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From The Economist of 31 Dec 2011 entitled "Take five":

In recent years, many big drug companies have gutted their research departments. This is partly because those department have failed to cope up with new "blockbuster" drugs of the sort that created Big Pharma in the first place, and partly because the big firms' bosses had hoped that smaller biotechnology companies, of the sort Dr DePinto has helped set up, would do the hard work of drug discovery instead, and then let themselves be bought by the big firms.

Unfortunately, it hasn't quite worked out like that. The output of the biotech firms has been a trickle, rather than a torrent. The have been one of the worst performing parts of the private equity market since 2007.

Today's results are dependent of what was in the innovation pipeline seven and twelve years ago. But cost controls - what MBAs do - means innovation is gleefully stifled. Management that 'does not come from where the work gets done' means research and innovation cannot be productive. When MBAs became CEOs of Big Pharma, then blockbuster drugs were not being developed in the 1990s. With stifled research in the 1990s, the blockbuster drugs in 2000s could not exist. So Big Pharma did after 2000 what any MBA would do. As AT&T, GM, and Eastman Kodak had also done. They played money games. And went running to wacko extremists in government for protection. Rather than fire the number one problem (as Obama did to Wagoner in GM), American wacko extremists (George Jr et al) created Federal laws to keep American drug prices 40% higher. The Economist summarizes the problem.


Merck is a perfect example of why America must surrender jobs to foreigners (ie China). Why under 35 year olds that once made $45K in 1992 and $47K in 1999 (when America had an educated president) were only making $32K in 2007 (when America had an MBA president).

Merck was once one of the best Big Pharma companies with new and innovative drugs. Then Raymond V. Gilmartin took over in 1994. A 1968 Harvard Business School graduate. In the 2000s Merck was crying because it had no blockbuster drugs in the pipeline. Gilmartin did what MBAs do – stifle innovation to increase profits. He even lied about health problems created by a profit center - Vioxx. Under Gilmartin, the problem was known. As an MBA, he quashed honesty to make profits. Rather than do what made Merck great, the MBA hired lawyers and cost controllers. While stifling the innovation pipeline.

Gilmartin is now doing the only thing he understands. He a business management professor in Harvard. Teaching more students how to stifle innovation in the name of profits. To enrich the rich while destroying American jobs.

Merck's previous CEO was Roy Vagelos. Educated in Chemistry at U of Penn. Became a medical doctor in Columbia U in 1954. Spent time as a research doctor in places such as National Institute of Health. Authored over 100 scientific papers. Was the Chief Scientist at Merck before becoming CEO. Came from where the work gets done. Which is a definition of an American patriot.

Vagelos is the reason why Merck was the Big Pharma benchmark for innovation. Could develop so many blockbuster anti-cholesterol and statin drugs including Zocor. Merck did much of the research (ie the 4S study) that proved how cholesterol caused deaths and how the problem could be averted with drugs. Ten years after Vagelos retired, Merck was still earning profits because that CEO was an American patriot. He was not a dumb and evil business school graduate - Gilmartin.

Merck no longer has blockbuster drugs in their innovation pipeline. Like any anti-American company (such as Fiorina at HP), Merck's lackluster future is directly traceable to doing what is taught in business schools. We can even quantify how bad their MBA CEO Gilmartin was. He was paid $37million annually. While productive and patriotic companies such as Google pay their CEO Eric Schmidt $500thousand annually.

Reality is so obvious - ie Wall Street - that only a wacko extremist could deny it.

The Economist says why American Big Pharma was running to government for protection. And got it from another MBA named George Jr. (Same wackos who loved George Jr also called Sen John McCain a liberal.)

Thanks to wacko extremists, Federal law keeps American drug prices 40% higher compared to the same drug sold elsewhere in the world. Another trophy to an MBA education. Money games and lawyers (ie Vioxx) to mask innovations and honesty that MBAs stifle. An MBA who was running Merck into the ground ten plus years ago demonstrates why The Economist says Big Pharma is now becoming a welfare case. As anti-American as the heart attack of America: Chevy.

Merck was once patriotic under Roy Vagelos - who came from where the work gets done. The Economist describes what happens when top management is dumb – is educated in business schools.