Merck to Buy Schering-Plough

Drug makers Merck and Schering-Plough have announced that they will merge in a $41 billion deal made up of cash and stock. The merger of the two New Jersey-based pharmaceutical giants comes just a month and a half after news of another blockbuster merger between Pfizer and Wyeth. The merged company will keep the Merck name.

Merck and Schering-Plough are co-marketers of the cholesterol drugs Zetia and Vytorin.

These mergers are spurred by economic pressures created by drug pipelines lacking new drugs to replace the bestsellers due to come off patent in the coming years, and by what’s perceived as coming pressure by the U.S. government to reduce prices. The Wall Street Journal discusses the Merck Schering-Plough deal, and offers a live blog of the companies’ analyst conference call.

Shares of Merck stock (MRK) were down more than 6% in early trading Monday, while Schering-Plough stock (SGP) was up sharply, seeing a 15% rise.

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