During 2009, our shares moved in a range from € 57 to € 74. Following a good start to the year, negative news weighed on the share price several times. From a full-year perspective, Merck shares represented a stable investment in a highly dynamic market environment in 2009. The risk-balanced business model consisting of Pharmaceuticals and Chemicals modulated the fluctuations.
Our share price proved to be considerably more robust than the benchmark indices in the crisis-ridden first quarter. On January 23, 2009, the Merck share price jumped by 8.6% to € 69.89 when we announced the good results of the CLARITY study. The news that cladribine tablets could represent the first marketed oral treatment for multiple sclerosis supported the share price. Like the German indices, the Merck share price declined in the course of the first quarter and marked its low on March 6, 2009, closing at € 57.24.
Developments in the pharmaceutical business impact the share price
From May until the end of July, our shares developed on a par with or better than the DAX®, and they significantly outperformed the BEUPHRM. They reached € 74.37, the high for the year, on July 1, 2009.
On July 24, Merck shares tumbled in a one-day slide of nearly 15%. This was attributable to a letter from the scientific committee of the European Medicines Agency issuing a negative opinion on the use of our oncology drug Erbitux® in the treatment of lung cancer. The share price fell on one day from € 73.43 to € 62.62. Merck shares recovered only slowly from their decline in late July, developing stably thereafter but at a significantly lower level than the DAX® and BEUPHRM.
In September and October, Merck shares caught up with the indices and rose to € 70.99 on October 21. In November they fell again. In response to Merck’s request for re-examination of the negative opinion on the use of Erbitux® in lung cancer, a negative opinion was again issued on November 19, 2009. Consequently, the share price decreased moderately by 2.4%.
Lastly, on November 30, 2009 the refuse to file letter from the U.S. Food and Drug Administration on the new drug application for cladribine tablets led to a 4.0% decline in the share price to € 62.81 at the close of trading. Merck is working intensively to resubmit the application in the world’s largest pharmaceutical market.
Nevertheless, at € 65.16, Merck shares ended the year just slightly above the comparable year-earlier level as a result of developments in the Chemicals business sector that had a counteractive effect on the share price. For instance, the Liquid Crystals business recovered significantly in the course of the year, a development that was viewed positively by financial analysts.
Focus on liquidity
On average, around 500,000 shares were traded daily in 2009, which compares with a daily trading volume of around 750,000 shares in 2008. On July 24, the first trading day after the negative opinion on Erbitux® in the lung cancer indication in Europe, nearly 4.5 million Merck shares changed hands. High liquidity is very important to us. We want to ensure at all times that our shares are freely tradable on the stock exchanges. With a market capitalization of € 14,165 million, Merck held 29th place in the DAX® ranking as compared with 24th place in 2008. In terms of average daily trading volumes, we moved up from 30th to 27th place.
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