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Pharmaceutical Research in Wilhelmine Germany: The Case of E. Merck

Published online by Cambridge University Press:  14 April 2011

Carsten Burhop
Carsten Burhop
Affiliation:
Heisenberg Fellow at the Max Planck Institute for Research on Collective Goods in Bonn, Germany
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Abstract

This paper offers a detailed case study of the emergence, organization, and development of research and development at E. Merck. During the 1890s, revolutionary changes in the scientific knowledge base, especially the rise of bacteriological research and the entry of dyestuff producers into the pharmaceuticals market, combined with the financial distress Merck was undergoing to force the firm to reorganize pharmaceutical research as a corporate strategy. Consequently, between 1895 and 1898, Merck restructured its in-house research, forming closer ties with universities and other outside inven- tors. Merck depended on these sources to generate new products, while relying on in-house scientists to improve productive efficiency. A spate of new products was launched between the late 1890s and 1905, but, in the following years, resource constraints restricted Merck's innovative capacity.

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Articles
Information
Business History Review , Volume 83 , Issue 3 , Autumn 2009 , pp. 475 - 503
Copyright
Copyright © The President and Fellows of Harvard College 2009

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15 Jahresbericht für das Betriebsjahr 1897–1898, MRO F3/2a.

16 Carl Emanuel Merck, Emanuel August Merck, and particularly Willy Merck published several articles in one of the leading academic journals, the Berichte der deutschen chemischen Gesellschaft (today the European Journal of Inorganic Chemistry), during the 1880s.

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32 Detailed figures about the research budget are not available for later years. However, the number of researchers in the central laboratory was more or less constant until World War I. Therefore, the expenditures for in-house research probably remained constant. Expenditures for external research, on the other hand, increased substantially. In 1912, for example, Merck spent about 300,000 marks to compensate outside inventors.

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39 Merck also owned many foreign patents. In 1903, the firm held sixty-seven German and fifty-six foreign patents. Jahresbericht für das Betriebsjahr 1902–1903, MRO F3/7c.

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45 Jahresbericht für das Betriebsjahr 1903–1904, MRO F3/8c.

46 Jahresbericht für das Betriebsjahr 1905–1906, MRO F3/10c.

47 Jahresbericht für das Betriebsjahr 1904–1905, MRO F3/9c.

48 Jahresbericht für das Betriebsjahr 1896–1897, MRO F3–1b; Jahresbericht für das Betriebsjahr 1912, MRO F3/16a.

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64 Similar product specific accounts were also kept by Bayer and Hoechst (Wimmer, “Wir haben immer was Neues,” 120, 185–86). At Merck, only one conflict regarding the accounts is documented for the pre–World War I period.

65 This is documented in various letters of Freund, Merck, and the competing pharmaceutical firm Knoll. Merck-Knoll/Stypticin-Stypta/Prof. Freund, 1906–07, MRO F1/47.

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67 Letter from Merck to Knoll, 12 Sept. 1907; Merck-Knoll/Stypticin-Stypta/Prof. Freund, 1906–07, MRO F1/47.

68 Finally, Merck and Freund switched from profit-sharing to another form of variable compensation in 1912. Yet, the details of these negotiations are not documented in the files.

69 Dozens of contracts are contained in Verträge mit Erfindern und Gelehrten A–K, MRO R 15/11; Verträge mit Erfindern und Gelehrten L–Z, MRO R 15/12; Anstellungsverträge und Erfinderverträge, MRO R1/42.

70 Contract between Merck and Carl Böttinger, 12 Oct. 1898; Anstellungsverträge und Erfinderverträge, MRO R1/42; contract between Merck and A. Lindemann, 23 Apr. 1903; Anstellungsverträge und Erfinderverträge, MRO R1/42; contract between Merck and P.Römer, 6 May 1905; Anstellungsverträge und Erfinderverträge, MRO R1/42; contract between Merck and Georg Sobernheim, 10 Dec. 1901; Anstellungsverträge und Erfinderver-träge, MRO R1/42; contract between Merck and A. Ellinger, 10 Apr. 1912; Verträge mit Er-findern und Gelehrten A-K, MRO R 15/11.

71 See, e.g., Borscheid, Naturwissenschaft, Staat und Industrie in Baden, 206–7, for a case at BASF, and also Hoechst; Hounshell and Smith, Science and Corporate Strategy, 38; Mowery, David C., “Industrial Research and Firm Size, Survival, and Growth in American Manufacturing, 1921–1946: An Assessment,” Journal of Economic History 43 (1983): 953– 80, for Du PontCrossRefGoogle Scholar.

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79 Jahresbericht für das Betriebsjahr 1896–1897, MRO F3/1b.

80 Jahresbericht für das Betriebsjahr 1900–1901, MRO F3/5c.

81 Jahresbericht für das Betriebsjahr 1902–1903, MRO F3/7a, and Jahresbericht für das Betriebsjahr 1908, MRO F3/12c.

82 Jahresbericht für das Betriebsjahr 1896–1897, MRO F3/1b.

83 Between 1882 and 1893, Ehrenberg published several papers in the Journal für praktische Chemie (Journal of Applied Chemistry) and worked in the early 1890s in the scientific laboratory of the Chemische Fabrik von H. Trommsdorf in Erfurt. Jahresbericht für das Betriebsjahr 1897–1898, MRO F3/2c.

84 Jahresbericht für das Betriebsjahr 1899–1900, MRO F3/4a.

85 Meyer-Thurow, “The Industrialization of Invention.”

86 Anstellungsverträge und Erfinderverträge, MRO R 1/42. Contracts of Merck with: Dr. Erich Ruderson (1 June 1914; 3,600 marks base salary; Dipl. Ing. Edmund Carl Burchard (1 July 1911, 4,500 marks fixed salary, unspecified profit share for inventions); Dr. A. Pister (10 Aug. 1914, 3,960 marks fixed salary); Dr. Ludwig Wolter (1 Dec. 1914; 2,400 marks fixed salary).

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94 Jahresbericht für das Betriebsjahr 1901–1902, MRO F3/6c.

95 Jahresbericht für das Betriebsjahr 1899–1900, MRO F3/4c.

96 Ibid.

97 Jahresbericht für das Betriebsjahr 1908, MRO F3/12c.

98 Jahresbericht für das Betriebsjahr 1897–1898, MRO F3/2b.

99 Jahresbericht für das Betriebsjahr 1900–1901, MRO F3/5a.

100 Jahresbericht für das Betriebsjahr 1909, MRO F3/13d.