Corporate Social Responsibility Case Study

Case Title:

Merck-The Promotion and Recall of Vioxx

Abstract:
Vioxx, one of Merck’s top selling drugs, was withdrawn from the market on September 30th 2004. It had become the world’s fastest-growing branded prescription medicine for arthritis. The case examines the events that followed from its approval in 1999 to its withdrawal in 2004.

The case highlights Merck’s business strategy and how it developed Vioxx as a brand that was promoted extensively through DTCA and changed the entire decision-making model of the prescription drug by encouraging patients to ask their doctors for Vioxx. The case lines up the various clinical studies that were conducted for Vioxx and the way the cardio-vascular risk findings were communicated to the FDA and the public. It also details the impact of the withdrawal on: Merck’s goodwill and market position, repercussions on the entire pharmaceutical industry and the counter-measures taken by the company to minimise the impact of this action. The case also discusses whether the withdrawal was a sound decision or Merck could have opted for other alternatives.

Pedagogical Objectives:

• To discuss and highlight Merck’s business strategy and how it developed Vioxx as a brand
• To detail the impact of the withdrawal of Vioxx on Merck’s goodwill and market positioning
• To understand the pharmaceutical industry
• To analyse the counter-measures taken by the company to minimise the impact of its Vioxx withdrawal
• To debate whether the withdrawal was a sound decision on the basis of corporate social responsibility or optinos for other alternatives.

Keywords : Corporate Social Responsibility Case Study Business Strategy, Marketing- Branding, Positioning, Direct-to-consumer advertising, Business Ethics