Ensuring Merck's Success

WITH GLOBAL prescription sales now topping $550 billion, it's clear that pharmaceutical products play an important role in many of our lives.

One of the top firms in this industry is Merck, maker of drugs such as Zocor, Maxalt and Fosamax. The Whitehouse Station, N.J.-based company was ranked fifth in the world by Pharmaceutical Executive magazine in its May 2005 ranking.

Though Merck's downsizing plans may have made recent headlines, its $21.493 billion in global pharmaceutical sales are certainly nothing to sneeze at. Neither is this: Merck is a huge supporter of in-plants, maintaining not one but four in-plants to serve its New Jersey and Pennsylvania offices.

David Heinbach, a 30-year Merck veteran, oversees three of them in his role as manager of reprographics and mailing services, part of Merck Creative Services. His operation in Whitehouse Station, N.J., employs seven people in reprographics and 17 in mail. Heinbach also manages a two-employee copy shop in Merck's Rahway, N.J., research headquarters and a four-employee copy shop in its Upper Gwynedd, Pa., sales headquarters. He also oversees the mail operations at each. A forth in-plant in West Point, Pa., is not under his management.

"We run like a business within a business here," Heinbach declares. His in-plants charge back for all work, and benchmark against commercial printers to make sure their prices average 25 percent below outside costs.

Heinbach's main operation specializes in printing internal communications, newsletters, letterheads, forms, posters and brochures. It does not produce product labels, inserts or packaging.

The Whitehouse Station operation runs three offset presses—a two-color, 14x20˝ Heidelberg GTO, and a pair of two-color Ryobi presses—as well as a host of Xerox digital printing equipment. About a year ago, Merck overhauled its Whitehouse Station and Rahway operations, replacing older copiers with Xerox 6180s and Nuveras. Rahway also got a 6060, while Whitehouse Station installed a top-of-the-line Xerox 8000.

"With the better copy quality on the 8000, we're doing some color projects that we weren't doing a few years back," Heinbach reports. "Jobs that were being sent outside to be done on a six-color press because they wanted that kind of quality, we can do now on the 8000."

The in-plant is also getting a lot of work printing posters on its three Epson and Hewlett Packard wide-format ink-jet printers.

"It's a growing business," Heinbach remarks.

Another expanding source of business, he adds, is scanning documents to create PDF files.

"I see more and more requests for that, to archive documents," he says.

Justifying the Need for New Equipment

Three years ago, the in-plant installed a Heidelberg computer-to-plate system to supply plates for its offset presses, with great results.

Getting approval for all this new equipment from upper management has required Heinbach and his crew to do a lot of homework, but the results are generally positive.

"If we can justify there's a business need for it, then [getting equipment is] usually not a problem," he says.

It helps that Merck values its in-plants. Heinbach cites a variety of reasons this is true:

• Confidentiality: "Some of the stuff we do, especially on the copy side, they don't want to have leave the building," he says—especially financial and legal information.

• Cost: "Obviously there's a cost savings involved in doing it in-house as compared to sending it outside," he says—and he does cost comparisons frequently.

• Convenience: "Some of our biggest customers, like marketing, are literally right down the hall from us, so...they can design a job right here in our operation, and then print it right here," he notes. "If you want to see a proof, you want to see the job on press, they're literally right down the hall from us, so you have that convenience."

This convenience, he adds, is perhaps the main reason Merck maintains in-plants at its different offices.

"You do need something onsite for [jobs] that are due right away," he insists. "You need some equipment at each site."

For larger projects, though, and jobs not under deadline pressure, the separate in-plants often send work to one another. Overseeing such load balancing is part of Heinbach's responsibility.

Since there is no company mandate to use the in-plants' services, Heinbach works hard to promote them.

"We market all the time," he says.

The operations hold open houses, print brochures describing their capabilities, send post cards to potential customers and even set up displays.

"We'll set up a table to catch people as they're going into the cafeteria with some sample of our products that we've done," he says. "New people come into the building all the time, so you try to remind people and let the new people know what's going on.

"If the price is right, but the product's not right, the quality's not right," he concludes, "then they'll go outside."

--By Bob Neubauer