INVENTING WITH PURPOSE CORPORATE RESPONSIBILITY REPORT (2018/2019) COMPLETE WEBSITE COPY AND DATA NOVEMBER 2019 OUR PURPOSE | Overview Our Purpose Overview We have a legacy of saving and improving We live our core commitment to sustainable impact responsibility for using resources wisely and minimizing lives by creating sustainable impact. by managing our business responsibly, following our our environmental footprint. calling to find solutions for some of the world’s most Our approach to corporate responsibility is about the For more than a century, we have been inventing debilitating diseases, striving to reach those in need health, economic, social and environmental impact medicines and vaccines for many of the world’s most with our medicines and vaccines and helping to build we have on individuals and communities around the challenging diseases and we have built a company with robust, durable health systems worldwide through world. We hold ourselves accountable to our many the talent, tenacity and strength to take on some of the partnership, investment and innovation. stakeholders, including patients, employees, customers biggest threats to human and animal health. Operating responsibly as a business is and shareholders, whose perspectives help to define our Reflecting our commitment to managing environmental, corporate responsibility priorities. social and governance (ESG) issues, we continue to at the very heart of our ability to deliver focus our approach to corporate responsibility in four sustainable impact—driving long-term primary areas that are of greatest relevance to our value for our company and society. business and society. y Access to Health We cultivate innovation and excellence by building a diverse and inclusive global workforce, who are y Employees empowered to succeed, personally and professionally. y Environmental Sustainability We anchor ourselves and our partners to the y Ethics & Values highest ethical and business standards, and we take Corporate Responsibility Report 2018/2019 2 OUR PURPOSE | Overview Sustainable Development Goals Philanthropy (SDGs) Through our long history of philanthropy, we continue to demonstrate our commitment to sustainable impact. In addition to responding to the needs of stakeholders, Our philanthropic contributions, product donations and our corporate responsibility efforts also support the 17 employee volunteering efforts, help find solutions to key Sustainable Development Goals (“SDGs”) adopted by global health challenges and strengthen communities the United Nations in 2015 to help end poverty, protect where our employees live and work. the environment and ensure prosperity. Our program investments aim to support interventions We have joined global leaders to that have shown evidence of effectiveness in advancing address the goals on health and the quality of health services delivery, reducing health well-being, clean water, climate care disparities, fostering innovation in the delivery change, diversity and inclusion, of health care, and empowering patients as active responsible consumption and participants in managing their own health. Learn more production and others. about our approach to philanthropy. Our support of the SDGs is a testament to our company’s Total Philanthropy 018 125+ year legacy of inventing for life to create a healthier word for all. For more information, please visit our Sustainable Development Goals page. Sills-Based Volunteering $3.M Product $2.8B Cash Grants Donations Contributions $2.B $84M Corporate Responsibility Report 2018/2019 3 OUR PURPOSE | Letter from Our CEO Letter from Our CEO Environmental Sustainability and Ethics & Values. care systems. Working with more than 160 partners, It represents our commitment to widely recognized our programs have improved access to quality care and reporting frameworks that reflect key environmental, modern contraception for more than nine million women social and governance issues, and our support for in 48 countries. the 10 universally accepted principles of the UN I am proud that our investigational vaccine is being Global Compact. delivered and having an impact in areas of Central Our industry is facing some challenging headwinds, Africa affected by the Ebola virus. Some may say that but our commitment to corporate responsibility will investing to develop an Ebola vaccine doesn’t make good not waiver. The number of health care and drug pricing business sense, but I believe this is the kind of challenge reforms being considered is possibly at an all-time high. that MSD was designed to tackle. Health care costs, especially a patient’s out-of-pocket Corporate responsibility initiatives like MSD for costs, need to be addressed. We want to help find a Mothers and our investigative Ebola vaccine make us an sustainable solution, and we will continue to work with attractive employer for people who want to change the stakeholders and be transparent about our efforts. We world. And it adds to the sense of purpose that keeps have a history of responsible pricing and publicly disclose us going. information about our prices in the United