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Technology Transfer in the Interwar U.S. Pharmaceutical Sector: The Case of E. Merck of Darmstadt and Merck & Co., Rahway, New Jersey

Published online by Cambridge University Press:  07 June 2019

ANDREW GODLEY ,
MARRISA JOSEPH  and
DAVID LESLIE-HUGHES
ANDREW GODLEY
Affiliation:
Andrew Godley is Head of the Department of Leadership, Organisations and Behaviour at the Henley Business School and Professor of Management and Business History and Academic Director of the Henley Centre for Entrepreneurship, at the University of Reading. E-mail: a.c.godley@henley.ac.uk
MARRISA JOSEPH
Affiliation:
Marrisa Joseph isLecturer in Entrepreneurship at the Henley Business School, University of Reading. E-mail: m.joseph@henley.ac.uk
DAVID LESLIE-HUGHES
Affiliation:
David Leslie-Hughes is an independent scholar. E-mail: nsheward201@comcast.net
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Abstract

This is a case study of the U.S. pharmaceutical producer, Merck & Co. By 1940 this was one of the leading pharmaceutical producers in the United States, and the company went on to become one of the global industry leaders after World War II. It was founded in 1891 as the U.S. subsidiary of a much larger German pharmaceutical company, E. Merck of Darmstadt. The existing understanding of Merck & Co.’s history emphasizes how it was reacquired by the American branch of the Merck family after wartime sequestration, and from then onward it pursued a path of development separate from its former parent. This article revisits that history of the company and shows how the two Mercks began to cooperate and share technology and manufacturing know-how during the 1930s, something that was particularly to the advantage of Merck & Co.

Type
Article
Information
Enterprise & Society , Volume 20 , Issue 3 , September 2019 , pp. 613 - 651
Copyright
Copyright © The Author 2019. Published by Cambridge University Press on behalf of the Business History Conference. All rights reserved. 

