The development of Merck shares in 2007 was continuously marked by news about the Merck Serono division and by speculation about the Liquid Crystals business. During the second half of the year, external factors, including concerns about rising energy costs and the impact of subprime mortgage defaults and their potential impact on the global economy, weighed heavily on equity markets.

The closing of the Serono acquisition took place on January 5, 2007. The Merck share price rose during January by 14% from €78.54 (2006 year-end closing share price in Xetra® trading) to €89.46. This was the result of growing enthusiasm for the potential of the new Merck Serono division to contribute to earnings and cash flow, as well as positive clinical trial news. Among other things, Merck announced that the Phase III CRYSTAL study of Erbitux® in first-line metastatic colorectal cancer had met its primary endpoint. The €2 billion capital increase, additional positive clinical and regulatory filing news, the announcement of the imminent sale of the Generics division, and the expected inclusion of Merck in the German DAX® 30 index drove the stock for the first time ever above €100 to €100.10 on April 10.

Following the announcement of the results of the CRYSTAL study at the ASCO meeting in early June, the Merck share price reached its all-time high of €106.55 on June 15 – an increase of nearly 36% over the year-end share price for 2006. Thereafter, Merck shares moved lower due to investor profit-taking following the emergence of the subprime loan crisis in July. The decline continued in September due to arising uncertainty about the long-term development of the Liquid Crystals business. Speculation caused the share price to fall by more than 15% within a few trading days. A period of consolidation followed. With the publication of the third-quarter results in October, Merck gave an update of the portfolio of the Merck Serono division, presenting details of the individual research and development projects as well as the new structure of the R&D organization. During the final weeks of trading, Merck shares recovered from their second-half low of €80.06 on November 16. The year-end share price was €88.30. The company’s market capitalization thus amounted to €19.2 billion at the end of 2007.