8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) March 21, 2011

Merck & Co., Inc.

(Exact Name of Registrant as Specified in Its Charter)

New Jersey

(State or Other Jurisdiction of Incorporation)

1-6571	22-1918501
(Commission File Number)	(I.R.S. Employer Identification No.)

One Merck Drive, PO Box 100, Whitehouse Station, NJ	08889-0100
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s Telephone Number, Including Area Code (908) 423-1000

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

(17 CFR 240.14d-2(b))

¨      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

(17 CFR 240.13e-4(c))

Item 1.02. Termination of a Material Definitive Agreement

Pursuant to the Call Option Agreement, dated as of July 29, 2009, by and among Merck & Co., Inc., formerly known as Schering-Plough Corporation (“Merck”), Sanofi-Aventis (“Sanofi-Aventis”) and Merck Sharp & Dohme Corp., formerly known as Merck & Co., Inc., (“Old Merck”) as amended on February 17, 2010 by Amendment No. 1 thereto, February 18, 2010 by Amendment No. 2 thereto, February 19, 2010 by Amendment No. 3 thereto and March 8, 2010 by Amendment No. 4 thereto (as so amended, the “Call Option Agreement”), Merck granted to Sanofi-Aventis the right to conduct due diligence on Merck’s (and its subsidiaries’) animal health business and the option (the “Call Right”), exercisable at the sole discretion of Sanofi-Aventis, to acquire from Merck (by way of contribution to Sanofi-Aventis’ animal health subsidiary, Merial Limited (“Merial”)) Merck’s animal health business in exchange for the issuance and transfer of 50% of the then-outstanding equity interests in Merial, such that Sanofi-Aventis and Merck would each own 50% of Merial as of the consummation of such transactions. Merck, Sanofi-Aventis and Merial entered into that certain Contribution Agreement, dated as of March 30, 2010, as subsequently amended (as so amended, the “Contribution Agreement”), as a consequence of Sanofi-Aventis’ exercise of the Call Right.

On March 21, 2011, Merck, Old Merck, Sanofi-Aventis and Merial Limited entered into a Master Termination Agreement and Release whereby the parties thereto agreed to terminate the Call Option Agreement and the Contribution Agreement.

Item 8.01. Other Events.

On March 22, 2011, Merck issued a joint news release with Sanofi-Aventis announcing the execution of the Master Termination Agreement and Release. A copy of the joint news release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit 10.1	Master Termination Agreement and Release, by and among Merck & Co., Inc., Merck Sharp & Dohme Corp., Sanofi-Aventis and Merial Limited, dated March 21, 2011.
Exhibit 99.1	News release issued March 22, 2011

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Merck & Co., Inc.
Date: March 24, 2011	By:	/s/ Katie E. Fedosz
		KATIE E. FEDOSZ
		Senior Assistant Secretary

EXHIBIT INDEX

Exhibit Number	Description
10.1	Master Termination Agreement and Release, by and among Merck & Co., Inc., Merck Sharp & Dohme Corp., Sanofi-Aventis and Merial Limited, dated March 21, 2011.
99.1	News release issued March 22, 2011

EX-10.1

Exhibit 10.1

EXECUTION VERSION

MASTER TERMINATION AGREEMENT AND RELEASE

Master Termination Agreement and Release, dated as of March 21, 2011, (this “Agreement”) by and among:

(1) Merck & Co., Inc., a corporation organized under the laws of New Jersey, formerly known as Schering-Plough Corporation (“Merck”);

(2) Merck Sharp & Dohme Corp., a corporation organized under the laws of New Jersey (formerly known as Merck & Co., Inc.) (“Old Merck”);

(3) Sanofi-Aventis, a société anonyme organized under the laws of France (“Sanofi-Aventis”);

-and-

(4) Merial Limited, a company limited by shares organized under the laws of England and domesticated in the State of Delaware, United States as Merial, LLC, a limited liability company (“Merial”).

(Merck, Old Merck, Merial and Sanofi-Aventis are hereinafter referred to individually as a “Party” and collectively as the “Parties”).

