Building on a 50-year relationship, Merck & Co., Inc. announced that Banyu Pharmaceutical Co., Ltd. has become a wholly owned subsidiary of Merck.

With this step, Banyu becomes the largest wholly owned subsidiary of Merck outside the United States, operating in the second largest pharmaceutical market in the world. For Merck, full ownership of Banyu expands the company's network of wholly owned operations to every major market of the world.

"Merck is delighted to welcome Banyu and all of its employees as full members of the Merck group. This step represents a natural evolution of the long and very productive relationship between the two companies and reflects recent developments in the global pharmaceutical markets," said David W. Anstice, president, Human Health, who is responsible for Merck's business in Japan, Latin America, Canada, Australia and New Zealand. "Full ownership will enable Banyu to enhance its position in the world's second largest pharmaceutical market, while simultaneously strengthening Merck's position as one of the world's largest research-based pharmaceutical companies.

"Japan is recognized internationally for its world-class medical science. The Merck strategy of locating its major research facilities in areas which offer the best talent around the world will be enhanced by the ownership of Banyu. Through the Banyu Tsukuba Research Institute, a strong foundation is in place for the development of innovative drugs discovered by Banyu to benefit patients worldwide," he added.

Haruhiko Hirate, who assumed the positions of representative director and president of Banyu on Jan. 1, 2004, said the Merck ownership will give Banyu access to resources, support and expertise to enhance Banyu's well-developed capabilities in research and development, manufacturing, marketing and sales. "We are entering an important new phase in the life of Banyu, and I see a bright future for Banyu. We will contribute global, cutting-edge science to Merck, and we will bring world-class medicines from Merck to improve patient health in Japan," he said.

Distribution of the Merck medicine, cortisone, in Japan, laid the foundation for the relationship and led the two companies to establish a joint venture in 1954 called Nippon Merck-Banyu Co., Ltd. That relationship grew and in 1984, Merck acquired majority ownership of Banyu.

Banyu One of Top 10 Pharmaceutical Companies in Japan. Since then, the two companies have worked in close collaboration, and Banyu today is one of the top 10 pharmaceutical companies in Japan. Banyu, which was established in 1915, has made many important Merck-discovered medicines available to Japanese patients.

To achieve its goal of full ownership, Merck completed two tender offers in 2003 to acquire the remaining shares in Banyu that it did not already own. An exchange of shares between Banyu and MSD (Japan) Co., Ltd., a wholly owed Japanese subsidiary of Merck, resulted in Banyu becoming a wholly owned Merck subsidiary.

Banyu will continue to operate in Japan under its current Banyu name.