Merck CEO Quits Trump Advisory Role in 'Stand Against Intolerance' -- 4th Update

By Peter Loftus Features Dow Jones Newswires

The head of drugmaker Merck & Co. resigned Monday from a manufacturing-advisory council to the Trump administration in an apparent protest of the president's failure to quickly condemn the white supremacists who marched and waged violence in Charlottesville, Va., over the weekend.

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Merck issued a statement Monday morning on Twitter from Chairman and Chief Executive Kenneth Frazier, saying, "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."

"As CEO of Merck and as a matter of personal conscience, I feel a responsibility to take a stand against intolerance and extremism," Mr. Frazier said in the statement. A Merck spokeswoman said the company had no comment beyond Mr. Frazier's statement.

Almost an hour later, President Donald Trump posted on Twitter: "Now that Ken Frazier of Merck Pharma has resigned from President's Manufacturing Council, he will have more time to LOWER RIPOFF DRUG PRICES!"

Later Monday, Mr. Trump singled out white-nationalist groups by name for condemnation after stopping short of doing so two days earlier. Such groups had largely supported his presidential campaign, and Mr. Trump was widely criticized on Saturday for saying there was a display of hatred and violence in Charlottesville by "many sides."

On Monday evening, Mr. Trump once again took to Twitter to blast Merck, saying Merck "is a leader in higher & higher drug prices while at the same time taking jobs out of the U.S. Bring jobs back & LOWER PRICES!"

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A Merck spokeswoman declined to comment. Merck earlier this year said that in 2016 it raised list prices for its brand-name drugs and vaccines by an average of 9.6%, with an average net price increase of 5.5% reflecting discounts and rebates.

A White House spokeswoman declined to comment further on the president's tweets about Merck.

Other CEOs who made statements on Twitter in response to the weekend violence included Lloyd Blankfein, chairman and CEO of Goldman Sachs Group Inc. The Wall Street chief quoted Abraham Lincoln in tweeting: "A house divided against itself cannot stand." He added: "Isolate those who try to separate us. No equivalence w/ those who bring us together."

Mr. Frazier, who is African-American, was one of 28 business and union leaders the president named to an advisory council in January aimed at helping him boost U.S. manufacturing jobs. It has been known variously as the American Manufacturing Council and the Manufacturing Jobs Initiative and is led by Dow Chemical Co. CEO Andrew Liveris.

Mr. Liveris said in a written statement that he condemns the violence in Charlottesville and that there is no room for hatred, racism or bigotry at the company. His statement didn't address Mr. Frazier's resignation from the manufacturing council or his own status with the group, but he said Dow would continue to support job-creation policies.

General Electric Co. Chairman Jeff Immelt will remain on the manufacturing council, according to the company, which issued a statement saying, "GE has no tolerance for hate, bigotry or racism, and we strongly condemn the violent extremism in Charlottesville over the weekend." The statement said, "It is important for GE to participate in the discussion on how to drive growth and productivity in the U.S."

Stephen Schwarzman, CEO of private-equity firm Blackstone Group LP and the chairman of Mr. Trump's Strategic and Policy Forum, a group of executives tapped to advise the president on how government policy affects business and the economy, condemned "bigotry, hatred and extremism" in a statement. He will remain chairman of the panel, a spokeswoman said.

"Encouraging tolerance and understanding must be a core national imperative and I will work to further that goal," Mr. Schwarzman said in the statement.

Mr. Frazier is the latest CEO to step down from a role advising the White House. In June, Elon Musk of Tesla Inc. and Robert Iger of Walt Disney Co. resigned from advisory roles after Mr. Trump said the U.S. would withdraw from the Paris climate accord.

Mr. Musk tweeted at the time: "Leaving Paris is not good for America or the world." Mr. Iger said at the time that he was resigning from the president's business advisory council as "a matter of principle."

Travis Kalanick, then Uber Technologies Inc.'s CEO, stepped down from Mr. Trump's Strategic and Policy Forum in February after calls by users to delete the ride-hailing service's app.

Mr. Frazier, a Merck veteran and its CEO since 2011, has met in the past with Mr. Trump at the White House, including a gathering of pharmaceutical CEOs in January when Mr. Trump told them drug prices were too high.

Their public interactions appeared more cordial before Monday. At the January meeting, Mr. Frazier shook hands with the president and told him Merck, based in Kenilworth, N.J., employed thousands of Americans in manufacturing and research jobs. In February, Mr. Frazier met with Mr. Trump to discuss possible changes to U.S. tax and trade policies that Mr. Frazier said would promote U.S. economic growth.

In July, Mr. Frazier attended a White House event with the president to announce a new glass-packaging product for drugs that Corning Inc. co-developed with Merck and Pfizer Inc. "Thank you, Mr. President, for your leadership. It's an honor to be here at the White House, and I'm grateful for the administration's continued support for American innovation and manufacturing," Mr. Frazier said.

Mr. Frazier, an attorney, is one of two African-American CEOs of companies in the S&P 500 index and one of four in the Fortune 500, according to the Executive Leadership Council, an organization that supports increasing the number of black executives.

Merck makes diabetes drug Januvia, cancer treatment Keytruda and the human papillomavirus vaccine Gardasil. It is the second-biggest U.S. drugmaker by annual sales, behind Pfizer.

--Nikki Waller, Tom Gryta and Nathan Becker contributed to this article

Write to Peter Loftus at peter.loftus@wsj.com

(END) Dow Jones Newswires

August 14, 2017 19:51 ET (23:51 GMT)