WHEREAS:

(A) Merck and its Subsidiaries are engaged in the animal health business, including the discovery, development, manufacturing and sale of veterinary medicines in all major food producing and companion animal species (collectively, the “I/SP Business”);

(B) Pursuant to that certain Call Option Agreement, dated as of July 29, 2009, by and among Merck, Sanofi-Aventis and Old Merck, as amended on February 17, 2010 by Amendment No. 1 thereto, February 18, 2010 by Amendment No. 2 thereto, February 19, 2010 by Amendment No. 3 thereto and March 8, 2010 by Amendment No. 4 thereto (as so amended, the “Call Option Agreement”), Merck granted to Sanofi-Aventis the right to conduct due diligence on the I/SP Business and the option (the “Call Right”), exercisable at the sole discretion of Sanofi-Aventis, to acquire from Merck (by way of contribution to Merial) the I/SP Business in exchange for the issuance and transfer of 50% of the then-outstanding equity interests in Merial, such that Sanofi-Aventis and Merck would each own 50% of Merial as of the consummation of such transactions;

(C) Merck, Sanofi-Aventis and Merial entered into that certain Contribution Agreement, dated as of March 30, 2010, as subsequently amended, as a consequence of Sanofi-Aventis’ exercise of the Call Right (as so amended, the “Contribution Agreement”);

(D) The Parties wish to terminate the Call Option Agreement pursuant to Clauses 9.1.6 and 9.1.8(y) thereof; and

(E) The Parties wish to terminate the Contribution Agreement pursuant to Section 14.1.1 thereof.

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EXECUTION VERSION

Now, therefore, in consideration of the mutual covenants herein contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereto hereby covenant and agree as follows:

1 Definitions

Capitalized terms used herein but not otherwise defined shall have the meaning set forth in the Contribution Agreement.

2 Termination of Contribution Agreement

2.1 The Parties agree that the Contribution Agreement is hereby terminated in accordance with Section 14.1.1 thereof.

2.2 Pursuant to Section 14.2 of the Contribution Agreement, the Contribution Agreement is hereby void and of no further effect (except with respect to Sections 14.2 and 17.2 and Article 18 thereof, which shall survive this termination and remain in full force and effect), without any liability to any Person in respect thereof or of the transactions contemplated thereby on the part of any Party thereto, or any of their Affiliates or Representatives.

3 Termination of Call Option Agreement

3.1 The Parties agree that the Call Option Agreement is hereby terminated in accordance with Clauses 9.1.6 and 9.1.8(y) thereof.

3.2 Pursuant to Clause 9.2 of the Call Option Agreement, the Call Option Agreement is hereby void and of no further effect (except with respect to Clauses 9.2, 10 and 11 thereof, which shall survive this termination and remain in full force and effect), without any liability to any Person in respect thereof or of the transactions contemplated thereby on the part of any Party thereto, or any of their Affiliates or Representatives.

4 Announcements; Information

4.1 No announcement or circular in connection with the existence or the subject matter of this Agreement shall be made or issued by or on behalf of any Party without the prior written approval of the other Parties. This shall not affect any announcement or circular required by Law or any regulatory body or the rules of any recognized stock exchange on which the shares of any Party are listed, but the Party with an obligation to make an announcement or issue a circular shall consult with the other Parties insofar as is reasonably practicable before complying with such an obligation.

4.2 Notwithstanding the foregoing, each of Merck and Sanofi-Aventis shall issue a joint press release in the form attached as Exhibit A hereto at a mutually agreed time following the execution of this Agreement.

4.3 The Parties shall, where required by, or prudent under, the applicable rules, regulations or customs of any Public Authority that was heretofore contacted by any Party in connection with the transactions contemplated by the Call Option Agreement or the Contribution Agreement, cooperate to jointly inform any such Public Authority of the

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EXECUTION VERSION

termination of the Call Option Agreement and the Contribution Agreement and cooperate and use commercially reasonable efforts to resolve any inquiries from such Public Authority.

