Kenneth Frazier stepping down as Merck CEO, becomes executive chairman
Kenneth Frazier is stepping down as CEO of Merck in a shakeup for the pharmaceutical giant as the industry seeks to contribute solutions to the COVID-19 pandemic even as it faces bipartisan scrutiny over drug prices.
Frazier, who will be succeeded as CEO by the company’s chief financial officer, will become executive chairman for an undetermined period of time when the transition occurs at the end of June.
He joined Merck in 1992 as a vice president, became president of the company’s Global Human Health Division in 2007 and was elevated to CEO and chairman in 2011.
Frazier is one of only a handful of Black CEOs of major corporations. Of the 279 top executives in the 50 biggest companies in the S&P 100, only five were Black as of an analysis conducted in 2020 by USA TODAY.
“It has been a privilege to serve as Merck’s CEO for the past decade and to work with the most dedicated and talented employees and management team in the industry,” Frazier said in a statement.
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The Merck CEO notably quit then-President Donald Trump’s manufacturing jobs council over Trump’s response to the racist protests and violence in Charlottesville, Virginia, in August 2017.
“America’s leaders must honor our fundamental values by clearly rejecting expressions of hatred, bigotry and group supremacy, which run counter to the American ideal that all people are created equal,” Frazier said at the time. “As CEO of Merck and as a matter of personal conscience, I feel a responsibility to take a stand against intolerance and extremism.”
Trump said Frazier had been an obstacle to lowering drug prices, a goal that has drawn bipartisan political support in Washington.
Frazier has said the pharmaceutical industry is able to deliver innovative new drugs because of the industry’s profits.
“We have to be able to say to people, look, you cannot have a system that develops new drugs unless you can get access to the capital,” he reportedly told Biotechnology Innovation Organization’s annual meeting in 2019. “And you can’t get access to the capital unless you get a return on investment that is commensurate with the huge risk we are taking in this business.”
Under his leadership, the company delivered Keytruda, a cancer drug that made up more than one-third of Merck’s pharmaceutical revenue in 2020.
There have also been disappointments under his tenure. Most recently, the company abandoned its COVID-19 vaccine candidate after a clinical trial delivered underwhelming results.
Frazier’s successor as CEO is Robert M. Davis, who will also become president of Merck on April 1. Davis joined Merck as CFO in 2014 and his role was expanded in 2016 to include oversight of the company’s corporate business development, investor relations and IT.
“Rob has been instrumental in helping Merck take the right actions to adapt to the changing healthcare environment while remaining committed to investing in the scientific innovation that we expect will drive our future growth,” Frazier said in a statement.
Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.