States. This DISCLOSURES IN THIS SECTION includes our pledge not to increase our average net That purpose was captured by our modern-day founder, GRI 102-14 prices across our portfolio by more than the rate of George W. Merck, who said, “Medicine is for the people, inflation annually. not for the profits.” For me, only two metrics truly At MSD, we have been committed to our mission matter—how many people you help, and how much help Whatever may come, we remain steadfast in our focus of saving and improving lives for nearly 130 years. you give those people. on following the science to see where we can have the Over that time, we have been responsible for some greatest impact on patients’ lives. After all, R&D is Promoting enduring social good and securing business of the most significant scientific advancements and the main source of the biopharmaceutical industry’s success are inextricably linked. While there is always improvements in public health. value to society. As we look to the future, we’re more to do, I would like to thank all our employees, our Any one individual can make the scientific breakthrough making investments in our pipeline and manufacturing suppliers and our partners for the work they do every needed to discover a new medicine. I’m reminded of capability to help protect one billion more lives by 2030. day toward these goals. The activities highlighted in this our esteemed former colleague, Maurice Hilleman, report are a testament to the incredible impact they are the father of modern vaccines, whose centenary we Our industry is facing some challenging having all around the world. celebrate this year. However, it takes the infrastructure headwinds, but our commitment to Sincerely, of a company like MSD to translate invention into a corporate responsibility will not waiver. product that can help millions of people every day. Operating responsibly as a business is at the very heart We have a legacy of tackling urgent global health of our ability to do so. challenges. For example, MSD for Mothers, our global Kenneth C. Frazier Our 2018/2019 Corporate Responsibility Report initiative to reduce maternal mortality around the Chairman and Chief Executive Officer reviews our progress against our four key areas of world, empowers women to make informed choices; corporate responsibility: Access to Health, Employees, equips health care providers; and strengthens health Corporate Responsibility Report 2018/2019 4 OUR PURPOSE | Our Business Our Business DISCLOSURES IN THIS SECTION Our businesses include pharmaceuticals, Products GRI 102-2 vaccines and animal health. We are a global health care company that delivers GRI 102-6 We continue to focus our research on conditions that innovative health solutions through our prescription represent some of today’s most significant health medicines, vaccines, biologic therapies and animal health We are inspired by a shared vision and products. View the list of products marketed in the mission to save and improve lives. challenges—like cancer, HIV, HPV, hepatitis C, cardio- metabolic disease, antibiotic-resistant infection and United States. RESOURCES Alzheimer’s disease, and we are on the front lines in the Prescription products fight against emerging global pandemics, such as Ebola. 10-K Product Pipeline Our core business is the discovery and development of We also devote extensive time and energy to increasing prescription medicines for diseases and conditions that access to medicines and vaccines through far-reaching impact millions of people. programs that donate and deliver our products to the Our Corporate Company Fact We invest billions of research dollars to find medicines people who need them. Website Sheet that can help improve lives. Today, our company has We’re applying our global more than 50 prescription products in key therapeutic With a steady focus on innovation and sound science, we reach, financial strength areas such as cardiovascular disease, respiratory work to deliver vaccines, medicines, and animal health and scientific excellence $42.3B disease, oncology, neuroscience, infectious disease, products that can help millions around the world. to doing more of what 2018 revenue immunology and women’s health. we’re passionate about: Our core product categories include diabetes, cancer, improving health and vaccines and hospital acute care. improving lives. Corporate Responsibility Report 2018/2019 5 OUR PURPOSE | Our Business We are a global health care company Senior leadership with a 125-year history of working to Our chairman and CEO, Ken Frazier, is accountable to make a difference. our company’s Board of Directors. Vaccines Learn more about our Board members, including Vaccines are one of the greatest public health success committee charters and assignments. Our Executive stories in history, and our company has played its part in Committee manages the business. These top leaders, that story. representing diverse areas of the company, meet regularly to review progress against our company goals. We have been working to discover and develop vaccines View the list of Executive Committee members.