Merck Forms Health Venture Fund
November 28, 2000
WHITEHOUSE STATION, N.J. -- Merck & Co.
formed a new venture-capital unit to invest up to
$100 million in private Internet and other
businesses involved in the commercialization
and delivery of pharmaceutical and health-care
services.
The news confirms a story in The Wall Street
Journal Tuesday.
Per Lofberg will head the fund and has
relinquished his job as chairman of
Merck-Medco, Merck's (MRK) pharmacy
benefit management business with $20 billion
in revenue. Merck-Medco president Richard
Clark will head the division following Mr.
Lofberg's departure.
Mr. Lofberg said the new fund will be called
Merck Capital Ventures, and it will offer more
than the usual venture-capital arrangements.
"The difference between our approach and the
normal venture capitalist is that when it's all
said and done, the VC just offers money," Mr.
Lofberg said. "We have the money to invest,
but on top of that we are offering companies a
chance to do business with Merck or
Merck-Medco."
The fund, to be headquartered in Montvale,
N.J., will stay in close contact with top Merck
officers, Mr. Lofberg said, so that promising
companies can pitch their services to the right
people within Merck. Mr. Lofberg sais he
doesn't expect this arrangement to result in
conflicts of interest within the company.
The fund will allow Merck to hold onto the services of Mr. Lofberg, who has
shepherded Merck-Medco's fast growth since 1993 but has been itching for a
change. Mr. Lofberg expects that his investments will average from $5 million to
$7 million each. He said he intends to mine his many connections for promising
start-ups.
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