t a challenge, but when a storm comes up, that’s the test.” Of course, as a family company (70% of Merck’s total capital is privately held by the company’s founding family), quarterly results are less important for Merck than they are for 100% public companies, enabling it to take a long-term view. And any company that has been around since 1668 — when Friedrich Jacob Merck acquired the ‘Engel Apotheke’ (Angel Pharmacy) in Darmstadt — has already seen off a good few economic slumps (not to mention a couple of world wars and the odd global pandemic). NICE and IQWIG Schnee’s biggest concern is more political, namely Germany’s Institute for Quality and Efficiency in Healthcare (IQWIG) and the UK’s National Institute for Clinical Excellence (NICE). Erbitux is still unavailable on the UK National Health Service (NHS) after being rejected by NICE in 2006, but Schnee reserves his strongest criticisms for IQWIG. “There is a danger that mechanisms are used just in the short term to fix budget problems. This is what IQWIG has done in Germany. I am absolutely for health technology assessments. But we cannot only focus on drug costs; what about the healthcare costs related to work absence, for example?” As you might expect from a man who sits in an office of windows, Schnee is most aggrieved about what he calls 1 NEWS 2 11 FROM THE EDITOR / NEWS CALENDAR 3 MERCK SERONO 7 PHARMA’S GREAT HOPE 10 NEWS 12 LAST WORDS 13 ON THE MOVE
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