5 Representations and Warranties

5.1 Each of the Parties represents and warrants to the others as follows:

5.1.1 it is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation;

5.1.2 it is not in violation of any material provision of its organizational documents;

5.1.3 the execution, delivery and performance by it of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate proceedings and no other corporate proceeding on the part of it is necessary for the consummation by it of the transactions contemplated hereby;

5.1.4 this Agreement has been duly and validly executed and delivered by it, and, assuming the due and valid execution and delivery by the other Parties, constitutes a legal, valid and binding obligation of it enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the enforcement of creditors’ rights generally; and

5.1.5 the execution, delivery and performance by it of this Agreement and the consummation by it of the transactions contemplated hereby do not and will not (i) contravene or conflict with the organizational or governing documents of it or (ii) conflict with or constitute a violation of any provision of any material law binding upon or applicable to it or any of its properties or assets.

6 Mutual Release

6.1 Each of Merck and Old Merck, on behalf of themselves and their respective Subsidiaries and Affiliates, and the successors, assigns, agents, representatives, stockholders, members, directors, managers, officers and employees of Merck, Old Merck and their respective Subsidiaries and Affiliates (collectively, the “Merck Releasors”), hereby irrevocably and unconditionally release, settle, cancel, acquit, discharge and acknowledge to be fully satisfied, and covenant not to sue Sanofi-Aventis, Merial, any of their respective Subsidiaries and Affiliates, and the successors, assigns, agents, representatives, stockholders, members, directors, managers, officers and employees of Sanofi-Aventis, Merial and their respective Subsidiaries and Affiliates (collectively, the “Sanofi Releasors”) from or in respect of any and all obligations, covenants, arrangements, representations, warranties, understandings or agreements of the Sanofi Releasors pursuant to the terms of the Call Option Agreement or the Contribution Agreement (including, for the avoidance of doubt and without limitation, any payment obligation of the Sanofi Releasors pursuant to Section 6.1.5 of the Call Option Agreement), of whatever kind and nature, whether known or unknown, contingent or otherwise; provided that such release shall not apply to any continuing obligation of the

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EXECUTION VERSION

Sanofi Releasors under the Call Option Agreement or the Contribution Agreement which, by the terms of this Agreement, expressly survive the termination of the Call Option Agreement and the Contribution Agreement.

6.2 From and after the date hereof, the Merck Releasors shall not bring any action, suit or proceeding whatsoever against any of the Sanofi Releasors for any matter or circumstance with respect to which the Merck Releasors have released the Sanofi Releasors under this Agreement. The Merck Releasors further agree not to encourage or suggest to any other Person that such Person institute any legal action against the Sanofi Releasors with respect to any such matter or circumstance.

6.3 The Sanofi Releasors hereby irrevocably and unconditionally release, settle, cancel, acquit, discharge and acknowledge to be fully satisfied, and covenant not to sue the Merck Releasors from or in respect of any and all obligations, covenants, arrangements, representations, warranties, understandings or agreements of the Merck Releasors pursuant to the terms of the Call Option Agreement or the Contribution Agreement (including, for the avoidance of doubt and without limitation, any payment obligation of the Merck Releasors pursuant to Section 11.1.2, 11.1.3 or 11.1.4 of the Call Option Agreement), of whatever kind and nature, whether known or unknown, contingent or otherwise; provided that such release shall not apply to any continuing obligation of the Merck Releasors under the Call Option Agreement or the Contribution Agreement which, by the terms of this Agreement, expressly survive the termination of the Call Option Agreement and the Contribution Agreement.

6.4 From and after the date hereof, the Sanofi Releasors shall not bring any action, suit or proceeding whatsoever against any of the Merck Releasors for any matter or circumstance with respect to which the Sanofi Releasors have released the Merck Releasors under this Agreement. The Sanofi Releasors further agree not to encourage or suggest to any other Person that such Person institute any legal action against the Merck Releasors with respect to any such matter or circumstance.

7 Governing Law

This Agreement shall be governed in all respects by, and construed in accordance with, the Laws of the State of New York (without giving effect to its principles of conflicts of laws, to the extent such principles would require or permit the application of the Laws of a state other than the State of New York). Any claim, action or dispute against any Party to this Agreement arising out of or in any way relating to this Agreement shall be brought in the courts of the State of New York located in the City and County of New York or, in the event (but only in the event) that such courts do not have subject matter jurisdiction over such claim, action or dispute, in the Federal Courts of the United States sitting in the State, County and City of New York. Each of the Parties hereby irrevocably submits to the exclusive jurisdiction of such courts for the purpose of any such claim, action or dispute; provided, however, that a final judgment in any such claim, action or dispute shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each Party irrevocably waives and unconditionally agrees not to assert, by way of a motion, as a defense, counterclaim or otherwise, in any action or proceeding with respect to this Agreement (i) any objection that it may ever have that the laying of venue of any such claim, action or dispute in any federal or state court located in the above-named state or city is improper, (ii) any objection that any such claim, action or dispute

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EXECUTION VERSION

brought in any of the above named courts has been brought in an inconvenient forum or (iii) any claim that it is not personally subject to the jurisdiction of the above-named courts.

