There's an article in Wednesday's Wall Street Journal (subscriber-only link here) (Update: also available freely here - thanks to Kyle of The Chemblog for finding this) on Merck's head of research, Peter Kim. It's well-written, in the sense that depending on how you come to it, you could come away with very different conclusions. If you're a fan of Kim and his approach since he took his current job, then you may well see a portrait of a driven, hard-working scientist struggling to change an insular, arrogant research culture and drag it into the real world. But if you're not so sure about Kim's managerial virtues, you can find evidence that he's in well over his head.
As the article notes, one of the big changes he's made is the number of deals that Merck has been signing. To be fair, the company was probably going to pick up the pace on outside collaborations anyway when its late-stage pipeline took so many hits, but maybe not to this extent. Much is made of a "charm school" operation where Merck's people were supposedly told not to be so haughty with potential small-company partners. I find it hard to imagine that this made a huge difference, though. Merck most certainly does have an attitude, even now, but I have to think that small company pitchmen are used to getting the same stuff everywhere they go.
Everyone knows the score at these presentations. The people from the smaller outfit are saying "We have something that you don't. Even though you're big and have more money than we do, believe us, you want this." And their counterparts on the other side of the table are saying "Prove it. We know that you think we're a big piggy bank to be turned over and shaken, but no nickels are coming out until you show us something more than snappy PowerPoints". The glad-handing approach that the article portrays Kim as using sounds to me like a recipe for overpaying for deals.
But my favorite part is on the various departures that have taken place:
Soon after he arrived, he angered Emilio Emini, Merck's senior vice president of vaccine research. During his 20 years at the company, Dr. Emini had done some seminal AIDS work. Dr. Kim wanted to hire another accomplished but controversial AIDS researcher, David Ho, to oversee him. Dr. Emini strongly objected. . .(and) left Merck in early 2004. He now works for rival Wyeth. . .
Vetern Merck research managers such as Kathrin Jansen, who was instrumental in the devleopment of (cervical cancer vaccine) Gardasil, and Scott Reines, a top researcher in psychiatric diseases, also took jobs at other pharmaceutical companies. . .Dr. Kim hired other academic scientists who enjoyed good reputations but, like hiim, had never developed a drug. . ."
Not having developed a drug is no particular shame - all of us in the industry start out never having done that. The thing is, we also start out knowing that everyone else in the place knows more than we do about it. High-level academia transplants have a poor track record in the drug industry - if you'd like some more evidence, you can ask some people with a few years of experience at Bristol-Meyers Squibb. Kim is probably correct when he says that Merck had too much of a "That's not how we do things here" attitude, but people sometimes forget that academia has no immunity to that disease, either.
Update: I also recommend checking out the take at Health Care Renewal, from an ex-Merck employee.