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Corley, T. A. B., and Godley, A. C.. “The Veterinary Medicines Industry in Britain, 1900–2000.” Economic History Review, 64, no. 3 (2011): 832–854.CrossRefGoogle Scholar
Corley, T. A. B., and Godley, A. C.. “Veterinary Medicines in Britain: Output and Industry Organisation Since 1900.” Medical History , 55 (2011): 361–364.Google Scholar
Cramer, Tobias. “Building the ‘World’s Pharmacy’: The Rise of the German Pharmaceutical Industry, 1871–1914.” Business History Review, 89, no. 1 (2015): 45–73.CrossRefGoogle Scholar
Finucane, Brendan T. “Canadian Contributions to the Introduction and Use of Divinyl Ether.” Canadian Journal of Anesthesia, 55, no. 12 (2008): 853–858.CrossRefGoogle ScholarPubMed
Fisher, J. C. “Basic Research in Industry.” Science, 129, no. 3364 (1959): 1653–1657.CrossRefGoogle Scholar
Furman, Jeffrey L., and McGarvie, Megan J.. “Academic Science and the Birth of Industrial Research.” Journal of Economic Behavior and Organization, 63 (2007): 756–776.CrossRefGoogle Scholar
Galambos, Lou, and Sturchio, Jeffrey. “Transnational Investment: The Merck Experience, 1891–1925.” Zeitschrift fur Uniternehmergeschichte, 81 (1994): 227–243.Google Scholar
Godley, Andrew. “Entrepreneurial Opportunities, Implicit Contracts and Market Making for Complex Consumer Goods.” Strategic Entrepreneurship Journal, 7, no. 4 (2013): 273–287.CrossRefGoogle Scholar
Godley, Andrew. “The Emergence of Agribusiness in Europe and the Development of the Western European broiler chicken industry, 1945–1973.” Agricultural History Review, 62 (2014): 292–313Google Scholar
Godley, Andrew and Casson, Mark, “‘Doctor, Doctor ’ Entrepreneurial Diagnosis and Market Making.” Journal of Institutional Economics, 11 (2015): 601–621CrossRefGoogle Scholar
Gortler, Leon. “Merck in America: The First 70 Years from Fine Chemicals to Pharmaceutical Giant.” Bulletin of the History of Chemistry 25 (2000): 1–9.Google Scholar
Hannah, Les. “Logistics, Market Size, and Giant Plants in the Early Twentieth Century: A Global View.” Journal of Economic History, 68, no. 1 (2008): 46–79.CrossRefGoogle Scholar
Hertner, P. “German Multinational Enterprise Before 1914: Some Case Studies.” In Multinationals: Theory and History, edited by Hertner, P. and Jones, G., 113–133. Aldershot, UK: Ashgate, 1987.Google Scholar
Hugill, Peter J., and Bachmann., Veit “The Route to the Techno-Industrial World Economy and the Transfer of German Organic Chemistry to America Before, During and Immediately After World War.” Comparative Technology Transfer and Society, 3, no. 2 (2005): 158–186.CrossRefGoogle Scholar
Indianapolis Star (Edelhart, Courtenay). “The Economy: Eli Lilly & Co. A Firm Foundation.” Indianapolis Star, April 18, 1999.Google Scholar
Kline, Ronald. “Constructing ‘Technology’ as ‘Applied Science’: Public Rhetoric of Scientists and Engineers in the United States, 1880–1945.” Isis, 86, no. 2 (1995): 194–221.Google Scholar
Kobrak, Christopher. “Issues in German Corporate Governance: A Note on the History of Schering AG and the Culture of German Capitalism.” Paper presented to European International Business Academy, Stockholm, Sweden, December 1996.Google Scholar
Lee, Jeho. “Innovation and Strategic Divergence: An Empirical Study of the U.S. Pharmaceutical Industry from 1920 to 1960.” Management Science, 49, no. 2 (2003): 143–159.CrossRefGoogle Scholar
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Liebenau, Jonathan. “Detail Men: Marketing Medicine.” In History, Bagmen and Markets, edited by Davenport-Hines, R. P. T.. Aldershot, UK: Gower, 1986, pp. 82–101.Google Scholar
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Lynn, Matthew. The Billion Dollar Battle: Merck Versus Glaxo . London: Heinemann, 1991.Google Scholar
Owens, Larry. “MIT and the Federal ‘Angel’: Academic R&D and Federal–Private Cooperation Before World War II.” Isis, 81, no. 2 (1990): 188–213.CrossRefGoogle Scholar
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Scheiding, Tom. “Building the Scholarly Society Infrastructure in Physics in Interwar America.” Studies in History and Philosophy of Modern Physics , 44, no. 4 (2013): 450–463.CrossRefGoogle Scholar
Schneider, Michael. “Das Wissenschaftlichen Unternehmen. Zur chemisch-pharmazeutischen Forschung bei E. Merck, Darmstadt, ca. 1900–bis 1930.” Zeitschrift fur Unternehmengeschichte , 62, no. 2 (2017): 163–203.Google Scholar
Sturchio, Jeffrey, and Galambos, Lou. “The German Connection: Merck and the Flow of Knowledge from Germany to the United States, 1880–1930.” Business and Economic History On-Line 9 (2011): 1–14.Google Scholar
Time magazine, various issues, including August 26, 1929, Time “Drug Disinc,” Vol. XXII No. 2.Google Scholar
White, Michael. “US Alien Property Custodian Patent Documents: A Legacy Prior Art Collection from World War II—Part 1. History.” World Patent Information 29, no. 4 (2007): 339–345.CrossRefGoogle Scholar

Archival Material

Frontline various issues, e.g., 14 (January–February) 1969, 20 (March–April), 1970. Merck Archives, Whitehouse Station, NJ.Google Scholar
Galambos, Lou, and Sturchio, Jeffrey. “Sustaining Innovation: Critical Transitions at Merck & Co., Inc.” Unpublished manuscript, August 8, 1997. Merck Archives, Whitehouse Station, NJ.Google Scholar
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Archival Sources

Chemical Heritage Foundation, Philadelphia, PAGoogle Scholar
Merck KGaA, Archives, Darmstadt, Germany (EMA)Google Scholar
Merck & Co., Inc., Whitehouse Station, NJ (MA)Google Scholar
U.S. National Archives, MDGoogle Scholar