8 Waiver of Jury Trial

Each Party acknowledges and agrees that any controversy which may arise under this Agreement is likely to involve complicated and difficult issues, and therefore each Party hereby irrevocably and unconditionally waives any right such Party may have to a trial by jury in respect of any Litigation directly or indirectly arising out of or relating to this Agreement. Each Party certifies and acknowledges that (i) no representative, agent or attorney of any other Party has represented, expressly or otherwise, that such other Party would not, in the event of Litigation, seek to enforce the foregoing waiver; (ii) each Party understands and has considered the implications of this waiver; (iii) each Party makes this waiver voluntarily; and (iv) each Party has been induced to enter into this Agreement by, among other things, the mutual waivers and certifications in this paragraph.

9 Counterparts

This Agreement may be executed in several counterparts (including by facsimile or other electronic transmission), each of which shall be deemed an original and all of which shall together constitute one and the same instrument.

10 Binding Effect

This Agreement shall be binding upon and inure to the benefit of the Parties and their respective heirs, successors and permitted assigns.

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EXECUTION VERSION

In Witness Whereof, the Parties hereto have duly executed this Master Termination Agreement and Mutual Release as of the date first above written.

MERCK & CO., INC.
By:	/s/ Peter N. Kellogg
	Name: Peter N. Kellogg
	Title: Chief Financial Officer
MERCK SHARP & DOHME CORP.
By:	/s/ Peter N. Kellogg
	Name: Peter N. Kellogg
	Title: Chief Financial Officer
SANOFI-AVENTIS
By:	/s/ Karen Linehan
	Name: Karen Linehan
	Title: Senior Vice President, Legal Affairs & General Counsel
MERIAL LIMITED
By:	/s/ José Barella
	Name: José Barella
	Title: Chief Executive Officer

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EXECUTION VERSION

Exhibit A

Joint Press Release

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EX-99.1

Exhibit 99.1

News Release

 

Sanofi-aventis	Merck
Media Contact :	Media Contact :
Jean-Marc Podvin	David Caouette
+33 1 53 77 44 50	+1 (908) 423 34 61
Investor Contact :	Investor Contact :
Sébastien Martel	Carol Fergusson
+33 1 53 77 45 45	+1 (908) 423 44 65

Merck and sanofi-aventis to maintain separate businesses in animal health

Whitehouse Station, NJ and Paris, France - March 22, 2011 - Merck (NYSE: MRK) and sanofi-aventis (EURONEXT: SAN and NYSE: SNY) announced today the mutual termination of their agreement to form a new animal health joint venture by combining Merial, the animal health business of sanofi-aventis, with Intervet/Schering-Plough, Merck’s animal health unit. As a result, each party will keep its current, separate animal health assets and businesses.

Since the initial announcement about the intended combination on March 9, 2010, both companies have worked diligently to create the proposed animal health joint venture, including submitting requests for the required antitrust reviews. The companies are discontinuing their agreement primarily because of the increasing complexity of implementing the proposed transaction, both in terms of the nature and extent of the anticipated divestitures and the length of time necessary for the worldwide regulatory review process. Merck and sanofi-aventis mutually determined that ending their plan is in the best interests of both companies and their respective shareholders, as well as the employees of Merial and Intervet/Schering Plough.

Sanofi-aventis remains strongly committed to its animal health activities, which it will continue to develop under the Merial brand as a growth platform of its diversified healthcare business. Merial is one of the world’s leading innovation-driven animal healthcare companies dedicated to research, development, manufacturing and commercialization of veterinary pharmaceuticals and vaccines and generated annual sales of US $ 2.6 billion in 2010.

Merck’s Intervet/Schering-Plough is a global leader in the research, development, manufacturing and sale of veterinary medicines and generated sales of US $ 2.9 billion in 2010. Merck remains committed to animal health and intends to capitalize on Intervet/Schering-Plough’s broad and innovative portfolio going forward.

As a result of termination, both Merial and Intervet/Schering-Plough will continue to operate independently. The termination of the agreement is without penalty to either party and each party is responsible for its own expenses.

About Merck

Today’s Merck is a global healthcare leader working to help the world be well. Merck is known as MSD outside the United States and Canada. Through our prescription medicines, vaccines, biologic therapies, and consumer care and animal health products, we work with customers and operate in more than 140 countries to deliver innovative health solutions. We also demonstrate our commitment to increasing

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access to healthcare through far-reaching policies, programs and partnerships. Merck. Be well. For more information, visit www.merck.com.

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About sanofi-aventis

Sanofi-aventis, a leading global pharmaceutical company, discovers, develops and distributes therapeutic solutions to improve the lives of everyone. Sanofi-aventis is listed in Paris (EURONEXT: SAN) and in New York (NYSE: SNY). For more information, visit www.sanofi-aventis.com.

About Intervet/Schering-Plough Animal Health

Intervet/Schering-Plough Animal Health, based in Boxmeer, the Netherlands, is focused on the research, development, manufacturing and marketing of animal health products. The company offers customers one of the broadest, most innovative animal health portfolios, including products to prevent, treat and control disease in all major farm and companion animal species as well as products for reproduction management. Intervet/Schering-Plough Animal Health; subsidiaries of Merck & Co. Inc., Whitehouse Station NJ, USA. For more information, visit www.intervet.com.

About Merial

Merial is a world-leading, innovation-driven animal health company, providing a comprehensive range of products to enhance the health, well-being and performance of a wide range of animals. Merial employs approximately 5,600 people and operates in more than 150 countries worldwide. Formed in 1997, Merial is a leading animal health company that was a 50/50 joint venture between Merck and sanofi-aventis and is now a wholly-owned subsidiary of sanofi-aventis, after Sanofi-aventis acquired Merck’s interest in Merial for a cash consideration of $4 billion (US) in 2009. For more information, please visit www.merial.com.

Forward-Looking Statement by Merck

This news release includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, statements about the benefits of the merger between Merck and Schering-Plough, including future financial and operating results, the combined company’s plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Merck’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the possibility that the expected synergies from the merger of Merck and Schering-Plough will not be realized, or will not be realized within the expected time period; the impact of pharmaceutical industry regulation and health care legislation; the risk that the businesses will not be integrated successfully; disruption from the merger making it more difficult to maintain business and operational relationships; Merck’s ability to accurately predict future market conditions; dependence on the effectiveness of Merck’s patents and other protections for innovative products; the risk of new and changing regulation and health policies in the U.S. and internationally and the exposure to litigation and/or regulatory actions.

Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in Merck’s 2010 Annual Report on Form 10-K and the company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site (www.sec.gov).

Forward Looking Statements by sanofi-aventis

This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are statements that are not historical facts. These statements include projections and estimates and their underlying assumptions, statements regarding plans, objectives, intentions and expectations with respect to future financial results, events, operations, services, product development and potential, and statements regarding future performance. Forward-looking statements are generally identified by the words “expects”, “anticipates”, “believes”, “intends”, “estimates”, “plans” and similar expressions. Although sanofi-aventis’ management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of sanofi-aventis, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include among other things, the uncertainties inherent in research and development, future clinical data and analysis, including post marketing, decisions by regulatory authorities, such as the FDA or the EMA, regarding whether and when to approve any drug, device or biological application that may be filed for any such product candidates as well as their decisions regarding labelling and other matters that could affect the availability or commercial potential of such products candidates, the absence of guarantee that the products candidates if approved will be commercially successful, the future approval and commercial success of therapeutic alternatives, the Group’s ability to benefit from external growth opportunities as well as those discussed or identified in the public filings with the SEC and the AMF made by sanofi-aventis, including those listed under “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” in sanofi-aventis’ annual report on Form 20-F for the year ended December 31, 2010. Other than as required by applicable law, sanofi-aventis does not undertake any obligation to update or revise any forward-looking information or statements.

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